Modernization of NTUC Income - Digital System

What were the problems faced by Income in this case? How were the problems resolved by the new digital system? In the past, NTUC Income, which has over a million insurance policy holders, processes were very tedious and paper-based. The entire insurance process started with customers meeting an agent, filling in forms and submitting documents. The agent would then submit the forms at branches, from where they were sent by couriers to the Office Services department. The collection schedule could introduce delays of two to three days.

Office Services would log documents, sort them, and then send them to departments for underwriting.

Proposals were allocated to underwriting staff, mostly randomly. Accepted proposals were sent for printing at the Computer Services department and then redistributed. For storage, all original documents were packed and sent to warehouses where, over two to three days, a total of seven staff would log and store the documents. In all, paper policies comprising 45 million documents were stored in over 16,000 cartons at three warehouses.

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Whenever a document needed to be retrieved, it would take about two days to locate and ship it by courier. Refiling would again take about two days.

So the processes were complicated and the result was waste of space and time, which leads in waste of money. The digital system can solve both of these problems and it cost 1/3 of the “paper–based” cost. What types of information systems and business processes were used by Income before migrating to the fully digital system? To solve these problems, NTUC Income started to use the HP 3000 in 2002.

Despite periodic investments to upgrade the HP 3000 mainframe that hosted the core insurance applications as well as the accounting and management information systems, it still frequently broke down.

The HP 3000 backup system allowed restoration to only up to the previous day's backup data. If the daily backup was not completed at the end of the day, the affected day's data would be lost and costly and tedious reconciliation would be needed to bring the data up to date. Another information system was the COBOL programs that were developed in the early 1980s and maintained by Income's in-house IT team, also broke multiple times, halted the systems and caused temporary interruptions.

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In addition, the IT team found developing new products in COBOL to be quite cumbersome and the time taken to launch new products ranged from a few weeks to months.

Describe the information systems and IT infrastructure at Income after migrating to the fully digital system? All this changed in June 2003, when Income switched to the Java based eBao LifeSystem from eBao Technology. The software comprised three subsystems - Policy Administration, Sales Management and Supplementary Resources. This system had a

Customer-centric design,

Seamless integration with imaging . Barcode technology. A product definition nodule that supports new products, new channels and changes in business processes. Implementation work started in September 2002 and the project was completed in nine months. By May 2003, all the customization, data migration of Income's individual and group life insurance businesses and training were completed. The new system was immediately operational on high-availability platform. All applications resided on two or more servers, each connected by two or more communication lines, all of which were "load balanced.

This robust architecture minimized downtime occurrence due to hardware or operating system failures. 4. What benefits did Income reap from the new system? As s result of adopting eBao Life System, about 500 office staff and 3,400 insurance advisors could access the system anytime, anywhere. Staff members who would telecommute enjoyed faster access to information, almost as fast as those who accessed the information in the office. NTUC Income new system had made possible:

1. Singular view of every customer - across products and channels
2. Opportunities to cross-sell .
3. Improved customer service
4. 50 % savings on both the time and cost needed to process policies
5. Reduced the time needed to design and launch new products
6. How well is Income prepared for the future?

Are the problems described in the case likely to be repeated? NTUC Income has build a very good foundation for the future. This new system with the according IT infrastructure make almost impossible for the previous problems to be repeated. NTUC Income has a fully digital system which is the future, and constant upgrading and maintenance.