Archive for the ‘information technology providers’ Category

35,000 Feet to Street Level w/ Sales Enablement

Sunday, October 25th, 2009

A week ago I attended an event put on by one of my clients. A ‘Global VP’ from a multinational IT mega corporation was flown in to speak to a room full of executive clients and prospects. The topic was Business Intelligence, so I was looking forward to it. I was disappointed. It was overly long and complex.

It reminded me about the disconnect between large vendor Marketing and the sales messaging needed by SMB MSPs, SIs and VARs. That VP had a slick PowerPoint presentation developed by a corporate Marketing department. It leveraged information purchased from major IT research vendors – Forrester, Gartner, IDC, etc. It was a good starting point, but almost worthless to sales people on the ground trying to sell specific solutions.

Sales Enablement is the process of arming an organization’s salespeople with information that will help to close profitable deals. Sales Enablement delivers the most relevant information for a specific sales situation.

Sales people are what I call “just in time learners”. They are extremely busy. They are action-oriented. They have little patience for sitting, reading and digesting reams of information so they can later distill and communicate the most significant message for a particular sales situation. Salespeople learn what they need to know when they need to know it. Sales Enablement should bridge the gap between the 35,000 foot PowerPoint and the, “I’m sitting across the table from a decision maker who is willing to take the next step… if I can show her that we are capable of solving her specific business problem.”

The specificity need not be deeply detailed, but it should address the particular problem… not describe issues that are universal across an industry. It should bridge Sales and Marketing departments. It should augment market research and global messaging with:

  • Competitive Intelligence – not at the vendor level, but of local MSPs, SIs and VARs
  • Tribal knowledge – specific to the client industry in the local geography
  • Product knowledge from the minds of the technologists who have developed/integrated similar solutions, and
  • Answers to questions and objections encountered by salespeople who have sold similar solutions in that market.Sales Guy with Projector1 196x300 35,000 Feet to Street Level w/ Sales Enablement

Here are three common mistakes salespeople make when attempting to bridge the gaps described above:

Mistake #1: Giving the Feature/Benefit World Tour

These tours often happen during demos, presentations, proposals, and in printed and online collateral. They’re an attempt to show prospects everything that your product/service/solution can deliver. Don’t give the ‘List of the Top Ten Features and Benefits’. Your website should have that information. When in front of a customer you want to pick the two or three features and benefits that are meaningful to them given their situation.

A savvy sales enablement provider will help the salesperson pick the three most relevant features and benefits, and will translate them into higher-order value statements. As an example, the three most relevant value statements for an Electronic Records Management solution might be:

  1. A 25% increase in productivity due to improved access to information for daily tasks.
  2. An average 40% savings on paper storage costs.
  3. A 99% reduction in fines and penalties due to regulatory non-compliance.

If you know that all three of those are primary concerns with that prospect, you’ve just reduced your sales cycle significantly.

Mistake #2: Let Me Tell You All About My Baby

This happens most often when an engineer is brought along on a sales call. They are (usually justifiably) proud of their baby. They built it, and they love to talk about it… what it does, how it does it, why it does it this way, and so forth ad nauseum. There’s a time and a place for this conversation – when your techie is talking to their techie. When that occurs, it’s usually quite late in the buying process and the business people have already decided to go ahead.

Don’t throw the baby out with the bath water, though. Summarize the solution effectively (and briefly) using graphics, then provide a link or a white paper which details the technical information. Your decision maker will be more at ease if he can give those details to his trusted technical advisor.

Mistake #3: No Proof Points… Just Trust Me

This is a situation that’s as old as B2B technology sales itself. Salespeople understand the effectiveness of case studies and testimonials. They constantly ask Marketing for them; but they never want to take the time to elicit them from clients. Your salespeople, and your technicians and customer service reps too, should be alert for positive statements from clients. When clients make these statements, the automatic response should be, “Thank you. We’d love to be able to use that in our promotional materials. Can I have someone contact you about it?” Then, whoever is handling your Sales Enablement should quickly follow up with a written testimonial, or if appropriate, an outline for a case study, for their approval. Don’t wait for the client to write it. It won’t happen.

Also be alert for situations where your solution has made a hero out of someone in the client organization. Those people will be happy to sit down with your Sales Enabler and tell them all about the problem that was solved, and how it came about, and the results achieved. Case studies with a client hero or heroine resonate with prospects. After all, who doesn’t want to be seen as a hero by their company?

Consider incenting everyone who has client contact to submit potential testimonials and case studies.

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Insurance Technology Pundits

Wednesday, August 12th, 2009

For those of you who own, manage or sell for IT companies that target insurers, I have a trio of blogs, and one trade publication, that you ought to be reading. It’s amazing the amount of free, yet valuable, information that’s available today on the web.

These three Insurance Technology pundits are Ellen Carney, Barry Rabkin and Ara Trembly. All three of these people make their living consulting to technology vendors in the insurance space. They are all well-connected in the industry, and they all have valuable insights.

Barry’s blog is called ‘Rabkin’s ROI – Rants, Observations and Insights from an Insurance Technology Analyst‘. Barry has a unique point of view as a result of 30 years of experience in what he calls the ‘InTech’ world.

Both Ellen and Ara have blogs on the Insurance Networking site. You may have to register to access the blogs, but it’s well worth the five minutes. You can also sign up to receive IN’s enewsletter. Lots of good information. Here’s an excellent post by Ellen listing the findings of a recent Forrester research study re how insurance execs are planning their IT spending; and an insightful one by Ara discussing the demise of homegrown insurance systems (or not).

These people are bona fide world class experts in the field of information technology in the insurance industry, and you can peek inside their brains for free! Relevant and useful information to help you make better business decisions. It’s a wonderful world.

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Interview with EVP at Safeguard Guaranty

Thursday, July 16th, 2009

Ken Fries and I worked together a long time ago in Agency Automation at Aetna in Hartford. I left for Boston and Digital Equipment Corp. Ken stayed in Hartford and stayed in the insurance industry. His resume includes stints as the Vice President of Agency Strategy, eBusiness and Technology at The Hartford, an independent agency owner (he bought, built up and sold the agency over a five year period), AVP of Project Management & Efficiencies at Mass Mutual; and today he’s EVP of startup insurer Safeguard Guaranty. He knows as much about the state of technology deployment in the insurance industry as just about anybody on the planet.

So I gave him a call.

Bob:  Customer knowledge across lines of business has been an issue since we worked together at Aetna all those years ago. When I went to Digital, it was an issue we tried to address with data warehouses. Then, years later at EMC when I was the Insurance Industry Marketing Manager, we tried to address it with CRM and Enterprise Storage Networks. Is customer knowledge across lines of business still the holy grail for insurers?

Ken:  Maybe not considered to be the holy grail, but still very, very important in many different aspects.  First and foremost is the data. I believe, as do many companies, that data is still king. It indicates past performance of customers and predicts future traits in terms of buying patterns, needs, claims modeling and rate setting for pricing of products. Literally as we speak, Travelers is doing some heavy spending on data analytics and modeling based off this data. I have never seen an insurance company to date making such a tremendous commitment to acquiring and analyzing the data as they are currently doing.

Bob:  How is Safeguard Guaranty solving this issue?

Ken:  Well, we’re lucky in that we have no legacy systems to deal with. We’re putting systems in place that can truly capture customer data in an Enterprise fashion versus traditional segmented type systems by line of business or market segment.

Bob:  Do you think insurance industry executives are finally ready to tackle this beast?

Ken:  Certain firms like Travelers, Progressive and Geico are definitely committed to this, but many of the others are not yet prepared from a human resource/expertise perspective to understand the value of solving this issue… let alone ready to commit the substantial dollars needed to resolve it. They won’t do it, until the reality of losing their market share to companies like Travelers, Progressive and Geico hits them smack between the eyes.

So, it’s still an issue in much of the industry, and in Ken’s perspective, vendors need to educate their insurance clients on the competitive dangers they face, and the potential solutions available.

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New Bank Card Regulations Affect IT Shops

Tuesday, June 30th, 2009

I’ve reprinted an article from the July issue of Bank Technology News below. The author, Rebecca Sausner, writes that the new US regulations on credit card companies will eat up most of these companies’ IT budgets over the next couple of years. This is good news for ‘body shops’ who will benefit because internal IT shops at these banks will be overwhelmed trying to rewrite their applications to comply with the new regulations.

IT vendors who supply more innovative Card Company solutions will see their projects sidelined for the next 12 to 18 months. Opportunity always accompanies change, though. Innovative IT providers should study these new regulations and attempt to partner with the Card Companies on applications that can help them comply while also adding customer service functionality.

COMPLIANCE

Card Co’s Day of Reckoning Hits IT

Bank Technology News  |  July 2009

by Rebecca Sausner

The new federal regulations overhauling credit card industry practices seemed radical, until President Obama signed a law in May that upped the ante in terms of timing and restrictions, and then in June proposed the Consumer Financial Protection Agency. Either alone represent a sea change for card lenders, requiring them, as the American Bankers Association puts it, “to overhaul their entire business models, eliminate specific practices, and reconstruct the way they extend credit and interact with customers.”

“Overhauling” and “reconstructing” have technology implications, but not always good ones. What will happen with the proposed new regulator is unknown – every bank lobby in the country opposes the idea. But the card law is a done deal, and represents such a major short-term challenge for lenders’ technology operations that one banker told MasterCard Advisors that compliance could absorb as much as 70 percent of the coming year’s IT resources at his institution. Everything from customer service technologies, billing and payment processing systems, disclosure processes, and pricing models must all be rewritten or replaced. Best guess is that most lenders will band-aid existing systems to meet the deadline – or face stiff fines – and overhaul down the road. “When you combine that the changes affect every part of the process, and when every part of the process involves technology, it’s going to be a drastic and very burdensome thing for IT departments,” says Michael Brauneis, director of regulatory risk consulting at Protiviti.

Certain provisions require entirely new processes to be added to the customer information file. Among them is the requirement that consumers opt-in to the product feature that allows them to pay a fee in order to exceed their available credit limit. For this, banks will have to build permissions functionality. Some institutions are looking at ways to comply without losing revenue. One solution: instant opt-in via a text message sent to a consumer at the point of sale. “They’re looking for something that could realistically be done so that it will be legal and consumers will accept the charge for the over-the-limit transaction,” says Greg Hedges, managing director at Protiviti.

The changes in how card issuers can utilize delinquency and other information to adjust credit availability will also be onerous, requiring that the links between the risk analysis and servicing side of the system be revamped. “I think it would drive even more the move towards more flexible technology where you could have three pricing tiers or have thousands,” says Dennis Dixon, president of Zoot Enterprise.

The new law may also “serve to wash a lot of the innovation that’s existed in the market out of the market,” Hedges says. “Organizations that had very sophisticated risk-based pricing, who started to look at consumer behavior, are trying to look at how they can keep those practices in place and still stay in compliance.” And for some, the rules may be too much to handle. “I strongly believe a lot of the smaller firms are just going to exit the business,” Brauneis says, adding the understatement of the week, “It’s already less attractive than it was a few years ago.”

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Finally Time for Insurers to Develop Comprehensive Views of Clients

Friday, June 26th, 2009

Adapting to the new economic and regulatory realities requires some new thinking on the part of insurance executives. It’s always easier for them to continue using legacy systems without any significant changes. In times like these, however, change is needed. There’s a considerable amount of research predicting that insurance industry IT budgets will increase in the remainder of 2009.  This is a good sign for the industry’s future, and for vendors selling hardware, software and services to the industry.

Research shows that insurance industry executives are more likely to seek advice from technology vendors than their counterparts in banking and most other industries. I haven’t seen any convincing arguments regarding why this is the case; but anecdotal evidence from our clients supports it.

A recurring theme in media predictions and analysts’ research is that insurers are investing in better underwriting and improved risk management. These offer good and necessary improvements, but only on the tactical level, i.e. incremental improvements in efficiency.

Technology providers ought to focus on changing the way insurers operate strategically and help them to place greater emphasis on customer lifetime value. It requires some creativity and a change of mindset. It’s amazing to me that this is still an issue. Twenty years ago, when I was in Digital Equipment Corp.’s Insurance Industry Consulting Practice, we were addressing ways (mostly data warehouses) of building 360 degree views of insurers’ clients across lines of business.

It may be that, given the current environment, insurers are finally feeling enough pain to take the steps necessary to  increase value and profitability by better knowing their customers. It takes more than just a vision to make things happen, though, especially with such a high level of uncertainty in the air.

I’d like to hear from insurance executives, research pundits and IT providers out there:

  1. Is customer knowledge across lines of business still the holy grail for insurers?
  2. How are you solving this issue?
  3. Do you think insurance industry executives are finally ready to tackle this beast?
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Digital Relationships

Wednesday, June 24th, 2009

Business to Business Moves Online

It isn’t news to you that the nature of your relationships with your clients and prospects has changed. Existing relationships are more difficult to maintain as the people you used to deal with leave their posts, and their replacements (if there are any) are much less inclined to engage with IT providers. Cultivating new relationships is more difficult because prospects don’t feel the need to interact with IT providers until they’re ready to buy. They do their research online. If they contact you, the conversation will be about price.

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Relationships

What may be news is that there’s a more cost effective way to build, nurture and maintain relationships with clients and prospects. You don’t have to be in the same room (or the same country). You can build the trust online that forms the foundation of every sale. With one caveat – the relationships you build must be authentic. Everybody has a well-honed BS detector today. If you aren’t in it for the long haul, if you’re just trying to make your quarterly numbers, resign yourself to competing on price.

Return On Influence

There’s networking and relationship-building for business, and there’s ‘sales disguised as networking’. Don’t confuse the two because your prospects won’t. The first one is truly helpful because he wants to make and keep relationships. The second one is interacting only to fill an immediate need.

By being helpful over time, even when there’s no imminent payoff on the horizon, you become a trusted advisor. And you’re able to accomplish this fairly easily, because it’s a one to many relationship. By communicating relevant and useful information through your blog (and commenting on other appropriate blogs), and/or a newsletter, white papers, videos, your website etc., you build a reputation. As long as the content you develop is high quality, people with an interest will find it and disseminate it to others.

Starved for Time, Not Information

It seems counter intuitive. Why develop more content when people don’t have time to consume the information that’s already available to them? If you develop content that resonates, or informs in a way that’s valuable, or entertains (or preferably, all three), people rightly perceive it as a time saver. They didn’t have to hunt down these tidbits, assimilate them and think them through – you did it for them.

Content Strategy

Of course, you can’t deliver useful, relevant, compelling information off the cuff. You must determine what your positioning is. What subject matter do you want to be the trusted advisor for? And who are your target prospects? Once that’s done, you can develop a content strategy that outlines the research you’ll do and the topics you’ll cover. An added bonus is that, as search becomes more contextual (see Bing, Kosmix and Duck Duck Go), your relevant content becomes your search engine optimization (SEO). No need to trick the search engines into driving traffic. The same valuable information that keeps people interested, will also draw the interest of the search engines.

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US Insurance Regulatory Reform Affect on IT

Sunday, June 21st, 2009

I found this post by Mike Fitzgerald at Celent. It’s an insightful review of the Obama plan for regulatory reform, and how it will play out for insurers and their technology providers. I’ve posted it below in its entirety. Bottom line – new compliance regulations are going to require upgrades to data management tools.

“Insurers must prepare now for stress on their data management and compliance processes.”

Thanks, Mike!

Federal Regulatory Reform of Insurance – The First Salvo

Post by Mike Fitzgerald
June 19th, 2009

The Obama administration published its white paper on financial services industry reform this week, Financial Regulatory Reform: A New Foundation, Rebuilding Financial Supervision and Regulation (http://www.financialstability.gov/docs/regs/FinalReport_web.pdf) .  This will now serve as a baseline against which the legislative process can act.  So, while this is not law yet, there are some broad trends which can be noted in the approach which will have implications for insurance firms and their technology response.

A high level review of the document reveals the broad goals for insurance industry regulation and the proposal of two regulatory agencies which will directly affect the way business is done.  Taken from the report, the principles underlying the recommendations specific to insurance are:

  1. Effective systemic risk regulation with respect to insurance
  2. Strong capital standards and an appropriate match between capital allocation and liabilities for all insurance companies
  3. Meaningful and consistent consumer protection for insurance products and practices
  4. Increased national uniformity through either a federal charter or effective action by the states
  5. Improve and broaden the regulation of insurance companies and affiliates on a consolidated basis, including those affiliates outside of the traditional insurance business
  6. International coordination.

I anticipate much angst around points four and five, especially as these directly challenge the state regulatory set up and its effectiveness and efficiency.  On a broad level, no one can argue that these are worthy goals, but how they are accomplished will be contentious.

The establishment of two regulatory agencies is proposed – the Office of National Insurance (ONI) and the Consumer Financial Protection Agency (CFPA).  The duties of the ONI are fairly well detailed.  From the report: “The ONI should be responsible for monitoring all aspects of the insurance industry. It should gather information and be responsible for identifying the emergence of any problems or gaps in regulation that could contribute to a future crisis. The ONI should also recommend to the Federal Reserve any insurance companies that the Office believes should be supervised as Tier 1 FHCs. The ONI should also carry out the government’s existing responsibilities under the Terrorism Risk Insurance Act.” The ONI will also serve as the U.S. representative to the International Association of Insurance Supervisors with “the authority to enter into international agreements, and increase international cooperation on insurance regulation.”

The potential impact on insurance of the CFPA is less clear.  The report states that it would “protect consumers across the financial sector from unfair, deceptive, and abusive practices in credit, savings, payment, and other consumer financial products and services”.  Insurance products, particularly life instruments such as variable annuities, are not specifically mentioned.  The emphasis is on preventing a repeat of the perceived improprieties seen in the mortgage and credit card areas.  However, it does not specifically exclude insurance and “other consumer financial products and services” is a very broad area.

Some of these lines will be drawn as Congress develops its legislation.  Many, especially where Federal responsibility ends and state requirements begin, will only be determined once the Federal system is in place and active.  The practical impact to the insurance industry is that there is another sheriff in town now and he will be demanding our time and attention.  Companies must prepare now for stress on their data management and compliance processes. (See the Celent reports Insurance Data Mastery Strategies http://reports.celent.com/PressReleases/20081126/DataMasteryStrategy.asp and Insurance Data Mastery Solution Spectrum http://reports.celent.com/PressReleases/20081203/DataMasteryVendors.asp).

Pending upgrades to data management tools should happen now and any planned data conversions completed.  Companies without a robust reporting environment should invest in these capabilities as the up front investment will be less than the continued expenses associated with a “catch up” approach.  In 2010, plan for short timelines for compliance and a more confusing and expensive regulatory landscape.

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