FBM Idaho’s Journey to Unmatched Customer Experience: Q&A

Pocatello, Idaho might seem an odd place to find insurance innovation, but CIO Adam Waldron notes smaller carriers’ agility advantage—and their need to stave off competition from larger firms with deeper pockets.

Pocatello autumn colors in hills

(Panorama of Pocatello, Idaho. Source: City of Pocatello.)

Earlier this month, Farm Bureau Mutual Insurance Company of Idaho (FBM Idaho; Pocatello), the state’s largest domestic property/casualty carrier, announced that it had selected Guidewire’s Quote and Buy Portal for Policyholders and Account Management Portal for Policyholders. The insurer is a long-time ClaimCenter user and deployed Guidewire’s Claim Portal in late 2015 and PolicyCenter, Client Data Management and Reinsurance Management, as well as BillingCenter in 2016, as part of an ongoing business transformation initiative. We took the opportunity of the latest news to catch up with the CIO Adam Waldron to discuss the how this state-based organization, founded by farmers and ranchers in 1947, has embraced digital strategy and is create an unmatched customer experience.

Insurance Innovation Reporter: Where does the latest adoption of Guidewire solutions fit within your broader modernization initiative?

Adam Waldron, CIO, Farm Bureau Mutual of Idaho.

Adam Waldron, CIO, Farm Bureau Mutual of Idaho.

Adam Waldron, CIO, FBM Idaho: This is just one small step, though significant one, in a much broader, long-term digital strategy. We have adopted an agile methodology, so we look at this as more of a continual evolution. We will continually learn and improve the solutions we are offering to our internal and external customers. We are excited to take this first step for portals, but we know we still have a long way to go in terms of our aspirations and delivering an unmatched experience to our customers.

 IIR: How does FBM Idaho think about technology transformation? Was there a discrete starting point when the leadership recognized a need to modernize?

AW: The transformation started several years ago as simply moving in a general “direction” based upon a perceived need to modernize. That in and of itself was an important pivot point in a traditionally conservative “stay-the-course” company. There were several drivers behind the decision, but not a well-defined or cohesive strategic road map. It was a loosely defined strategy driven more by the perception of external forces and consulting advice than an internal deliberate effort with a clear why and end goal.

The general direction of change quickly turned into specific, planned, strategic intent as transformation momentum, internal and external pressures, as well as costs built. Our new CEO Paul Roberts [as of July 2014] was pivotal. He began placing greater emphasis on transformation, modernization initiatives, and the culture, discipline and mindset to support such. This important change eased resource constraints and established transformation as a well-defined priority, systemic, and systematic effort throughout the enterprise. We have a renewed focus on an unmatched customer experience, and that does not happen without a very specific digital strategy built upon modern, agile, and efficient systems and processes.

IIR: What results have you enjoyed since the Claim Portal implementation, and what related moves has FBM Idaho made in terms of customer service?

AW: The Claim Portal has been live for well over a year now.  We have used it as a tool to learn, gauge market response and tune our tactics. We recently performed a minor upgrade, with much larger enhancements coming this summer. We just recently launched a new Microsoft Dynamics-based CRM system that integrates with Guidewire and provides a 360 view of the customer, and is proving to be a great tool for agents in pursuing and monitoring book growth. We rolled out the system after a few months of development and did so under budget. The key was staying focused on intent and preventing scope creep.

IIR: We’ve discussed FBM Idaho’s use of drones in the past; what progress have you made on that front?

AW: We now have two licensed drone pilots, and a research collaborative with Idaho State University, who has a Federal COA that allows us greater flexibility. We are stepping slowly and cautiously with the use of drones while federal guidelines become more clear and established. Ironically, one of the impediments to our university collaboration was their inability to find insurance coverage. We also found in same cases that simple solutions, like a stabilized camera on a stick, work best in some situations.

IIR: FBM Idaho has also been exploring the Internet of Things (IoT). What news on that front?

AW: We have piloted several IoT devices in the field focused on water loss prevention, and the initial results are very positive. We prevented several major claims even in the limited pilot we conducted. The vendor ecosystems, standards, and integrations are our main impediments at this point. We will be re-evaluating these initiatives in the third quarter, and possibly launching several pilot programs with vendor partners.

IIR: What about progress in analytics?

AW: Our BI and Analytics initiative now yields new results and insights on a daily basis. One of the most recent examples is the use of CAT [catastrophe] and Claims dashboards and reports in response to the most significant snowfall event in the company’s history that resulted structures collapsing across the state. We were able to build tools for monitoring, prioritizing etc. within a matter of hours.

Paul Roberts, CEO, Farm Bureau Mutual of Idaho.

Paul Roberts, CEO, Farm Bureau Mutual of Idaho.

We have achieved rooftop geo-coding accuracy for over 95 percent of our insured risks, which is important in rural and large farm areas where standard geocoding services return a mailbox location or street location that may be miles away from the actual insured building or property.  This tool is integrated into Guidewire along with custom fire protection class rating.

We are using Geographic Information Systems (GIS) models and workflows that automatically identify policyholders within boundary areas of wildfires and earthquakes and notify agents.

An internal Idea Engine portal gathers and encourages ideas across the enterprise. We found that we obtain better results when we issue an idea challenge focused around a specific topic, rather than just leaving it open ended.

IIR: What is the long-term aspiration reflected in these moves?

AW: A well-defined digital vision is imperative to the future of our company and the successful execution of our overarching enterprise Mission, Vision and Strategic Intent. We must have digitally enabled internal and external capabilities in order to serve our clients in the manner they choose and expect.  These capabilities enable us to deliver, and benefit from, our promise of an unmatched customer experience.

Industry boundaries are increasingly meaningless when it comes to digital experience and capabilities. New entrants, changing consumer behaviors, and technological innovations threaten to disrupt our established business models. Our vision is an agile, adaptable, and evolving platform for product and service delivery that enables employees, members, and clients. Such that:

  • We are able to identify and quickly respond to current, changing, and unmet client concerns and interests so that we deliver an unmatched experience that evolves responsively.
  • We consistently deliver client and workforce-enabling solutions that enhance productivity, effectiveness and decision making capabilities.
  • New frontiers of value are captured; not delayed, ignored or sidestepped due to complexity, systems risk or resource constraints.
  • Decisions and actions are data-enabled with relevant, meaningful and accurate data.
  • Internal and external customers rapidly receive information and can make decisions through high-tech, high-touch service.
  • Operational excellence is continually enhanced; inefficiencies and quality issues are eradicated

IIR: People might not automatically think of insurance innovation when thinking of a company based in Pocatello, Idaho. What would you say to them about the relevance of technology innovation to a company such as FBM Idaho, and to turn the tables, why is tech innovation so important to companies such as yours specifically?

AW: We have the benefit of being able to move and respond quickly—if we choose to. Getting to that choice is often the most difficult part, and lamenting missed opportunities does us no good. Sometimes we shoot for revolution, when instead we need to think evolution. For a company like ours, “disruptive” innovation might not be in the cards, but innovation certainly needs to be at our core. We have an amazing talent pool of people who love where they live and work. I often marvel when I visit other companies, or various consultants cycle through our team and I hear comments on how far ahead we are in certain areas, or how knowledgeable and skilled our team is, or how much is handled by a small team. I can’t imagine it any other way, and always feel we are behind and need to constantly push the envelope of our own abilities and aspirations.

For us innovation is crucial in order to stave off competition from larger firms with deeper pockets. More importantly, however, innovation allows us to continually evolve and deliver on the promises we make to our clients and our employees in terms of service, solutions and security.  

IIR: How does a company like FBM of Idaho stay focused on innovation?

AW: Shared meaning, understanding of “why,” where we are going and how we intend to get there are critical to a transformation journey. Without a shared vision, people may be motivated and engaged, but still not marshaling in the same direction, towards a unified objective.

Talent is key, and long resumes are easily overrated. We have found it most effective to hire based upon passion, grit, aptitude, drive and the culture we aspire to. We have had numerous experienced consultants cycle through that performed well below recent university graduates. We are a bit different in that we hired our core team as fulltime employees rather than relying on an SI, or consulting firm to manage and conduct our implementation. It is a strategy that I expect to pay dividends well into the future. Local hires are more invested in what they are doing, and we retain and build upon internal knowledge that comes from successes and failures.

Culture is corrosive to change, and it takes time for culture to adjust and coalesce around a new strategic direction.

FBM Idaho Reaches Transformation Milestone with Multiple Guidewire System Deployment

Anthony R. O’Donnell // Anthony O'Donnell is Executive Editor of Insurance Innovation Reporter. For over a decade he has been an observer and commentator on the use of information technology in the insurance industry, following industry trends and writing about the use of IT across all sectors of the insurance industry. He can be reached at AnthODonnell@IIReporter.com or (503) 936-2803.

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