201309 LOMA Policyowner Service and Contact Center Workshop

Presented by:Presented to:

THE NOLAN COMPANY

LOMA 2013 Policyowner Service Seminar and

Contact Center Workshop

Conference Survey & Current Topics

Steven Callahan, CMC©

ChFC, CLU, FFSI, FLHC, FLMI/M, ACS

September 10, 2013

Practice Director

2 Policyowner Service Seminar and Contact Center Workshop September 10, 2013

Introduction

The Nolan Company• Management consulting firm celebrating 40th Anniversary serving Insurance,

Healthcare and Banking clients.• Focus on solving complex operational and technical business challenges seeking

improvements in client competitiveness, effectiveness, and performance.

www.renolan.com www.linkedin.com/in/stevencallahan

www.renolan.com

www.linkedin.com/in/stevencallahan


Session Overview

Current Challenges

Survey Results Group Topics


Claims Severity

Industry Faces Challenging Times

Investments

RegulationMarket Exits

Technological Advances

Competition

Life Insurance Ownership


Demands on Service AmplifiedMore Diverse Consumers

Surge in New Service Mediums

Five Generations of Consumers, Large New Wave Coming(% of Total Population)

Greater Ethnic Diversity

The Digital Generations- powerful consumers


Diversity Adding To Expectations

0

10

20

30

40

50

60

70

80

Milli

ons

GI Swing Boomer Gen X Gen Y

High TechLow Tech

Increasing Customers Demands• Immediacy / 24x7 access• Transparency• Personal service relationships• Language differences• Benchmarks within and outside the industry

Agent > Mail > Phone > Fax > Email > Website > Chat > Social (FB, Twitter)


Service Operations

Putting the Pressure On

New↑ & Old↓Technology

Expanding Service M

ethods

Diverse ← & Aging →Workforce


With Less Room for Error

Key sources of service frustration and probability of switching:

Best way to prevent switching?• First contact resolution 67%• Reward & recognition for doing more business 54%• Preferential treatment 44%

62%64%65%

70%71%

73%77%

78%

0% 10% 20% 30% 40% 50% 60% 70% 80%

Attempts to cross sell when calling for…Having to repeat same information over…

Long hold times when calling serviceStaff unable to answer question

Business policies that inhibit delivering…Multiple attempts to get problem resolved

Unfriendly or impolite service staffIncorrect product or service provided


“… a modest increase in customer experience will increase customer loyalty

and boost revenues by approximately $298

million for a $10 billion insurance provider.“Forrester Research Datamonitor

“Nationwide Insurance found that a

1% increase in customer retention

increased annual premiums by $1

million”Insurance Tech Datamonitor

Cisco Innovators

“Reducing customer attrition by 5-10% can increase annual profits

by as much as 75%, according to a study by the Wharton School.“

Eight Strategies for First Rate Customer Service,

Cisco Innovators

Today’s Customer has Great Power

Tens of thousands of positive service touchpoints a day, and yet one bad interaction…

And suddenly your company is at the top of the tweets list telling thousands followed quickly by a Facebook “Unlike” Fan Page.

Before Social Media

Today’s Customer


Yet Strong Service Delivers Revenue

Strong Customer Experience Management =

Improved Revenue

Red = Lost Revenue / Customer TurnoverYellow = Incremental Revenue, Existing CustomersDark Blue = New Customer RevenueLight Blue = Net Change in Revenue

AverageBest-In-Class LaggardsNet Up $273M Net Up $84M Net Down $43M


And Companies Are Acting

Expanding Accessibility 100%Accelerating Service Delivery 96%Increasing Hours and Days of Service Availability 82%Creating Different Levels of Producer Service 82%

Consolidating Similar Functions Across Divisions 75%

Creating Different Levels of Customer Service 63%Aligning Operations with Customer Markets 63%Consolidation of Call Center Operations 57%

Aligning Operations with Distribution Channel 57%

Consolidating Physical Locations 50%

RespondentsArea of Focus


Evolving the Service Delivery Model

One Size Fits All

§ Same service for all segments

§ Over invest in some, under invest in others

§ One model to manage

§ Differentiation created at company vs. segment levels

§ Easier to match capabilities

Evolving Model

§ Segmentation of needs and value

§ Service matched to segment needs

§ Appropriate service investment in each segment

§ More challenging model to manage but also …

§ Harder to replicate by the competition


Based on Differentiated Customers

PredictiveAnalysis

and Modeling

Low Medium HighPropensity to Convert

High value,Low

conversion, 2nd Priority

High value, Medium

conversion, Top Priority

High value, High

conversion, Top priority

Good value, Low

conversion, Low Priority

Good value, Medium


Good value, High

conversion, Top Priority

Low value, Low

conversion,Low Priority

Low value, Medium

conversion, Low Priority

Low value, High


Potential Value

Low

Med

ium

H

igh

Potential Future Value of Customer

Scoring of prospects based on conversion and value, marketing strategy developed to match

Survey Data

Web Log

Data

TextData

Purchased Data

Psycho-graphic Data

13


Using Life time Value

Time of Purchase Demographics -Loses predictive value over time as relevance is superseded by inforce behaviors

Customer behavior shifts focus from current to future value

Predictive Analysis

Current Value

Future Value

Post Purchase Activity –Increases in predictive value over time as behavioral patterns develop


Leveraging Technology to Deliver

From:

To:Phone

Paper

Email

Text

BYOD

Web

Service Delivery Process

Self-Service

ResolutionChat Video

Transfer Dialer

• Real time availability becomes key• Interactive online rules, forms and data neededNote: Social Media is a transport

Process = Requestà Process à Resolution


With a New Service Paradigm

• “Customer Satisfaction Doesn’t Count”The emotional connection payoff…Through extensive research, Gallup has developed a measure of customer engagement (CE11) that quantifies the strength and nature of a customer’s emotional connection to a company. Gallup’s 11-item metric assesses the critically important emotional bonds of Confidence, Integrity, Pride, and Passion that together reflect the true health of any company’s customer relationships. The payoff is a far stronger link to business results than any satisfaction measure can hope to provide.

…Gallup has found that without a strong emotional bond, satisfaction is meaningless.

Gallup Management Journal, March 2003

16









The One Change…..New phone system and experienced people that can train on the reports that are produced and to help trouble shoot problems with Call Monitoring & Witness.SystemsIntegrated and faster technology platform. Our CRM is slow and limited in functionality and we have multiple legacy systems. CSR sit on the clock a lot.Option of immediate feedback/survey provided by the customers at the end of a callMore advancement in social media within our company.Better measurement of contacts per policy/agent so we could see who's calling a lot to try and anticipate their issues and help prevent phone calls.A comprehensive Customer Relationship Tool with extensive tracking capabilitiesA more sophisticated phone software which would enable real-time reporting and monitoring.social media and automatic processingMore effective management of the call. Setting better expectations for callers. Less dependency on the back office.Implementing a CRMHiring appropriate levels of staff for the Contact Center and for backingup the Contact CenterKnowledge distribution systems (on-line documentation, field-level helps, etc.)Adding a Customer Service Center to allow them to handling simple changes. Adding a documentation system to allows us to track all phone conversations. Building a survey for our customers so we know how were doing.Create 2 groups. One dedicated to the telephone calls and another dedicated to processing changes, etc. Therefore, a better focus towards each tasks.Separation of call center and processing center; however, our group is currently smallImproved systems (i.e. mainframe legacy system)Having a console that worked with all of our admin systems to provide complete information to the reps without having to utilize multiple systems. We need a more complete one-stop-shop.Moving off of multiple claim systems onto one platform.


Common Issues and Challenges

• Misalignment of service strategy and corporate strategy• Focus on technology solution and ignore process• Customer service positions viewed as entry level• Customer service training often early casualty of budget cuts• Static solutions prevent dynamic changes• Failure to revise key metrics to reflect dynamic service environment

25

Economy & Finance

201309 LOMA Policyowner Service and Contact Center Workshop