AIA adopts ‘best of breed’ for post-integration transformation
By Karamjit Singh December 12, 2013
- Chose the best IT systems from AIA and ING to be adopted post-integration
- IT sees itself playing a business enabler role, no longer support function
WHILE the brand and marketing initiatives have grabbed all the headlines in the AIA integration of ING Group’s local insurance operation into its business, the critical IT operations of the combined entity have been moving along at a steady pace to provide the enlarged entity with the capabilities to provide customers of both AIA and ING with a seamless experience.
‘Best of breed’ was the approach taken when the IT operations of both companies were looked at in terms of the overall organisation’s transformation.
“This was not just to be looked at as consolidating both sets of IT units,” says Teh Kim Leng (pic), AIA Bhd chief information officer (CIO).
“The underlying message was that this was to be taken as an opportunity to transform, hence the company pushing for ‘one plus one to be three-plus,” he adds.
The thinking had to be different when the company leadership sent a not-too-subtle message about how it expected the transformation effort to pan out. Thus both IT units sat down with a blank sheet of paper in December 2012 to map out the new operating model for IT.
“We knew one thing – IT could not play the traditional reactive support role when the entire business was going through a transformation,” Teh says of that meeting.
The question posed was: What role did they see IT playing in AIA, two or three years down the road? The answer was to become a strategic unit and not play a supportive role.
That meant being proactive about bringing technology innovation from the market to bear on the type of products and services AIA offered its customers.
It also saw the introduction of a set of people embedded into the various business units with the task of educating these units about the role IT could play to help them meet their business objectives.
These were not very technical people, but they did understand the role that technology could play in the various business units.
A similar team at ING was already doing this, and they were simply brought over into AIA after the merger.
“We want the business strategy of the company to be shaped taking into consideration the technology tools that are available in the market, instead of plugging technology into the strategy as an afterthought,” says Teh, who was the CIO of ING before the merger.
Having set the role IT aims to play in AIA, next, a high-level assessment of the IT capabilities of both organisations was carried out. This revealed that each had their strengths in particular areas.
What the best-of-breed approach did was to simply pick which of the two IT units in AIA and ING had the stronger capabilities and technology in the various areas, and the other had to then follow suit.
In some ways it was almost complementary, as the clear strengths of one unit were not evident in the other. For instance, AIA was an industry leader in portals, with a complete suite serving agents, customers, clinics and hospitals.
“On the other hand, in areas where both were seen to be lagging, we chose to bring in new technology to benefit both,” says Teh, who considers it fortunate that he did not have to make any tough decisions about junking a system which had been invested in heavily by either AIA or ING.
This approach actually made the whole IT unit transformation more complex and challenging, he acknowledges, due to the integration that went on, “but it also positioned the combined entity on a stronger foundation.”
The first major milestone in this transformation journey was achieved in June with the company moving to a single licence “which crucially, brought both organisations to the same page,” he says.
It was a massive exercise with up to 30 projects being worked on simultaneously, with between 200 and 300 people (both inhouse and from vendors) working furiously to meet the June 17 deadline for the single licence move.
“We had a 60-hour window the weekend before to deploy 78 systems in total,” says Teh.
Not all were new – some were existing systems that were tweaked – but all were part of the process to launch some enhanced products.
Work is now underway on the second major cycle of the transformation effort, with a new system for agency compensation implemented. This is where AIA is pulling the best-of-breed solutions together.
Because both organisations have been around for a long time, legacy systems were spread throughout. The new policy system was an example of a new and more efficient system being implemented.
“We knew we had to go to market with new innovations, but this was not going to happen using legacy systems. We had to pull some key systems together, and hence one of the major ones is this agency compensation system,” says Teh.
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