IT in the Insurance Industry

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The insurance industry is facing increased pressures as a result of competition, consolidation, globalization and the convergence of services The industry is looking increasingly to information technology and web enablement to create sustainable value and differentiate its products and service. The industry must embrace IT emerging technologies and integrate them with existing products and processes in order to stay competitive. In particular, the industry needs to harness the power of IT to:

• Improve its core competencies in underwriting, claims and policy administration
• Deliver increasingly high levels of customer service and retention

To do this, the industry must shore up its ailing IT infrastructure and leverage existing legacy systems, data, platforms and development tools into web and IT enabled solutions.

Insurers are no longer looking at IT as strictly a cost center and instead see it as a key enabler of new business processes and transformation that can reduce expenses and help IT become more aligned with the business.

By streamlining and automating IT systems and processes, IT is becoming more strategic to the business and key to putting insurers in a more competitive position globally.

Read on to see how Evergreen Systems helped one such insurance client recapture their customer service function from an outsourced vendor and raise the bar on the delivery of superior service level management through service catalog development.

Case Study

Service Level Management Through Service Catalog Development

This insurance industry leader in disability individual income protection and group long term care is one of the top providers of supplemental benefits in the nation.

With primary offices in the Southeast and Northeast US, a total of 21 million insured policy holders, 1100 associates in field offices across the country, nearly 12,000 employees worldwide and a corporate goal of 92% customer satisfaction with customer employers, this major insurance provider struggled to understand customer service expectations when they brought previously outsourced IT services back in-house.

The Challenge

As application owners, the lines of business and home managers were not clear on their own expectations of IT, except that they expected superior customer service. The insurance leader engaged Evergreen Systems to help evaluate their service level management process and develop short and long term road maps for delivery of superior customer service. The company made a strategic commitment to make the transition to a true service-oriented IT organization, beginning with an ITIL® maturity assessment. Evergreen was then able to work with the company to 'jump start' the process, moving it quickly towards the delivery of a well-developed service catalog. This product then defined bundled 'end user' oriented products and articulated service level expectations to the business owner's end users.

The company had two primary business challenges:

• As a public insurance company, subject to regular audits, regulatory requirements dictated that their processes were documented, repeatable and reliable.
• As all IT services were brought back in-house from a long period of outsourcing, the organization was charged with benchmarking line of business customer expectations and delivering the expected services within the same outsourced cost parameters.

Assessment

The insurance leader leveraged Evergreen's 'quick hit' assessment, in order to analyze and gauge their ITIL maturity level quickly. This proven methodology and Evergreen's highly experienced consultants allowed the client to quickly complete the assessment and pinpoint service catalog development as a primary 'pain point'.

The assessment utilized a questionnaire which leveraged the basic structural elements necessary for efficient process management and which allowed the client to effectively benchmark the organization's operations against ITIL best practices. This tool evaluated the IT organization for a number of critical factors, including technology enablement, organizational readiness and performance indicators, as well as created awareness about management and control issues that could be improved through better process capabilities. An ITIL long term roadmap and action plan was then developed to initiate an effective IT transformation plan and included activities such as:

• A half day ITIL focused process overview
• IT staff interviews using ITIL assessment questionnaires
• Reviews of documentation, reports and metrics
• Validation and definition of open and outstanding questions

Recommendations

The assessment revealed that service level management was a 'hot button' and participant feedback quickly highlighted the fact that end user customers (and their application owners) needed a single location to find out information about available IT services. The assessment pointed to the need for a service catalog as a 'one stop shop' for offering customers consistent, high quality IT services.

The Service Catalog provided the customer one location to view and order services provided by IT and organized and bundled 'services' in a way that customers understand and use them. By providing details about the characteristics of IT services, including Service Level Agreements (SLAs) and Operational Level Agreements (OLAs), service catalogs allow IT organizations to set, and meet, end user customer expectations. Service catalogs also help IT to rationalize end-user demand through the establishment of service and vendor standards and to optimize that demand based on business planning and spending. This in helps IT control service usage by using request management and compliance procedures to maximize and automate workflow.

Implementation

The roadmap for service catalog creation included 7 steps broken into three phases, including data gathering and planning, data population of services and recommendations for steady state operations. Deliverables included a project roadmap, a tool kit that facilitated the development of SLAs and OLAs and templates designed to self-populate as additional services were added.

The first phase collected data needed to begin the basic taxonomy development of the service catalog, including:

• Definition of service families
• Definition of services within service families
• Mapping services to existing customers
• Mapping expectations and dependencies to services
• Establishment of operational level agreements
• Establishment of service level agreements
• Establishment of cost of services
• Deliverables included:
• Excel tools and spreadsheets that populated the service catalog with services, others that helped define the OLAs and a third that populated data for the SLAs.
• Procedures and process recommendations on completion of services, change information and dependencies.
• Customer-to-service mapping tools and information, including review intervals, as well as recommended measurements and metrics.

Results

As a result of their Evergreen Systems engagement, this high-end insurance provider was able to bring its IT operations in-house and quickly establish what its application owner's service expectations were, meeting them by presenting a customer-driven menu of service catalog offerings.

The company was able to also ensure adoption of the new tools through collaborative efforts with Evergreen that included:

• Workshops that gather IT and end-user data.
• Cross training and 'train-the-trainer' workshops that enable the core team to bring expertise in-house.
• Marketing and communications plans that articulate the uses, scope and value of the project.

Deliverables and tools that were delivered also ensured the integrity of future audits by providing documentation that demonstrated repeatable and reliable IT processes.

As a major service provider to application owners, end users and agents and affiliates worldwide, this major insurance player was now able to organize its vast array of hardware, services, desktop, hosting, network, remote access, email and shared services, and organize them by the services valued by the business.