With the economy in shambles, insurers, just like other industries, are looking for ways to squeeze blood from the proverbial stone. That means cutting costs and improving existing processes. Sometimes that means new technology is needed, especially in the critical area of claims. But selecting the right technology vendor to provide a new claim management system can be daunting and downright frightening. It's like getting married–while there may be many attractive options, it is crucial to find your perfect mate before tying the knot.
Keep in mind, there are many vendors that offer great products, but not every great product or system is right for your company-specific situation. Getting back to the marriage analogy, the supermodel rarely finds true happiness with an Iowa farm boy. The challenge when looking for a claim management system–and perhaps the perfect mate–is finding the one that will mesh best with your personality, skills, and capabilities. In a claim management system, that means the vendor must provide the exact right mix of functionality, flexibility, technology, and support at the most economical price possible.
Starting Off on the Right Foot
From the beginning, it is imperative to assemble a team from within the claim department to assess the company's specific needs and requirements. When assembling this group, include people from every level and area of responsibility. Management must make certain to gather all of the different perspectives to ensure a decision is made that positively impacts the strategic direction of the company.
Once a system is selected, this core group will have to take ownership. Having project owners who have been involved from the beginning can be beneficial in terms of familiarity with the new system, integration points, and other aspects that may have come to light during a proof of concept or discovery phase. These people will be your teachers and cheerleaders.
Another group that needs to be engaged early is the company's IT professionals, who will have responsibility for maintaining the new system. Be sure to include IT management, project managers, programmers, and testers in the evaluation and discussion so that any issues with existing systems can be tested and resolved before the actual selection and implementation.
Executive level support is crucial. While company executives may not be involved directly in the evaluation process, managerial approval of an initiative such as a claim management system is paramount to the success of the implementation.
The Long Haul
Even at the beginning of a vendor search, it is important to remember this is a long-term commitment. Think of it as dating before the marriage. During the course of your marriage, there will be good times and bad. There may even be some counseling at some point. Divorce is too expensive and wasteful to make it anything but a last resort. The key to making the best vendor selection is to do everything you can upfront to make a good choice.
Interview multiple vendors in different locations. Meet them at trade shows to find out whether they look and act professional in this type of setting. Ask yourself, "Do others seem to have an interest in this company's product?" If time and budget allow, consider meeting top contenders at their locations. You need to find out what type of offices they have and whether the building, employees, and workstations are neat, well kept, and professional looking. Lastly, vendors that are serious about earning your business should be willing to meet at least once at the physical location where the system will be implemented. Show them what your company is all about, and make sure there is a firm commitment to do more than make a Webinar marketing demonstration and a virtual sales call.
Short list your potential vendor partners by making note of how many similar customers the vendor has and whether the vendor company shares cultures and values that are similar to your own. People who share similar corporate cultures and values will have a good understanding of each other and be able to communicate effectively. Keep in mind your "spouse" doesn't necessarily need to be from the same geographic area of the country or the world.
When it comes to technology, we all like gadgets and gizmos. But do not be swayed by the sizzle of cool stuff. The important measures are whether the system will provide the functionality required, the flexibility to prepare you for future needs, whether you are able to communicate effectively with your significant other, and whether the price is within your budget. When you find the best fit, don't be afraid to walk down the aisle.
John Foster is the vice president of claims for Farmers Alliance Mutual Insurance in McPherson, Kans. He can be reached at john.foster@fami.com.
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