=Paper=
{{Paper
|id=Vol-2428/paper2
|storemode=property
|title=Ditching labor-intensive paper-based processes: process automation in a Czech insurance company
|pdfUrl=https://ceur-ws.org/Vol-2428/paper2.pdf
|volume=Vol-2428
|authors=Jan Marek,Kurt Blümlein,Jürgen Neubauer,Charlotte Wehking
|dblpUrl=https://dblp.org/rec/conf/bpm/MarekBNW19
}}
==Ditching labor-intensive paper-based processes: process automation in a Czech insurance company==
https://ceur-ws.org/Vol-2428/paper2.pdf
Ditching labor-intensive paper-based processes:
Process automation in a Czech insurance company
Jan Marek1, Kurt Blümlein2, Jürgen Neubauer2, and Charlotte Wehking3
1 Generali CEE Holding, Na Pankráci 1658/121, 140 00 Prague NJ 08544, Czech Republic
jan.marek@generali.com
2 Bizagi, Nymphenburgerstrasse 4, 80335 Munich, Germany
{kurt.blumlein,jurgen.neubauer}@bizagi.com
3 University of Liechtenstein, Principality of Liechtenstein
charlotte.wehking@uni.li
Abstract.
(a) Situation faced: The insurance company Generali CEE Holding faced two
types of challenges. From an external perspective, the company had to tackle
challenges concerning digital transformation, regulatory compliance, and new
legislation. From an internal perspective, the company faced a legacy of paper-
based process documentation as well as process and workflow inconsistencies.
(b) Action taken: In the digital age, paper-based processes are obsolete and
obstruct progress. Based on an Agile project management approach, Generali
CEE Holding ditched its labor-intensive paper processes for corporate risk
underwriting during a company-wide transformation project, integrated their
processes and data into one robust platform, and implemented robotic process
automation software to significantly boost productivity and efficiency.
(c) Results achieved: The new platform and robotic process automation software
helped Generali CEE Holding make their processes consistent, automate their
inter-company workflows, and enhance employee and customer satisfaction. It
also ensured compliance with ever-changing laws and regulations in their
corporate risk underwriting.
(d) Lessons learned: Simply ditching paper-based processes by digitizing them
or deploying a solution for robotic process automation does not guarantee a
desired goal. It requires a lot of effort in terms of time and resources. This project
demonstrated that a radical change from paper-based processes to robotic
automation in a short period of time was possible by starting small and focusing
on a smaller sample of processes, making use of an Agile project management
approach, and connecting the business and the IT departments in the endeavor.
Keywords: Business process management system, robotic process automation,
insurance industry
Copyright © 2019 for this paper by its authors. Use permitted under
Creative Commons License Attribution 4.0 International (CC BY 4.0).
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1 Introduction
The international insurance company Generali provides life and other types of
insurance for a range of clients, including individuals, small- and medium-sized
companies, as well as corporations. The company aims to manage uncertainty about
their customers’ futures by protecting them against various risks. Generali offers motor,
home, accident, and health insurance as well as commercial and industrial risk solutions
in their property and casual insurance segments. With over 14,000 employees, 24
percent market share and eight million insurance contracts, Generali CEE Holding is
an important subsidiary and market leader in the Czech Republic. However, Generali
CEE Holding faced several challenges concerning digitalization, the insurance market
itself, and in their daily working routines concerning process and workflow
management that resulted in inefficiency and productivity loss. For example, internal
processes had been paper-based, which created the duplication of data and resulted in
time- and resource- consuming tasks for their employees.
New regulatory legislation also forced Generali CEE Holding to adapt their internal
processes. Generali CEE Holding took advantage of this opportunity to initiate an
organization-wide transformation project. The goal of this project was to embark on an
organization-wide business transformation to significantly boost productivity and
efficiency in the area of corporate risks underwriting. In 2010, Generali CEE Holding
teamed up Bizagi, an international software company for business process management
(BPM) solutions, to manage this transformation. In this case, the transformation
focused on digitizing processes, as well as process- and workflow automation,
including robotic process automation. The automated and efficient processes and
workflows finally delivered immediate benefits for Generali CEE Holding. Generally,
process automation is concerned with the automation of either simple single-process
activities or entire complex processes [4]. This paper describes the situation and the
challenges Generali CEE Holding faced, actions that were taken to overcome these
challenges, what was achieved, and finally, lessons learned.
2 Situation Faced
From an external perspective, Generali CEE Holding not only faced legislative and
market challenges but also new the challenges from the digital age. First, a changing
regulatory backdrop and new legislation from the Czech and European governments
forced Generali CEE Holding to take actions and adapt their processes. For example,
they had to meet the requirements of data protection regulation legislations and changes
to the International Financial Reporting Standards and Insurance Distribution
Directive. Second, digitalization was a powerful force, radically changing the insurance
company’s landscape. Therefore, Generali CEE Holding needed to act quickly and
deliberately to stay competitive and not lose the race against competitors. Insurance
companies often go through digital transformation projects to optimize the customer
experience and enhance customer loyalty.
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From an internal perspective, Generali CEE Holding struggled with process and
workflow inconsistencies. First, their processes used paper-based documentation. Such
traditional filing systems, often result in a waste of time and resources. Finding the right
document, passing the documents back and forth to update process information,
creating duplicate entries, and even dealing with lost documentation results in
inefficiency and unstructured processes. Second, processes that have already been
properly documented digitally, can be managed even more efficiently with the help of
(robotic) process automation. Various industries have recognized the enormous
potential of business process automation to improve product quality and efficiency [7].
However, Generali CEE Holding employees still needed to switch between different
systems (e.g., an internal data management system, policy system, and client overview),
to receive the right information.
To overcome these internal and external challenges, Generali CEE Holding initiated
a large-scale process project.
3 Action Taken
As part of the transformation strategy, Generali Holding CEE initiated a large-scale
project. The overall aim of this project was to deliver structured processes for the
underwriting process lifecycle in order to enhance productivity and efficiency. In
particular, the focus was on the policy cancellation and the policy binding processes.
Based on an Agile project management approach (i.e., Scrum), Generali CEE Holding
started to take the required actions. Agile methods originate in the field of software
development and found their way into project management (e.g., [3]). Nowadays, this
approach enjoys great popularity among practitioners due to its fast-developing nature
and user-centeredness. In the Agile method, a self-organizing team works at a high pace
that still allows a balance of creativity with productivity. The team always needs to
respond flexibly to changes from both the business and the technical sides [6].
Furthermore, employees and customers are actively involved in the development
process to provide timely feedback. New technology by itself does not create value
right away, it needs people and processes to incorporate the technology, thus making
innovation possible and creating value for the company [8].
Generali CEE Holding followed multiple steps to change from paper-based, labor-
intense processes to partly robotic automation-driven ones. The following paragraphs
describe the four main steps of this journey. First, Generali CEE Holding’s IT and
business departments came together to form a project team. Other than the software
solution provided by Bizagi, the project was handled in house due to unclear user
requirements at the beginning and a high demand for fast delivery. The entire project
had a timeframe of eight months. A team of three BPM developers and two business
analysts worked together in workshops and interviewed users to receive the necessary
information about the requirements of the new platform. Consideration of the important
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principles of BPM, such as the principle of joint understanding and the principle of
involvement, allowed the team to master challenges they encountered [11]. For
example, the project team presented the users with the new versions of the prototype
every week for five months. Consequently, all the stakeholders were well integrated
into the project, and a common understanding of the problem and solution was created.
At first, the target group (i.e., employees of the business and the IT departments)
disliked the idea of the new platform, and the project team faced great resistance to
change. The employees preferred stability and continuity with the existing way of
working and feared the new changes. Often, as in this case, communication has been
recognized as a relevant dimension for the success of organizational change [9]; the
success also depends on top-level management supporting proper communication,
training, and workshops [2]. As soon as the users understood that the new platform
would simplify their work and allow a more efficient way of working, the users’
resistance to the change disappeared.
Second, based on the collected user requirements, Generali CEE Holding introduced
a robust BPM platform prototype to facilitate the process and workflow management.
Over a period of five months, the project team presented the users with new versions
of the system on a weekly basis. Based on the users’ feedback, the prototype was
developed further and new functions were added. Each week, a new feature of the
platform was introduced to keep the users interested. The new platform consisted of
four systems: web service integration, a document management system, the BPM
engine, and a policy management system. Fig. 1 represents the new BPM platform.
Internet Internal network
management
management
Web Service
BPM engine
integration
Document
system
system
Policy
Bizagi
Brokers Broker application
Firewall
Clients Client application Back office users Bizagi Front-end
Fig. 1: Solution architecture
This simple architecture allowed Generali CEE Holding’s customers and employees
to interact smoothly. The web service integration in the form of an Oracle Enterprise
Service Bus allowed Generali CEE Holding to communicate with their clients and
brokers via the internet. Several application programming interfaces allowed the
collected customer information to be distributed to the BPM engine and document
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management system. It was then possible to automatically handle customer cases, such
as quotations, complaints, and data protection regulation requests, and send these
directly to the corresponding back-office departments. The new application allowed the
replacement of old-fashioned paper-based documentation with digital process
documentation. Additionally, the use of a single platform allowed an easy and fast
distribution of process information across departments with defined business rules. All
business data could be retrieved directly from the workflow system itself and the
corresponding integrated database. Employees did not need to switch between different
systems or paper-based documents to get the right information. Furthermore, the
graphical representation and real-time monitoring of process elements delivered a high
degree of control and visibility of service level agreements.
The third step in the journey was the optimization and simplification of the
processes. All the user forms were kept manageable to avoid complex adjustments at a
later stage (e.g., changes in the production parametrizations or in product behavior).
Additionally, Generali CEE Holding minimized process activities and collected further
business rules to facilitate decision making.
Fourth, in addition to process optimization and new software, advanced technology
in the form of robotic process automation (RPA) was introduced. RPA is defined as a
“software-based solution to automate rule-based business processes that involve routine
tasks, structured data, and deterministic outcomes” [1 p. 65]. Such RPA software sits
on top of the existing BPM systems [12]. Fig. 2 shows an overview of positioning RPA
to highlight the corresponding relevance of this technology [10].
Cases handled by Cases handled by Cases handled by
traditional process robotic process humans in an ad-
automation automation hoc manner
Case frequency
Long tail of work
1 2 3
Case type
Fig. 2: “Positioning RPA” adapted from [10]
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The “long tail of work” is split into three different case types: 1) cases that show a
high degree of frequency and a common structure that can easily be automated, 2) cases
that show a medium degree of frequency but do not justify process automation, and 3)
cases with a low degree of frequency and need to be handled in an ad hoc manner. RPA
can support the second type of case, as robotic agents imitate human workers.
According to Fung [5], the second case type is characterized by the following five
criteria and are therefore particularly suitable for RPA: 1) low cognitive requirements,
which are tasks that do not require subjective knowledge or the creativity of workers;
2) high volume, which are tasks that are performed on a frequent basis; 3) access to
multiple systems, which are tasks that require access to various applications; 4) limited
exception handling, which are tasks with a high degree of standardization; and 5)
human error, which are tasks that are likely to fail due to human mistakes. According
to these criteria, Generali CEE Holding started to use RPA for all their policy
cancellation processes. All other processes connected to policy binding were still done
manually and in an ad hoc manner. The testing from the current pilot phase already
shows promising benefits for extending RPA into other process areas at Generali CEE
Holding.
4 Results Achieved
The transformation project was strategically relevant to the company and resulted in a
great success. The introduction of the workflow system delivered immediate benefits
for the company.
Process documentation. Changing the documentation style from paper-based to
digital allowed Generali CEE Holding to improve process documentation efficiency, to
eliminate duplicate data entries, and to improve accuracy and better use of existing
resources. As a result, process control was increased and responsibilities were clear.
For example, the time to prepare quotes and offers for customers was reduced by 40
percent.
Process automation. Generali CEE Holding automated and fully operationalized 38
processes within two months. RPA resulted in cost reduction based on increased
productivity and reduced average processing time. In particular, Generali CEE Holding
was able to enhance cost savings up to 50 percent with the new solution. Additionally,
the use of RPA increased productivity with 24/7 potential and at the same guaranteed
the quality of work as the failure potential of human error was excluded. Process
decisions were now made based on clear and predefined logical rules instead of
subjective knowledge or the experience of workers. This led to quality improvement
and error reduction, as the robots run with only up to 1% error by default. Besides the
benefits of cost reduction, even employee satisfaction increased as monotonous
activities (e.g., copy-paste activities) were eliminated from their daily tasks, and they
could focus on more value-adding tasks that required creativity and decision-making
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skills. Furthermore, the new platform ensured greater visibility and auditability of
transactions leading to better control of the overall underwriting process lifecycle.
Generali CEE Holding could now follow new regulatory requirements in a fast manner
and compliance was increased. Generali CEE Holding was now able to respond more
flexibly and faster with its customers and regulators. Based on a faster handling of
customer queries, for example, in the contact center concerning complaint
management, the customers benefited as well. The introduction of RPA enabled
Generali CEE Holding to enhance business agility and make use of scalability effects.
Besides responding to changing regulations, seasonal demand could be solved by
deploying virtual resources (i.e., robots) at a fraction of the cost and in a short period.
As RPA had minimal impact on the existing IT landscape of Generali CEE Holding,
the use of such software did not necessarily require Generali CEE Holding to make
major changes in IT and allowed them to stay agile.
5 Lessons Learned
Based on the journey that was experienced from paper-based, labor-intensive processes
to their automated replacements, the Generali CEE Holding project revealed several
lessons learned.
Integrate data and processes. An integrated data model provides a proper
foundation for process success as information and data can be shared across different
departments and stakeholders at any time but with fewer resources. Furthermore, it
allows an enhanced capacity for proper decision-making or forecasting based on
accurate data. It takes a lot of effort to consolidate data and processes, but it paid off
with great benefits for the company in this case. For example, it now allowed them to
reduce data complexity, collaborate with internal and external stakeholders more easily,
and quickly make and deploy changes to the entire production environment without
much effort while taking care to keep the processes and data right.
Start small. Generali CEE Holding started to define and automate their processes
and workflows with a few working processes in one specific area. Learning from a
small sample allows later simplification and adaption due to market or legislation
changes in a fast and easy manner. In particular, starting with a prototype with very few
functions and adding new features every week keeps the users interested in future
features and the final solution. Additionally, Generali CEE Holding started with one
pilot project (i.e., the back office in the Czech Republic). The number of back offices
in Europe that have started to implement RPA and learn from the experiences of this
pilot project is steadily rising. At the time of this writing, the new platform includes 51
processes and has been delivered in four countries and five languages.
Work agile and involve users. Generali CEE Holding followed an Agile method
approach (i.e., Scrum) to account for user requirements and the final solution rather
than the traditional waterfall approach. First, a good and motivated project team should
8
be built that drives the change project. It is inevitable to bring the IT and business
departments together and build a workforce of both departments to ensure a good
overview and solid foundation for the project (e.g., for mapping of business processes
and providing information about process execution frequency). Second, user
involvement is of utmost importance. Based on regular workshops, interviews, and
briefings, it was possible to capture user feedback and requirements for the final
solution. Workshops can ensure that business and technology users are on the same
page. It is also recommended to connect the BPM experts with the RPA experts, so all
involved project participants are always informed about every decision or update.
Third, created prototypes should be delivered quickly to gain stakeholder commitment
and investments for the project. The faster a new version of a prototype exists, the
better.
Master change. An implementation of a new platform is only successful if future
users accept and work with the new platform. Therefore, some easy rules should be
followed and resistance to change should be directly taken care of. First, the new
platform should be made relevant. The top-management should support the new
platform and communicate its importance to all levels of the company. Second,
negative views from skeptical employees should be listened to and should be taken
seriously. With training or workshops, their voices can be heard. The entire project
team should always take time to receive feedback in regular user requirements and
feedback meetings. Third, make the new platform desirable. If employees understand
that the new platform is easy to use, valuable, and facilitates their working habits, it is
more likely to get adopted. Fourth, the project team should stay flexible. They should
have a project plan (e.g., timeline, tasks, responsibilities) in mind, but should be
comfortable with change and project plan adjustments.
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