NEW TECHNOLOGIES OFFER INSURANCE COMPANIES ALTERNATIVE TO DW

Insurance companies spend enormous sums on data management projects that never get completed, or that fail to deliver the hoped-for benefits. According to Patrick Kassebaum, director of the insurance division of Mesa Corporation, the reason for this wastefulness is that insurance companies have assumed that data warehousing -- for all its operational inefficiencies and strategic limitations -- is the only way to solve their data storage and management problems.

"It's not uncommon for insurance companies to spend half-a-million dollars or more -- not to mention months of valuable time -- converting all the data in their data warehouses whenever the company makes an acquisition, confronts a regulatory change, or simply wishes to streamline a key business process," Kassebaum says. "And then this whole conversion process has to be repeated whenever the system must serve a new business need."

Kassebaum points to a fundamental flaw in data warehousing technology: its assumption, based on an analogy from the physical world, that "data residing in disparate systems needs to be transported to a single location in order to be efficiently made available to end users."

As Kassebaum goes on to explain, "The rationale for the data warehousing approach -- that data sets with differing structures need to be given a single, common structure in order to create, say, master records of individual customers that anyone in the company can use -- is simply untrue. And the process of cleaning and standardizing customer data not only costs time and money but can rob the data of much of its strategic value."

One solution now being touted as an alternative to traditional data warehousing is called "unified data view" software. Yet even here, Kassebaum says, data must be taken out of its source databases and standardized a la conventional data warehousing. Meanwhile, he adds, newer systems poised to replace the data warehouse concept can deliver to insurance companies systems with the ability to:

• Take data from any source -- without cleaning, standardizing, or creating rules -- and bring it onto one screen in the way that individual users wish to see it, not in the way that an I/S specialist says they should see it
• Allow users to work with data from disparate sources, with point-and-click workflow features cutting processing time significantly
• Attach a new database or administration system to a current data storage system without changing any old or new data -- and to do so in a matter of hours

"All this means a revolution in data storage and management," Kassebaum concludes. "Companies need to start exploring alternatives to data warehousing that can enable them to streamline operations, dramatically cut costs, and use their customer data to create competitive advantage."

Patrick Kassebaum is Director of the Insurance Division of Mesa Corporation, a maker of enterprise interactive document-asset-management systems located in Lincoln, Nebraska. For more information visit Mesa's Website: www.mesacorp.com.

Contact Mesa Corporation, Patrick Kassebaum, 800-628-5977, pkassebaum@mesacorp.com.