The Brazilian arm of BNP Paribas-owned insurance firm Cardif is looking at taking its IT into the next stage of development to meet the demands of a fast-growing customer base. Chief information officer Beto Rubim tells IT Decisions about his plans for technology at the company, in an exclusive interview.
In order to stay ahead in the multibillion-dollar Brazilian insurance market as the main independent firm in the country – most leading insurance companies in Brazil are owned by local banks – Cardif Brazil is improving its IT architecture and further developing its multichannel strategy.
Cardif focuses on the mass insurance market in areas including motor and coverage of products, such as white goods sold by its retail partners, and has 13 million customers in Brazil. The firm’s net profit almost tripled in 2010, rising from R$ 17.1m ($ 10.5m) in 2009 to $46.1m last year, up 169% – so IT has to support that exponential growth.
According to chief information officer Beto Rubim, who joined the company exactly a year ago, the firm’s main focus around IT over the last few months has been around ensuring that the architecture is as open and flexible as possible to accomodate more partners – the firm already works with major retailers such as Carrefour and Magazine Luiza, who interface with Cardif’s systems in different ways.
“I can connect with [the IT at] any partner, whether they have a mainframe set-up or via web services. I am prepared to adapt to any IT set-up that our partners may have as our architecture allows it,” Rubim told IT Decisions.
“If we have a sales window and I am not flexible enough to meet the requirements, we cannot sell. If the sales people identify an opportunity or partner, I have to cater for it and get it up and running, even if it is within a matter of weeks,” said the IT chief, who is also the firm’s chief operating officer.
“This is the biggest challenge for IT here at Cardif: to be chameleons.”
Simplifying is key
Cardif wants to improve its multichannel strategy so the IT underlying products have to be lean and inventive to follow market changes. Rubim said that the firm’s main car insurance product, Seguro Autofácil , is one such example where IT innovation has played a central role.
Purchasing car insurance in Brazil can be bureaucratic and involve a lot of paperwork. According to Rubim, Cardif has innovated by introducing services such as billing and payments online for the front-end, while simplifying the systems in the back-end, that cove tasks such as credit scoring with the appropriate agencies and check any driver penalties with the authorities.
The policy management system used at Cardif has been developed in-house and is based on SQL Server, Java and .Net. This platform sends and receives information to and from the various interfaces with external partners such as retailers, which are often web-based.
Rubim says that the systems are working well and no major improvements will take place around the company’s core platform this year. However, the IT infrastructure needs to be scalable to support demand, so the company is increasing the processing power of its HP server farm, as well as storage and bandwidth.
The social networking dilemma
About 90% of Cardif’s business comes from its partners, who sell insurance policies to customers. However, with business-to-consumer products such as AutoFácil rapidly gaining popularity, understanding how to use social networking tools to sell more products has become crucial.
According to Rubim, the company already has a social networking strategy established by its marketing department, but the IT team is now looking at the technical implications of using tools such as Facebook and Twitter to drive sales.
“We need to fortify our presence in the social networking channels. But when you have a customer base of 13 million and then you roll [social media tools] out, there is a danger of bringing a seaquake into the business if you don’t have the right processes and technologies in place,” said Rubim.
“We cannot attract demands for which we are not prepared in terms of sales, customer service, support and anything else you may generate. You have examples of people [using social media] and disappointing the customers at the end of the process,” he said.
“I need to put together a structure where I can scale up and down fast. If you ask me today if I am ready, I would say I am ready for the basics. But what if everyone knocks on my door? I will not be ready. And that is the [improvement] journey that will be on this year.”
The company is using Autofácil as a platform to ascertain its demands in terms of social networking; that is because the customer base for that product is smaller and therefore social media needs would be easier to handle.
“I have seen case studies where companies started selling products through channels such as group buying websites and Twitter, then a huge wave of demands came and they couldn’t handle it – that is absolutely not what we are going to do,” said Rubim.
Cardif does not have interfaces to communicate with final customers via mobile devices such as the iPhone, but according to Rubim this is also being looked at. The insurer will also be improving its main website over the next few months.
Small is beautiful
According to Rubim, a key advantage when it comes to getting IT work done fast is Cardif’s partnerships with local software factories. The CIO did not want to disclose the names of the firm’s IT partners, but said that IT firms like Stefanini, CI&T and Politec are “too big” – his four suppliers have turnovers in the R$4m range.
“I like to work with the small guys, particularly people who know the insurance market. Because they are small and I am a big customer for them, it is to their own interest to help me out – and that gives me agility,” said Rubim.
“It is a matter of having your partner close to you and ensuring delivery. You pick these big partners, they have their big customers and you are just another one – when you have a problem and call the big suppliers, you are kept waiting on a helpdesk queue, whereas I can call the owner of the small company I work with at his house and he will pick up the phone,” he said.
“I have had stories with big vendors where I had a “buried” project and they saved me, but the fact is that you have more trouble controlling these large firms – with the small companies, you have the power in the relationship and I prefer to be in that position.”
Rubim’s advice to fellow CIOs looking to buy IT services from Brazil is to look into the smaller vendors, but take the time to get to know them and go the extra mile.
“You have to get to know the company owners and the people supporting them. You actually have to work – which is something that some CIOs get lazy about. I know everything about the suppliers I work with, from the name of the secretary to their financial performance – but that’s something that requires a lot of work,” said Rubim.
“Hiring a big company is a lot easier, but working with the smaller ones pays off too. You have to invest in building strong relationships and that does not happen over the phone or the web. You have to be there, physically.”
Keeping tabs on staff
The CIO is worried about cost control, but one of his main challenges is keeping staff motivated and retaining the technology talent he’s got in house, so Cardif is investing in succession planning and training for its IT staff.
“We have been putting together a high-performance team, so we have to make sure that we look after them, so no one steals our resource,” said Rubim.
“There is a lot of people moving around in the market, so my job is to reassure these people. I do try and explain to them we have a good team and career development prospects. You always have to be concerned about that,” he said.
Despite the pressure to reduce cost, retain talent and guarantee IT availability and scalability for a constantly growing business, the CIO remains upbeat.
“We have a simple IT set-up – the more you embellish it, the worse it gets. We had very sophisticated databases which we have simplified, we try and keep everything as uncomplicated as possible so we can focus on what’s needed,” said Rubim.
“During a meeting I had recently with our auditors over at BNP, I was asked by the global IT head: ‘What should I be concerned about?’ I said: ‘You can put your head on your pillow and sleep tight; there is nothing for you to be concerned about.’”
Image by Léoo licensed under Creative Commons.