Aspire Systems insurance wp Page 10
Internet Strategy for Insurance Companies
Jack Welch, at General Electric, has become so convinced of the implications of net based busi-
ness models that he has commissioned teams of "destroyers" to literally demolish the current way
of doing business and build new delivery systems. The teams are expected to deliver new business
models in weeks and months. Not years. Management has specific accountabilities, reflected in
their incentive compensation programs, to build and use new, net based business models. Blowing
the organization up and starting over may be a bit too extreme for insurance leaders. However, many
are experimenting with new organizational models to foster net innovations. That may include
forming subsidiaries to test net based capabilities or other controlled methods of engaging in Internet
commerce and service delivery. The risk with this approach is that it will compartmentalize the new
business models and perpetuate expensive, inefficient business practices in the rest of the organi-
zation.
The Bottom Line
Developing a comprehensive, integrated Internet strategy can seem overwhelming or easily deferred
by other priorities. On the other hand, small and mid sized insurance companies, in particular, face
major pressures in the future as larger companies in the financial services industries rapidly build
new net delivery and servicing systems. The need for a practical, realistic and fast paced business
plan that addresses business practices, processes, distribution and organizational issues is com-
mon to all companies that want to insure their future success.
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