Agility is not a matter of IT only


Agile management methods are often only associated with the development of IT software. In this regard, that is only one of the fundamental misunderstandings.

With regard to the topic of agility, one notices two big misunderstandings. One of these is the reduction of the term to its “speed” attribute. The higher implementation speed that is now extensively documented in many success stories is agility’s more immediately visible benefit. However, the option that has arisen from it — being able to adjust with more flexibility to altered conditions — is also strategically significant.

The second big misunderstanding lies in the fact that agility is solely attributed to the IT sector, and in this regard, primarily to the development of software. This rather one-sided view leads one to conclude that agility doesn’t improve a company’s overall effectiveness.

Agility is more than IT project management

As is well known, agile methods have their origins in the development of software. Approaches such as scrum or kanban grew out of the observation that traditional approaches in the development of IT applications were becoming less and less suitable for competitive pressure and altered IT infrastructures. In the traditional environment, a department would give the IT department a comprehensive features list in the form of a specification that was then handled by the software development team. That took time and the result did not always have something to do with the department’s actual wishes.

Roughly summarized, agile methods resist the drawbacks of traditional methods by allowing the team to independently handle smaller and therefore more manageable work packages in clearly defined timeframes. Departments are consulted earlier and collaborate in interdisciplinary teams, which means that they can have more of an influence on the development process. Acceptance by end users is determined through early testing. This ultimately ensures that mistakes (anything that doesn’t get “past the customers”) are avoided, especially since current developments and needs can be integrated into the development at an earlier stage.

This concept has now stood the test in countless companies and their IT departments. But agility is not something that they commit to.

BizDevOps: Develop agile company culture

For a number of years now, strategies and plans were for many insurers a part of everyday business and traditional procedure models. This includes the more or less structured brainstorming of ideas that are to be implemented into a traditional project – an approach that to a certain degree is now only suitable for the market environment.

Across many branches, one can observe from experience during the pandemic that a change in customer behavior has begun that is altering expectations. The speed with which this change is occurring might have even surprised experts, though there is no way to describe it within the framework of multi-year plans.

Furthermore, insurers still see themselves as being challenged by insurtechs in many respects. At first glance, their products and offers may not be as comprehensive and sophisticated as those of traditional insurers. However, it is for this reason that they are more comprehensible for young target groups especially, and thanks to agile methods in start-ups, they are also quick to adapt to the insured person’s wishes.

Though digitalization and the increased significance of insurance-related IT projects over the years are important drivers of change, the advantages that result from agility in IT will get lost in the shuffle if a cultural change doesn’t occur within insurance companies.

This cultural change can zero in on the catchy term “BizDevOps”. The abbreviation stands for Business, Development, and Operations. It essentially means a closer collaboration between departments and IT. For without IT, an insurance company’s processes would nowadays be inconceivable.

Lay the foundation and respect boundaries

Agility in this sense therefore comprises more than just the IT sector. Agile methods equally belong in marketing: With regard to insurance, more agility means that line organization and projects are no longer strictly separated from one another. Instead, they are linked together. This demands that all participants have the courage to constantly question what is already in place and that they want to make an improvement in the customers’ interests.

However, this only leads to better products, more efficient processes, and greater customer focus when the interdisciplinary team’s ideas and creativity are also allowed to be implemented – in other words, they don’t get smothered by hierarchies. There is an essential difference between “introducing and utilizing” agile methods and “stating that they exist.”

All departments that are active, either in the implementation of a product, or as part of the value chain, must be included in a comprehensive process. As a result, this concerns sales and marketing, product and portfolio management as well as personnel and finance departments.

For this reason, it is nothing less than a matter of cultural change within the entire company. This is not just a task for management, however. The teams are needed as well, as they must be conscious of their new collective responsibility.

That all of this doesn’t happen overnight goes without saying. Managers must learn to trust employees. The latter in turn must understand and get used to meeting with developers going forward.

In addition, every large organization also has established processes with respect to reporting and risk management that are aligned with a reporting system for traditional procedures.

Agility’s tools and methods are quickly explained. The bigger challenge is actually bringing them to life. This is because it is more than just dismantling knowledge silos and bureaucratic processes. The cross-departmental collaboration will only work if the obstacles on the way to it are identified and dismantled.

Agility requires far more than the introduction of tools and not only concerns IT. It is a cultural change in self-organization, a shift in the minds of employees and managers.

Learn more about digitalization, agility, and cultural change here. If you would like to talk to us about innovative insurance IT, then get in touch with our expert Karsten Schmitt, Head of Business Development.

Do you have any questions or comments? Then please leave us a comment.

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