How Insurers are Benefiting Twice from BPO

Many insurers have taken advantage of business process outsourcing (BPO) to reduce operational costs, improve the quality of their processing and accelerate their speed to market. But BPO also has the potential to help insurers overcome the challenge of improving the effectiveness and efficiency of their workforces.

Workforce optimization is vital given the key role that motivated and skilled staff play in helping companies achieve high performance. Insurers, however, face specific workforce challenges:

• The workforce in North America and Europe is reaching retirement age—a situation exacerbated by early-retirement programs.
  
  
• The changing expectations of younger workers are forcing companies to rethink traditional career management and incentive planning.
  
  
• Employee dissatisfaction and disengagement continue to grow, particularly among middle managers.
  
  
• New technologies, new sales methods and higher customer expectations determine the skills needed by employees.
  
  
• Global sourcing of resources makes collaboration a challenge and may reduce employee loyalty as well.
  
  
• Mergers and acquisitions continue to place demands on the insurance workforce.

Accenture’s High Performance Workforce Study has already touched on the upheavals under way within the insurance sector, with most insurers acknowledging that they are some way from having a truly effective workforce.

Demographic and other changes are not the only factors militating against a more effective workforce. As important are the structural and operational deficiencies that make it difficult for insurers to improve productivity and customer service—both essential for revenue growth, satisfactory margins and finally, for high performance. These deficiencies include an over-complex processing environment, a siloed organizational structure and suboptimal business processes. As a result, staff remain mired in a tactical mode of operating.

Outsourcing key insurance processes can help insurers meet these challenges and enable the transformation of the retained workforce. Among the areas where BPO can effect change are:

• Improved use of data.
• Improved integration and collaboration.
• Elimination of routine manual tasks.
• Better communication.
• Better management.

Benefits of this approach may include lower costs and risks, more satisfying jobs for the retained workforce and measurable improvements in business value (in terms of productivity, cost, retention or other significant metrics).

Based on its wide experience with customers and its research-based understanding of high performance in insurance, Accenture recommends that executives think of at least the following three areas when transforming their retained workforces:

• Establish a phased development approach. Major change programs are successful only when executed in stages.
  
  
• Create more effective leadership accountability and development. Executives must be accountable for making the change happen successfully.
  
  
• Retool the jobs, roles and behaviors of the retained workforce. It is not enough to retool the technology—to make the change stick, people need to be changed.

Contact Us to benefit from our experience in helping insurance clients to benefit twice from BPO.