Moving Up in a Down Economy

By Stephen Korow, DRC

Given the recent dismal news on the world economy, the natural impulse is to hunker down to survive the storm, make cuts wherever possible and hope that bad times leave your company mostly unscathed.  But, for those companies hearty enough to swim against the current, opportunities do exist.  However, bravery must be tempered with prudence or disaster will most likely follow. 

Ironically, the tough economic environment offers an opportunity for growth. Companies with the right set of tools, the right people, and the right strategy are advantageously positioned to thrive as competitors falter.  And, the economy will eventually turn around.  Those companies that have not reflexively cut personnel and resources will be better able to quickly accelerate into the next growth cycle. 

In today’s volatile environment, significant market shifts occur without warning, but with those shifts are opportunities.  Carriers must be able to respond quickly or the opportunities will be missed.  To be best prepared to jump quickly on opportunities as they arise, carriers should consider tools which have only recently become available – tools which enable quick modeling, pricing and introduction of new lines of business       

Careful technology investments can enable carries to identify potential new and low risk opportunities and additional revenue streams.   Employing familiar tools such a Microsoft Excel to model new products, minimizes the user learning curve.   Once the product is modeled, supporting code for the interface and database storage can be generated and dropped into a pre-existing framework or portal.  The product can then moved on to testing and production, giving carriers a much better chance of taking advantage of windows of market opportunity.

Use of modeling tools also allows carriers to make changes to rate plans and more rapidly move them to production.  With the right tools, carriers can easily work with potential rate plan adjustments to determine what tweaks will produce the best results and what impact they will have on a book of business. They also can identify opportunities to reduce risk yet retain high producing customers.  “What if” analysis of a book provides carriers with the knowledge to adequately assess the ramifications of a change to a rate plan prior to moving into production.  Carriers can also test   alternate rate plans against a book to determine what change best moves the company towards its goals.     

The IT group should be working with the business users to understand business needs and to put the right tools in the hands of business users to maximize efficiencies and deliver the greatest benefits.

When a company focuses too much on short term cutting costs they may run the risk of finding themselves unable to quickly react when the economy and the market begins to turnaround.  A balance between costs savings and wise technology investments will allow carriers to seize opportunities and be out in front when the economy turns.  

The enterprise that recognizes today’s tough times as an opportunity will be able to increase efficiencies, gain market share and come out of the downturn in a stronger position.  Those companies will come out of the recession in a sprint and be far ahead before the competition recognizes the opportunity they have missed.