Get the dollars in first and then invest in IT
Three years ago, a new management headed by CEO Ooi Say
Teng was brought into Uni.Asia Life Assurance, a Malaysian insurance company.
The company has seen a complete turnaround, and IT systems, says Teng, have
a played a critical role in this change. Deepali Gupta has the details
We gradually gave the user a system that functioned
the way it was supposed to. Users believed that the system was there to
help them. We then put an audit system in place. The key was that we promised
only what we were capable of delivering
What was the need to revamp the IT infrastructure and how
did you go about the process?
Earlier my branch staff reported that clients had to wait half-an-hour for a
receipt. Since financial services are in direct competition with banks where
everything is in real-time and online, it was essential to revamp the IT infrastructure.
Plus, every month the earlier system had a downtime of three-days. It was embarrassing
that when we talked of business, we only talked about our problems.
Employee morale was down, and, from a users perspective the system only
slowed things down. We were reprimanded by agents and policy-holders alike,
while the IT team wasnt willing to shoulder responsibility. We had to
gain trust. We gradually gave the user a system that functioned the way it was
supposed to. Users believed that the system was there to help them. We then
put an audit system in place. The key was that we promised only what we were
capable of delivering.
IT is a business driver, and the delivery of a suitable IT infrastructure proved
to be a business enabler. After putting the new infrastructure in place, the
number of new cases at Uni.Asia grew by 100 percent in the first year, the amount
of premium collection grew by 200 percent, and we increased the employee headcount
by 15. This year we expect to grow our business by 30 percent.
We can now issue policies within three days, so customer expectation and service
levels are never compromised. We can attribute that to our IT infrastructure.
Shareholders finance every stage of business development.
If you approach shareholders and ask for IT investment, the reaction
is bound to be unpleasant. So the safe approach is to just get the dollars
in first and then invest
How did you approach your IT investments?
We have multiple distribution channels with a focus on life insurance products.
In Malaysia, we offer life and health insurance. About three years ago, we got
a new management in place that reformulated the distribution strategy adopting
multiple channels. Life insurance makes financial sense in the long-term as
it takes up to seven years just to break even.
From an IT perspective that meant we had to create a long-term strategy. However,
shareholders finance every stage of business development. If you approach shareholders
and ask for IT investment, the reaction is bound to be unpleasant. So the safe
approach is to just get the dollars in first and then invest in IT.
This approach may be suicidal because once the business grows the distributor
and consumer will not compromise on quality or service. Therefore the company
gets caught in a situation where business is growing but the infrastructure
does not scale up to match this growth. It would lose both customers and intermediaries.
We decided to make IT our core strategic agenda. The IT Manager reported to
the CFO under the old structure, so the first decision was to appoint a CIO
who would report directly to the CEO.
Did you buy new solutions as soon as you decided to revamp
the companys IT strategy?
No. Mastek evaluated whether the system in place had a future. It came to the
conclusion that the problems were occurring due to poor initial implementation.
So, only that needed to be rectified, and the system worked well.
What kind of priority do you give to IT decisions?
Even in our high-level committee meetings, IT investment is a major point of
discussion. In these meetings we look at the current IT infrastructure, and
visualise what the future, given the present situation, will be. If there is
no clear future, it is time to get a new system.
Once you decided to redo the companys image, what
were the guiding factors while taking IT decisions?
IT, for me, is not about the solution on the front or the backend. The CIO will
figure out technical aspects. However, the technology must not be obsolete because
employees, particularly new recruits, need to be capable of using it.
When establishing IT partners there are two very important considerations
for a CEO: The first is whether or not the vendor can feel my pain, and the
second is to see if the partner shares my vision. I assess these factors personally
in monthly meetings. As for the technical competency of the vendor is concerned,
my CIO takes care of that.
Naturally, all this cannot be assessed from day one. The business has to develop
a relationship with the vendor over time. Like we did with Mastek, you first
have to draw a road map. Then establish a rapport so that at the time of trouble
no one tells you that fixing the problem is not part of the contract or says
that I should have asked for the service earlier.
So, I made my big goal clear and said, I will not compromise on schedule, costs,
and over a period of time rolled out many projects. As a result, I have built
a trust-based relationship. Now I am comfortable that help is only a phone call
As business grows, your IT infrastructure will have to
scale to a corresponding size. Do you have an expansion plan for IT chalked
We have developed a modular approach because we are a young company. We bought
a full range of products, and expect the solutions to grow with the business.
We introduced health insurance in March, and will continue to add services.
For me whats important is my ability to deliver what I promise to customers,
and my ability to introduce new products quickly. That is a priority, upgrades
are incidental and a means to mitigate risk.
Deepali Gupta can be reached at firstname.lastname@example.org