Case study: Modules cut back-office costs

Organisations often rely on old IT systems to manage activities such as HR and finance, and often these systems were not built to work together. If they want to improve efficiency, IT managers either have to find ways to link these disparate applications, or upgrade to a unified, integrated system.

When healthcare insurance and assistance specialist FirstAssist was spun off from its parent company, insurance provider Royal & Sun Alliance, it found it needed to replace its entire back-office IT infrastructure. "We are in the process of disconnecting our business," says Mitch Lambton, FirstAssist's IT director. "This involves us replacing our entire IT landscape across the enterprise technology stack, and achieving that in 18 months." The process began in April 2003 with a budget of £28m.

FirstAssist decided that the changeover would be a good time to move to an integrated system, and selected Oracle's E-Business Suite to improve service quality. It chose various modules from the suite, including general ledger, cash management, financial accounting and HR.

Lambton says one reason for selecting the Oracle suite was its integration capability, offering a unified system out of the box. "Because the solution was in essence pre-integrated in terms of the components, it allowed for rapid delivery of business systems to our users without having to add our own solutions," he adds. "This should give a vast improvement on our time to market."

The first stage of implementation involved the payroll capability, which was deployed in 12 weeks. General ledger and accounts payable modules were deployed in a similar timeframe.

Careful planning and management are needed to keep to the schedule. "This involves extreme planning on a daily basis, meeting the business community on a regular basis, and a single reference point for material about the project," says Lambton.

The firm also decided it needed a tailored claims management system. "We evaluated seven third-party solutions for claims management," says Lambton. But in the end the firm chose Oracle software to manage the claims process. "The suite offered all the horizontal capabilities, and then we topped and tailed it with a vertical function around claims management," Lambton adds.

FirstAssist is the first UK insurance firm to use the E-Business Suite to manage the claims process, according to Oracle's Chris Westwood. "Most firms still use legacy systems for this," he says. "But E-Business Suite offers a joined up process from the customer interaction level - via phone or internet - through to the back office, and finishing with required action from the claim."

This integration could help to reduce costs for the insurance specialist. "Management and control of the claims supply chain accounts for 75 percent of insurers' costs. We're helping them get end-to-end management of this," says Westwood.

The unified suite has also minimised the need for user training, as it offers a single platform with a common look and feel. "All our deployments are through a single point of entry," explains Lambton. "Users go through the Oracle portal for access to mail, the intranet and financial systems. We're reducing 15 to 20 systems down to one. This has a marked reduction in training costs."

The system provides a single environment for managing the firm's insurance product lines, as well as non-insurance services, such as healthcare products. "FirstAssist is not constrained by point solutions," says Westwood. "This will help them be more agile in the future."