In the previous blog posts in this series, I discussed what makes the life insurance industry an ideal candidate for robotic process automation (RPA) and the various benefits this technology delivers. Now, let’s talk about why many life insurers fail to harness the full potential of this powerful, strategic transformation lever despite having the appropriate ecosystem.

An effective RPA implementation requires a balance of many elements including an effective RPA operating model and organization design; appropriate governance of best practices, standards and execution strategies; change management; and last but certainly not the least, a holistic approach to identifying, prioritizing and selecting process candidates for automation.

Accenture has developed a unique, two-tiered approach that can deliver the best mix of tactical and strategic benefits. Insurers leveraging this approach can identify and address immediate opportunities—realizing quick wins that generate instant cost savings—while building momentum for more strategic and comprehensive operational transformation.

First-tier approach: This is a process-centric approach which means individual process candidates are assessed, scored and prioritized for automation primarily on their own merits. For example, the individual processes yielding the highest level of efficiency gains at the lowest level of complexity (implementation cost) will be prioritized.

Assessment and prioritization are typically completed using a scoring and assessment framework that considers key factors such as volumes, average processing time, complexity and the number of FTEs allocated to the execution of the process.

This is usually the first and only approach that insurers follow. It yields benefits quickly and efficiently. However, pursuing only a process-centric approach can leave a significant amount of value on the table without enabling meaningful strategic transformation.

Second-tier approach: This approach makes use of the scoring and assessment framework described above, but instead of evaluating individual processes on their own merits, the goal is to holistically evaluate groups of processes that are executed by discrete functional teams. It is not unusual for a team to carry out as many as 10 different processes, of which six or seven might be good candidates for automation.

For example, more than half of the back-office operations teams at one leading insurer were found to support multiple processes, each of which required fewer than four FTEs. These teams, accounting for over a third of the insurer’s operations staff, would mostly have been ignored under a process-centric approach.

The team-centric approach identifies the full breadth of potential that automation can achieve, prioritizing those processes as a group.

It allows insurers to achieve desirable ROIs by increasing the capacity of the team by up to 80 percent instead of the 30–40 percent that may be achieved by focusing solely on the one or two top-priority processes.

This team-centric tier enables insurers to transform the nature of their operations in a more strategic way by using RPA comprehensively. It gives them greater flexibility and scalability, setting the stage for the application of advanced analytics and enabling a sharper focus on customer interactions.

Life insurers planning to tap the RPA potential should ensure they follow a holistic approach that addresses both processes and team. With the right RPA strategy and effective governance structure, life insurers can make the most of RPA and become a successful insurer of the future.

For more details, read our point of view Intelligent Automation: Driving Efficiency and Growth in Insurance .

 

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