Outsourcing outline

Michael Thomsen Feb—06—

Outsourcing outline

An abundance of operational support alternatives permits executives to compare providers, analyze the insurance value chain and identify efficiency, enhancement and organiza-tional transformation opportunities.

Outsourcing is one mechanism to achieve these gains. An outsourced claims management process can transform an insurance company, but requires thoughtful planning, partnering, transition Outsourcing outline execution with great skill. Competition and change The insurance industry is competitive and change is constant.

The competitive playing field is global and the competition is robust. Industry leaders deliver shareholder value by growing revenue, generating profit and producing above average returns on equity in a constantly changing environment.

Predictions for the nature of change expected over the next ten to fifteen years are diverse, insightful and highlight the need for new ways of thinking about insurance operations. Innovative change starts with the most senior executives.

Executives must provide leadership within their organizations to prepare for the future. The role of the executive, need for innovative change and the need to experiment with operating models and processes to remain competitive in the long-term should drive insurance executives to evaluate the insurance value chain for opportunities to leverage innovative sourcing alternatives.

Organizations that outsource can gain process capabilities through joint ventures, consortia and other resource-pooling models.

Outsourcing outline

Further, an organization that offers an internally-built process to the marketplace in effect creates an independent profit center, responsible for delivering services internally and externally. Sourcing alternatives are categorized based on the location of the process or service.

The in-house domestic model describes when processes are internally built and maintained with personnel and resources in the same country as that of the service recipient. In the in-house non-domestic model, also known as captive offshore, an organization launches its own operation in a different country, including both near-shore and offshore outsourcing.

When an external provider conducts the process with personnel and resources in the same country as the service recipient, the outsourced domestic model is being used. An outsourced non-domestic model refers to the performance of processes by an external provider that delivers the service with personnel and resources in a different country than the service consumer.

Due to licensing and oversight requirements, claims management service providers have traditionally been outsourced domestic service providers.

The market for claims management service providers in the United States is fragmented with a small number of firms holding considerable market share.

Claims management service providers have been providing outsourced claims man-agement solutions to insurance companies for more than forty years.

Claims management service providers as a sourcing alternative The existence of a small number of large, well qualified commercial property and casualty claims management service providers in the United States may be attributed to the explosive growth of the alternative risk financing market during the latter part of the 20th century, and the subsequent broader adoption of these services by other bearers of underwriting risk.

During this period, we saw large individual commercial insurance buyers self-funding increasingly larger amounts of underwriting risk in the form of self-insured retentions and large deductibles.

As a result, they came to desire total control of the claims management process in order to gain process flexibility, fee and expense transparency, and reduced loss adjustment expenses. A few savvy insurers recognized a market opportunity and spun off their superior claims operations to create stand-alone profit centers that today are viable alternatives to the traditional insurance company claims operation.

Good claims management service providers offer competitive advantage through the maximization of efficiency, enhancement and transformation gains produced by their own sourcing strategies.

Inasmuch as the claims management process is comprised of several sub-processes, including claims investigation, loss reserving, financial management, litigation management litigation planningmedical cost containment managed care strategiesrecovery management subrogation, salvage, second injury fundsettlement, regulatory compliance and information management, each represents an opportunity to provide a superior service that positively influences loss and expense ratios.

In addition, other sub-processes involving call center functions, independent adjusting, loss fund administration loss payment issuancedefense work, medical bill review, nurse case management, PPO network management, structured settlements, and others may offer additional gain if managed effectively.

The most successful outsourcers focus on planning for business outcomes, partnering for performance, strong governance for smooth transition and execution with innovation.A lot of discussions about outsourcing in the media make it appear complex, but it's quite simple. Even in our homes, we "outsource" many tasks: Cooking, maintaining our lawns, and child care, just to name a few.

Outsourcing outline

When we don't have the time, the focus, or the skills to do the work ourselves, we look for someone who can, and someone who will do the work for a price we can afford to pay. Confirmed presentation title: "Principles and processes - building a robust, process driven discovery outsourcing operation at BAYER".

Professional custom writing service for your academic needs Money Back Guarantee 24/7 Support FREE Outlines Our professionals will help you to handle any assignment Essays Research Papers Zero Plagiarism Affordable Pricing. Offshoring is the relocation of a business process from one country to another—typically an operational process, such as manufacturing, or supporting processes, such as accounting.

Typically this refers to a company business, although state governments may also employ offshoring. More recently, offshoring has been associated primarily with the outsourcing of technical and administrative. ASD is a quality management standard for aerospace organizations.

Use it to establish, update, and certify your organization's quality management system (QMS). Outsourcing has become strategic—yet many executives remain unprepared. A new era of capability sourcing will trigger organizational redesign and require a new set of managerial skills.

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