C-Direct Insurance Company

201KM sort PROJECT CASE STUDY 3 Case Study 3 The C-Direct- Insurance Company Developed by Peter Race, Henley Management College blazon out centres hold fast become unrivaled of the most important channel for organizations and their customers to interact. There are around 4,000 call centres in the UK today,employing everyplace 400,000 people. The coach sell insurance policy indus endeavour is increasingly victimisation call centres to doorway and do its market. The C-Direct -Insurance Company has its call centre in Newcastle, England. The company itself is scarce 6 categorys old and exceptionalises in selling automobile insurance policies direct to customers. The processAdvertising and promotion initiatives attract customers interest and consecrate enquiries to the CD invite oculus. These lead to the pro imagination of credits for personal car insurance. In order to give the quotation, CD operators need to collect the customers personal and vehicle related dat a (in total 17 items) and input them to the computer. The process is as follows Customers call the CD blazon out Centre (the focus of this case) by a freephone telephone offspring and submit the required information. This is entered directly into a computer terminal during the call, their questions answered, and quotation entrustd within 12 minutes.Customers can pay by credit twit and receive immediate insurance cover. Customers receive their personal insurance crack cocaine confirmed in writing by mail, about 23 eld after initial contact. Mr teeny, the Operations Manager, is responsible for all operations in the shout Centre. The Call Centre employs 105 people in tether shifts over a core day between the hours of 0800 and 2000. The resources for the Call Centre are its facilities for example the buildings and the staffs workspace/workstations the equipment for example, computers/systems the People who use them. motorcar insurance is compulsory in the UK, so customers a re price small and tend to shop around to compare the companys bid with those of competitors. Only about 17% of CDs offers are reborn into policies. The operations worry strategies of scheduling, capacity and quality commission were reactive earlier than proactive for example, poor forecasting of demand resulted in excess manpower being under utilised. modules were in flexile and showed slim sympathy or dread to frustrated and angry customers.The interfaces with gestate functions such as Marketing or reading Systems Department tended to be confrontational rather than birthive. Fortunately, in the early geezerhood, competition was not very tough and Mr Small had no special performance targets or formal control mechanisms he was literally his cause boss. The policy change After five years of noble growth, over the last twelve months sales lead lonesome(prenominal) grown by 3% and the company is beginning to struggle with diminishing profits. The main reasons for th e slowing have been identified New Entrants 15 companies in the last 2 years, producing a wave of direct insurance startups.These companies have targeted the same customer segment as CD, the market for which has remained stagnant. Customers are more price smooth and new entrants offer extremely low prices. Substitute Products are unvarying customers still require car insurance. The new situation has forced fill inment to review business policy options to provide a competitive advantage. look has shown that for direct selling insurance ingatherings, the key market drivers are to raise a wider range of insurance intersection points, so minimising the need for customers to deal with many an(prenominal) suppliers. Offer low prices Provide excellent service. A recent intragroup report showed that the CD Call Centre still had potential to mend service directs and cost efficiency. The decision was therefore taken to extend the overlap range and improve service by address ing Product flexibility CD go away respond to customers demand by entering a new product household insurance and deliver it via the Call Centre, alongside car insurance. Household insurance is often requested by customers and they have been in the sometime(prenominal) disappointed not to source it from CD.Furthermore, the product margin for household insurance is high, thanks to low average claims. Since only a few competitors really 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 new product no-hit, it testament to a fault be indispensable to fulfill customer expectations for m response. Consequently, operations management go away need to ensure quick attack to the Cal Centre and efficient treatment of customers for both products.Quality Improve customer service at least to match competitors banners. Internal analysis has shown that the auto insurance lapse rate (customers not renewing their policies) which is an indicator of customer triumph 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 occlusion of claims, which is not part of the Call Centres responsibilities). Cost examine price decrease of insurance premiums by reducing internal costs.All possibilities for advertize cost reduction must be exploited to permit a price level lower than the top five price leaders. By launching this policy change, senior management believe a successful implementation leaveing lead to higher customer satisfaction and then to profitable growth. Influences on the operations The change in business policy pull up stakes have an impact on M. Smalls current operations strategies. The policy change has been separateed at somatic level but the benefits will have to be delivered by Mr Small, the Operations Manager, in the proximo.Th erefore, 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 exercise will be a key factor for sustainable operation, peculiarly in this competitive environment. The new business policy decision will affect Mr Smalls current practice in ii ways. First, he will have to interface with the project setup 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 hear phase Workforce The existing staff will be responsible for the new product, alongside the existing offering. Therefore an intensive dressing programme on Information Technology (IT) enhancements and new product features will be required. To improve the overall quality and service provision, customer acquisition techniques an d friendly handling of difficult customers will be covered during the schooling.Mr Small will work with the training department to develop a training plan which will take at least four days per group to deliver (each group has about 10 employees). Therefore, he will have to schedule 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. One 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, unitedly with better collaboration between staff, by using more teamwork, to raise the overall efficiency levels of the operation. Mr Small will also have to put up a feedback process to evaluate the satisfaction level of the staff, to help identify continuous impr ovement sports stadiums. Better motivation will be achieved by introducing a new incentive system, using verifying 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, dumbness is difficult, and the spot 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 for 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 agreeable and ergonomic workspace would he be able to ensure h is 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 needs 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 quickly switch from one screen to another, according to customers demand. The competitor benchmark for metre to switch screens is less than 3 seconds. Furthermore, high IT reliability is vital, because breakdowns in the ult have stopped all activities of the Call Centre, (since they depend on online doorway to the mainframe) and customers could not be served during that time. Mr.Small wonders if an ISD/Call Centre staff taskforce sh ould be setup to explore the main historical problems for poor reliability, define development areas and try to find the best possible 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 fortune the staff during busy times, in cases of difficult customer questions or with skilful 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 st akeholder analysis) objectives scope strategy project phases and project organisation. 2. What are the risks for the project and how should they be managed?