Agile development allows for organic evolution of work product, drives team engagement and morale, and enables iterative capitalization. Through scaling frameworks (i.e., SAFe), expanding Agile principles with DevOps, and leveraging project management discipline, insurers hope to reap benefits ranging from improved software quality to stronger collaboration between business and IT units.
Despite Agile already being a well-established and popular methodology, insurers are continuing to expand their usage in 2019. Though carrier adoption and investment in Agile capabilities is rising, certain challenges—particularly governance and organizational obstacles—prevent true industry-wide transformation.
As part of an Agile rollout, IT steering, governance, and financial reporting processes should be adapted. However, the requisite executive leadership buy-in proves a critical challenge. Because Agile projects do not have rigidly defined scopes, budgeting and decision-making processes appear less rigorous and defensible, which can induce pushback from stakeholders and business units. Additionally, organizational challenges can be serious blockers. Agile de-emphasizes organizational hierarchy, bringing decisions to the team level. This can be a challenge for organizations that are used to the predictability of the traditional Waterfall methodology.
When such governance and organizational challenges are overcome, insurers stand to benefit substantially. Organizational culture can be changed for the better; greater accountability, morale, innovation, and engagement are all expected to improve post-Agile adoption.
Though Agile methodology is better known for its concrete goals of greater software quality, lower cost and risk, stronger collaboration, and increased customer satisfaction, insurer CIOs are also driving organizational transformation through collaborative value creation and grassroots-level innovation. For more on this, see our recent report, Agile in Insurance: Expansion and Key Issues.
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