Technical Underwriting refers to a method used by financial institutions such as banks and insurance companies to evaluate the customer’s suitability endorsing their services (George 2009). In this instance, the case is about the Northern Insurance Company and their project undertaking on Technical Underwriting Financial System (TUFS). This project was the greatest among all other projects raised up by the Information Technology (IT) group of the Northern Insurance organization, and its main purpose involved modernizing their funding system as well as giving vital e-business roles. However, after some months past the project proposal, the project TUFFS was under so many issues since complications began after the organization spent a mere four million dollars, and therefore Martin Drysdale (the Chief Information Officer) was in trouble as far as his occupation was concerned. Martin called for a meeting with Melisa Freeman, the Chief Financial Officer (CFO) to discuss why the project was not profitable and should there be a reason for continuing funding the project.
Should They Have Invested On It?
The complications in project progress would not have been seen the issues such as poor planning arose. There was no problem of investing in the project because the system seemed beneficial to the company. The company should just have realized and analyzed the risks so that if they occurred they would know how to mitigate, eliminate or avoid them.
What Went Wrong?
One of the major reasons for the TUFS project failure was the lack of project management. As from the case document, the project failure became evident while the project was in progress and the management did not take proper actions in aligning their strategies as well as providing deliverables. Additionally, the departments of the organization were not cooperative with each other and therefore their communication was limited (Yardley, 2003). Mostly, project failure is usually attributed to poor planning, whereby the project team decides on the proper timing and cost budgeting together with the extra allowance. The project team approximated a very low budget, which could not easily relate to the project size and timeline. Some other important factors that contributed to the failure included the poor help desk performance and lack of training for the personnel involved in developing the system.
Besides, the entire Northern Insurance organization failed to evaluate its business requirements adequately but rather they got filled with imaginations that the software system would solve their business needs. Due to such thinking, the entire business gave in its entire role of expertise and senior management. The money-making plan was able to change after some time, but still the project could not get re-evaluated. The project at the beginning appeared very profitable and worth investing in but later the CIO found the need for cost-sharing after they found out that there were no realized achievements in the project. It gets realized that from the beginning, the business side, Freeman the CFO together with his allies knew and fully understood that the undertaking was costly than the CIO had stated in the budget but they could not relay the message and warn the IT project team regarding the issue. More so, they also knew that the project’s objective could only solve the business functions, but it could not add the value of the business. If the CIO could get warned on such limitations in the right way, then the project could have been canceled or even adjusted to satisfy the business needs of improving on its profitability.
How to realize the projected benefits
To recover the effectiveness of the benefits associated with the system and to increase the profits as made during the proposal, the organization should make changes in their safety measures. Additionally, the designers, programmers, and testers should redo the design and debug of the system so as to eliminate all the bugs that got located in the system. Additionally, changes should be made to the entire project staff so that the teams, managers, and technicians are collaborative (Kerzner, 2014). The Northern Insurance Company should also make intensive research on the customers’ needs and by collecting data from their customers regarding how to improve their services so as to satisfy the customers’ needs fully. The reason for the change in requirement analysis gets realized because the designers performed poorly in their system design work. Similarly, the entire staff needs to get trained regarding the current changes made to the software and internet, so that they know and understand how to handle the technical and software problems. The achievements in improving the company’s performance using the system get determined by such important changes made to the organization.
How They Can Measure the Benefits
For the business to find the value that the IT department adds to it, it should first understand the role of IT and the services that they provide. The benefits will get realized gradually when the business utilizes the IT services by using the TUFS system and also informing the IT when and where there is a need for changes in the system. In the Northern insurance company, they utilized legacy approaches rather than TUFS in their daily tasks. The business did not want to engage themselves during the project development but only wanted to see the final solutions, and therefore, the project could not succeed without encouragement or criticism from the business side and commitment on the IT side as both needed to cooperate equally to achieve the project goal. The benefits are easy to be measured depending on the situation of the business and so, if the business is in a good state, such as there is good cooperation among the personnel and that they are utilizing the system to its maximum, then the outcome gets positive. On the other hand, if the Business of IT do not work on the system in the right way, then only losses will be counted.
George, H. (2009). Underwriting: What every producer must now. Milwaukee, WI: HGI Press. Retrieved from https://books.google.com/books?isbn=0982433603
Kerzner, H. (2014). Project recovery: Case studies and techniques for overcoming project failure. Retrieved from https://books.google.com/books?isbn=1118809173
Yardley, D. (2003). Successful IT project delivery: Learning the lessons of project failure. Boston, MA: Addison-Wesley.