Leading Japanese Insurer: Application Outsourcing

Stellar results include a 30 percent reduction in costs and a 10 percent increase in productivity.

The client is a leading provider of group insurance for organizations and businesses in Japan. The company is a subsidiary of a global insurer and generates approximately 7 percent of the parent company's revenue total.

Insurance industry deregulation in Japan is leading to a higher demand for products. At the same time, pressure is mounting to reduce product life cycle development time. These trends call for greater IT capacity, stronger IT capabilities and a controlled cost environment. The client believed outsourcing its application management functions would help it meet these needs by freeing staff to focus on more strategic activities and reducing costs—all while delivering high levels of service and quality.

The company selected Accenture as its outsourcing service provider because of Accenture's deep industry skills; global delivery network; flexible and scalable outsourcing capabilities; and proven experience helping other insurers transform their IT operations. In addition, Accenture had demonstrated its commitment to helping the company achieve high performance for more than 10 years, most recently by implementing a sales force automation system.

Leveraging the Accenture Rapid Transition Suite—a powerful combination of proven methods, processes and approaches to drive the successful startup of a new service delivery environment—Accenture teamed with the client to transition the management and development of almost all components of the company's existing application portfolio.

During the seven-year arrangement, Accenture is providing all break/fix, inquiry, enhancements and project delivery for 76 different applications running in mainframe, Unix, J2EE and Microsoft .NET environments. In total, these applications support 7,000 client users in Japan.

In delivering this solution, Accenture is applying an innovative onshore/offshore model that provides the optimal mix of resources. Twenty percent of the resources work onsite in Japan and 80 percent are located at the Accenture Delivery Center in Bangalore, India.

Within five months, Accenture successfully transitioned all 76 applications. The outsourcing arrangement has reduced the client's costs associated with application management by 30 percent. At the same time, productivity has increased by 10 percent, with an incremental productivity increase of as much as five percent expected in each year of the contract moving forward.

Accenture offers a highly efficient and standardized delivery process that uses Capability Maturity Model Integration to drive responsiveness, productivity and customer satisfaction. With this outsourcing solution—the first of its kind for the insurance sector in Japan—Accenture has once again demonstrated its ability to help financial services businesses steer a path toward high performance.