Cloud Computing for a Crowd

Chubb devised an innovation process using a cloud-based crowdsourcing tool that is delivering ideas for new products and customer-facing services.

The Project :: Implement a cloud-based crowdsourcing platform and innovation-management process to mine revenue-­generating ideas from Chubb’s 10,400 employees and hundreds of thousands of external agents.

The Business Case :: Facing the most difficult market since the Great Depression, leaders of the $13 billion insurer knew they needed fresh ideas to profit in an increasingly competitive, slow-growth environment. In June 2008, Chubb’s board funded a strategy to—somehow, some way—harness the brainpower of its employees on five continents via regular “innovation events.” The first one would take place within three months.

First Steps :: Executives assumed they could repurpose a system they used to support virtual corporate gatherings, but it wasn’t up to the task. “We had to get a global program up and running from scratch,” says Chubb CIO James Knight. The platform had to be reliable, intuitive and cheap—the implementation budget was $250,000. “That’s a really tall order,” Knight says, one that narrowed the vendor field quickly.

They selected a collaboration tool from Imaginatik, which partnered with IBM to deliver the system. The process for provisioning software at Chubb had evolved from buying before building to “renting” before doing either. The software-as-a-service application met all of the company’s business requirements and gave Knight’s team a chance to experiment with the cloud.

Chubb hosted its first innovation event using the system in October 2008. Employees submitted and commented on ideas during a two-week period, then tracked the vetting process through six stages. Ideas were assessed first according to their feasibility, then cross-functional teams scored the proposed business cases. After full business cases were developed, the best ideas were funded and executed. The system also shows the financial performance of each project and whether it had to be decommissioned for failing to meet its target.

The first event yielded hundreds of profit-making ideas, 12 of which were developed. Four ideas have been delivered, including two product innovations: a new underwriting process for commercial inland marine policies and a simpler online process for drug companies buying liability insurance for clinical trials. Now the system is being used to collect and vet other types of innovations. For example, Chubb is collaborating with its independent brokers to create new customer-facing services and processes.

What to Watch Out For :: Knight says that “thoughtfully analyz[ing] a very large number of ideas and build[ing] on them” has taken more time and effort than executives expected. That’s made it more important that the payoff for employees—funding of the best ideas and rewards for those who generate them—is evident.

Stephanie Overby is a freelance writer based in Massachusetts.

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