C-Direct Insurance Company

201KM GROUP PROJECT CASE STUDY 3 Case Study 3 The C-Direct- Insurance Company Developed by Peter Race, Henley Management College foreshadow up centres fork over fast become one of the most important channels for organizations and their customers to interact. There be much or less 4,000 call centres in the UK today,employing over 400,000 hoi polloi. The level sell amends industry is increasingly using call centres to access and redevelopment its market. The C-Direct -Insurance Company has its call centre in upstartcastle, England. The company itself is just 6 classs old and specialises in selling automobile insurance policies direct to customers. The processAdvertising and promotion initiatives attract customers interest and cede enquiries to the CD promise tenderness. These lead to the provision of quotations for personal car insurance. In order to provide the quotation, CD operators need to collect the customers personal and vehicle related data (in total 17 items) a nd stimulant them to the computer. The process is as follows Customers call the CD echo nerve (the focus of this case) by a freephone shout return 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 laughingstock pay by credit card and receive immediate insurance cover. Customers receive their personal insurance turn confirmed in writing by mail, about 23 days after initial contact. Mr piffling, the Operations Manager, is amenable for all operations in the Call Centre. The Call Centre employs 105 people in three shifts over a core day between the hours of 0800 and 2000. The resources for the Call Centre be its facilities for example the buildings and the staffs workspace/workstations the equipment for example, computers/systems the People who use them. Car insurance is compulsory in the UK, so customers are price sensitive and tend to shop ar ound to compare the companys brook with those of competitors. Only about 17% of CDs cites are converted into policies. The operations management strategies of scheduling, cleverness and quality management were reactive earlier than proactive for example, poor forecasting of demand resulted in special manpower being under utilised. staffs were inflexible and showed little sympathy or understanding to frustrated and hot under the collar(predicate) customers.The interfaces with support functions such as Marketing or Information Systems surgical incision tended to be confrontational rather than supportive. Fortunately, in the early days, competition was not very tough and Mr Small had no special achievement targets or formal control mechanisms he was literally his own boss. The policy change After five dollar bill years of laid-back growth, over the last twelve months sales have only grown by 3% and the company is beginning to struggle with diminishing profits. The main reaso ns for the slowdown have been identified New Entrants 15 companies in the last 2 years, producing a wave of direct insurance startups.These companies have targeted the like customer segment as CD, the market for which has remained stagnant. Customers are more price sensitive and radical entrants offer extremely low prices. Substitute Products are unchanged customers still require car insurance. The revolutionary emplacement has forced management to review moving in policy options 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 infixed report showed that the CD Call Centre still had potential to improve service levels and cost efficiency. The end was therefore taken to extend the product range and improve service by reference booki ng Product tractability CD pass on respond to customers demand by prepareing a stark naked product household insurance and deliver it via the Call Centre, alongside car insurance. Household insurance is practically requested by customers and they have been in the past disappointed not to source it from CD.Furthermore, the product molding for household insurance is high, thanks to low average claims. Since only a some competitors currently offer household insurance, management believed they could generate an above average profit margin in the first year after launch. Responsiveness In order to make the sweet product successful, it will also be inevitable to fulfill customer expectations for time response. Consequently, operations management will need to visualise immediate access to the Cal Centre and efficient treatment of customers for both products.Quality Improve customer service at least(prenominal) to match competitors standards. Internal analysis has shown that t he auto 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 product, significant improvements in service delivery of all CDs activities is needed (including settlement of claims, which is not part of the Call Centres responsibilities). Cost Ensure price decrease of insurance premiums by reducing internal costs.All possibilities for besides cost reduction must be exploited to permit a price level spurn than the top five price leaders. By launching this policy change, senior management believe a successful carrying out will lead to higher customer satisfaction and consequently to profitable growth. Influences on the operations The change in business policy will have an impact on M. Smalls current operations strategies. The policy change has been developed at corporate level just the benefits will have to be delivered by Mr Small, the Operations Manager, in the f uture.Therefore, Mr Small will need to address the changes to operating systems structures and operations management objectives. The determination of the tradeoff between customer service and resource enjoyment will be a key factor for sustainable operation, especially in this competitive environment. The new business policy decision will affect Mr Smalls current practice in two ways. First, he will have to interface with the take care frame-up to manage the launch of the new product and modifications to the delivery processes.Second, Small will have to establish operations management strategies to allow the business to meet the objectives of the policy change. The Project phase Workforce The existing staff will be responsible for the new product, alongside the existing offering. Therefore an intensive development programme on Information applied science (IT) enhancements and new product features will be required. To improve the overall quality and service provision, customer s kill techniques and friendly handling of difficult customers will be covered during the training.Mr Small will work with the training department to develop a training plan which will take at least four-spot days per group to deliver (each group has about 10 employees). Therefore, he will have to instrument the training so that the normal business will not be hampered by too few staff in the Call Centre. The new training approach will also have a long term influence, because training updates for employees will be held at least once a year. unrivaled of the aims of the training is to reshape corporate culture so as to engender a commitment to high efficiency and excellent ervice. This will demand empowering the workforce to focus on customer service, together with give away collaboration between staff, by using more teamwork, to raise the overall efficiency levels of the operation. Mr Small will also have to interpose a feedback process to evaluate the satisfaction level of the s taff, to help make continuous improvement areas. Better motivation will be achieved by introducing a new bonus system, using positive customer feedback as a measure for rewards. Facilities & equipmentThe current workspace/workstation for a Call Centre staff member is a small, open boxlike area (less than one square metre), containing a terminal, keyboard and telephone. The boxes are very close together and do not have a proper noise protection. Staff complains about the workstations, because with the background noise of five or more colleagues, concentration is difficult, and the number of data input errors are high. Staff have little space to write notes, so for example, noting down a telephone number to return a call to a customer is very difficult.After looking at the staffs workspace, Small realised they would have to modify the building in order to create more space and provide noise protection. He thought that only by providing a convenient and ergonomic workspace would he be able to ensure his staffs full commitment to performance improvements. A careful forecast of future demand will be necessary in order to install the right number of new workstations and avoid under/over utilisation of resources. Technology A new terminal mask (template or standard screen) for the Call Centre ineluctably to be developed by the Information Systems Department (ISD).This mask must contain all questions that need to be answered by the customer. To ensure service quality, ISD would have to create a flexible IT system, which would enable the Call Centre staff to chop-chop understudy from one screen to another, according to customers demand. The competitor benchmark for time to switch screens is less than 3 seconds. Furthermore, high IT reliability is vital, because breakdowns in the past have stopped all activities of the Call Centre, (since they depend on online access to the mainframe) and customers could not be served during that time. Mr.Small wonders if an ISD/Cal l Centre staff taskforce should be setup to explore the main historical problems for poor reliability, define development areas and try to find the best thinkable solution. Organisation Experience in the past has shown that the first few months after a product launch to be critical. Therefore, a new role of a first alert support person needs to be established. The first alert person will help improve service by patrolling the Call Centre and helping the staff during busy times, in cases of difficult customer questions or with technical problems.Furthermore, they would have a coaching role for new employees and also support staff training. The Human Resource Department (HRD) will need to develop the job description, provide a career plan for that role, manage the necessary recruiting and training process and determine how this new position fits into the organisation. Questions 1. Prepare the Project Definition Report for implementation of the policy change. This report should cover vision purpose (including a stakeholder analysis) objectives scope strategy project phases and project organisation. 2. What are the risks for the project and how should they be managed?