Project Darwin on the move

Project Darwin – the modernisation of Lloyd’s of London’s back office - has moved into its second phase after a new set of governance principles were agreed upon by the shareholders of Xchanging Ins-sure Services (XIS).

The second step will now focus on the back office system and build on a report on Project Darwin conducted by the Boston Consulting Group last year which will help to develop a clear central services IT strategy.

The latest development was revealed in a letter from Lloyd’s chief executive Richard Ward to Lloyd’s managing agents, which said that Xchanging would retain its existing contract to run the back office system.

Here are the views of some key market players:

Ian Summers, Aon

Aon’s Head of IT Service UK and EMEA Ian Summers said the change in governance would give the market a bigger say in the modernisation of Lloyd’s.

“The governance model has changed so it gives the customers a bit more influence on how it the system is developed and Xchanging keep their current contract but any new contracts for the technology build or infrastructure can go out to tender,” he said.

“Before Xchanging decided whether it went out to tender or not rather than the customer.”

Summers said the problem in the past had been that Project Darwin was the answer to everything and therefore anyone who wasn’t consulted automatically thought the project could be impacting their clients, banking arrangements or processing systems.

“Actually this has helped to clarify what Darwin is doing, which is looking at the governance and it’s all to do with how Lloyd’s and companies manage their service provider, which doesn’t really affect the client and broker side so much,” he said.

However Summers said that consultation would be key in phase two which would focus on the back office system and build on a report on Project Darwin conducted by the Boston Consulting Group last year which would help to develop a clear central services IT strategy.

“They are basically looking to modernise the market but not throw all the toys out,” he said.

Summers heads up the London & International Insurance Brokers Association (LIIBA), which has produced a final draft of a paper representing the views of the broker that will be presented to Lloyd’s and at the next meeting of the Lloyd’s Market Association in late July/early August, and he expects to get feedback by the following meeting.

Phil Race, Agencyport

Technology firm Agencyport managing director Phil Race said it was good to see the governance extended to the London market due to the increasingly blurred line between Lloyd’s and London in terms of messaging, the bureau and services provided, but that change was still a long way off.

“I think Xchanging are still wrestling with a real legacy challenge and trying to sell to its stakeholders the investment and transformation required so I should imagine there are still a few more steps on the journey,” he said.

“It still retains quite a monopolistic position. Although the letter talks about opening up contracts and tenders and external benchmarking, which is all very sound, when you own the plumbing it’s very difficult for people to complete against you for those services.

“It feels like there’s been a lot of effort expended on project Darwin at the moment, and it’s like moving deckchairs and reshuffling the pack – there has been no real transformation yet.”

Race said he was disappointed that Lloyd’s hadn’t consulted technology providers in the market such as his firm on their view.

Xchanging

A spokesman for Xchanging said: “We are really pleased with this latest development in terms of governance and are looking forward to continuing to do so to meet the market’s needs for modernisation.”