It's a customer's world, and if you want to run a successful company, it's wise not to forget that fact. And if the only contact you have with your customers is through a monthly bill, quarterly invoice or yearly statement, you must make sure your customers receive the service and information they need in a timely, accurate and clear format.
Customer care via documents sounds easy, but this point of contact frequently fails to meet customers' expectations often as a result of a technical stumbling block. Although a company may have all the information it needs to service its clientele, source data is often trapped in communication silos, making it difficult to bring together the information needed to create the best customer experience possible.
The good news is that new technology XML and XSL is available to transform these lagging processes and enable companies to communicate more effectively with their customers. The insurance industry is a prime example of how these Web service technologies can enhance the financial bottom line and improve customer satisfaction.
Communication Silos Impede Interaction
In order to complete a customer transaction, insurance companies must facilitate interactions between multiple partners, service providers and customers. This impacts nearly all core business processes claims, sales, customer service, compliance and reinsurance are only a few examples. These processes are dependent on the concurrent interaction of multiple stakeholders. To date, these interactions have been completed through various point-to-point, non-automated solutions such as the fax and the telephone or by more complex methods such as EDI.
It is essential to streamline these processes in order for insurance companies to improve this fundamental interaction and collaboration. Automating workflow with data transparency lowers the error rates, reduces the number of exceptions and provides an audit trail. The result is a much higher level of customer and partner satisfaction.
Bridging the Gap
XML (eXtensible Markup Language) has been widely adopted because it facilitates the exchange of information across otherwise incompatible systems. As a result, companies can integrate their data more easily and transform it into new documents for the Web. "XML is becoming widely adopted by every provider of software," says Eric Austvold, research director of Strategic Infrastructure at AMR Research. "Soon, there won't be a software package on the planet that won't speak XML. Anyone who is looking to buy new software · should investigate and ensure that the provider has based a lot of the technology on the ability to share information via XML."
XML, and its complimentary technology XSL (a powerful presentment tool that acts as a mechanism to describe how the XML document should be displayed on the Web), are particularly well suited to solving data integration and Web presentment challenges for insurance companies because they are document-intensive businesses. XML, along with Web services and the supporting standards of Extensible Stylesheet Language Transformations (XSLT), Simple Object Access Protocol (SOAP) and Web Services Description Language (WSDL), form the framework for transforming data and integrating it in a consistent way.
"If you can communicate via XML, then you can get to a common format to exchange information," says Austvold. "Once you have the format to exchange the information (XML), it's important to then develop a process that you can adhere to. Once you have a common document that everyone can use, you then need to streamline the business process to solve a business challenge, such as increasing the accuracy and reducing the time of making customer claim adjustments."
Managing the Complexity of Systems
Every insurance company wants to reduce costs to alleviate profit pressures. This is often difficult because of complex processes that require interaction with numerous parties on a regular basis. The data exchanged in this system is both voluminous and complex, and many of the processes, such as policy quoting and claims adjusting, have a significant number of manual steps. In doing so, data is entered into multiple systems and paperwork and is shuffled between stakeholders. No overall view of the process exists, and work is often fragmented and inefficient. In order to manage interactions across thousands of partners, these challenges need to be overcome.
Another difficulty in reducing costs is that, over the years, insurance organizations have invested heavily in legacy systems and home-grown applications deployed across multiple technology platforms using various data structures. These systems are difficult and costly to maintain and have not provided a streamlined, integrated environment. The need for standard business processes that provide customers with premium service creates a strong value proposition for XML and XSL.
Moving Forward
XML and XSL are important technology components that solve data integration challenges. "Web service technology provides a common set of connectivity regardless of existing systems," says Austvold. "Legacy systems can become Web-service enabled so a company has a common format to extract information from the legacy-based system and share it with other systems, all speaking Web services."
Companies with large investments in legacy systems are typically resistant to moving their architectures online, but extending the usable life of these systems justifies the newer investment in XML. Obviously, firms cannot discard the years of information and financial investments made in these systems. XML and Web services are attractive choices to get these organizations online while maintaining access to their vast data stores. XSL can be used to present documents on the Web in multiple formats based on several different styles and specifications.
Another benefit of XML is the ease of implementation. Beyond the initial time investment, using this technology does not require extensive in-house expertise or an intimate knowledge of the existing database's data dictionary in order to devise a schema that extracts legacy data for reformatting in a myriad of electronic formats.
XML Standards
XML and associated technologies have spawned discussions regarding the automation of B2B interactions with all tiers of partners. Industry-specific organizations, such as ACORD, are now developing standards to define a common lexicon and set of processes used by the insurance industry. Insurance companies around the world have contributed to standards evolution through ACORD, which has in turn published XML data standards for P&C, surety, life, reinsurance and claims. Within the context of this documentation, ACORD standards also suggest process flows between all parties in the value chain. This standardization effort will accelerate the participation of partner organizations in collaborative commerce. These standards and technologies will enable companies to offer back-end, core processes to trading partners or customers through a Web service.
The Time Is Right
Implementing XML and Web service technologies to integrate data and automate business processes holds extraordinary promise to reduce costs, increase efficiency and provide advanced capability. Standards have evolved to a point where adopters can reap tangible business benefits. Software vendors have implemented solutions customized to the ACORD standards, simplifying implementation. Extending internal infrastructure to all members of the value chain can be completed quickly with minimal risk. As members of the insurance value chain adopt these standards, electronic collaboration will become even easier and more effective. If insurance companies are going to remain competitive within the industry, and as part of the economy as a whole, the time is right to investigate and invest in this watershed technology.
JoAnn Clare is vice president of Financial Services Practice for Fujitsu Consulting, and Stephen Palmer is chief operating officer for Whitehill Technologies. For more information, contact "document" magazine @ www.dptmag.com.
