Salaries frozen, bonuses slashed, a whole industry in turmoil. But banking, and the wider world of financial services, is still one of the most attractive careers for graduates. writes Dave Boland
F inancial services provide employment for about 150,000 people in Ireland, with about 11,000 working in Dublin's IFSC alone. The establishment of the IFSC in the late 1980s, and Dublin's rebirth as an international hub for back-end financial service work, transformed the entirety of the labour market, offering high-paid opportunities to highly skilled graduates who would have had to emigrate in the past to achieve the sorts of levels of employment that were now available. And, thanks to the Dublin's pre-eminence in the sector, financial services are still creating jobs in spite of the tribulations currently being experienced throughout the industry.
"The roles are definitely still there," said Lisa Maher, recruitment consultant for banking and financial services at Sigmar Recruitment. "There are still companies acquiring talent, and still companies that are growing, especially in the funds industry. So I would say that the whole sector is still strong in terms of recruitment."
What is certainly true is that the merry-go-round has slowed, and people are more reluctant to move these days than they would have been maybe a year ago. But the industry is expected to find its feet again within 12 to 18 months, and with a steady stream of new entrants to the market, there are still ample opportunities for graduates, even relatively inexperienced ones, with the right qualifications and qualities.
The greatest number of openings in financial services is in the funds arena, with roles in fund accountancy, shareholder services, fund administration and trustee services. Entry level roles, which had been advertised extensively until a short time ago, have largely dried up – but mid-level to senior level roles are still relatively plentiful.
For somebody who has already started their career in funds, this is good news. They may have entered the industry on a modest enough salary (maybe €25,000 or €26,000), but a new job with just a year's experience could net them in the region of €30,000 or more.
But it's the extras that used to form such a significant part of a financial service professional's salary that are still somewhat up in the air. Bonuses, even in back office, support-type roles, used to be one of the key attractions of a job in the industry, but bonuses are rarely guaranteed, and tend to be related to the overall performance of the company. With the whole industry suffering, bonuses may be considerably down this year (unless there is a major pick-up in the next couple of months, which is unlikely).
But the industry is making up for the disappointing bonuses in other ways.
"Salaries are still strong," said Maher. "And benefits are still very strong. A lot of companies are upping their benefits packages, with mortgage subsidies or rental allowances being introduced to encourage people to work for them."
Not that properly qualified people should need many inducements to work in the industry. Even with the current tribulations, financial services should remain one of the most significant employers on the market for many years to come. And, with the industry experiencing a bit of a wobble at the moment, the only way is up, isn't it
Thursday, 23 October 2008
Still Opportunities in Finance Jobs
Salaries frozen, bonuses slashed, a whole industry in turmoil. But banking, and the wider world of financial services, is still one of the most attractive careers for graduates. writes Dave Boland
F inancial services provide employment for about 150,000 people in Ireland, with about 11,000 working in Dublin's IFSC alone. The establishment of the IFSC in the late 1980s, and Dublin's rebirth as an international hub for back-end financial service work, transformed the entirety of the labour market, offering high-paid opportunities to highly skilled graduates who would have had to emigrate in the past to achieve the sorts of levels of employment that were now available. And, thanks to the Dublin's pre-eminence in the sector, financial services are still creating jobs in spite of the tribulations currently being experienced throughout the industry.
"The roles are definitely still there," said Lisa Maher, recruitment consultant for banking and financial services at Sigmar Recruitment. "There are still companies acquiring talent, and still companies that are growing, especially in the funds industry. So I would say that the whole sector is still strong in terms of recruitment."
What is certainly true is that the merry-go-round has slowed, and people are more reluctant to move these days than they would have been maybe a year ago. But the industry is expected to find its feet again within 12 to 18 months, and with a steady stream of new entrants to the market, there are still ample opportunities for graduates, even relatively inexperienced ones, with the right qualifications and qualities.
The greatest number of openings in financial services is in the funds arena, with roles in fund accountancy, shareholder services, fund administration and trustee services. Entry level roles, which had been advertised extensively until a short time ago, have largely dried up – but mid-level to senior level roles are still relatively plentiful.
For somebody who has already started their career in funds, this is good news. They may have entered the industry on a modest enough salary (maybe €25,000 or €26,000), but a new job with just a year's experience could net them in the region of €30,000 or more.
But it's the extras that used to form such a significant part of a financial service professional's salary that are still somewhat up in the air. Bonuses, even in back office, support-type roles, used to be one of the key attractions of a job in the industry, but bonuses are rarely guaranteed, and tend to be related to the overall performance of the company. With the whole industry suffering, bonuses may be considerably down this year (unless there is a major pick-up in the next couple of months, which is unlikely).
But the industry is making up for the disappointing bonuses in other ways.
"Salaries are still strong," said Maher. "And benefits are still very strong. A lot of companies are upping their benefits packages, with mortgage subsidies or rental allowances being introduced to encourage people to work for them."
Not that properly qualified people should need many inducements to work in the industry. Even with the current tribulations, financial services should remain one of the most significant employers on the market for many years to come. And, with the industry experiencing a bit of a wobble at the moment, the only way is up, isn't it
F inancial services provide employment for about 150,000 people in Ireland, with about 11,000 working in Dublin's IFSC alone. The establishment of the IFSC in the late 1980s, and Dublin's rebirth as an international hub for back-end financial service work, transformed the entirety of the labour market, offering high-paid opportunities to highly skilled graduates who would have had to emigrate in the past to achieve the sorts of levels of employment that were now available. And, thanks to the Dublin's pre-eminence in the sector, financial services are still creating jobs in spite of the tribulations currently being experienced throughout the industry.
"The roles are definitely still there," said Lisa Maher, recruitment consultant for banking and financial services at Sigmar Recruitment. "There are still companies acquiring talent, and still companies that are growing, especially in the funds industry. So I would say that the whole sector is still strong in terms of recruitment."
What is certainly true is that the merry-go-round has slowed, and people are more reluctant to move these days than they would have been maybe a year ago. But the industry is expected to find its feet again within 12 to 18 months, and with a steady stream of new entrants to the market, there are still ample opportunities for graduates, even relatively inexperienced ones, with the right qualifications and qualities.
The greatest number of openings in financial services is in the funds arena, with roles in fund accountancy, shareholder services, fund administration and trustee services. Entry level roles, which had been advertised extensively until a short time ago, have largely dried up – but mid-level to senior level roles are still relatively plentiful.
For somebody who has already started their career in funds, this is good news. They may have entered the industry on a modest enough salary (maybe €25,000 or €26,000), but a new job with just a year's experience could net them in the region of €30,000 or more.
But it's the extras that used to form such a significant part of a financial service professional's salary that are still somewhat up in the air. Bonuses, even in back office, support-type roles, used to be one of the key attractions of a job in the industry, but bonuses are rarely guaranteed, and tend to be related to the overall performance of the company. With the whole industry suffering, bonuses may be considerably down this year (unless there is a major pick-up in the next couple of months, which is unlikely).
But the industry is making up for the disappointing bonuses in other ways.
"Salaries are still strong," said Maher. "And benefits are still very strong. A lot of companies are upping their benefits packages, with mortgage subsidies or rental allowances being introduced to encourage people to work for them."
Not that properly qualified people should need many inducements to work in the industry. Even with the current tribulations, financial services should remain one of the most significant employers on the market for many years to come. And, with the industry experiencing a bit of a wobble at the moment, the only way is up, isn't it
Banking and Financial Services Management Master's Degree
Banking and Financial Services Management Master's Degree
The Banking and Financial Services Management Master's Degree provides advanced training in interpersonal skills and financial management technology for those looking to advance in the fields of banking or finance. The typical coursework for this degree includes accounting, managerial accounting, international business, business writing, corporate communications, financial planning and more. Please find more information below.
Banking and Financial Services Management Master's Degree Overview
The Banking and Financial Services Management Master's Degree is for those interested in being trained in how to work in a variety of business areas providing financial and banking services. A Banking and Financial Services Management Master's Degree will train the student with the knowledge and skills needed to work with financial institutions to create workable interfaces between businesses and financial institutions. A Banking and Financial Services Management Master's Degree will provide students with the knowledge needed in the business world to work with companies and industries to find ways to managing banking and financial transactions and manage company money.
Career Possibilities for a Banking and Financial Services Management Master's Degree
Those who earn a Banking and Financial Services Management Master's Degree may find employment in the following jobs:
Corporate Financial Manager
Accountant
Bank Manager
Financial Transaction Manager
Bookkeeper
Banker
Financial Services Consultant
The data available from the U.S. Department of Labor, www.dol.gov, indicates non-supervisory banking positions can earn a weekly salary of $494. Non-supervisory positions in other financial and insurance companies averaged in at a weekly rate of $684. Financial Managers could potentially earn an hourly salary of $39.37.
Outlook and Growth of an a Banking and Financial Services Management Master's Degree
The career outlook for a graduate with a Banking and Financial Services Management Master's Degree is very exciting and extremely positive. The business world needs trained employees in this area and statistics seem to indicate that the need continues to grow in nearly every business area. Increasingly the need for qualified employees who can work with money and manage the technology needed to transfer funds from financial institutions and banks for companies also continues to grow. Nearly ever area of the business world needs qualified financial experts to manager company money for a variety of activities.
Coursework for a Banking and Financial Services Management Master's Degree
Some of the classes needed to earn a Banking and Financial Services Management Master's Degree may include, but are not limited to:
Managerial Accounting
Investment Analysis
Portfolio Management
Company Mergers and Acquisitions
Financial Markets
Project Management
Financial Management
Operations Management
Data Analysis
Employee Management
Electronic Commerce
Web Design
Economics
Business Writing
Skills for a Banking and Financial Services Management Master's Degree
Once the student has earned a Banking and Financial Services Management Master's Degree, the skills possessed by the student may include:
Managerial Accounting Skills
Business Writing Skills
Business Financing Skills
Investment Skills
Portfolio Management Skills
Data Analysis Skills
Project Management Skills
The Banking and Financial Services Management Master's Degree provides advanced training in interpersonal skills and financial management technology for those looking to advance in the fields of banking or finance. The typical coursework for this degree includes accounting, managerial accounting, international business, business writing, corporate communications, financial planning and more. Please find more information below.
Banking and Financial Services Management Master's Degree Overview
The Banking and Financial Services Management Master's Degree is for those interested in being trained in how to work in a variety of business areas providing financial and banking services. A Banking and Financial Services Management Master's Degree will train the student with the knowledge and skills needed to work with financial institutions to create workable interfaces between businesses and financial institutions. A Banking and Financial Services Management Master's Degree will provide students with the knowledge needed in the business world to work with companies and industries to find ways to managing banking and financial transactions and manage company money.
Career Possibilities for a Banking and Financial Services Management Master's Degree
Those who earn a Banking and Financial Services Management Master's Degree may find employment in the following jobs:
Corporate Financial Manager
Accountant
Bank Manager
Financial Transaction Manager
Bookkeeper
Banker
Financial Services Consultant
The data available from the U.S. Department of Labor, www.dol.gov, indicates non-supervisory banking positions can earn a weekly salary of $494. Non-supervisory positions in other financial and insurance companies averaged in at a weekly rate of $684. Financial Managers could potentially earn an hourly salary of $39.37.
Outlook and Growth of an a Banking and Financial Services Management Master's Degree
The career outlook for a graduate with a Banking and Financial Services Management Master's Degree is very exciting and extremely positive. The business world needs trained employees in this area and statistics seem to indicate that the need continues to grow in nearly every business area. Increasingly the need for qualified employees who can work with money and manage the technology needed to transfer funds from financial institutions and banks for companies also continues to grow. Nearly ever area of the business world needs qualified financial experts to manager company money for a variety of activities.
Coursework for a Banking and Financial Services Management Master's Degree
Some of the classes needed to earn a Banking and Financial Services Management Master's Degree may include, but are not limited to:
Managerial Accounting
Investment Analysis
Portfolio Management
Company Mergers and Acquisitions
Financial Markets
Project Management
Financial Management
Operations Management
Data Analysis
Employee Management
Electronic Commerce
Web Design
Economics
Business Writing
Skills for a Banking and Financial Services Management Master's Degree
Once the student has earned a Banking and Financial Services Management Master's Degree, the skills possessed by the student may include:
Managerial Accounting Skills
Business Writing Skills
Business Financing Skills
Investment Skills
Portfolio Management Skills
Data Analysis Skills
Project Management Skills
Financial Services
Financial services
In today’s market, financial services organisations must offer product innovation and improve their customer service to remain competitive whilst providing a suitable return for their stakeholders. This must be achieved in an environment of increasing regulation and, in Europe in particular, an erosion of national financial borders which afforded a degree of competitive protection. Added to this is the ever present cost efficiency challenge, the effective management of risk and the more sophisticated measurements of economic capital.
The fact that many institutions have enjoyed record profit growth in recent years makes the problem harder. Where will future profits come from? How will institutions invest to gain market share or grow revenue? As the structure of the financial services market continues to evolve, these pressures threaten traditional sources of revenue which makes such questions harder to answer.
The combination of these factors means that for larger institutions size does matter. To achieve economies of scale and specialisation, complex systems and processes must be streamlined and optimised. Further participant consolidation will occur whether for pure commercial logic or because of indirect encouragement by politicians. For whatever reason, shareholders and executives need to see the benefits of mergers and acquisitions on the bottom line quickly. It is essential that companies reduce costs and deliver new services to their customers ahead of the competition.
For smaller institutions the changing landscape will heighten the need to take far reaching decisions on the direction that the organisation should take, the types of customers it serves and the ownership of product creation and servicing.
Perhaps the hardest choice faces the mid-sized institutions; those often major national, but not multi-national, players. Some will become targets for acquisition, others must decide with whom to ally and how to protect their customer base.
Shared service centres, whether purely cross departmental or a full white label operation, enable improved returns on existing investments in people, processes and technology for all financial services institutions. Consolidation of specific processes within an organisation enhances the visibility of costs, revenues and margins. Firms can select ideal sourcing models: whether to invest or divest, to insource or to outsource, based on cost reduction or revenue growth objectives. It also challenges organisations to link business, operations and technology in a seamless process.
The market dynamics are being accentuated by the growing requirement to satisfy industry regulators. This obliges financial services companies to improve and refine risk processes and management and monitor liquidity and collateral in more sophisticated ways. This should be underpinned by sound capital ratios and enhanced reporting as well as price and service transparency. Simply complying with much of the new regulation could increase overheads significantly. The trick is to use the change brought about by regulation to change the business process, improve the business model and grab new revenues. Whatever the requirement, there is a need for efficient data capture, manipulation and management.
Logica understands the business and technology issues. We work with financial institutions worldwide using our applied knowledge of the financial services market gained over the last four decades. Some 70 per cent of the world’s top financial institutions including corporate and retail banks, financial clearing houses, general and commercial insurers, central banks and regulators rely on us. Logica solutions reduce the risk for clients implementing transformed business processes.
In today’s market, financial services organisations must offer product innovation and improve their customer service to remain competitive whilst providing a suitable return for their stakeholders. This must be achieved in an environment of increasing regulation and, in Europe in particular, an erosion of national financial borders which afforded a degree of competitive protection. Added to this is the ever present cost efficiency challenge, the effective management of risk and the more sophisticated measurements of economic capital.
The fact that many institutions have enjoyed record profit growth in recent years makes the problem harder. Where will future profits come from? How will institutions invest to gain market share or grow revenue? As the structure of the financial services market continues to evolve, these pressures threaten traditional sources of revenue which makes such questions harder to answer.
The combination of these factors means that for larger institutions size does matter. To achieve economies of scale and specialisation, complex systems and processes must be streamlined and optimised. Further participant consolidation will occur whether for pure commercial logic or because of indirect encouragement by politicians. For whatever reason, shareholders and executives need to see the benefits of mergers and acquisitions on the bottom line quickly. It is essential that companies reduce costs and deliver new services to their customers ahead of the competition.
For smaller institutions the changing landscape will heighten the need to take far reaching decisions on the direction that the organisation should take, the types of customers it serves and the ownership of product creation and servicing.
Perhaps the hardest choice faces the mid-sized institutions; those often major national, but not multi-national, players. Some will become targets for acquisition, others must decide with whom to ally and how to protect their customer base.
Shared service centres, whether purely cross departmental or a full white label operation, enable improved returns on existing investments in people, processes and technology for all financial services institutions. Consolidation of specific processes within an organisation enhances the visibility of costs, revenues and margins. Firms can select ideal sourcing models: whether to invest or divest, to insource or to outsource, based on cost reduction or revenue growth objectives. It also challenges organisations to link business, operations and technology in a seamless process.
The market dynamics are being accentuated by the growing requirement to satisfy industry regulators. This obliges financial services companies to improve and refine risk processes and management and monitor liquidity and collateral in more sophisticated ways. This should be underpinned by sound capital ratios and enhanced reporting as well as price and service transparency. Simply complying with much of the new regulation could increase overheads significantly. The trick is to use the change brought about by regulation to change the business process, improve the business model and grab new revenues. Whatever the requirement, there is a need for efficient data capture, manipulation and management.
Logica understands the business and technology issues. We work with financial institutions worldwide using our applied knowledge of the financial services market gained over the last four decades. Some 70 per cent of the world’s top financial institutions including corporate and retail banks, financial clearing houses, general and commercial insurers, central banks and regulators rely on us. Logica solutions reduce the risk for clients implementing transformed business processes.
Introduction to Financial Services for IT Contractors
If you are thinking about becoming a contractor, or have been contracting for a number of years, the financial benefits of setting up on your own are quite obvious. The average contractor will at least double his or her income on leaving permanent work, and in many cases the rewards are much greater than this. However, management of your money is now up to you. This section details the key components of contractor finance; the pitfalls and the benefits.
As a new or established contractor it is inevitable that you will require access to financial service products. In permanent employment, a lower, salaried income is enhanced by additional benefits such as sick pay, company pension scheme, medical and life insurance. These benefits are largely taken for granted but provide vital protection from hardship that disappears the day that you start contracting.
Depending on your circumstances, you will need to replace some or all of this safety net and must now find the costs personally. You will have the means to do so thanks to your newly enhanced income and much of this package can also be provided very tax efficiently through your limited company. Additionally you must make the most of your decision to contract and it is important that your money is set to work as efficiently as possible. Company and personal tax breaks must maximised so that the Inland Revenue doesn't end up the real beneficiary of all your hard work! This can be achieved by careful structuring of your finances and tax efficient investment of surplus income.
There are a bewildering number of insurance companies, banks and other providers of financial services but many of their products will be poorly suited to the unique position in which a contractor operates. Pensions and investments must have low set up costs and have complete flexibility of the number and level of contributions required, mortgages must take into account dividends with competitive interest rates and protection products must be tailored to your particular circumstances.
We advise that you seek an independent financial advisor (IFA) who specialises in the contractor market. Only an independent advisor will be able to scan the market for the most suitable product at the best price and only a specialist will properly understand your situation. You should structure your affairs so that you have flexibility in case you return to permanent work, go abroad or need to react to the unforeseen such as IR35.
As a new or established contractor it is inevitable that you will require access to financial service products. In permanent employment, a lower, salaried income is enhanced by additional benefits such as sick pay, company pension scheme, medical and life insurance. These benefits are largely taken for granted but provide vital protection from hardship that disappears the day that you start contracting.
Depending on your circumstances, you will need to replace some or all of this safety net and must now find the costs personally. You will have the means to do so thanks to your newly enhanced income and much of this package can also be provided very tax efficiently through your limited company. Additionally you must make the most of your decision to contract and it is important that your money is set to work as efficiently as possible. Company and personal tax breaks must maximised so that the Inland Revenue doesn't end up the real beneficiary of all your hard work! This can be achieved by careful structuring of your finances and tax efficient investment of surplus income.
There are a bewildering number of insurance companies, banks and other providers of financial services but many of their products will be poorly suited to the unique position in which a contractor operates. Pensions and investments must have low set up costs and have complete flexibility of the number and level of contributions required, mortgages must take into account dividends with competitive interest rates and protection products must be tailored to your particular circumstances.
We advise that you seek an independent financial advisor (IFA) who specialises in the contractor market. Only an independent advisor will be able to scan the market for the most suitable product at the best price and only a specialist will properly understand your situation. You should structure your affairs so that you have flexibility in case you return to permanent work, go abroad or need to react to the unforeseen such as IR35.
The 21st Century Insurance World Set for Change
The 21st Century Insurance World Set for Change
For the insurance sector, the future is far from nebulous – it’s right here and now. And as globalization continues to grow in reach and scope, insurance firms should in theory find it easier to reach into new and emerging markets and expand their business strategies.
But in reality they face numerous challenges as they adapt to a 21st century world. Today’s customers are demanding greater transparency and flexibility and insurers are being compelled to deliver.
During the recent Microsoft Canada Smart Solutions Breakfast Series held in Toronto, the discussion focused on how insurance firms can better connect their people to their customers. Tony Jacob, Director, Business Development, Insurance Industry, WW Financial Services at Microsoft and Don Canning, Managing Director, Insurance, Worldwide Financial Services, Enterprise & Partner Group discussed the challenges the North American insurance industry faces as it strives to retain a competitive edge in a rapidly changing sector.
The profile of today’s customer is changing, notes Jacobs, as individuals born between 1981 and 2000 enter the work force and become active consumers. He pointed to a recent study released by Insurity and Microsoft Corp. at the ACORD LOMA Insurance Systems Forum 2008, which reveals that technology will play a critical role for insurance firms recruiting or serving those in this "Millennial generation."
"This is a generation where consumer technology is really going to influence their expectations for enterprise IT,” says Canning. “We need to think about the way people work and start developing more portal-based applications that work the way they do – including making systems more intuitive and familiar for today’s knowledge workers."
The rise of the Millennials
Indeed, the report notes that the insurance sector faces a “brain drain” as nearly 60 per cent of employees are now over age 45. The challenge for today’s firms, according to Jacob, is around maintaining a balance between acquiring new customers and developing and retaining existing ones. Not only must insurers proactively move to become more transparent, they will also need to focus on leveraging internal technology and develop more innovative products and services.
Millennial customers are not only demanding newer, technologies in the workplace —— they also carry specific expectations as to how insurance companies should interact with them as consumers, such as the ability to view their full accounts online, access web-based support and instant-message agents directly.
There is also an increasing desire for more flexible and customized IT applications, says Jacobs. In order to adapt to this new world of work and maintain competitiveness in a global economy, successful insurance companies will need to look at responding quickly to economic opportunities and threats by incorporating more flexible IT processes that facilitate distributed collaboration and innovation with customers and partners.
“The question from a technology standpoint is, what can we do as an industry to be proactively more transparent as a way to avoid regulatory regimes?” says Jacobs. “We're entering into an era where there's going to be an expectation of the customers that they're able to interact with insurance firms on a 24/7 basis. This will obviously have huge implications on our future employees, future agents and brokers.”
Why IT innovation is key
Technology innovation, says Jacobs, will be essential for insurance firms in a global, knowledge-based economy.
“Things are changing so rapidly in India, China and across southeast Asia, because that's where innovation is growing. As a result, North American firms will need to increase innovation. We've got to come up with the innovative products and services,” says Jacobs.
Recognizing this new world of work, Microsoft is actively involved in working with insurance firms to develop and deploy better IT – applications that empower individuals through systems that help with the blending of structured and unstructured data.
Microsoft’s IVC program, for example is an emerging ecosystem of insurance partners that address key solution areas across the industry — from point-of-sale and service to policy administration and claims processing — by utilizing the core strengths of Microsoft software in front- and back-office technologies. The objective of the IVC program is to deliver innovative, straight-through processing for insurance on the Microsoft platform using Web services, Extensible Markup Language (XML) and industry-specific standards.
“The insurance industry will need to manage both outcomes and processes. It's really the Millennials we need to think about as they're going to expect virtualized support. We're going to have to think about rules extraction and getting those embedded into our processes,” notes Canning.
Insurance companies will also need to consider implementing projects that look at new ways of data management and service delivery. This involves building out a more flexible IT architecture – including enhanced enterprise resource planning (ERP), business intelligence (BI) and customer relationship management (CRM) software.
“Think about new business models and how you are going to grow in emerging markets. It’s all about enabling businesses and processes to connect faster and accelerate,” says Jacobs, adding that firms will need to look towards developing a 360-degree view of the customer while developing stronger straight-through processing capabilities to maintain a competitive edge.
The goal is to allow customers to work with insurance companies in a much more interactive way. Today’s agent and broker services – including independents and third-party agencies – will require better reporting tools with real-time access to the customer service representatives in order to make better risk decisions.
“You need to think about the quality of the data and what can you do with that data, particularly in terms of standards-based systems that help get even better at looking at underwriting profitability, performance of product lines, performance of intermediaries and opportunities for niche products,” says Canning. “It plays really well into the sense of the Millennials as our next customers for insurance products.”
For the insurance sector, the future is far from nebulous – it’s right here and now. And as globalization continues to grow in reach and scope, insurance firms should in theory find it easier to reach into new and emerging markets and expand their business strategies.
But in reality they face numerous challenges as they adapt to a 21st century world. Today’s customers are demanding greater transparency and flexibility and insurers are being compelled to deliver.
During the recent Microsoft Canada Smart Solutions Breakfast Series held in Toronto, the discussion focused on how insurance firms can better connect their people to their customers. Tony Jacob, Director, Business Development, Insurance Industry, WW Financial Services at Microsoft and Don Canning, Managing Director, Insurance, Worldwide Financial Services, Enterprise & Partner Group discussed the challenges the North American insurance industry faces as it strives to retain a competitive edge in a rapidly changing sector.
The profile of today’s customer is changing, notes Jacobs, as individuals born between 1981 and 2000 enter the work force and become active consumers. He pointed to a recent study released by Insurity and Microsoft Corp. at the ACORD LOMA Insurance Systems Forum 2008, which reveals that technology will play a critical role for insurance firms recruiting or serving those in this "Millennial generation."
"This is a generation where consumer technology is really going to influence their expectations for enterprise IT,” says Canning. “We need to think about the way people work and start developing more portal-based applications that work the way they do – including making systems more intuitive and familiar for today’s knowledge workers."
The rise of the Millennials
Indeed, the report notes that the insurance sector faces a “brain drain” as nearly 60 per cent of employees are now over age 45. The challenge for today’s firms, according to Jacob, is around maintaining a balance between acquiring new customers and developing and retaining existing ones. Not only must insurers proactively move to become more transparent, they will also need to focus on leveraging internal technology and develop more innovative products and services.
Millennial customers are not only demanding newer, technologies in the workplace —— they also carry specific expectations as to how insurance companies should interact with them as consumers, such as the ability to view their full accounts online, access web-based support and instant-message agents directly.
There is also an increasing desire for more flexible and customized IT applications, says Jacobs. In order to adapt to this new world of work and maintain competitiveness in a global economy, successful insurance companies will need to look at responding quickly to economic opportunities and threats by incorporating more flexible IT processes that facilitate distributed collaboration and innovation with customers and partners.
“The question from a technology standpoint is, what can we do as an industry to be proactively more transparent as a way to avoid regulatory regimes?” says Jacobs. “We're entering into an era where there's going to be an expectation of the customers that they're able to interact with insurance firms on a 24/7 basis. This will obviously have huge implications on our future employees, future agents and brokers.”
Why IT innovation is key
Technology innovation, says Jacobs, will be essential for insurance firms in a global, knowledge-based economy.
“Things are changing so rapidly in India, China and across southeast Asia, because that's where innovation is growing. As a result, North American firms will need to increase innovation. We've got to come up with the innovative products and services,” says Jacobs.
Recognizing this new world of work, Microsoft is actively involved in working with insurance firms to develop and deploy better IT – applications that empower individuals through systems that help with the blending of structured and unstructured data.
Microsoft’s IVC program, for example is an emerging ecosystem of insurance partners that address key solution areas across the industry — from point-of-sale and service to policy administration and claims processing — by utilizing the core strengths of Microsoft software in front- and back-office technologies. The objective of the IVC program is to deliver innovative, straight-through processing for insurance on the Microsoft platform using Web services, Extensible Markup Language (XML) and industry-specific standards.
“The insurance industry will need to manage both outcomes and processes. It's really the Millennials we need to think about as they're going to expect virtualized support. We're going to have to think about rules extraction and getting those embedded into our processes,” notes Canning.
Insurance companies will also need to consider implementing projects that look at new ways of data management and service delivery. This involves building out a more flexible IT architecture – including enhanced enterprise resource planning (ERP), business intelligence (BI) and customer relationship management (CRM) software.
“Think about new business models and how you are going to grow in emerging markets. It’s all about enabling businesses and processes to connect faster and accelerate,” says Jacobs, adding that firms will need to look towards developing a 360-degree view of the customer while developing stronger straight-through processing capabilities to maintain a competitive edge.
The goal is to allow customers to work with insurance companies in a much more interactive way. Today’s agent and broker services – including independents and third-party agencies – will require better reporting tools with real-time access to the customer service representatives in order to make better risk decisions.
“You need to think about the quality of the data and what can you do with that data, particularly in terms of standards-based systems that help get even better at looking at underwriting profitability, performance of product lines, performance of intermediaries and opportunities for niche products,” says Canning. “It plays really well into the sense of the Millennials as our next customers for insurance products.”
Operations Management in UK Financial Services
The extremely competitive nature of the financial services industry today and the changing landscape of customer expectations and their approach to investing in financial products, puts an onus on suppliers to consider how well they are dealing with new and existing customers' business transactions. This research investigates how technology is being applied to manage and improve operations.
Key Findings
Operations management is a critical business task contributing significantly to the overall performance of financial services companies
Over 90% of UK financial services companies set and publish operational targets. Reducing processing times and costs are targeted alongside measuring the quality of work done. Production Management methodologies such as Lean and Six Sigma are being applied extensively to manage work throughput.
The UK has embraced the use of specific operations management systems
85% of UK financial services companies report having specific systems in place to support operations management. Reporting, document and process management tools and to a lesser extent, staff forecasting and scheduling applications are all components of such systems.
Such systems have had an impact on improved operations
The survey shows that introducing operations management systems has led to improved customer service, reduced costs and better staff utilisation. However, despite a reasonable degree of satisfaction with such systems, there is room for improvement. Also, although staff attitudes should be important, motivation and staff satisfaction levels have shown lower levels of improvement.
Real time visibility of work is vital
Visibility of who is doing what at any point in time, with the ability to reallocate work during the day, is stated as being very important to effective operations management but this is not always an integral part of the operations management system.
Although continuous improvement to operations management performance is desired, obstacles do exist.
The survey found that staff resistance to change and to being monitored, competing demands of other revenue generating priorities and dealing with legislation, were all difficulties faced when trying to introduce initiatives to improve operations. Against this, establishing a return on investment (ROI) for operations management improvements can be difficult.
Many systems in place today are based on client/server technologies but there is desire to move toward pure web applications
This opens the door for Software as a Service offerings (SaaS). However, SaaS is not perceived as a way to support operations management systems. Is this because there are genuine doubts about SaaS or due to a lack of understanding of the potential benefits of the SaaS model?
Key Findings
Operations management is a critical business task contributing significantly to the overall performance of financial services companies
Over 90% of UK financial services companies set and publish operational targets. Reducing processing times and costs are targeted alongside measuring the quality of work done. Production Management methodologies such as Lean and Six Sigma are being applied extensively to manage work throughput.
The UK has embraced the use of specific operations management systems
85% of UK financial services companies report having specific systems in place to support operations management. Reporting, document and process management tools and to a lesser extent, staff forecasting and scheduling applications are all components of such systems.
Such systems have had an impact on improved operations
The survey shows that introducing operations management systems has led to improved customer service, reduced costs and better staff utilisation. However, despite a reasonable degree of satisfaction with such systems, there is room for improvement. Also, although staff attitudes should be important, motivation and staff satisfaction levels have shown lower levels of improvement.
Real time visibility of work is vital
Visibility of who is doing what at any point in time, with the ability to reallocate work during the day, is stated as being very important to effective operations management but this is not always an integral part of the operations management system.
Although continuous improvement to operations management performance is desired, obstacles do exist.
The survey found that staff resistance to change and to being monitored, competing demands of other revenue generating priorities and dealing with legislation, were all difficulties faced when trying to introduce initiatives to improve operations. Against this, establishing a return on investment (ROI) for operations management improvements can be difficult.
Many systems in place today are based on client/server technologies but there is desire to move toward pure web applications
This opens the door for Software as a Service offerings (SaaS). However, SaaS is not perceived as a way to support operations management systems. Is this because there are genuine doubts about SaaS or due to a lack of understanding of the potential benefits of the SaaS model?
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