Being a technology executive means keeping your eyes firmly fixed on the big picture. This is doubly the case in the insurance industry, where even the most straightforward projects are saddled with layers of complexity, thanks to the ever-changing tangled forest of standards and legal requirements. There is seemingly no such thing as the subtle maneuverthe project that will bear fruit next week. You want results? Come back in 18 months.
But this is 2002, in the era of instant messages, day trading, and 24-hour news. We may not be in a recession, but economic forecasts are still partly cloudy. Long-term plans are often being put on back burners in favor of ideas and programs that will generate revenue or cut costs today.
We asked a number of industry executives and analysts for their best suggestions for those types of projects. They do, in fact, exist; any of the following five ideas will deliver an ROI in six to nine months, if not sooner. Will they dramatically alter the course of your company? Doubtful. But, as we all occasionally forget, little things can sometimes mean a lot.
Data Mining on the Cheap
Data mining is all the ragecompanies are setting up vast data warehouses and are poring through years of information, in search of broad patterns that will help their executives make better decisions in the future. But, as just about anyone who has tried to implement a data warehouse knows, data mining is by no means a short-term project. If your company is not yet willing to invest the time or the money, there are alternatives that suffice in the meantime.
Jamie Bisker, director of research for insurance practices at TowerGroup, suggests looking into tools for Online Analytical Processing (OLAP). Such business intelligence products include Computer Associates CleverPath, IBMs DB2 OLAP Server, and Microstrategys OLAP Provider. All of these integrate with common applications such as Microsoft Excel, and root through terabytes of data in search of the answers to your questions: Why is this project taking so long? How much did this cost? What is this costing us across the country, in different geographical areas? If the question deals with numbers, the answers are buried in the data already at your disposal. OLAP software finds the patterns that, once analyzed, will help improve your business processes.
Its a cheaper way to do data mining, says Bisker. Just a little bit of money and a little bit of time could deliver an ROI in two to six months. It takes a couple of months to get started, and then you have to do the analysis, which requires people who know what they are doing. But the point is, it doesnt take years to find inefficiencies in your business practices.
Fraud Alert
Any effort at all put towards fraud remediation is time and money well spent, says Bisker. Even basic, ongoing fraud trainingjust keeping the employees up to speed on the latest fraud techniqueswill produce a near-immediate ROI. Merely spreading the word about such Web sites as the Coalition Against Insurance Fraud (www.insurancefraud.org) is bound to have an impact.
For those looking to be still more proactive, there are variety of products to purchase, such as ISOs ClaimSearch (www.iso.com) and HNCs Payment Optimizer (www.hnc.com). The technology behind Payment Optimizer is used by another HNC program, Falcon, to analyze close to 90 percent of credit card transactions in the U.S. Falcon performs a speedy analysis of the transaction, looking for anomalies in the card holders spending patternstime of day, amount of purchase, and so on. Credit cards, of course, are less important in the insurance business. Payment Organizer instead analyzes, among other things, workers comp claims and Medicare claims, searching for patterns and assigning each claim a score of 0 to 1000. The higher the score, the more likely it is your SIU investigators should be pursuing the matter.
Most fraud in the insurance industry is discovered after the fact, but todays tools can catch it as it happens. You ask for a claimants VIN, says Bisker, and then you can automatically do a VIN search and cross reference it against existing claims, and if the number has been used a half dozen times before, that will send up a flag. Youre then only a few pointed questions away from potentially exposing a fraudulent claim before it costs you a dime.
Open the Portal
According to Craig Lowenthal, its vice president and CIO, Hartford Financial Products has discovered a tremendous ROI by merely having its own internal portal, set up with software from PlumTree (www.plumtree.com). Akin to a customizable Web site like MyYahoo, PlumTree allows its users to embed gadgets into its product. These gadgets can run a wide gamut: Hartfords underwriters can do online research at financial sites such as EDGAR and Yahoo Finance and, whats more, have the fruits of that research automatically filled in to the right blanks on a variety of forms, thus cutting down on grueling paperwork.
Other gadgets are even more impressive: Data can be grabbed off of the companys legacy systems, arranged into reports and displayed for executives: A permanent, real-time exhibit of the companys financial progress.
Lowenthal, who works out of New York City, even created a gadget to smooth out security snafus for visitors to his office. Hartfords New York office was originally based at 7 World Trade Center but was forced uptown after September 11. The new building, like many others, didnt have security in place prior to then, and there were a lot of problems making the adjustment. Our visitors couldnt get up to see us, says Lowenthal. You dont want to have your guests undergoing a shakedown in the lobby. So we worked with the building management and came up with a pass generator as yet another gadget. Anybody with an appointment is now e-mailed a secure PDF file that allows them to come right through security without waiting on line. Only one Hartford staffer was needed to create this new gadget.
Amazingly, all this took about two months to set updoes a tech project get shorter term than that?
Get Into a Scrape
Todd Eyler, an analyst at Forrester, believes that if youre going to take on a short-term project, it may as well directly benefit the consumer. Ask yourself: Where are my key pain points right now? he suggests. Often, the answer is going to be something related to customer service, and the effectiveness of the people in your call center at delivering a positive experience for the customer.
Of course, all the old information is hiding out in the now-replaced legacy system. Making the transfer to the new system is a lot easier, however, thanks to screen-scraping software from companies such as Jacada (www.jacada.com) and Red Oak Software (www.redoaksw.com). Screen scrapers work by literally taking a picture of the green computer monitors screens (from behind the scenes) and remapping the information on those screens pixel by pixel over to the new system; its essentially paperless OCR. Screen scraping software takes only a few months to install, and gives insurers access to data that would otherwise be trapped on a legacy system. This data can then be given to the call center rep, or even the customer, over the Web.
Up to Speed and Up to Date
It seems almost too obvious to mention, but simple efforts to improve employee retention often fall by the wayside, especially in a time of scaled-back budgets. Bisker reminds us to keep your people trained and up-to-date, and make sure they get rotated to new and interesting assignments, the better to convince them you want them around for the long haul.
He continues: I think the industry is suffering from a knowledge drain. Every industry has to deal with this to some extent as people head for other industries or retire, but its particularly a problem in the insurance industry because many companies have built their own proprietary systems.
In other perhaps-you-already-knew-this news: Theres something to be said for spending money on software you already own. Make sure your software is at its most current upgrade levels, advises Bisker. Say you already have a product from SAS or Microstrategyif you havent upgraded to the newest version, you may be missing out on new features that can help your current users, or help your customer base, or reduce errorsany one of which is a nice return on investment.
Lowenthal, back at Hartford Financial Services, has also made a habit of what he calls traditional workflow enhancements.
You cant add more employees these days, he says, so its good to focus on technology that presents any type of automation in the workflow, whether it be imaging or automatic letter creation. Anything that allows you to process more business with your present roster of employees.
These are small projects in their own right, but perhaps it is helpful to think of them as the foundation of a larger scheme: Make use of OLAP software while the kinks are worked out of the new data warehouse; make use of screen scrapers as the first step in ditching those legacy green-screens. In this way, larger projects get sliced up into more digestible, bite-sized pieces.
Each project may in itself be just a small step, but many small steps will eventually carry you a long way.
Altio: www.altio.com.
The Coalition Against Insurance Fraud: www.insurancefraud.org
HNC: www.hnc.com
ISO: www.iso.com
Jacada: www.jacada.com
PlumTree: www.plumtree.com
Red Oak Software: www.redoaksw.com
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.