Case Study #5:
1. What were the problems faced by Income in
this case? How were the problems resolved by the new digital system?
·
Incomes insurance processes were very tedious
and paper-based. This resulted to humongous Income also experienced frequent
breakdown of the HP 3000 mainframe which hosted the core insurance applications
and the accounting and management information systems.
·
In addition to this, HP 3000 back-up system only
allowed restoration to the previous day’s back-up data. Hardware failures
caused six days of complete downtime.
·
COBOL programs also encountered frequent
breakdowns that halted the systems and caused temporary interruptions. At the
same time, development of new products using the COBOL is quite cumbersome and
took weeks, even months, to accomplish.
·
They also lost opportunities to cross-sell
because transaction processing for policy underwriting was still a batch
process and information is not available to agents and advisers in real-time.
Through the new digital systems, these problems were addressed.
·
The paper-based insurance processes were
replaced by a paperless platform. Under the new system, all documents are
scanned and stored on trusted storage devices. Frequent breakdowns were
addressed by the high-availability platform. Multiple servers are hosted and
connected to more communication lines that are ´load balanced.
·
The new system also addressed downtime due to
breakdowns by its hot back-up disaster-recovery centers. The new digital system
also addressed the slow development of new products by COBOL through the
straight through processing workflow capabilities of the new system.
2. What types of information systems and
business processes were used by Income before migrating to the fully digital
system?
·
The insurance process of Income was very manual
and paper/file intensive. Filled-up application forms of clients were sent by
agents through courier. Their collection schedule causes delays of two to three
days.
·
The Office Services log, sort, and send
documents to underwriting. Proposals were allocated to staff randomly. No
system was in place for proper assignment of tasks per staff.
·
Voluminous documents are manually sorted and
stored by a number of staff at their warehouse. Since there was no clear
document management system, retrieval of documents takes days to accomplish.
·
Income also made use of HP 3000 mainframes which
were very unreliable due to frequent breakdowns that resulted to downtime,
decreased productivity and wasted manpower hours.
·
COBOL programs were also used which also
encountered technical failures. At the same time, COBOL programs were very slow
in developing new products for the company resulting to lost sale
opportunities.
3. Describe the Information systems and IT
infrastructure at Income after migrating to the fully digital system?
·
According to James Kang, CIO of Income, the Java
based eBao Life System from eBao Technology is very customer-centric. It
provided seamless integration with imaging and bar code technology.
·
It also contains a product definition module
that supports new products, new channels and changes in business process. Data
migration of Income’s individual and group businesses was successfully
implemented and customized.
·
The new system was operational on high-quality
platform with multiple servers and communication lines. The new system also
revamped business continuity and the company’s disaster recovery plan.
·
A real-time hot back-up disaster recovery center
was implemented. Business processes went from paper intensive to paperless
through digital storage and records. Many users can access the system at one
time, any time, and anywhere.
4.
What benefits did Income reap from the new
system?
·
Providing easier & more convenient access
for staff: for those staff members who telecommute, it enabled them to gain
faster access to information, as fast as those staff that accessed information
within the office.
·
Enabled cross-selling of products &
improvement of customer service: this new system has allowed income to gain a
singular view of each of their customers across their products and channels,
enabling an even better life and general insurance line.
·
50% savings on both time & cost needed to
process policies: due to the straight through process workflow capabilities of
the new system, it enabled reduction of 50% on time and cost needed to process
policies. Time needed to design and launch new products was also reduced
significantly.
·
Provides greater support to intermediaries:
Income is able to provide support to agents, brokers, and customers to do
online services regularly
5.
How well is Income prepared for the future? Are
the problems described in the case likely to be repeated?
·
In the insurance industry, information systems
are very important in ensuring product and services-competitiveness. Customer
queries should be addressed accurately and promptly. Products should be
constantly improved and new designs should always be made available.
·
With the new information system, Income is now
equipped to face the challenges of the industry. To ensure the success of the
new system, proper implementation and control should be done.
·
Continuous straining should be given to the
staff to ensure proper use of the system and to maximize the potential of the
system.
·
The system should also be continuously improved
through the proper management of feedback from users.
- Upgrades should also be done periodically to cope with the changes in the demand of the industry and the market
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