CRM• Customer satisfaction in any sector is a multi-faceted dimensionwhich encompasses quality product and value addition through valueevidence• CRM, or Customer Relationship Management, is a company-widebusiness strategy designed to reduce costs and increase profitabilityby solidifying customer loyalty• There are three key elements to a successful CRM initiative: people,process, and technology.• CRM is perceived as an• Information technology solution for ensuring a better customer servicesby increasing business in competitive environment• Meeting the demands of the market• The needs of customers• Evolved as Customer- Centric Philosophy for whole organization
Objectives of CRM• CRM is an organizational strategy to develop mutuallyprofitable lifelong relationship with the customer• The primary objectives of CRM are to build and maintain abase of committed customers who are profitable for theorganization• Use technology and human resources to understand theneeds and behavior of present and potential customers.• Acquire, retain and establish mutually rewarding, one toone, relationships with customers.
Objectives of CRM• Provide better customer service to customers.• Identify high value customers so that the organization canserve them better with differential service.• Increase customer revenues by cross selling and upselling.• Simplify marketing and sales processes• Collect customer information at all possible points andmaking this information available to the entireorganization
Need of CRM in Insurance Industry• Insurance products are becoming more commoditized.• Presence of numerous players.• Advertising efforts are being countered by comparison portals,insurance advisors and corporate alignments.• A large share of business is driven through intermediaries whereinformation challenges exist for effective management.• Companies continue to face stiff revenue targets spread across toomany stakeholders.• Stakeholders struggle to deal with too many processes, systems andgeographies• Speedy documentation and processes at the time of issue of policies• Prompt redressal of customer grievances
PROCESS OF CRM• Redesign Functional Activities• Redesign the functional activities on implementing CRM whileworking at cross-purposes functional Departments• Customer-centric Business Strategy• Plan around customer wants but not company goals,• focus on listening to customers but not forcing them to listen toyou• Promote communication of marketing including databasemarketing (e-database marketing, e-database, e-marketing, etc)
CRM Process• CRM Initiative• Introduce new technologies in System• Communicate & Educate employees• Identifying Customers• Primary Customers : policyholders, beneficiaries, insured, agentsor brokers• clear understanding of each of the customer segments• build an infrastructure and strategy to provide customers withproducts and services• Collecting and owning customer data• Capture and combine customer information from various offices &sources
Existing CRM Facilities inIndian Insurance Sector• MAX NEW YORK LIFE• The RATER strategy for its operations and for thecustomers• Reliability• Assurance• Tangibles• Empathy• Responsiveness
• CUSTOMER LISTENING SYSTEMS• The company has a customer listening system• The tools used for it are:• Customer satisfaction surveys• Agent satisfaction surveys• Service scorecard (Customer touch point experience)• Customer/Agent issues inventory• Service monitoring questionnaire with policy pack• Complaint questionnaires
VALUE CHAIN• Product development• Customer acquisition• Policy issuance• Post policy servicing• Collections/renewals• Claim settlement• This process is supported by Customer Care/call centres,IT, F& A, Actuarial, HR &facilities, Marketing and legalprocesses.
LIFE INSURANCE CORPORATION• e- CRM software by the help of Wipro and IBM .• CRM project is the largest of its kind in India.• Wipro and IBM work together to compile the data policy holders ofLIC.• Data would reflect consumer behaviour of policy holders, nos ofcustomers going for loans• Extensive network with a Web front-end to make policy detail andservices more accessible.• EPS (Enterprise Portal System)• Voice-• enable it’s WAN and video• Conferencing solutions
Benefits for LIC• Streamlines processes• Collections via the Web reduce time taken fortransactions & benefited LIC by 12% reduction in costs.• Single point of servicing of the customer.• Single Window Operations for all products and servicesfor a customer• Customer ID links all policies of a customer from thebranch data base.
HDFC ERGO GENERAL INSURANCE• With the new system in place, field executives can nowupload leads generated from the market, third-partydatabases, and existing customers into a centralrepository.• The sales team then uses the Lead Tracking andReporting Mechanism tool to manage leads and trackthese leads across the customer lifecycle, generate variousreports for top management
Benefits for HDFC ERGO• The system has given the flexibility to customize theproducts according the users needs.• A single repository of data enables the company toclosely track the sales pipeline and figure out where thegaps are, and how to close them out.• An increased lead conversion rate which stands at 30%. A30% conversion rate of 20,000 leads equals 6,000policies.
Strategies for Success of CRM• Comprehensive Repository• A repository of customer information incorporating data of the entireorganization and all its locations should be created• A system should be built to allow real time data access• Localize• CRM systems’ mid-point contact software must be in local language forcustomers and employees• Should adhere to local security and privacy laws, management of currencyrelated issues• productive integration of local business processes• Phased implementation• Single point testing• MNCs must begin with identifying their most successful and revenuegenerating country• Reduces risk of failure of overall system
Strategies for Success of CRM• Collaborating with all stakeholders• Organizations should involve existing business partners• business and channel partners offer valuable inputs from theirexpertise area• help acquire buy-in for new technologies and processes.• Integration• Effective cross-channel integration helps all departments to beactively involved in sales and service through a singlecustomer view• Integration between front office and back office systems is amust.• User coaching
Successful CRM Implementationin Insurance Sector• Reliance General Insurance• Leading provider of Health, Car, Home, Travel and Businessinsurance.• Network of over 200 offices spread across 173 cities in 22 states ofIndia.• Founded in 2000.• Challenges Faced:• Different processes for different customer segments.• Reorganize and streamline reporting systems.• Eliminate multiple reporting tools and constant data reconciliation.• Implement "one version of the truth" solution across informationsilos.
Solution• Effective lead management through direct channel &telesales• Effective customer servicing by intelligent allocation of casesto specialist teams & closures within SLA.• Integration between various core systems for effectivecustomer servicing/operations management.• Lead capture through various source & distribution acrossagencies for a quicker inspection & sale of policy.• Sales Force Automation, Marketing Automation, CustomerService & Support along with Analytics module• Starting with 500 users in 2008, Reliance General Insurancehas now a CRMnext user base of 10000
Benefits• Enhanced the capabilities of customer servicing byincreasing first time right (FTR) and turnaroundtime (TAT) adherence by 400%.• Reduced the cost of servicing by a great margin.• Improved lead conversion.• Increased the capability of customer retention.• Reduced time and IT resource requirements for regulatoryreporting.
TATA AIA Life Insurance• Background• Tata AIA Life Insurance Company Limited (Tata AIA Life) is a jointventure company, formed by Tata Sons and AIA Group Limited(AIA).• It struggled with multiple systems, technologies and stakeholderconflicts. Customer information and processes were fragmented inover 25 systems.• Challenges• Inter-department coordination• No unified system of customer information available• Manual assignment for premium collections over spreadsheets and emailscreated delays• Manual assignment of new applications for verification, validations
• Challenges• Knowledge retention• No effective tracking of channel, branch and vendor persistency andperformance.• Lack of reliable measures to track feedback of customers on products andservice.• Standard Customer Communication• No standardized platform for communication between internal team andcustomers.• Process control and inefficiency• No single system to monitor new application issuance across all touch-points.• No cataloguing of undelivered or invalid cheques• Manual extraction and analysis of customer data for execution ofcampaign.• Incorrect capturing of service requests due to lack of validations leadingto increase in wait time for customer
Solution• Convenient New Business Process• Single system for Branch, operations, agents• Reduced departmental dependencies• Pending Management• Policy Dispatch Management• Integrated Customer Services Process• Across Touch-points - call center, branch, email, web, mail,• Across Request Types - Enquiry, Complaints, Requests,• Across Departments- Customer service, POS, New Business
Solution• Marketing and Lead Management System• Touch point unification - call center, branch, email, web, mail,SMS, portal• Single system for managing Leads - New Acquisition Leads,Cross-sell Leads• Models for Intelligent Cross-selling• Cross-sell campaign set-up• Collections Management System (Business Conservation)• Single system across Agencies both internal and external
Benefits• Increased customer retention• Improved inter-departmental teamwork• Categorization of customers• Availability of information on a single platform• Business Conservation and New Business• Profit goes up 402 percent - from Rs.51.79 crore to Rs. 260.31crore.• New business premium from traditional business at 45 percent -up from 29 percent.
Benefits• Customer Service Management• TAT for customer service request has improved from 4.05days to 2.74 days.• Adherence to SLA has increased to 95%.• Better process control• Increased visibility through automated reports, escalationsleading to better control.• Process consolidation of pre-submission calling, cross sellcalling, new lead calling, campaign designing• Availability of information with regular updates on thecampaigns with offer statuses and customer information
SBI Life• Background:• SBI Life Insurance is a joint venture between State Bank of India and BNP ParibasCardif., wherein SBI owns 74 percent of the total capital and BNP Paribas Cardif theremaining 26%.• CRM Highlights:• An in-house CRM system that serve as a complaint and lead management system• SBIs CRM system handles customer complaints efficiently through multiple channels• New CRM system has improved transparency, brought down complaint resolution timeand cuts across all customer touch points• Allows a single view of the customer and follows it within the hierarchy• SBI Life can efficiently service any query/compliant because they have a consolidatedview of all the past payments and history of customer interaction• New system allowed to capture the initial interactions with potential customers. Thishelped in understanding customer behavior; what people are looking for.
Benefits• The central monitoring team helped in customer serviceescalation hierarchy decision.• It allows a single view of the customer and follows itwithin the hierarchy, and offers a summarized view• Improved transparency, brought down complaintresolution time• First insurer in India to complaint with IRDA ruleseffectively.
Reasons for CRM Failure• Customer – if clients are dissatisfied with executionof CRM system• Data – Data stored should be complete. Anyinconsistency can lead to problems• CRM is implemented for enterprise & not customer• Cost – Cost incurred in for support, maintenance &ongoing upgrade. As business grows this becomesquite expensive• Security - A lot of security patches needs to getinstalled. If not done on time it can lead to problems.
Failure in CRM Implementation – MetLife InsurancePROBLEMS• Happened when several databases across enterprisewere integrated• Data organized around product groups & notcustomers• Data across systems was inconsistent• Wanted to increase automation & amount of dataavailable to customers• Goals of users was not explored• Voice response system was installed• Customer wish was not taken into consideration
Failure in CRM Implementation – MetLifeInsuranceRESULTS• Resulted in customer attrition, wasted financialresources, and lost opportunities• The customer was not willing to punch through abunch of numbers• Insurance agents complained of losing deals becauseof poor service• Cost of the implementation project ran into sevenfigures• Cost of implementation was less than the likely lossessuffered by MetLife due to loss of customer
Failure in CRM Implementation – CignaPROBLEMS• Cigna HealthCare was operating with IT systems thatwere nearly two decades old• It had separate units for enrolment, processingmedical claims and verifying customer eligibility• The customer information pertaining to medicalclaims was spread across 15 distinct IT systems• The claims and eligibility information systems werenot inter-connected• Customer service representatives found it difficult toprocess the 120 million claims per year that CignaHealthCare received
Failure in CRM Implementation – CignaRESULTS• Develop an integrated system• This system would• Generate one bill across products and divisions• Process the medical claims of customers• Provide case histories of all the customers to thecustomer service representatives• Facilitate exchange of information with customers
Failure in CRM Implementation – CignaWhere the system failed• Failure in integration of huge database• Implementation of system without optimally checking it• The front-end applications, used by service representativescould not retrieve data from the back-end systems easily• The back-end database was not filtered and sorted out• Customers also faced difficulties in obtaining informationrelating to health coverage plans• Cigna was unable to confirm the registration to customersfor many days• Cigna issued identity cards with incorrect numbers andservices were provided incorrectly• Cigna lost .89 million customers & $ 398 million in revenue
CHALLENGES• Effectively collaborate with network of agents andintermediaries to get better visibility of sales processes,reduce cycle times and prevent revenue leaks?• How to provide valid, up-to-date intermediary-wiseperformance data to help relationship managers driverevenues?• How to influence corporate buying decisions, whileworking to forward relationship width?• How to ensure optimal service quality to customers&intermediaries, across a multi-source eco-system?
CHALLENGES• How to evolve a complete 360 view of customers alongwith their policy holdings, risk profile, premiumpayments, claims history, to judge true valueof relationship?• How to tap complete household/ account potential tooffer personalized products as per requirement andpropensity, using cross-sell/ up-sell techniques?• How to provide proactive real-time insights intoprocesses for actions, with intelligent reports&dashboards?• How to comply with ever changing insuranceregulations?
Conclusion• Insurance sector in India is a booming sector and has seen atremendous growth in the past few years.• Affirmative view of customers about owning an insurance policywhich proved that Insurance is the need of the day.• Insurance companies have started developing specific CRMinitiatives to retain their customers.• Policy holders also acknowledge the presence of such CRMinitiatives.• Though many initiatives have been taken up by companies, stillCRM in the Insurance sector is at a nascent stage• CRM solutions can go a long way in helping companies implementeffective measures to manage risks.• CRM solutions can help the sales team make clear decisions