Armed Forces

Insurers cant afford to send their sales force out into the field today unless agents are armed with a solid sales force automation tool. But its not as straightforward as one might expect. Business complexity continues to defy a single system or even a common approachbut not IT ingenuity.

I dont know if its the tail wagging the dog or the dog wagging the tail, but the industry is looking for new ways to capture, secure, and maintain clients and to do that cost effectively, says Joe Galvin, group vice president at Gartner research. He adds this requires gaining insight into the actions, performance, and capabilities of your go-to market resource, and that defines the goals of sales force automation (SFA) technology.

But SFA is not a one-size-fits-all solution for insurers. First, the common and oft-cited roadblocks of legacy system and integration issues, disparate systems, and silos of information present the usual challenges to insurers looking to give their sales forces the customer views they need to sell, cross-sell, and up-sell. Second, the different marketing models of insurersdirect and call-center sales, captive agents, and independent brokerspresent a whole set of different considerations.

Supporting the Captives

If you have captive sales agents, you clearly have more control over the technology they use, Galvin says. Control over the sales channel was particularly important in the days when SFA applications were exclusively client/server based, requiring installation on the agents system. Yet even with the Web-enabling of these applications or the emergence of Web-only systems (i.e., Salesnet, salesforce.com), agents still needor at least benefit froma footprint of the application on their mobile hardware for the times when it is impossible, or at least impractical, to be connected. And realizing that remote field staff may lack the connection speed of home-office staff even when wired, some carriers have sought SFA solutions for captive agents that are less resource hungry than enterprise solutions.

Healthcare provider Lumenos, based in Alexandria, Va., for example, has both enterprise and Web-based SFA technology in place. The carrier originally deployed Siebel for its inside, outbound-call-based sales force. But as its product model evolved from a managed savings account product to a policy that combines a health savings account with traditional insurance coverage, it brought on salespeople to work in the field, dealing with consultants and brokers and also directly with employers to sell the product. That called for a change in SFA strategy as well.

We wanted an industrial-strength call-center solution, but when we made the product expansion in early 2001 before Siebel 7 was released, we had to do a lot of remote synchronization of databases to support field sales. That wasnt practical to do over a 14.4 connection in a hotel, so we looked for something that was browser based, explains Chad Pomeroy, CTO for Lumenos.

Lumenos chose salesforce.com to support its mobile sales staff, retaining Siebel for the call-center customer-service staff. The migration meant porting existing prospect and contact information from Siebel to salesforce.com, but Pomeroy reports the process was painless.

We were able to get the system up and running in 60 days with just the resources of one of my business-team members, he says. It was a process of filling out pick lists to create a rules-based import, with some manual list management.

Pomeroy reports the main drawback to using two different systems for sales support is a lack of automatic integration between the two. We use Business Objects as a data warehousing solution, and we will need to bring salesforce.com into the warehouse so we can link it with Siebel. Right now, there is a bit of a fracture, he says. Lumenos compensates for this by having an account implementation team re-enter customer data into Siebel once a salesforce.com-originated sale is completed, he explains.

For some insurers, client/server SFA systems remain because of the time, expense, and potential problems of replacing them. Often with existing SFA client/server systems, there are prebuilt integrations into agency management systems as well as the insurance companys product set, says Chris Yaldezian, director of financial services industry strategy at PeopleSoft. Moving to a Web-based SFA system makes it easier for the insurer to update the application but will likely upset that integration, he explains. An insurer has to assess the costs of maintaining the system on the agents side every time you want to create new combinations and offers against the cost of rebuilding or losing those connections, he adds.

Building on a Foundation

Prudential Financial, Inc., Newark, N.J., has found it is quite happy with the SFA applications it has extended to its agents over time and instead has worked on developing a single front-end system to provide a common launch point for these multiple systems. The carrier made news a few years ago when it decided to provide laptops to its agents in a project called LaunchPad (see LaunchPad Lifts Off, Tech Decisions, June 2000). The machines were deployed with Lotus notes and E-Z Datas Client Data System and Agency Data System. The next phase was the in-house development of an electronic new-business program for life, investments, and property/casualty that now has been rolled out to agents in most states.

But as the number of sales-facing applications increased, so has the complexity of accessing these applications. Therefore, in 2002 Prudential developed Navigator, a portal designed to be installed on each agents laptop, which presents a consolidated view of all applications. We found the cost in building [the portal] has been cheaper, and the product better, than going outside, says Valerie Baumann, vice president of field technology at Prudential. We also have a lot of tools and databases that are Prudentialized, so things just dont fit off the shelf.

We wanted to organize tools so they would be easier for agents to find and use, says Baumann. We see Navigator as our blueprint for how our agents will access their [Prudential] information, including illustration systems, tools for needs analysis, and other systems.

The model for the near future is for applications to continue to be installed on agents laptops and updated via CD or download as changes occur, although Prudential plans for the portal to be the framework for eventually delivering these applications via the Web. Our vision is eventually to move all laptop function to the Web, but the phone lines, as they exist today, cannot move large chunks of data quickly, says Baumann. Were very much watching as broadband makes its way across the country.

Northwestern Mutual, Milwaukee, Wisc., also has provided a variety of stand-alone applications for its sales force, the Northwestern Mutual Financial Network (NMFN), consisting of contracted, captive representatives in more than 350 offices nationwide. Applications include the Siebel Insurance platform, sales proposal tools, and a host of customer-focused reports, cross-selling tools, and lead-generation systems for the insurers life insurance, disability insurance, long-term care, annuities, and investment products.

In our business model, the main relationship is between the representative and the customer, so we provide technology to help enhance that relationship, says Pency Byhardt, North-westerns director of field technology. About three years ago, we sharpened our focus on field technology to support our financial network. That was based on productivity, recruiting and retention of representatives, mobile support, and providing representatives a customer-centric view, she says.

Today, Northwestern is knee-deep in an ambitious, multiyear effort to integrate its portfolio of sales tools to a common platform based on Siebel. A number of our existing applications are being rewritten to allow for this integration, says Steve Ruys, Northwesterns director of information systems. Siebel Insurance itself currently has been rolled out to more than 85 percent of its field force (about 8,500 financial representatives and sales support staff).

The eventual integration with Siebel will be important not only to make the number of individual applications that exist easier to use, but also to further facilitate the interdependent nature of the NMFN. Our field force is not a disconnected group of independent brokers. They work together as a network. We have specialists and experts available to work with our representatives to provide innovative solutions to clients, explains Byhardt.
Through customer-focused reports and cross-selling capabilities, Siebel helps identify opportunities for Northwestern Mutuals full array of product offerings, Byhardt adds. Once all of our lead generation tools are integrated into the new system, it will enable better tracking and managing of these leads.

Ruys explains that most sales applications currently can be used in either offline or connected mode and that Northwestern supports broadband access for its representatives where available. The connected mode offers the potential for joint work across our financial network and sharing information as needed. But our representatives also have a mobility requirement where a connection is not practical. For that need, they also can use the platform remotely with synchronization. He adds Northwestern expects the new platform to be the foundation for more complete anytime, anywhere access.

Directing the Brokers

The exclusive distribution models of Lumenos, Prudential, and Northwestern offer those insurers a greater degree of control over the type of technology their sales forces use (or are at least provided) versus carriers that use independent brokers. I dont think the word manage applies to independent agents, says Chuck Kavitsky, president and chief marketing officer for Allianz Life Insurance Company of North America, Minneapolis, Minn.

Recognizing its independent brokers always will represent numerous insurers, Allianz Life has chosen to link its product and sales information with eAgency, a Web-based sales automation hub that will connect carriers with brokers.

We know eAgency will allow agents to have a department store structure, where they have many resources to go to. But we also know that if our products are good, we will be chosen many times, says Kavitsky.
Allianz has a two-tiered marketing approach. The carrier contracts with field marketing wholesalers who in turn recruit and manage the individual brokersall 150,000 of themwho ultimately sell Allianz Lifes products. eAgency will be extended to both groups, beginning with Allianz Lifes largest wholesaling organization and a test group of higher-producing agents, and is expected to be online by summer.

From the eAgency portal, agents will be able to access product data, sales information, commission schedules, and other company-specific information about any carrier that subscribes to eAgency, as well as manage leads and contacts, mine sales data, and make use of reporting features. A wireless version is available exclusively on the BlackBerry handheld device.

Since eAgency is not carrier-specific, agents, rather than insurers, will bear the cost of the system. Despite eAgencys multicompany focus, Allianz Life has chosen to promote the use of the system to its wholesalers and agents because it believes that quality of its products and service, rather than control of technology, is the key component to doing business with independent brokers. We just want shelf space, Kavitsky says.

Supporting the Internal Sales Force

Carriers that deal with independent brokers also will have an internal sales force charged with attracting, managing, and occasionally terminating relationships with those brokers. Borrowing from the tenets of partner-relationship management, sales automation solutions targeting insurers have considered this business reality.
The major way we see insurers trying to affect that channel is to be able to drive loyalty of independent agents and to understand more about what theyre writing and not writing. Thats where the relationship managers use SFA technology to sell to and maintain the distribution channel, says Ron Young, general manager of Siebel Systems insurance division.

Pan-American Life, New Orleans, supports its network of independent agents with a call center and its Partner Direct, an extranet that provides agents access to policy information, pending applications, commission statements, and information regarding contact that policyholders directly have with Pan-American. The company also is considering ways to generate leads automatically to send to producers via the Partner Direct portal.

The carriers own sales staff uses a Web-based system from Salesnet, first deployed in 2002, to manage contacts with prospective agencies and relationships with existing ones. Our goal was to get all of our sales staff on a single [contact] system that provided a database of prospects that we could manage versus the variety of spreadsheet-based and manual systems that field staff had been using, says Charles Jorge, second vice president of customer relationship management at Pan-American.

The system, hosted on an ASP basis by Salesnet, can be accessed via laptop or PDA by Pan-Americans sales staff. They can port existing contact information from Outlook into Salesnet, and any remaining information, as well as new and ongoing contact data, is entered by users directly at their personalized portal at salesnet.com.

According to Jorge, Pan-American chose Salesnet over other systems because the reminders and workflow features of the system made it more robust than simple contact management systems, but it was less expensive and less complex to use than other sales automation systems. Even so, lingering cultural issues have led to mixed results of the system.

To be honest, weve had a difficult time getting the more experienced sales reps accustomed to the system. Some of them are used to keeping everything in a box with sticky notes. Others, however, have taken to the technology very quickly, Jorge explains. It works very well if all the steps in the [contact management] process are followed.

Market Trends

As in other areas of insurance technology, sales force automation has seen an evolution of industry-vertical focus. Additionally, there has been a continued movement toward componentization of what had formerly been a purely enterprise application, particularly as crunched IT budgets have required addressing specific sales force pain points.

One trend unique to sales technology has been a strong interest in SFA systems by the life insurance industrygreater than the health segment and greater still than property/casualty.

When you look at who has signed deals [with SFA vendors] over the past year or two, they will be life [carriers] more times than not, says Kimberly Harris, research director at Gartner. The [property/casualty] companies are focusing more on back-end systems and straight-through processing as a way to speed up what happens with the information they receive from agents. Life insurers are strengthening the front end as they are realizing that their distributors are going through a radical change.

That change, Harris explains, is a focus on wealth management and the need for their representatives to be advisers. [Brokers] need more information and new products and advisory tools on their desktop to allow them to manage wealth and cross-sell, and carriers need to track how that information is being used.

Vendors confirm this shift as well. The life insurance industry has put a lot more focus as of late on being able to turn themselves into financial services companies and to sell a broader array of products. When you think of the types of products theyre selling, their belief is you need to have a more sophisticated and consultative selling process, says Siebels Young. The property/casualty industry has been going through some soul searching, looking at adding distribution channels and to what level they should provide [SFA] technology to captive and independent agents.

However, Young believes this trend will reverse in the near future, particularly if the financial results of property/casualty carriers continue to improve. If your goal is to drive revenue, improved quoting capability alone will not accomplish that. Insurers will need to provide the analytic tools and products that help agents understand their prospects and customer base.

Getting Your Moneys Worth

Insurers, particularly those that use independent agents, have difficulty assessing the value of the sales automation technologies they provide to the field force. There isnt a great deal of correlation between leads in and sales out, says Denis Pombriant, vice president and managing director of customer relationship management at Aberdeen Group, a Boston-based research group.

Some carriers take control of a lead and require it to be reported on, because they recognize its a corporate asset, says Ron Young, general manager of Siebel Systems insurance division. And if their agent doesnt work the lead, it will be reassigned or the agent may not receive future leads, he explains.
Other carriers, perhaps acknowledging independent agents may prefer to use the contact and lead management functions of agency management systems and related applications of their own choosing, have focused on the carrier/broker, rather than the broker/customer, end of SFA. Industry insiders report one area of SFA technology dealing with the carrier/broker relationship that has caught the attention of insurers has been incentive and compensation systems.

When you target the acquisition, retention, and management of independent agents, an insurers ability to pay compensation becomes a huge part of your attractiveness as a partner, says Chuck Johnston, formerly an analyst at META Group research who recently was named director of industry marketing at Callidus, an incentive and compensation software developer.

Young reports the number of incentive and compensation vendors that have begun targeting the insurance space as evidenced by representation at LOMAs annual conference is simply staggering. That doesnt surprise Joe Galvin, group vice president at Gartner research. The degree to which you can leverage technology in a partnered arena to make your products visible and aware, easy to understand, and competitively priced is important, but more important is that agents have confidence they will be paid accurately and on time, he says. Thats how you build agent loyalty.

While many SFA vendors offer in-centive and compensation components, few currently provide an insurance-vertical focus, according to Kimberly Harris, research director at Gartner. Among those that do are Callidus, Trilogy, and CSC.

Sales Force Automation Tech Guide

Allen Bailey & Associates
Austin, Texas
512-502-8800
www.allenbailey.com

Capterra
Falls Church, Va.
703-748-1596
www.capterra.com

Computer Sciences Corp.
El Segundo, Calif.
310-615-0311
www.csc.com

COSS Development Corp.
Milwaukee, Wis.
262-241-8989
www.cossdev.com

Data Life Associates
Verona, N.J.
860-267-4903
www.datalife.com

Document Sciences Corp.
Carlsbad, Calif.
760-602-1400
www.docscience.com

eAgency Systems
Newport Beach, Calif.
949-253-9131
www.eagency.com

EW Group
East Granby, Conn.
860-653-1719
www.ewgroup.com

E-Z Data
Pasadena, Calif.
800-777-9188
www.ez-data.com

Focus Solutions, Inc.
Fort Washington, Pa.
215-643-9300
www.focus-inc.com

Iconixx
Houston, Texas
713-934-0200
www.iconixx.com
Insurance Technologies
Colorado Springs, Col.
719-442-6400
www.insurancetechnologies.com

InSystems
Markham, Ont.
888-467-9783
www.insystems.com

InterlinkONE, Inc.
Wilmington, Mass.
978-694-9992
www.interlinkone.com

LIDP Consulting Services
Woodridge, Ill.
630-960-0133
www.lidp.com

LifeLink
Park City, Utah
435-649-5300
www.lifelinkcorp.com

LogicPlus
Eagan, Minn.
651-452-8277
www.lplus.com

MFXchange Holdings, Inc.
Toronto, Ont.
866-639-6399
www.mfxfairfax.com

NaviSys
Edison, N.J.
800-775-3592
www.navisys.com

Novinsoft
Port Perry, Ont.
905-985-8546
www.novinsoft.com

PeopleSoft
Pleasanton, Calif.
800-380-7638
www.peoplesoft.com

Philbert Software Group
Roswell, Ga.
800-969-7741
www.philbert.com
PrinterOn Corp.
Kitchener, Ont.
519-748-2848
www.printeron.net

pTeraDac Corp.
Eagan, Minn.
800-400-4561
www.pteradac.com

SalesForce.com, Inc.
San Francisco, Calif.
415-901-7000
www.salesforce.com

Salesnet
Boston, Mass.
617-350-0160
www.salesnet.com

Siebel Systems, Inc.
San Mateo, Calif.
650-295-5000
www.siebel.com

SOLCORP
Mississauga, Ont.
630-960-4604
www.solcorp.com

SunGard Insurance Systems
Miami, Fla.
800-337-2677
www.sungard.com

Systems Engineering Group, LLC
Glastonbury, Conn.
860-368-3983
www.segllc.com

Touchtone Corp.
Costa Mesa, Calif.
800-786-8663
www.wintouch.com

Trilogy Software, Inc.
Austin, Tex.
512-874-3100
www.trilogy.com

Xerox Global Services
Rochester, N.Y.
770-569-5668
www.xerox.com