Robert EpnerConference Chairman

Regional General Manager & Chief Operating OfficerING Asia/Pacific Ltd

Six Sigma / Lean IQPC Industry Conference

Hong Kong Process Improvement Through Effective

Measurement Practices

2

• 12th largest financial institution worldwide by market capitalisation

• 6th largest financial institution in Europe by market capitalisation

• 11th on Forbes Magazine’s “Global 2000” listing in 2006

• €73.5bn market capitalisation

• 120,000* + employees

• 50 million* + corporate and institutional clients in over 50 countries

ING - World-Wide Financial Services Group

As at 8/9/2006* Source: ING financial as of 2nd quarter 2006

3

ING has a Wide Presence in the Asian markets

China1.3bn

Malaysia23m

Philippines85m

Thailand64m

India1.1bn

Japan127mKorea

48m

Taiwan22m

Australia & NZ

24m

Hong Kong7m

Singapore3m

Second largestInsurance

business in Asia

Second largest Investment

Management business in Asia

ex Japan

4

Over the last 3 years Operations Culture has Transformed….

• TPE Created

• Ops Network created

• Standard KPIs

2nd Half 2003

ProcessAnalysis

May 2004

1st Customer Cup & Six

Sigma Training

July 2004

First wave of Six sigma Projects

( 7)

Oct 2004

KPI targets incl. in TPE-MTP

Second Wave Six Sigma Projects (11)

Jan 2005

NB UW Regional Process

Optimization

March 2005

2nd Customer Cup

July 2005

Six Sigma Champions Training

Claims Regional Process Optimisation

Jan 2006

Customer Service Model

Regional Optimization

Implementation NB/UW & Claims

Optimization processes 3rd Wave of Six

Sigma Projects (4)

4th Wave of Six Sigma Project

(19)By own trainers

Train the Trainer (TTT)

July 2006

STP for NB/UW

2nd TTT Workshop organized

3rd Customer

Cup

Black Belt Course

Stage 1Process

Management

Stage 2Six Sigma

Deployment

Stage 3Regional Process

Optimization

5

Planning

People

AnalyticalProblemSolving

ProcessManagement

Business System – The “4 Ps” Approach

6

New Business and UW Leaders: Jimmy Wong, Vivek Bengani, Steven ChikNew Business and UW Leaders: Jimmy Wong, Vivek Bengani, Steven Chik

Policy Owner Services Leaders: Emily Chen, Philip Koh, Stella Feng Policy Owner Services Leaders: Emily Chen, Philip Koh, Stella Feng

Claims Processing Leaders: Lynna NG, Ritu Thakur, Bing Mu WuClaims Processing Leaders: Lynna NG, Ritu Thakur, Bing Mu Wu

Contact Center Leaders: Tina Dougherty, Ryoichi Tachibana, Meesook Won Contact Center Leaders: Tina Dougherty, Ryoichi Tachibana, Meesook Won

Aust Dalian HK India Japan Korea Malay Shang Taiw Thai

1

2

3

4

Workstream Organization: Regional Process Owners

“Workstream Governance Charter” establishes roles and responsibilities

NZ

Malaysia Korea Hong Kong

Malaysia

Taiwan

Malaysia

Shanghai

Taiwan

KoreaAustralia Japan

India

7

AP Regional totals for 12 BUs – 2005 Figures

Work Stream Volumes Total for

the Year

Monthly Average

Total Policies Issued 1.2 ml 100,000

Total Inbound Calls 3.3 ml 275,000

Total POS Transactions 1.0 ml 60,000

Total Claims 2.6 ml 220,000

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A. Cost Efficiency

1. Productivity

2. Unit cost per policy issue B. Responsiveness

1. Simple Application Cycle Time

2. Complex Application Cycle Time

Standardizing data collection - Quantitative and Qualitative

Standard KPIs designed for Asia Pacific Region for 4 workstreams• New Business/ Underwriting• Claims• Policy Owner Services• Call Center

A. Quality and Satisfaction

1. Customer Satisfaction SurveyAgent SurveyEnd Customer Survey

2. Internal Audit Rating

3. External Audit Rating

KPIs - New Business / Underwriting

Quantitative Qualitative

9

KPI Measurement and Tracking

• Monthly KPIs submitted to Regional Office by 12 Business Units.

• KPI reports analyzed by respective Workstream Leaders.

• Workstream Leaders present during Monthly Regional Operations Call

• Operations Dashboard compares Actual KPIs Vs Targets of each country.

• Improvement in KPIs tracked - basis for the annual “Customer Cup Awards” for Process Improvement and Six Sigma.

10

Managing and Measuring Six Sigma Projects

• Regional Six Sigma initiative started by RO in 2004.

• Over 70 projects rolled out in 4 “Six Sigma Waves.

• Building Internal Capabilities: “Train-the-Trainer” (TTT) Workshops Green (Orange) Belt Certification Black Belt Certification

• BU Projects monitored and coached at tollgates by Regional Office.

• Sharing Completed Projects in the ING Six Sigma Site.

11

Special Challenges for Regional Projects

3 Region-wide Projects to create Standardised processes

• As-is-profiling done by each BU

• Best Practices identified

• CTQs identified through VOC

• Optimised Processes designed

Implementation of the Region-Wide Standardization Projects:

• Refined KPIs to align with optimised processes

• Compliance Report designed to track gaps

• Local Quick Win Projects for filling gaps

• IT initiatives planned on Region-Wide basis

• STP for policy issuance rolled out as Phase I

12

Summary - Six Sigma Projects in Asia Pac

TOTAL > 67 BU Level

> 3 Region Wide Optimization

> 18 Quick Wins

11

10

7

6 6

5

67

5

2 2

0

2

4

6

8

10

12

Korea Malaysia Australia Taiwan HongKong

J apan India Dalian Shanghai Thailand KB Life

Greenfield Markets

BU Wise Six Sigma Projects

3 Region Wide Optimization

1. New Business/Underwriting

2. Claims

3. Customer Service

13

TPE: BU members Set Measure for Operational Excellence

Claims

A) Cost

B) Speed: Average TAT

C) Quality

New Business/Underwriting

Policy Owner Services

Contact Center

DriverDriverDriverDriver Objectives & MeasuresObjectives & MeasuresObjectives & MeasuresObjectives & MeasuresPresentPresentPresentPresent

……… ……… ……….. ………..

’’04E04E ’05F’05F ’06F’06F ’07F’07F

KPIs Based on Key Principles: “Make Them Practical” and “Get Started then Refine”

Speed: Average Turnaround Time (TAT)1. Non-investigation

2. Investigation

Cost: 1. Claims per Staff2. Unit Cost Per claim

Quality: 1. Customer Satisfaction Survey2. Corporate Audit Services Audit

3. Reinsures Peer Review

14

Quarterly Summary – Asia Pac Ops Dashboard

'+' = better than Plan 'O' = On plan ' -' = Worse than plan

Performance Measurement Hong kong Japan Korea Malaysia Taiwan Australia Dalian Palic India Thailand KB Life**

NB/UW

Cost Efficiency + + - - + - + - - - +Responsiveness - - - - + O O + + + -

Quality and Satisfaction + O O O + na + O O - +CLAIMS MANAGEMENT

Cost Efficiency + + - - - - - - O O +Responsiveness - O O + + na - O O O +Quality and Satisfaction O O na O O na O na na - +

CONTACT CENTRE

Cost Efficiency - + O O o - O O - - +

Responsiveness + O O + o + + O + O -

Quality and Satisfaction O + - - O O O + na - +POS

Cost Efficiency + + + - - + + + - + +Responsiveness - + + + + + O + na + +Quality and Satisfaction O na O + O na O - na - O

'+' = better than Plan 'O' = On plan ' -' = Worse than plan

End of 3Q 2005Insurance Asia Pacific Operations Dashboard

(Actual Vs. MTP)

Q3 2006

Performance Measurement

NB/UW

Cost Efficiency

Responsiveness

Quality and Satisfaction

POS

Cost Efficiency

Responsiveness

Quality and Satisfaction

CONTACT CENTRE

Cost Efficiency

Responsiveness

Quality and Satisfaction

CLAIMS MANAGEMENT

Cost Efficiency

Responsiveness

Quality and Satisfaction

Malaysia

--+

-o+

+++

+

o+

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As-is- profiling – Sample of NB/UW for design stage

SAMPLE

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Customer Segmentation for VOC – Measure stage of the Optimised Processes

25-27TOTAL

5E4 - Claim Rejected / Partially Paid / In-Dispute (after-closed)

5E3 - Claim Accepted(External) End Customer - Life

Claim

5E2 - Claim Rejected / Partially Paid / In-Dispute (after-closed)

5E1 - Claim Accepted(External) End

Customer - Medical Claim

1I5 - BU Finance Director / Manageror Chief Actuary

5I4 - Claim Assessor, Field Investigator, other Claims "service provider"

1-2I3 - Service Centre Manager (Korea, Taiwan, others?) or Claims Dept. Manager

1-2I2 - Branch Manager

3I1 - Agent w/3+ Years Experience

(Internal) ING sales & operations staff

(incl. 3d party agents)

Target #s per BU

SEGMENTATATION

25-27TOTAL

5E4 - Claim Rejected / Partially Paid / In-Dispute (after-closed)

5E3 - Claim Accepted(External) End Customer - Life

Claim

5E2 - Claim Rejected / Partially Paid / In-Dispute (after-closed)

5E1 - Claim Accepted(External) End

Customer - Medical Claim

1I5 - BU Finance Director / Manageror Chief Actuary

5I4 - Claim Assessor, Field Investigator, other Claims "service provider"

1-2I3 - Service Centre Manager (Korea, Taiwan, others?) or Claims Dept. Manager

1-2I2 - Branch Manager

3I1 - Agent w/3+ Years Experience

(Internal) ING sales & operations staff

(incl. 3d party agents)

Target #s per BU

SEGMENTATATION

Sample Segmentation

for VOC

Over 2000 internal and external customers Interviewed for the Optimization Processes )

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The Optimized/Std Process : Sample of Claims Optimized

Process Flow

Step 1Customer decides to

make claimContacts ING

Step 2 Claims verification

Step 3aING presents claims form

Step 3bNotify customer of

invalid claim

Step 4Customer completes form and prepares other documents

Step 5Customer sends

documents to ING

Step 6ING receives and

scans documents, sceens for

missing/dumb requirements. Inputs

data.

Step 6ACall to customer to

verify missing/incorrect data

Step 7Create electronic

claims file and dispatch to assessor

Process Details & Rationale(note source

of best practice)

Customer/agent contacts ING through website, call centre (AUSTRALIA), email,

walk-in (KOREA, TAIWAN)

Customer/agent answers prescribed

questions (AUSTRALIA) via

channel of choice. ING validates inforce policy, customer

details, policy terms (TAIWAN, AUSTRALIA,

JAPAN)

ING sends correct claims form to customer via email or post. Form has supplementary docs check list. ING

notified the customer on how to check the claims status (SMS, website, call

centre number)

If policy is not in force or terms do not match

claim, ING notifies customer/agent and

sends letter (AUSTRALIA, JAPAN)

Claims administrator inputs data, scans

documents and screens documents for

incorrect or missing data.

Claims administrator calls customer to verify

incorrect or missing data.

Retreival of NB documents. Batch all into electronic claims

file. Dispatch to assessor.

Who / Where

Customer's channel/place of

choice. If email refer customer to call centre

or website

On-line, via call centre, or walk-in.

IT system triggered to generate/print pre-filled claim form.

Call centre or website or meeting with agent

Claims administrator Claims administrator Claims administration

Normal Cycle Timeemail = immediate

post = 3-5 days with printing batch over night

Immediate after claims pre-screening

< 1 day of receiving documents

immediately 1 day

Other Best / Fresh Practices(note source)

1. Customer completes entire claim via internet. Allows for bookmark option to return to claim form at a later date. Also customer can print out form letter and

checklist for supplementary docs.2. Web/call centre questionnaire results

in pre-filled claims form.

If medical or when product risk allows

ING provides option to customer to reinstate inforce policy through

extra payment

Exceptions / Limitations

Technology Implications

Claims Sub-Process 1 Claims Submission and Pre-Assessment

Customer completes the rest of the pre-filled form. Customer prepares supplementary

documents from checklist. Customer sends all forms/documents to ING. ING advises fastest way to return documents (fax, email, advisor, walk-in, post) and gives service commitment depending on channel. Customer indicated preferred methos of payment: EFT, check to

customer or agent

within 1 week of customer receiving forms if by post

Outputs:customer/policy verification OR

claims invalidationclaims file

From customer contact ING to claim pre-registration < 10 min

Customer's home

Total Cycle Time = tbd< 14 days if by post

< 7 days if by email and return by post

< 5 days web claim addtnl docs

< 1 days if web claim no other docs

< 30 minutes if walk-in with all supplementary

documents

Web customer interface. Call centre CRM and questionnaire interface. Business rules engine for questionnaire. System integration and workflow.

Inputs:customer data

claims datasuplementary documents

NB/policy documents

Customer cashless claims card (MALAYSIA, THAILAND) generates claims processing

without customer effort.Give customer contact details of claims

administrator for future queries (AUSTRALIA)

Workflow, systems integration, imaging system

21

3a

3b

4 5 76 6a21

3a

3b

4 5 76 6a

SAMPLE

18

Measuring Compliance of Optimised process – Quarterly Compliance Report submitted by Bus & summarised at RO

SAMPLE

The BUs’ self-assessments compiled quarterly compliance report

Summary of Compliance

SAMPLE

ING process improvementProcess New Business/Underwriting

Compliance with the optimized NB/UW process 2006 Q3

AU DL HK IN J P K B K R MY NZ SH TH TW

Sub-process and X measuresUnderwriting

4·1 We queue and route applications to balance workload with underwriter capacity 2 2 2 2 2 0 2 2 2 0 2 2

4·2 We route applications to minimize handoffs and referrals upwards 2 0 2 2 2 0 2 2 0 0 2 2

4·3 Underwriters can make counter-offers within pre-set limits, without referring the case upwards 2 2 2 2 2 0 2 2 2 0 2 2

4·4 We always underwrite to maximum sum assurable for later up-sell 0 0 0 2 0 0 0 0 0 0 0 0

Policy Issuance

5·1 We process payment only after we take the decision to issue the policy 2 0 0 0 0 0 0 0 0 0 0 0

5·2 The payment amount received is checked for correctness automatically 0 2 2 0 2 2 2 2 0 2 0 2

5·3 When payment is verified the policy packet is queued automatically for printing 2 2 0 2 0 2 2 0 0 2 2 2

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Managing BUs Project implementation – Monthly tracking of Projects

Owner Start Finish Start Finish Status

Malaysia

Quick hits

Capturing Dumb requirements Jimmy Q4 2005 Q4 2005 09 2005 12 2005 Finished

Agent explanation of the UW process to the customer Uma TBA

Balancing application workload with UW capacity Tina TBA

Underwriting for the maximum sum assurable Jimmy Q3 2006 04 2006 - - In progress

Welcome call and anti-lapse call for all new customers Kimmy TBA

Six-month upgrade for all new policies Jimmy 04 2006 01 2007

Customer and agent satisfaction Philip TBA

Improve scanning in Docuflow Jimmy Q4 2005 Q4 2005 09 2005 01 2006 Completed

Local investment projects

Online data input for branches (interim solution) Jimmy Q4 2005 Q1 2006 12 2005 04 2006 Completed

SMART to display medical requirements at e-submission Uma Q4 2005 Q1 2006 Q3 2006 Q4 2006 In progress

Automate simple non-medical deferments, Phases 1 to 3 Uma Q3 2005 Q1 2006 07 2005 11 2005Completed

Phase1 only

Integrate scanning, verification and packaging in a single step Jimmy Q4 2005 Q2 2006 12 2005 06 2006 Completed

Improve requirements management in workflow system Robert Q4 2005 Q2 2006 Q1 2007 Q2 2007 Not started

Enhance routing capability in workflow Tony Q4 2005 Q1 2006 Q3 2006 Q4 2006 Not started

Improve confirmation of non-issuance in workflow system Jimmy Q4 2005 Q2 2006 Q2 2007 Q3 2007 Not started

Plan Actual

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Sample of Quick Wins - Claims Projects

Workstream Project Goals Project Leader

Claims Design of Case-specific Claim Form Ted (Australia)

Claims Avoidable -Requirements Screening Ted (Australia)

Claims Pre-Screen Call Ted (Australia)

ClaimsCase-Routing to Assessors / Specialists & Field Investigators

Young Eun (Korea)

ClaimsClaim Assessor Case / Precedence Library and Best Practices Ritu (India)

ClaimsDispute Case Handling (incl. definition, metrics)

Raymond (HK Life)

Claims Escalation Logic Boonticha (Thailand)

Claims Accept / Decline CorrespondenceJimmy (Malaysia)

ClaimsDecline Communication Call & Info Capture Emily (Dalian)

Claims Fraud Detection / Prevention Ritu (India)

21

Linkage bw Six Sigma Projects, Optimised Process , Six Sigma Qualification Program and KPIs

Orange Belts

Black BeltsProject Selection Optimised Process Gap Analysis

Projects identified to fill gaps bw Current and

Optimised Process

Project Completed to achieve Project Goals and Improve

Processes

Project completion leads to Target

KPIs & Optimised Process

Planning

People

Analytical Problem Solving

ProcessManagement

Successful Project Replicated across

BUs via Workstream leaders &

updated on Intranet TPEX site – for

benefit of all BU s

Professional Development

Project Team Qualifies Orange Belt on

Completion of Project

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To Summarise we have a boxful of tools which are “field tested”

REPORTS

NEW KPIS

DASHBOARD

COMPLIANCE SUMMARY

PROJECT IMPLEMENTATAION

VOC INTERVIEW QUESTIONNERE

VOC SEGMENTATION

VOC FINDINGS

THE SIX SIGMA DEPLOYMENT MODEL

STD/OPT PROCESS

IT PROJECTS

QUICK WINS

AS-IS-PROFILING TEMPLATE

BEST PRACTICES LISTING

CTQs LISTING

CORE TEAM

WORKSTREAM LEADERS

WORKSTREAM MEMBERS

TRAINED RESOURCES

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THANK YOU!!