Better resource management can help insurers avoid wasting time and resources on projects. Brian Nordyke and Jonathan Schwartz offer insights to enhance operational efficiency in this Insurance Thought Leadership article.

As the possibility of a global recession continues to be raised by economic prognosticators, insurers are looking for innovative ways to tighten their belts. One option is slashing labor costs. However, the talent crisis plaguing the insurance industry means mass layoffs are ill-advised—400,000 insurance employees are predicted to retire within the next few years. Adding to this challenge, the generation that would theoretically be replacing the retiring generation has little interest in doing so—eight out of 10 millennials surveyed had a limited understanding of the wide-ranging employment opportunities the insurance industry can offer.

Savvy companies recognize layoffs can stymie an organization’s future growth once the macroeconomic outlook flips bullish; instead, they’re figuring out how to prioritize, measure and manage capacity—to put the right people on the right projects and ensure effective and efficient execution.

One underused method is developing structured approaches to resource allocation. Approached in a traditional, system deployment-led way, this process can often take more than a year to implement. However, it’s now possible to realize gains in resource management and efficiency much more quickly. And there’s never been a more critical time.

Better resource management boils down to prioritizing and sequencing how to allocate talent to new or existing projects. In a recent survey of 39 companies, Resource Management Institute (RMI) concluded there are many areas that are ripe for big gains in efficiency. They learned that forecasting and capacity planning, along with developing a skills inventory, continue to require improvement. Governance was another area where vast improvements could be made. Without introducing good forecasting, supported by a more exacting skills database, the resource management process remains largely ineffective, and failures are inevitable.

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