Like many industries, insurance is examining its systems and processes to make certain they will contribute toward achieving a more successful and profitable year in 2004. Celent Communications views this activity as the major technology direction for carriers in the months ahead. A lot of focus will be on internal applications and improving the infrastructuremaking applications work well with each otherand focusing a lot of the IT spending around improving internal operations, says Matt Josefowicz, manager of the insurance group for Celent and one of the authors of Insurance Outlook and Strategic Agenda: 2004 and Beyond.

Josefowicz advises insurers should attain an AAAA rating for their IT departmentsalignment, agility, accessibility, and affordability. Those basically are the four things IT planners should keep foremost in mind, he maintains.

Alignment: We see the business/IT alignment as a huge, overwhelming concern these days, says Josefowicz. The number-one concern of program offices and IT steering committees is making sure the scarce IT resource dollars are being directed at the most effective projects. These projects must support the general business strategy, he believes, rather than being done in a disconnected fashion that may not get the biggest benefit for the company from its investment. We see CEOs and CFOs taking a more active role in steering committees as business/IT alignment really is job one, he says. Even more than cost containment.