IBM: Only Half Of Insurance CEOs Feel Prepared For Future

I have previously referred to this report from IBM but it keeps cropping up here and there. Frankly, I have come to find it rather irritating! Mainly due to the fact that neither IBM nor respondents really seem to know exactly what complexity is or how they are going to begin to deal with it.

In fact it’s worse than that because, until these CEO’s review their operations from the inside out (i2o)and embrace operational and product TRANSPARENCY, they will continue to add to the complexity of their own organisations…oh the irony!!!

Here is an extract from the article in P&C National Underwriter and below it my comment that I sincerely hope that they will publish:

Of insurance chief executive officers surveyed, only half believe their enterprises are adequately prepared to handle a highly volatile, increasingly complex business environment, according to a survey released by Armonk, N.Y.-based IBM.

IBM said at the ACORD/LOMA conference in Las Vegas that 68 percent of the insurance CEOs surveyed expect the level of complexity to grow significantly over the next five years, but just 53 percent believe they know how to deal with it successfully.

Eighty-two percent of insurance CEOs cited increased government regulation as a major source of uncertainty in the new economic environment.

Based on in-person interviews conducted by IBM consultants, the “2010 IBM CEO Study” reveals that chief executives in the insurance industry believe that—more than rigor, management discipline, integrity or even vision—successfully navigating an increasingly complex world will require creativity, which emerged as the number one leadership competency.

The study is the fourth edition of IBM’s biennial Global CEO study series. Between September 2009 and January 2010, IBM said it interviewed 1,541 CEOs, general managers, and senior public sector leaders, including 78 insurance respondents from 28 countries.

“For insurance CEOs, avoiding complexity is not an option—the task is to figure out how to respond to it,” Mark Lewis, general manager, IBM Insurance Industry said in a statement. “The effects of rising complexity call for CEOs and their teams to lead with bold creativity, to connect with customers in imaginative ways and redesign operations for speed and flexibility.”

COMMENT: I have read, with great interest, recent efforts from IBM and McKinsey to warn of the dangers of complexity. As someone who has spent circa 30 years in the insurance industry it is reassuring to know that there IS an awareness of emerging risks…BUT who is kiddin’ who?

Spelling COMPLEXITY is one thing but who, amongst all of these highly paid exec’s is going to (1) define just what it is they are (allegedly) so afraid of?

I would appreciate if even one of the, quoted, 68% who expect an increase in complexity OR on one of the 53% who already know how to deal with it to convince me, privately or in this “public” forum, how they intend to (2) measure it (3) manage it.

Three simple questions about something striking such fear into CEO’s and justifying the numerous expensive man hours required to compile such in depth reports should not present too much of a challenge…should it!?

We will see!

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