What Makes AXIS and GGY Different
1. Our focus is to provide the best software.
GGY is in the software business. That is what we do and have done for over 24 years now. We are not consultants who happen to have developed a system to meet the needs of our consulting practice. We do not sell you a system with the idea that you also need our help to get it up and running for you and to keep it running. Our only interest is in giving you the best system possible and moving it ahead to meet your needs. When you call, our goal is to assist you as best we can and not try to obtain your consulting assignments as well.
It is true that companies do need outside help from time to time. You can choose from many consultants to assist with implementation or urgent projects. You are not stuck with one company for your consulting needs.
2. Why buy a toolkit to develop your own software when you can buy a system?
AXIS is vendor maintained yet extremely flexible. The system alleviates your need to provide the programming expertise along with the associated cost. It means that your people can spend their time obtaining and analysing results rather than worrying about programming the system and checking the system. We have been told that companies find it expensive to set up their own systems group.
Our idea of vendor-maintenance is not just to respond to bugs, which we will always do with top priority, but to continually enhance the system to meet regulatory, actuarial and business demands, and respond to technological opportunities. In other words to keep the system current and state of the art. Our goal is to convince you not only that AXIS can meet your specified needs today, but that it will continually grow to meet your changing needs in future on a cost-effective basis.
AXIS has to be flexible because the calculation engine is locked. We provide user programmability at the front-end and reporting levels but not in the critical calculation steps. We have tremendous flexibility in describing insurance products, defining valuation bases, and reporting intermediate and summary level results. Since the calculation code is locked, ongoing audit control issues can focus on managing the implementation of new releases provided by the vendor, and the promotion of new user data to production applications.
Frequently we get questions about the advantages and disadvantages of open and closed code so there is a section below that goes into more detail.
3. Why have separate systems when you can have one?
AXIS is a single system that supports multiple actuarial applications in addition to valuation. It allows users to do Pricing, Financial Projections, Surplus Adequacy Testing, Cash Flow Testing, ALM work, and Stochastic testing. This means that you can have one system that everyone uses thereby ensuring consistent results and greatly increasing efficiency of communication between departments and rotation of actuarial staff. And you do not need to spend a lot of effort in reconciling different systems.
4. Every client is a reference.
Why should this matter to you? We want you to be able to phone any of our clients at anytime and get a good review of AXIS and GGY service. We want any potential customer we have to be able to phone you when you become a client. We need to earn that good review every day and that is how we run GGY. People tell us we are the exception in the business.
5. AXIS is fast.
AXIS' speed allows you to get fast results. Speed is more than raw processing power. It also refers to how fast you can get your information into the system and how fast you can get your results out.
6. Why model business when you can use seriatim for everything?
AXIS allows you to choose to do your valuation, cash flow testing and any other corporate work using seriatim data to give you more consistency in your work, and avoid the need to manage reduced size models.
7. Why is a vendor maintained system a better choice?
It is because you save time and money and you have a system that is robust and moving ahead to meet the challenges and changes that will happen in the future.
Some actuaries seem to prefer an open code system and may feel that a closed system does not give them flexibility. It is not clear why, but presumably it is because an open system allows users to add code themselves and gives them the perception of flexibility. In reality, it actually adds another layer of risk to the company that is very difficult to manage, monitor and quantify. It seems that many companies are very concerned about Risk Management so it is surprising that they want to take on the additional risk of an open code system.
AXIS has been called a closed system by many people, including competitors. However "vendor maintained" is probably a more accurate term. Sometimes the advantages of a vendor maintained system over what is typically called an "open code" system are not always obvious.
Vendors developing and marketing open code system typically say that having open code gives you flexibility. That may be true in the short run if you happen to have a skilled programmer at your company they may be able to make changes quickly. This is obviously very appealing, but it also has potentially disastrous consequences.
If the user can change the code of the system, results run yesterday before the user-coded changes may be different from today. Results run on one machine may be different from results on another machine, and it is likely that the vendor cannot reproduce any of the results a user gets so they are not much help in providing solutions. Further, since there are no other companies using the same code, there is little peer review. If the user were truly an expert programmer, and knew the system inside out, then perhaps less peer review than normal may be acceptable. Usually the user only has a superficial understanding of the code compared to the developer's programmers.
You might make a change in one place, not knowing the implications that it has for the rest of the system. Or you might make a change in one place and not know that changes are required in other areas of the system. Imagine the difficulties when one actuary makes a change in one part of the company, and another makes a change to the same code in another part of the company. Imagine further what happens when the programmer moves to another department or leaves the company. These problems are enough to rule out any real hope of maintaining code integrity, but they are just the beginning.
The vendor is constrained in making changes to improve the system. If he makes changes, then what happens when a new version is released - it may conflict with the changes made by the end users. Upgrades become a nightmare, and a truly expensive proposition. The developer cannot change the architecture of the system, because so much user code is dependent on the current architecture. For example, if the code today is in C++, then the vendor cannot switch to a new generation programming environment if one becomes available without consequences for all user code. Perhaps the new release, if it is a major one, will force the user to start over and scrap everything they have done, and maybe even pay new license fees.
The end result is predictable. The developer cannot be free to make significant changes to code without antagonizing his users, and as time goes on, such changes are always necessary, unless the initial design was perfect and the developer executed perfectly against that design. The system stagnates, if not absolutely then certainly relative to a vendor maintained system where the developer can freely move from DOS to Windows, from procedural to object oriented code, and is free to make any improvement to meet the changing needs of the client and the times.
Speed is also an issue. Over time, since the vendor is constrained from making changes to take advantage of new technology, the system slows down relative to closed systems. There is also the issue that user code tends not to be optimized for speed since they are more concerned with getting an answer than worrying about speed. As companies want more and more information, speed becomes a bigger issue.
Over and above these problems, the biggest negative is the lack of feedback to the developer - if the user can make all necessary changes, the developer is out of the loop, and this is another reason the software stagnates. Contrast this to the closed system, where the user tells the developer they need feature X, the developer codes X (usually a more general implementation than requested), every user can use it (so each user gets the benefit of every other user’s good ideas) and, because the feature is available to all users, there will be peer review by other users including users from outside the company.
Is this a pretty bleak picture? Yes, but we are only describing what we have been told by longer term users of open systems and by what we have observed in the market. It may be interesting for you to talk with some longer term users of open systems and find out the problems that they have had with integrity of the system, with getting and keeping staff who want to program for more than a year or two thereby causing continuity problems, with getting people in the company to share the code so that the results are the same from machine to machine and with upgrading to new versions of the system once they put their code in.
But what about closed code or vendor maintained systems? Frequently we are told (by non-users and competitors) that vendor maintained by definition means a system is not flexible. That may be true for some systems but it is definitely not true for AXIS. In fact, just the opposite is true. Because the calculation engine is locked we need to make sure the system is as flexible as possible to make sure our users can do what they want, when they want.
That does not mean that they can always do all the things they want, whenever they want; but then open systems do not guarantee or deliver that either. In fact, what we have heard from companies with open systems is that you need to be able to program changes yourself since many times what you are buying is a structure and you fill in the holes yourself. Of course, you can get the vendor to do it but each job is a custom job and the consulting rates are quite expensive. We have also been told that it is not always possible to get their time when you need it. So the reality is that open systems have their own set of problems when changes are needed.
With GGY, when you want a change, our goal is to generalize the change. Because we are not doing custom changes for just one user the cost is spread over many users and most changes are covered as part of the maintenance. And each user has the opportunity to benefit from all the improvements to the system. With open systems, the benefit is lost to other companies and even within companies since frequently the changes do not get into all the copies being used.
Although the core calculations are locked, we do provide user programmability at the front-end and reporting levels. We have tremendous flexibility in reporting intermediate and summary level results. We are also now in the process of adding several new objects to the system that will give you even more flexibility while retaining the traditional advantages of AXIS. For example, a Formula table may be used instead of a normal table in specific places in the system where extra flexibility is required. It comprises VBA code using a list of input variables, a list of output variables, and an array of data. The user can create any number of local variables within the VBA code. This formula code is pseudo-compiled to run at high speed, but does not affect the system source code, and cannot affect anything but the predefined list of output variables. The source code of AXIS will detect the presence of a formula table and will replace the normal method of calculation of the output variables from the input variables, with the user-defined code from the formula table.
The reality is that AXIS alleviates your need to provide the programming expertise along with the associated cost. It means that your people can spend their time obtaining and analysing results rather than worrying about programming the system. Also, it means that you have one system that everyone uses thereby ensuring consistent results within departments and across the organization. I suggested that you contact users of open systems to get their feedback and I think the same suggestion goes for our users. It would be interesting for you to get their comments as well.
In summary, if you think that you want to spend large sums of money getting the vendor to customize a system or you want your actuarial people to be software developers using the vendor's software development kit then probably an open system should be your choice. However, if you want reasonable long term costs and you prefer that your actuarial people do actuarial work then you should seriously consider AXIS.