Manual processes can be time consuming, particularly if you are trying to extract data from disparate systems and turn it into actionable business intelligence. That's the situation MutualAid eXchange (MAX) found itself, according to Paul Heacock, the carrier's CIO.
"We ran our carrier system in production and then we ran our agency system and we put them together manually in a spreadsheet to have some sense of what our income levels were as opposed to what we projected," says Heacock. "That was the reason we really needed to get to a data warehouse.
MAX also found itself spending too much time building its reports and didn't have much time to analyze the data and learn what was going on.
"A lot of our reports were spreadsheet-based and they were complicated," says Heacock. "They are not user friendly; they are transaction oriented. So we have to repackage them into a format that is a little easier to understand. Even then, when people ask a question we couldn't drill down."
One of the nice features of any BI tool—including the 4sight Business Intelligence tool purchased by MAX—is it is being built from the ground up.
"We predefined the reports and the dashboards that we want," says Heacock. "When we see a number we are curious about we can drill all the way down to the coverage level to find out what created that number. We hope to spend a lot more time analyzing numbers than creating the numbers."
Getting it in Shape
Heacock believes MAX's data is in better shape than most insurance carriers because MAX has been in business for just a decade.
"One advantage we have is we have only 10 years of data," says Heacock. "It's been in the same legacy system, so it hasn't gone through two or three iterations of conversion and changes in that regard."
MAX business users have found some bad records that don't make sense. But because the carrier is running the BI solution parallel with its legacy system, when two numbers don't match it has been easier to determine the problem.
"When we start to drill down it's sometimes something incorrectly calculated or presented in the BI tool, but often it's just the legacy data," says Heacock. "It's not anything that I feared it might be."
The MAX data is in a lot better shape than Heacock thought it would be.
"We had some records that just weren't complete," he says. "When you tried to drill down they weren't there. Our agency management data is a lot less reliable. Some of that is downloaded from other carriers and we found some holes there."
More to Come
Heacock is excited about the new dashboard capabilities available to MAX that will present a high-level summary of the data and also enable the what-if modeling.
"The ability to play with the components of the combined ratio, for instance, is important," he says. "It's easy to play with the losses, but what if our average premium went down 10 percent or up 10 percent and everything else remained constant? What would that do to our combined ratio?"
The modeling capabilities are something MAX intends to spend more time on once the carrier gets the more germane things done, such as new production reports and exposures reports.
We still have to get that nailed down, but we're looking forward to the ability to model the data," says Heacock.
New Work Habits
Heacock reports MAX is working on some basic issues for now, but also is developing a model that patterns the sales pipeline.
"We have a goal of X written premium for next year," he says. "There's an element involving retention of current business and the new production. If you follow new production down the chain, how many quotes do we have to make to get that level of production? In order to get that many quotes, how many sales calls and proposals do we have to make. We're trying to trace it all the way down to how many hits we need on our Web site. That's been defined conceptually, but not practically."
BPM in Place
Heacock believes there's an element of BPM in its business intelligence efforts. Currently, MAX is looking at all business processes and trying to optimize them.
"From the top or from the bottom, we need to get those views optimized and then measured before the metrics," says Heacock. "If I don't know how many Web site hits that I can trace through to a sale, I can't build a model. I need to understand what drives those Web site hits? How many unique visits do we need? There's an element of BPM in there as well."
MAX is still trying to get all the operational reports finalized and accepted. Business users are more familiar with tabular numbers, but Heacock is trying to give them some graphics along with the tabular numbers.
"The real payoff is down the road where we can be more proactive rather than just reacting to the numbers," he says. "Maybe we can figure out how we can make a more direct impact with the numbers. Our current reporting is looking through the rearview mirror. We really want to start looking through the windshield. But you can't go forward until you know what's behind you. Our goal is to have these things done by the end of this year. That's an aspiration. We may not totally be where I'd like us to be, but it's incremental. We'll be doing some things along the way."
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