Which Data Insights Matter and Why

Robert Grasing
Insurance Experts' Forum, May 2, 2013

Measurement is the starting point for most meaningful improvement initiatives. But as the saying goes, “If you cannot measure it, you cannot manage it”—and certainly, you cannot evaluate the need for improvement.

Putting a stake in the ground to understand current performance should be a part of the DNA of any successful and agile company. The importance of using a fact-based approach has not changed regardless of economic conditions or technological advances. Ongoing measurement, collection and analyzation of trends and comparative data is critical in assisting management establish improvement targets and measure progress.

In financial services organizations, the measures that matter most help management understand the company’s:

• Productivity (work volumes per employee per day/week/month);

• Cycle time (the length of time between when a customer asks for a product or service and when it is completed);

• Error rate (the ratio of work completed to rework);

• Unit cost (the operating cost of the area performing the work compared to the volume of work completed);

• Customer satisfaction (measured directly—through recorded complaints, customer surveys, or focus groups, or indirectly—through customer attrition and changes in call center service requirements); and

• Sales volumes or achieved levels. It is important to concentrate on measures that matter, so we are careful to compare net new business in addition to top-line growth.

So how does a management team use these measurements to make decisions? The line-of-business performance data indicates how the company is doing across the key indicators, information that can then be benchmarked against similar-sized and structured organizations to get comparative performance. Trending, benchmarking and analyzing this data provides management with the information needed to see the potential for improvement. Once the data and trends are understood, initiatives can be prioritized and specific goals can be set in real terms against an established starting point—for example, a reduction in error rate, cycle time, or unit cost or an increase in capacity or net new business.

Next, improvement teams can be assigned to examine the underlying process measures and evaluate the probable impact of various ideas for change. Ongoing measurement helps to advance the process objectives as the benefits of progress are realized. These internal measures also provide a check in the creative process, encouraging the team to stay on task and work toward a common goal. A fact-based case can then be constructed for specific recommendations. Upon approval, the implementation team uses the expected new measures as a check on their effectiveness. The process feeds into a continuous loop of improvement: internal measurement, external benchmarking, impact evaluation, staged implementation, and then measuring results.

Industry knowledge and measures that matter are indispensable to realizing substantial improvements and managing growth effectively.

Robert Grasing is President at The Nolan Company, a management consulting firm specializing in the insurance industry.

Readers are encouraged to respond to Robert directly at, or using the “Add Your Comments” box below.

The opinions posted in this blog do not necessarily reflect those of Insurance Networking News or SourceMedia.

Comments (0)

Be the first to comment on this post using the section below.

Add Your Comments...

Already Registered?

If you have already registered to Insurance Networking News, please use the form below to login. When completed you will immeditely be directed to post a comment.

Forgot your password?

Not Registered?

You must be registered to post a comment. Click here to register.

Blog Archive

The Software-Defined Health Insurer: Radical But Realistic?

Can a tech startup digitally assemble the pieces of a comprehensive, employer-provided health plan?

Data Governance in Insurance Carriers

As the insurance industry moves into a more data-centric world, data governance becomes more critical for ensuring the data is consistent, reliable and usable for analysis.

Fear This

Just days before this Issue, which contains our security cover story, went to press, we got some interesting news: 1.2 billion unique usernames and passwords and 542 million email addresses were reportedly stolen from 420,000 websites, according to The New York Times. The websites ranged from Fortune 500 companies down to small online retailers.

Should You Back Up Enterprise Data to the Cloud?

Six questions that need to be asked before signing on with an outside service.

Modernizing Information Management

While better reporting and actuarial analysis help to support financial decisions, improved analytics and decision making greatly assist the rest of the organization.

Strategic Planning: Here and Now

Insurers’ annual strategic planning efforts can benefit from an infusion of tactical reality.