People, process and technology were relevant to Holly
Morris archaeological specialty long before computers were invented. While her
technology and business roots run deep, she sees her success as an outgrowth of
a liberal arts education crowned by a masters degree and PhD in anthropology.
And her anthropological insight is likely to be more relevant than ever as she
drives forward a technology transformation at Thrivent to support the membership
involvement and growth objectives of an organization that is not just a Fortune
400 company, but also a fraternal benefit society. Now having spearheaded a
major IT revamp at Thrivent, as CIO she talks to Dataquest about why the need
for the makeover was felt in the first place, the role of IT in insurance
industry in the US, the needs of a mid-sized company and much more.
W hy did Thrivent Financial plan to go in for a
complete IT revamp?
Thrivent Financial is a Minneapolis based Fortune 400 insurance and financial
services company with a 2.3 mn customer base. While we are in many ways similar
to most other mutual life insurance companies in the US, a big differentiating
factor is that we are a non-profit organization with a unique social business
model. The company gives back to the society and its membership $300 mn and 2 mn
hours of volunteer time every year.
However, like other insurance companies in the US, we too are
struggling with growth as the industry has become quite mature with no major
growth in the last twenty years. To keep up we too are getting into new
channels, simplifying our products, and have become more innovative in our
underwriting. And in this entire process, we have realized that our IT
infrastructure has to be completely made over to be able to support futuristic
business processes and systems. This need for IT to support business change is
what sparked the revamp efforts within the company. We are in the process of
building a new IT infrastructure that will enable us to become multi-channelled
and much more customer centric. It is a five-year, multi-million dollar
initiative which I call the Extreme Makeover.
What does the Extreme Makeover constitute?
A large part of the budget for the IT revamp has gone towards building a
customer centric model. As a first step we have converted all our policies onto
a new salesforce based strategic platform, which will reduce costs and make it
easier and quicker to get products online. Another area where IT has played a
key role is in helping us test many of our product concepts and ideas before
actually launching them.
We came up with a financial prototyping system which helped
us test and analyze our own products and come up with the final application
within five weeks and share it with business partners. In addition, we have been
able to put together a SaaS based IT platform which connects all touch points to
address the social nature of the business where different channels are tapped to
connect with the community. This serves our members who also serve as volunteers
and can access the budget that we give back to the community for various
charitable causes. So our multichannel distribution platform is seamless and
extremely customer centric.
In a nutshell, under the five-year makeover, the company is
in the process of rolling out twelve projects simultaneously. These include the
salesforce.com implementation, a data utility application, increased focus on
security, enterprise content management system, policy administration system,
new commission system, an online loyalty system, etc. We have also brought in an
architecture team and have prepared an SOA blueprint. Eventually all IT projects
and applications will be integrated on the underlying SOA layer.
What is the outsourcing strategy that you have adopted as
a CIO at Thrivent?
The adopted an outsourcing model based on flexibility and the ability to
scale up or down as required. With the help of two of our key outsourcing
partnersNIIT Technologies and Cognizantwe have been able to leverage on the
domain knowledge and expertise gained by the partners.
Thrivent has gone for a combination of outsourcing as well
in-sourcing for its various IT needs. The components outsourced include complex
aspects of the IT infrastructure, managed security, application development and
maintenance, etc. Primarily, what we have done is shifted a lot of maintenance
related activities of legacy applications to India. This has helped in freeing a
lot of employees to work on new projects and focus on more critical business
processes. Large chunks of the IT infrastructure, such as data centers are
managed in-house. For instance, our Wisconsin data center is managed by a
skilled set of in-house staff. The in-house IT team also manages a traditional
large mainframe computer storing all insurance related records. Prior to the IT
overhaul, Thrivents IT infrastructure could be described as pretty basic and
in no way outstanding.
How has IT transformed insurance business in the US? What
are the IT priorities of companies?
Today IT forms the core of the insurance business and is no longer
considered a back office function. Technology has really helped the business
move up the curve. Getting rid of old IT systems is gaining priority with an
increasing focus on adopting SOA based and SaaS or cloud based models.
What is your biggest challenge as a CIO at present? Being
an NPO, what takes on more focus while undergoing the Extreme
Makeoverefficiency or cost savings?
My biggest challenge right now is how to keep my team motivated, celebrate
interim successes, and get offshore partners to bring in more value while
maintaining costs and timelines. Despite being an NPO, cost pressures will never
go away. So, all our efficiency models such as Six Sigma and CMMI are focused on
driving down costs. After our funding for the five year revamp is exhausted, the
need for constantly updating IT systems will continue. Hence, we have to
leverage on IT to make room in our operating budget for further IT investments.
Our operating cost is at 40% of overall IT spends which on an average is quite