Here's a new business phrase that you can chew on: corporate cholesterol. At first, I thought the phrase was invented to describe the cardiovascular diagnosis of senior executives at U.S. corporations, but on closer examination, it's being used to identify the symptoms of business process inefficiency.All joking aside, inefficient business processes are the bane of business executives, who have been led to believe that the implementation of technology can help reduce the inefficiencies and clear those corporate arteries. However, despite the fact that insurance companies will spend close to $27 billion on technology this year, according to Datamonitor, 90% of insurance executives polled at this year's ACORD LOMA conference replied that inefficient business processes are affecting their business.
Among the 85 executives surveyed by Exigen Group, the most common symptom of business process inefficiency is customer inquiries that result in numerous e-mails and phone calls internally until a solution in found. Two articles in this month's issue-"Amica Life's Remodeled Front End" and "Kaiser's Secret To Customer Satisfaction: It's People"-address the importance of business process management and, in the case of the latter article, the importance of getting customer information into the hands of CSRs.
Although stubborn legacy systems have become the scapegoat for all problems that ail insurers, just 19% of executives polled in this survey blamed their existing systems for lack of business process innovation. Instead, the true culprit could be the fact that just 49% of those polled said that their organizations do not have a business process quality assessment program, such as Six Sigma, in place. Insufficient management interest and inadequate skills were also cited by respondents as major hindrances to business process change.
What's the cure for corporate cholesterol? I don't believe that the Atkins diet is intended to reduce corporate carbs. I suspect the solution for insurers is to integrate their siloed systems and databases. The lack of systems integration is the primary cause of inefficient business processes and the main source of corporate cholesterol. The cost of such business process inefficiency is high: a recent study by Exigen suggests that insurers are spending up to 30% more on core business processes than is necessary. Eliminating that waste will clear up those corporate arteries.
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