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Top 5 Considerations for Multi-Country Core Project Deployments in Insurance

Migration from a legacy system to a modern core platform is a big transformation and one of the most challenging projects an insurance company can face, both from the IT and the business side. For an international company whose plan is to run such a project across different lines of business and multiple countries, the complexity is multiplied. 

The good news is that it has been done before, so there is experience out there that insurers can rely on. We will share our experience and point out what we believe are the best practices for such journeys.

The questions

Multi-business, multi-country roll-out projects create a new set of considerations that are not seen in single country projects. Regardless of whether the key driver behind the project is a more strategic international consolidation, obsolescence of existing legacy technology, or an initiative to modernise user engagement and experience, the same topic will always lead the conversation: the standardisation of processes and business infrastructure. 

And this is for an obvious reason - a standardised infrastructure has not only a strategic long-term impact, but it also has a tremendous operational impact on project deployment timelines, the total cost of implementation, resource roles and requirements. Other interesting and thoughtful operational conversations are often about project predictability and risk, covering topics such as project governance, implementation methodology, contracting for an agile approach (all huge topics on their own).

The answers

In this post, we will address different areas which have different levels of impact on consolidation potential, from an operational point of view.
As you might guess, there is no silver bullet and therefore no single answer for a specific case. However, it mostly comes down to a limited number of areas that, if addressed properly, can have a significant impact on consolidation opportunities.

Those areas include:

  • Optimisation of products and processes across different businesses and countries
  • Selection of the right technology
  • Program governance
  • Operational excellence and competence building
  • Areas with a mixed bag of optimization capabilities.

Optimisation of products and processes across different businesses and countries

The similarity of the product portfolio and its structure between two or more countries is the single most important factor that can shorten implementation time, lower the project costs and reduce the overall project risk. 

Due to legal requirements, and differences in size and organisation, some countries differ, but our experience shows that we can always find enough similarities. And it is worth doing it - a consolidated portfolio simplifies maintenance and change management which results in higher long-term profitability. 

The consolidation potential can also be assessed during the project itself and it is not necessarily part of the strategic consolidation. First, an assessment is performed to identify two countries with leverage potential. Next, analysis of processes is done in parallel for both countries with the goal of identifying the true consolidation potential. Once a deep business analysis has been done and functional specifications are consolidated, the implementation can proceed.

Best practice: For the first project, select a country that can serve as a “role model country” - a country with significant leverage potential. Once it has been deployed, subsequent activities can be done much faster and with lower costs.

Best practice: However important it may be, the consolidation potential should not be the only criteria. It makes sense to consider and select a country that has a good track record of executed projects and stronger internal capacities (IT and business). This surely would increase the chance of having early project success. 

Selection of the right technology

The key to leveraging a similar product portfolio and processes is the selection of the right technology that supports requirements related to a simplified configuration of products and processes and is designed with this goal in mind. 

This principle also allows for community-style enhancement of the products and processes. Even though there may be little leverage before the project, there is the opportunity to build international consolidation later on. Even once products are deployed and managed by different processes, each country can constantly improve and contribute to the product and process optimisation in other countries.

Best practices: Core insurance platforms that are built on the notion of consistent change. With our platform AdInsure, all business logic is implemented as a configuration which means that the insurer can implement support for any business line in any number of countries on a single platform. The configuration principle also allows the portfolio and workflows to be duplicated from one country to another as simply as copying and pasting files.

Another important aspect of technology related to cross-country projects is its support for localization. This ranges from features such as “on-the-fly” language change to highly flexible architectures.

Best practice: Selecting a solution with already implemented local layers and/or solutions with multi-layer architectures: base product layer, configurable country, and company-specific implementation layers. 

Program governance

If the program is governed by a team which is authorised and tasked with the goal of optimising processes, and of building competencies that can be shared, the likelihood of actually reducing time and costs is higher. Similarly, the probability of countries being happy with the results is increased (read: increased likelihood of the project succeeding).

Best practice: Our experience shows that up to 30% of implementation effort can be saved with an internationally governed optimisation program.

Competence centre 

Learning is an important part of all repeatable projects, including in international solution deployment. The first project will always be an opportunity to learn, and therefore it makes sense to have people and roles available that will remain with the team for not only one country, but several deployments. Apart from product and process consolidation, there is value in building more project and technology-related experiences, such as implementation methodology and product configuration expertise.

Best practice: One good example is the establishment of a competence centre, which handles different aspects of the migration program:

  • Early assessment and decisions related to portfolio and process consolidation
  • Building implementation project methodology knowledge and providing support for local implementation teams
  • Building and sharing technology-related knowledge.

Areas with a mixed-bag of optimisation potential

There are no areas that, when addressed properly, cannot be consolidated. However, some areas provide better potential for cost, timeline, resource optimisation than others.
Data migration is the single most non-optimisable activity. There are different possible migration strategies that can decrease the scope of data migration, however, data is unique and specific to each particular country and needs to be addressed properly.

Best practice: Consider and implement scenarios that help decrease the scope of migration- avoid migration of short-term policies ie. migrate only if required, such as when a claim arises.

Since every deployment needs to be tested thoroughly, it is important to properly address automation and tool support for regression testing. However, even if 100% of the products and processes could be leveraged, i.e. if an exact copy of a solution in Country A would run in Country B, the infrastructure will certainly not be the same, nor the migrated data or local integration. Final user acceptance testing can take from one to three months in total.

Best practice: Implement a common regression testing program (here is the interview with our very own Daniel Polan on this topic) with the goal of leveraging testing scenarios, testing tools and process automation across countries.

Local integration needs to be performed separately for each country as regulations and other business requirements demand. 

Best practice: Where possible implement integration layers that can be leveraged across countries, such as a layer for integrating with a common back-end general ledger system.

Let us end the article with something that is not consolidation and optimization focused. At the end of such a multi-year project and during it, it is important to achieve some quick wins, it is important to make our business users happy. 

Candy practice: Add some non-core functionality with the goal to provide quicker business value. Consider adding BI to provide insight and decision-making capabilities to key business users. Start with key sales data to get an overview of sales performance in insights, such as analysis of non-renewed policies. Successful BI implementations have much higher satisfaction rates than transformational core projects - people like data.

Sebastjan Plavec, Business Developement, Adacta

Mirela Duvnjak, Business Consultant, Adacta

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