INFO3008-Professional Development Report – Management Assignment Help

Assignment Task

Task

Case Study- The Reliable Insurance Company

Company Background
Call centres have fast become one of the most important channels for organisations and their customers to interact. The direct-sales insurance industry is increasingly using call centres to access and service its market. The Reliable Insurance Company (RIC) has its call centre in Newcastle, Australia. The company itself is just 6 years old and specialises in selling public liability and personal liability insurance policies direct to
customers. 

Overview
After five years of high growth, over the last twelve months, sales have only grown by 3% and the company is beginning to struggle with diminishing profits. The main reasons for the slowdown have been identified:
• New Entrants: 15 companies in the last 2 years, producing a wave of ‘direct insurance start-ups’
• Some of these companies only have an internet presence and don’t have the costs of a ‘bricks and mortar’ business
• These companies have targeted the same customer segment as RIC, the market for which has remained roughly the same size
• Customers are more price sensitive and new entrants offer extremely low prices
• Substitute Products are unchanged – customers still require liability and indemnity insurance

The new situation has forced management to review business policy options and to review the information management to provide a competitive advantage. Research has shown that for direct selling insurance products, the key market drivers are to:

• Offer a wider range of insurance products, so minimising the need for customers to deal with many suppliers
• Offer low prices
• Provide excellent service

A recent internal report showed that the RIC Call Centre still had potential to improve service levels and cost efficiency. The decision was therefore taken to extend the product range.
The product range will be extended by 2 new products – car insurance and household insurance – delivered via the Call Centre, alongside liability insurance. Both household insurance and car insurance are often requested by customers and they have been in the past disappointed not to source it from RIC. Furthermore, the product margins for household and car insurance is high, thanks to low average claims. Since only a few competitors currently offer household and car insurance, management believe they can generate an above average profit margin in the first year after launch.
Along with the extending of the product range the following needs to be improved.

Responsiveness
In order to make the new product successful, it will also be necessary to fulfil customer expectations for ‘timely’ responses. Consequently, operations management will need to ensure quick access to the Call Centre and efficient treatment of customers for all products.

Quality
Improve customer service – at least to match competitors’ standards. Internal analysis has shown that the insurance ‘lapse-rate’ (customers not renewing their policies) – which is an indicator of customer satisfaction – was above the market average. To avoid this trap with the new products, significant improvements in service delivery of all RIC’s activities are needed (including settlement of claims, which is not part of the Call Centre’s responsibilities).

Cost
Ensure price decrease of insurance premiums by reducing internal costs. All possibilities for further cost reduction must be exploited to permit a price level lower than the top five price leaders. By launching this policy change, senior management believes a successful implementation will lead to higher customer satisfaction and consequently to profitable growth. 

Company’s Creation and Use of Information
Advertising and promotion initiatives attract customers’ interest and generate enquiries to the RIC Call Centre. These lead to the provision of quotations for pubic liability insurance. In order to provide the quotation, RIC operators need to collect the customer’s personal and data related to their occupation (in total 15 items) and input them to the computer.

Customers call the RIC Call Centre (the focus of this case) via a free telephone number and submit the required information. This is entered directly into a computer terminal during the call, their questions answered, and quotation provided within 12 minutes. Customers can pay by credit card and receive immediate insurance cover. Customers receive their personal insurance offer confirmed in writing by mail, about 23 days after initial contact.

Mr. Frank Stevens, the Operations Manager, is responsible for all operations in the Call Centre. The Call Centre employs 85 people in three shifts over a core day between the hours of 0800 and 2000. The resources for the Call Centre are:

• its facilities – for example the buildings and the staff’s workspace/workstations
• the equipment – for example, computers/systems
• the people who use them

The call centre creates the following information for operational procedures: 

Reporting
Reporting based on the real-time interaction with customers. These reports track current and historical staff performance so as to provide information for the maintenance and improvement of the quality of customer service.

Previous Client Interactions
The customers’ data and previous call history are stored however is not stored within the telephone system.
This results in the operator having to put the customer on hold while they walk to the document filing wall to retrieve the customers interactions. This has resulted in long waiting times.

Recording of Previous Calls
The calls made to RIC are stored as MP3 files that are time stamped and associated with a client’s ID. If an operator wants to review previous calls they need to go to the file server and located the client amongst thousands of recordings.

Knowledge Base
Currently, the knowledge based is locally installed on each operator’s computer. When a customer rings the operator will search the knowledge for the answer and then email the relevant information to the client.

Timesheet Management
As many staff work off time sheets, which they complete themselves. This has led to much frustration to management, and management have stated they would like to see the telephony software management do this automatically but not sure how.

It is believed the procedures used to create this information is archaic and management demands a new approach to the use and creation of this information. They have also suggested it might be time to replace their central telephony system if need be.