How RPA gives you the flexibility you need

Flexibility - Plan A, Plan B, Plan C, Plan D...

Over the past few years, the healthcare insurance industry has been the focus of a tidal wave of changes — regulations, new market challenges, open enrollment, labor challenges with business process outsourcing, and a significantly more complex operating environment. More than ever before, healthcare insurance companies can benefit from robotic process automation (RPA). Interestingly, the question we get the most is: “Where do we start?”

Flexibility - Plan A, Plan B, Plan C, Plan D...

While we and other vendors can help you discover the processes in detail (for example, please see our complete-package solution), perhaps we can start with identifying the operations areas that will net the most significant ROI. OpenConnect has been helping healthcare insurance companies automate for over 12 years, and here are the top four areas where we have seen our customers derive the most significant benefits from automation:

  • Claims adjudication
  • Enrollment and membership services
  • Provider data services
  • Revenue cycle management

Each of these operations has a complex need for both human and robot interaction, due to the challenge of data management. If the data is incorrect or not normalized, core systems begin to create exceptions, which drives up the need for more human labor interaction. Even worse, the patient experience suffers.

For many companies, these menial tasks and other routine data-entry processes continue to be handled manually. The cost for maintaining that status quo can be steep: it costs $57,725 to hire and employ just one data entry worker (this figure is based on data gathered from the U.S. Bureau of Labor Statistics and the Center for American Progress).

Working the plan — but staying flexible

Let’s consider the game of football (for our friends outside the U.S., we mean what you call “American football,” not what we call “soccer”). In football, the quarterback’s job is to direct his team down the field. And, although the team has a game plan, the coaching staff isn’t afraid to have the quarterback “call an audible” to adjust to the opponent’s constantly changing defensive “looks.” Using his vision of the whole playing field, the quarterback’s situationally responsive selection could be either running the ball or throwing a pass – each of which may deliver a successful outcome.  In fact, the so-called “run/pass option” play has become increasingly popular, precisely because of that flexibility it gives teams.

Much like a football team’s need to change things on the fly as they see new and shifting challenges looming ahead, healthcare insurers also need the flexibility RPA can provide in their strategy. While claims tend to be the first focus, we see customers identify sub-processes every day that can change the outcome of the game — in this case, a correctly paid claim. Think back to the “top four areas” we identified earlier. We have many customers who are attacking claims adjudication and seeing trends in provider data inconsistencies. This new knowledge allows our customers to pivot and begin pointing robots at cleaning provider data, which results in improvement to all claims adjudication rates.

This is the benefit you achieve when robots are implemented based on detailed analysis performed before the implementation. Even when employees are buried in manual data entry work, they’re hard-pressed to raise the level of the team’s or company’s performance. Starting an automation strategy opens the lens to “calling audibles” for your operational performance. Just like a team that sticks to a game plan even after it’s become clear the other side has overcome it, an annual business plan that involves throwing more human labor and overtime at a problem doesn’t work anymore.

So, as you embrace automation for all the benefits it can and will bring you, be sure to choose not only a vendor but also a plan that will give you maximum flexibility to meet your challenges — both the ones you can see now and the ones you can’t quite see yet.

Analytics and RPA — the perfect team

Hand draws process chart

I keep hearing that robotic process automation (RPA) is simple to use, doesn’t require a programmer, and can automate any business process. Unfortunately, we all know this isn’t entirely true. But, even if it were, there is more to automation than the RPA tool itself. Let’s look at a standard automation process used to automate business processes.

Hand draws process chart

Five phases to getting automation right

In 2010, OpenConnect worked with several customers to develop the OpenConnect Approach to Process Automation. This approach consists of five phases — Discover, Design, Build, Execute, and Measure — as shown in the diagram below. It is an end-to-end, iterative process that helps companies (a.) identify automation opportunities based on their automation strategy, (b.) design and build the solution, and (c.) measure the results of the robots.

Five phases of the automation process

This process has been used by several of our customers for many years, helping them successfully implement automation robots to improve quality, increase throughput, and reduce costs. But how is this process any different than others? After all, it’s very similar to many other processes you find in the RPA world. The major difference is how this process is implemented and executed.

The OpenConnect Approach to Process Automation uses a combination of analytics tools and automation tools to provide:

  • A list of automation opportunities in order of importance
  • The best path to take to get the highest throughput
  • The steps taken for each process/task
  • A document showing the details of the process/task
  • Robot measurements that can be used to help identify improvements

The importance of analytics

I think everyone would agree that analytics can improve automation; and many RPA companies provide analytics; but most RPA analytics tools available today show only what the robots did, not how to automate the process involved. The analytics data is created by the robots’ activity; so, before you get any data to analyze —i.e., Measure — you first must Discover, Design, Build, and Execute. And, while the data helps you improve the existing robots, it doesn’t help build the process logic in the first place.

Since RPA is automating what people do, we need to know what people do. The standard way to understand what people do is — to ask them! Sit down with a subject matter expert (SME) or a business analyst (BA), and have him/her walk you through the process. People who have used this method know that it’s not the best way to get the information you need. First, if you don’t ask the right questions, your process is going to have major holes that you won’t discover until you start to build the logic. Second, if you ask 10 people how to do something, you’ll probably get at least five different answers. What people tell you will be based on their experience; so, if you get a more experienced user, you might get more accurate data.

You can capture a few workers’ activities . . .

There are some tools available that allow you to capture what a person does and then use that information in the RPA tool to create your robot logic. To use one of these tools, you first install a piece of software on one or more desktop computers, and then have people start the recorder every time they execute a process. Typically, the tool provides an option to enter information for each step. This could include business logic or notes about why the person did something.

It’s true that this can help get the information into the RPA tool more quickly, but the data is only as good as the person executing the process. Also, what about process variations? Does the user have to navigate every possible path for this to be accurate? And how is the business logic captured? Finally, how reliable is the data when the person knows his/her activities are being recorded, much less when he/she is actually starting each recording manually?

So, on the face of it, although this initially may sound like a great feature, all it really does is help you get the data (useful or not) into the RPA tool. However, most RPA tools already have a “record” feature, so why couldn’t you just do the same thing within the RPA tool itself?

. . . or you can capture and analyze the workforce’s activities

Now, let’s consider a better way. Instead of capturing what one or two people are doing, why not capture the activity of the entire workforce?

Let’s say you have a fairly complex process, one that takes a user several weeks to learn and a couple of months to master. It contains multiple decision points and complex logic. Let’s say also that you have 200 people executing this process multiple times every day. If you could passively capture the data for every user, for every process, and for multiple days or week, you would have every variation, every decision point, and every screen used in the process. And users wouldn’t even be aware that their activity is being captured, so you’d get realistic data from actual users doing actual work — not from a few users being very careful about how they execute a process because they know they’re being recorded.

That sounds right; but how do you sift through all the data so you can make sense of it?

First, you must identify the users who execute the process the most often and with the highest efficiency. I have heard many people say that you don’t need to improve the process for RPA, because robots don’t care if it’s efficient. Well, the robots may not care, but you should care; because, the more efficient the process, the fewer robots you’ll need in the first place! That’s why I believe it’s important to learn the most efficient way to execute a process; and the right analytics can help you gain that knowledge.

How finding the “happy path” helps you

After you’ve narrowed down who the top users are, you then must understand the paths they take and identify the best one — commonly called the “happy path.” To do this, you need a tool that can automatically show you the process, and all its variations, in a graphical format that’s easy to understand and analyze.

The process map should be detailed enough to show the decision points, but not so detailed that it adds unnecessary clutter. Maybe User A goes to Screen 3 followed by Screen 2, but User B goes to Screen 2 followed by Screen 3. Does it really matter? In most cases, probably not. But it could. That’s why you must have control over the data that goes into the process map. For some activities, you might include several screens per activity; but, for others, you may want only one screen per activity. (An activity is displayed as a box in the process map, and lines connect the various activities based on user navigation.) You should also be able to analyze each variation by human “think-time.” If your goal is to reduce costs, automating the path with the greatest amount of human “think-time” will provide the best ROI.

Once you’ve identified the “happy path,” you should be able to document the selected process. Since all of the data is in the system, it should be a simple matter of clicking on a button to create the documentation. But how do you capture the business logic? You can capture what people do and how they do it but, for now, you can’t capture why people do it. The why refers to the business logic. We know that a user entered a specific value into a field, causing a specific action; but we don’t know why the user entered that value in that field.

This is where you need to include an SME, so he/she can help document those rules. Still, this is much different than the manual process I mentioned at the beginning of this article. We aren’t asking an SME to go through the process and provide details; instead, we’re asking the SME to review a document that already has all the screen-shots and navigation steps (the what) and asking him/her to add the why (the business logic). The SME simply adds text to explain why the user entered that value in that field.

Summing up: The right way

Since most of the time building automation logic is in the Discover and Design phases of the process (again, please refer to the diagram), using the right analytics can reduce the time to automate by as much as 50%. It also improves the quality of the automation and helps you identify the most efficient paths, which reduces the number of robots required. Fewer robots means a more economical deployment, purely and simply. This is the right way to automate.

Don’t be fooled when you hear people say they “identify what people do and automatically automate it.” I’m very skeptical about such claims if those making them have acted without proper analysis and the benefit of business logic provided by a knowledgeable human! To be sure, we eventually will get there with artificial intelligence, but we aren’t there yet.

WorkiQ is Citrix Ready — and what that means

Citrix Ready

WorkiQ is Citrix Ready — and we’re very proud of that. However, it does bring up two obvious questions. First, what does it mean? Second, what difference does it make? I’m going to try to answer those for you in reverse order. (After all, if it makes no difference, it doesn’t matter what it means.)

As you may already know, WorkiQ is OpenConnect’s real-time desktop analytics solution. It provides visibility into employee productivity. To be a little more specific, WorkiQ captures employee activity through a small software agent that usually is installed on each user’s workplace computer. However, there also are work environments in which a typical user doesn’t have a dedicated workplace computer. That’s why it’s important that WorkiQ has been certified as Citrix Ready.

Citrix and WorkiQ

One of the popular on-demand computing platforms is Xen Desktop by Citrix. We’ve worked hard to make sure that WorkiQ works great for a company that uses this platform. You might say that WorkiQ “sees” a Citrix session as just another standard activity session. Perhaps the user is on a dedicated desktop computer. Perhaps she’s using a Citrix computing resource. She may even be moving between the two. It doesn’t matter. In any of these cases, WorkiQ generates an accurate timeline of activity.

Many companies use Citrix to allow employees to work from home or from mobile devices. Citrix provides a standardized configuration and increases security. It also reduces wide area network (WAN) traffic by locating the computing resource closest to the data the user is accessing. That data exists on the server.

By the same token, we don’t put WorkiQ on individual devices in a Citrix environment. Instead, we capture the users’ activity by installing our Citrix-specialized WorkiQ agent on the Citrix server. The beauty of this approach is that WorkiQ can directly “see” traffic between users and all the other corporate applications on the server. That lets WorkiQ accurately capture activity data, and do so with the highest quality.

What Citrix Ready means

Citrix put our Citrix-specific WorkiQ agent through a uniform set of compatibility tests. In Citrix’s analysis, the agent installed seamlessly and implemented proper modifications to the server’s registry. WorkiQ also passed other Citrix compatibility checks, including memory handling within the Citrix server. As a result, Citrix certified WorkiQ as Citrix Ready.

A number of large sites — including one with over 100 Citrix servers — have successfully taken advantage of WorkiQ. Through the Citrix Ready program, OpenConnect also receives partner-level access to Citrix technical resources. This enables us to resolve any Citrix-related technical challenges our WorkiQ customers may have. In short, you can be confident in not only OpenConnect’s technology but also our ability to handle any challenges that may occur.

Note: Citrix is a registered trademark of Citrix Systems, Inc.

Should employees view analytics reports?

WorkiQ peer report -- allows an employee to view analytics data about his/her work performance

Operational analytics products such as OpenConnect’s WorkiQ provide insight into employee activity, helping you better understand how your employees perform their daily activities. Some solutions, including WorkiQ, also allow employees to view reports showing their activity compared to their peers’.

There is a growing debate over whether employees should have direct access to their analytics data. Some managers believe that a user who can view his own data will use it to help improve his performance. Other managers believe that employees will use the data against management, or will spend too much time looking at data instead of working.

As you would expect, there are advantages and disadvantages to letting an employee have access to her analytics data. The advantages include:

  • It makes her feel in control, and less like she’s being watched.
  • By comparing her activity with that of her peers, she’s energized to perform better and gains more pride in her work as she watches her own improvement over time.
  • It gives her control of her own destiny and allows you to better manage her expectations as an employee.

On the other hand, some of the reasons you should be cautious about allowing an employee to view his own reports are:

  • He might spend a lot of work time constantly looking at his data.
  • If the data shows that he’s performing poorly, he tends to challenge the data, which could cause a confrontation with his manager.
  • He can use the data to demand pay raises or other rewards.

As a result, you should consider these advantages and disadvantages before allowing your employees direct access to their own data. Each working environment is different; so only you, the person managing your team, can truly understand the potential impact of each approach.

Another way to provide transparency with analytics data

If you want to be transparent and allow your employees to see their data, but you’re concerned that they will spend too much time looking at reports, there’s an alternative approach you can try. Instead of giving employees direct, real-time access to the reports, use WorkiQ to create a peer report (shown below). This is a chart that shows how an employee has performed, over time, compared to her peers. In the employee’s peer report, she doesn’t see data for each of her individual peers; rather, she sees a single attribute that represents the average for all peers.

WorkiQ peer report -- allows an employee to view analytics data about his/her work performance

WorkiQ peer report
(click to view larger image)

You can share the peer report with the employee, either via an automatic emailing or by showing him the report during your weekly one-on-one meeting with him. This removes the disadvantages of allowing direct access to the reports, but still provides the feedback employees need. Some employees will still challenge the report, regardless of how and when it’s delivered to them; but most employees will welcome the feedback.

Getting away from Self-Reporting

Self-Reporting-Graphic-WorkiQ-Blog

Have you ever felt very satisfied with the completion of a workday or project just to realize you still need to document your time and/or items of work completed? Looking for more productivity from your team, but still requiring them to provide mandatory self-reported time/work sheets?

Many back office operations, particularly in Health Plans, have an excessive amount of self-reporting.   Still using spreadsheets that are difficult to roll up to a group level and take a lot of time to insure individual inputs are correct is an amazing time killer.   Others use simple web based applications which rely on accuracy of the reporter,  while believe it or not some plans still use paper, pencil and stop watches.

Self-Reporting is a root cause of several common operational deficiencies:

  • Too many costly work hours spent completing forms and combining spreadsheets
  • Consistency in the definitions of work across multiple groups and individuals lead to errors
  • Accuracy of data is dependent on those inputting the information, again leading to errors or misrepresentation
  • Without real-time data; managers cannot make decisions to impact inventory quickly

Using automated capture and reporting of work streamlines operations and provides real-time data.   Take a look at WorkiQ as an example using desktop analytics.   While visiting our information take a swim through our Savings Calculator to see how much your operations might benefit from eliminating self-reporting.

Measure Twice – Cut Once

WorkiQ Carpenter

For a carpenter, hasty cuts can result in an expensive loss of time and materials. Hence, the phrase “measure twice; cut once”. Applying this “measure twice & cut once” principle to back-office operations simply means; you can’t improve what you don’t measure.

[Whitepaper] IDC Analyst Connection: What Gets Measured Gets Better: Improving Performance

“WorkiQ is helping us have effective conversations with employee’s we were previously unable to have.” – Manager of Business Intelligence, Top Blue Cross & Blue Shield Plan

Many employees, especially those who choose back-office careers, are unable to communicate their challenges to managers or peers. One of the largest health plans in the country recently provided a great example.

A claims examiner, who we will call “Mary”, was consistently missing production numbers. The health plan’s claims system could report the number of claims Mary worked, and her average time-per-claim, but it could not explain “why” she was below team standards. After several warnings, Mary was on the verge of disciplinary action. With a WorkiQ pilot about to start, her management decided to wait until they could analyze her daily activity.

It turns out that Mary was not taking breaks, and her lunch was rarely more than 10 minutes. She spent more time in “productive” applications than anyone on her team, but this effort was not reflected in the output of her work.

Mary’s WorkiQ dashboard revealed that she was spending her breaks doing research through company documents and online resources. As a result of real-time data, it was easy to determine she did not have the training to perform at expectations. Working with her manger, Mary was able to join the proper training programs, and she was partnered to a mentor. Employee turnover is a huge expense in money, time and resources, WorkiQ is providing valuable empirical data to help Insurance companies successfully evaluation workforce performance based on facts.

By adding a layer of operational visibility through desktop analytics, Mary is now one of her department’s top performers. In the future, Mary can use a peer-comparison dashboard to see if other top performers have found more efficient ways to process claims.

WorkiQ Peer Performance Comparison
Peer Performance Comparison Dashboard – WorkiQ Desktop Analytics

Stories like this are fairly common, and a similar case occurred here at OpenConnect with one of our developers. To learn more about how desktop analytics can help your operations department, continue reading The positive impact of “Big Brother” software.

The positive impact of “Big Brother” software

OpenConnect-Big-Brother-Icon

When first introduced to the concept of desktop analytics, people often draw comparisons to Net Nanny® or George Orwell’s “Big Brother”. WorkiQ Desktop Analytics, for example, is not tracking passwords or bank accounts, but the software does monitor an employee’s computer-based activity in real-time. Initially, this concept may be unsettling to a measured associate, but desktop analytics can improve productivity, eliminate uncertainty, and potentially provide new insight into “actual” performance.

Hawthorn Effect (aka. The Observer Effect)

People, who know they are being observed, typically improve their behavior. Our customers report an average 10% improvement in productivity after three months of sharing activity reports with their users. Within the first 3 months of measurement, we have seen productivity spikes up to 26%.

This does not mean that someone surfing Facebook all day will become a model employee when monitored, but he will be more aware of his actions. Every company will have A+ and C- workers that set the curve, but simply knowing there is a grade will improve the class average.

Flexible Workplace

Over the last few years, HR analysts have found that professional employees, especially millennials, have prioritized workplace flexibility. Employers that allow flexible hours, telecommuting, and less micro-management are able to attract more qualified candidates. However, employers cannot abandon all oversight.

Desktop analytics can serve as a tool to manage telecommute workers with in-office visibility. It also provides an evolved alternative to social media blocking. Instead of forcing employees to hide their social media addictions, companies with desktop analytics can measure time spent in productive vs. non-productive activities. Molina Healthcare’s employees deliver 6.5 hours of productive time per day, and associates are free to use the remaining time as they please.

The Workplace Fitbit

In addition to measuring application usage, WorkiQ can track how employees process work, even when jumping between several systems. Smart managers are using this crystal ball to build culture of transparency, collaborative process improvement, and performance-based rewards. This starts by providing analytics dashboards to both managers and measured employees, then socializing team productivity and performance. Real-time reinforcement keeps employees engaged and competitive, and eliminates the uncertainty that comes from infrequent performance reviews.

I elaborate on the idea of a workplace Fitbit in this blog: Fitness trackers set precedent for work performance management

To learn how a WorkiQ saved the job of an underutilized employee, continue reading Measure Twice – Cut Once.

Analytics and Automation for the Back Office

5 reasons Back Office Operations are interested in workforce analytics & automation

  1. Measure in Real-Time
    On average US employees waste 2 hours a day beyond breaks and lunch hour. Real-time workforce analytics will capture activity in real-time of all associates, even those at-home, to identify productive and unproductive practices. WorkiQ captures all counts, time, and outcomes of activity so work can be categorized and managed.
  2. Manage in Real-Time
    Employees perform at varying levels of productivity and efficiency based on training, engagement, experience, and even acute situations in their personal life. Effective managers need reliable operational intelligence to identify if workers need training or if they are not optimizing work hours. WorkiQ provides the operational intelligence needed to identify, improve, and reward employ­ees through real-time management dashboards.
  3. Improve in Real-Time
    Dramatic productivity improvements start with increased engagement. Through awareness, scorecards and gamification; WorkiQ work­force analytics delivers a wide range of reports that empower people at every level of the company to compete and engage. Through real-time metrics, as opposed to infrequent performance reviews, associates know how they are performing in com­parison to their peers, where they excel, and where they can improve. Managers can compare employees with accurate stan­dards, reward superstar performers, and see where their team ranks against other groups or departments.
  4. Optimizing labor costs
    Companies using data-driven decision-making were, on average, 5% more productive and 6% more profitable than their competitors. Back office operations largest cost is labor. By using WorkiQ, you are able to identify empty labor and recapture productive hours, identify the true need for overtime costs, and utilize real-time data to measure the ability to work the inventory.
  5. Robotic Process Automation
    A natural utilization of operational intelligence is identifying opportunities for robotic process automation (RPA). Identifying and replacing routine or repetitive back office work with software robots enables companies to save considerable expense. Insurance companies, for example, use robots for their claims / auto-adjudication improvement. With a complete solution to identify, configure and execute, OpenConnect automation provides a complete solution providing significant savings back to your company.

Don’t apply front-office solutions to back-office problems

back-office and front-office - square peg in round hole

The Rail Yard and The Airport

The overall structure of work between the front-office and back-office is different.

While this is an oversimplification, call-centers operate much like a train. Call center managers build scripts and lay the track for their operators to move along, and operators are focused on direct interaction with the customer. Typically, tasks within the call center are short, transactional, and repeatable widgets of work. In the back-office, where human interaction is less important, these types of activities should be automated.

Back-office departments such as IT, account administration, accounting, and HR operate in nearly perfect contrast to the call center.

Back-office operations, such as insurance claims departments, function far more like a cargo airline pilot in the remote country. At the start of every day, each pilot receives several packages to deliver by the end of the week. The pilot knows the destination of each package or claim, but based on weather conditions, workload and/or environmental issues the path may vary. Two claims workers making the same run may chart a slightly different course, rely on different instruments, make adjustment based on obstacles, move at different speeds, and require the help of a co-pilot. Typically, tasks within the claims department are long, operational, and specialized widgets of work.

The Workflow

In the contact center, most associates with a similar functional focus perform tasks in a comparable and scriptable sequence. Most processes and sub-processes can be clearly defined in a workflow that all agents within the same department follow. An example of a simple contact center workflow can be found below. In this process, milestones such as the start of a call, completed customer account update, and resolution can be measured.

Generic Call Center Workflow

In most back-office operations, the structure of each work-unit may include measureable macro-level milestones, but variables such as claim complexity, availability of required documentation, each associates experience, and personal preferences make back-office operations difficult to script. For example, all claims may begin when the agent begins editing and end when the claim is submitted for payment. Between the start and end of each full unit of work, or fully processed claim, agents may take a variety of paths as illustrated below. These tasks, or sub-processes to a claim, may centralize around the claims system, but likely require the use of imaging software, email, internal IM/collaboration programs, phone calls, various research websites, and even social media.

Simple Claims Workflow

Generic Claims Workflow

Use the Right Tool for the Job

While goals such as increasing productivity, finding hidden capacity, cutting costs, improving efficiency, and simplifying processes are shared between the front-and back-office, the methods for collecting meaningful performance data need to vary.

The focus for front-office measurement should be customer engagement, the customer’s perception of service quality, risk reduction, the frequency of call paths, time spent on each call, and the outcome of each call.  Depending on the nature of the contact center, factors such as call rate and upsell statistics may also come into play. This information can help a company identify market trends, test brand messaging, and collect feedback for product development. Data points can be used to identify contact center associates with the highest frequency of positive dispute resolution, or those that nurture the highest degree of customer satisfaction.

Back-office measurement should be improved cycle time, increased employee utilization, and decreased error rates. Desktop analytics and process analytics should measure hours spent on various types of work activities, completed sub-units of work, and process that each worker performs.

Desktop analytics built for the back-office are designed to measure all activity on the desktop, not just activity within the core system (e.g. claims system), and then identify patterns or relationships between applications and processes. Short, repetitive, and transactional processes uncovered through these tools should be automated, and additional gains should be accomplished through training associates to model top performers, increasing engagement through gamification, and reducing the complexity of unnecessarily time-consuming tasks with automatic data propagation or BPI.

To learn more about how your company can improve back-office measurement, please visit openconnect.com.

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Automation and workforce analytics offer relief to rising outsourcing prices

outsourcing & insourcing checkboxes - WorkiQ Workforce Analytics

In a recent article featured in Supply Chain World Magazine, I discussed how manufacturing innovations, specifically large-scale 3D printers, are bringing jobs back home to the US. At the same time, computer-based innovations in process automation and workforce performance management are helping companies to increase productivity of in-house workers and cut the waste of outsourced operations.

BPO Piggy BankRising Cost of BPO in Offshore

In 2005, a PWC report listed the average salary of US-based call center employees at $19K per year, while their Indian counterparts took home just $7.5K per year. With the allure of low cost of labor, outsourcing operations such as IT, financial services, and technical support have historically allowed companies to reduce fixed costs (fewer FTEs), add flexibility to scale business, and focus on core-competencies at home.

Payscale.com lists a median US-based claims processor salary of $33K/yr., and Outsource2India advertises claims processors between $15K-$22K/yr. per FTE. In a 2010 interview, Phil Fersht, CEO of HfS Research, stated that “in some cases, workers in India are making only about 15 percent less than workers in Nebraska”. Today, [in] “Bangalore many probably earn more.”

While there is still a significant gap in FTE costs between the US and offshore, companies don’t need to look much further than inflation rates to see that the cost advantage of BPO in India is quickly closing. According to World Bank, inflation based on CPI, from 2010 – 2014 in the US was 1.5% compared to 10.9% in India. The cost of an FTE in India is rapidly increasing while US worker compensation has remained fairly stagnant. To further narrow the gap, a rise in the adoption of home workers in the US is helping companies to decrease overhead by as much as 20% when compared to brick and mortar operations (Source: NPR).

As savings decrease, companies are forced to evaluate additional costs/benefits of BPO such as quality difference, lack of direct managerial oversight, frequent labor turnover, brand perception, and IT security. For health plans, the risk of a Protected Health Information (PHI) leak can be catastrophic, and large salary savings are necessary to justify threats.

One of our healthcare payer customers recently replaced 100 outsourced FTEs with 50 US-based direct hires and increased production volumes and quality of work. To maintain competitive advantage, companies need to find lower-cost BPO hubs, automate repetitive processes, or execute operations in-house with greater efficiency and quality.

Enable the Best

Outsourced FTEs are rarely incented to suggest process improvements, lack of direct oversight makes it difficult to identify performance problems, and short-term assignments mean they are not fully invested in your company’s success.

Increasing worker performance is not about adding carrots, finding a bigger stick, or working longer hours. Smarter managers know that to get more work out of a smaller workforce they focus on increasing engagement, maximizing work time, identifying bottlenecks, and training teams based on the actions of top performers.

Whether a company is looking to automate processes or increase workforce performance, the first step should always be measurement. In the AHIP webinar Improving Employee Performance Through Measurement, Ed Peters, Open Connect CEO, and Jim Sinur, formerly Distinguished Analyst Gartner Group, discuss this topic in detail.

Most BPOs provide clients with macro-level production reports pulled from core systems. These reports identify NET production levels, but meaningful workforce performance measurement explains how employees actually spend their work time. Measurement should be automated, and not require laborious self-reporting and activity log. Task-level detail, such as the time spent adding missing details to a customer record, comparing documents in an imaging system, or researching account history can help managers to identify bottlenecks and training opportunities.

Automate the Rest

Not all processes require a human, but BPOs won’t advertise opportunities to reduce FTEs. Process automation software, such as WorkiQ Automation, has seen drastic improvements over the last decade. Back-office operational tasks that are computer-based and repetitive can be automated. Software robots can now perform online research, compare digital forms, create customer records, and execute artificial-intelligence levels of process complexity. By augmenting a portion of labor force with process automation, companies can reduce NET headcount, improve cycle time, and free up employees for higher value-add activities.

A decade ago, insurance auto-adjudication rates around 90% were unheard of. Now, most of the health plans I work with are automating over 85% of their claims on first pass. Significant advancements in process automation are the result of increased form/document digitization, an overwhelming abundance of real-time online data, and detailed process measurement. Today’s software robots not only follow the steps of pre-scripted workflow, they learn from their human counterparts and build a better workflow.

Again, good automation builds on good measurement. Before companies start to automate any process, they need to have a very good sample of data points that explain how top (human) performers would complete the automated task.

Smarter work is achieved through the continuous analysis of the work activities and processes, to ensure automation and performance management outperforms BPO contracts. For more information about WorkiQ Workforce Analytics or WorkiQ Automation, please visit www.workiq.com.

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