Is the “Nobody Gets Fired for Buying IBM” Mindset Stifling the Future of Your Insurance Company?

Roy Mill
|
July 2024

When you work in an industry long enough, you start to pick up on various “go-to” choices for certain scenarios, what feels like the “default” response to a specific situation. But just because something is the most common choice doesn’t automatically mean it's the best. Sometimes going with the safe bet makes sense, but just as often it stifles growth and innovation, limiting yourself in the process. In this blog, we will explore the old IT procurement adage of “nobody gets fired for buying IBM,” highlighting how it relates to the insurance industry, and when it is (and isn’t) a good idea to stick with the default option. 

The phrase “nobody gets fired for buying IBM” has been around for decades now, dating back to the 1970s. With IBM’s industry-wide dominance, their software was seen by many as the standard, the “default choice” for someone looking to buy new software. This didn’t necessarily mean that IBM was the best option for every situation, but it was so dominant and ubiquitous that even if something did go wrong, nobody would specifically blame you for your choice. For insurers, you could apply a similar mindset to the well established brands of Guidewire and Duck Creek. Simply put, this “nobody gets fired for” mindset is less about getting the best results and more about avoiding the risks that come with deviating from the norm, missing out on the rewards of taking calculated risks as needed.

That’s not to say that “buying IBM” is always a bad thing: insurance is complicated and many get frustrated trying to navigate the complexities of an insurance system, especially one that differs from what they are used to. Going with something unfamiliar is particularly scary when you consider the mission-critical nature of core systems. If the policy admin system fails, it could be disastrous, so do you really want to change it by going with a solution you aren’t confident about? 

Additionally, making any kind of big changes to your software selection (or anything else that might dramatically shake things up) will require buy-in from other key stakeholders, which isn’t always easy to get. Even if you’re willing to take a risk on something new, you might not be able to convince other decision-makers to follow suit, whether due to general groupthink and refusal experiments or because the formal process for gathering information from potential suppliers might just be too time-consuming. 

Yet sticking with the supposedly safe option is not the best option for what you need. Guidewire and Duck Creek are the go-to choices of many insurers, but they don’t guarantee success and for some, they are not a good fit. If you need a platform that will get your new product to market fast, you probably need to look elsewhere. Some might hesitate to go with a new solution because it's unproven, but what if that a new solution is the key  to supercharge your growth? 

More importantly though, you might miss true transformation with “buying IBM” mentality as it can be indicative of a much bigger problem within an organization, one that extends far beyond technology choices. One of the reasons that “IBM-buyers” shy away from alternative decision-making is a lack of ownership or agency. They don’t “own this place”, so why take risks? This line of thinking not only means that your people aren’t invested in your company or its goals, but that you can’t count on people to take the considered risks that facilitate innovation and generate growth. “Buying IBM,” in that case, is only a symptom for deeper problems related to ownership and delegation.

The fact is that the insurance industry is undergoing massive changes: new technologies have completely changed customers’ expectations for how insurance systems function, with a heightened emphasis on access, speed, and end-to-end customer service. Additionally, AI and other cutting-edge technologies are completely transforming the insurance landscape, to a degree that the “standard option” might not cut it anymore. So no, you probably won’t get fired for buying IBM (or Guidewire), but you could find yourself getting left behind by your less risk-averse competitors.

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