Firm Technology Design
Firm Technology Design
Firm Technology Design
The technology design process is an important part o any firm’s operations because good systems increase the company’s productivity and output. Most efficient firms design new systems regularly to sustain their output at high levels. Trevallion and Strazzari state, “Design is the result of an identified need or a perceived opportunity” (2003, p. 18). An effective design process is methodical and systematic and follows clearly outlined steps. In a simplified design process, the steps are investigate, design, produce and evaluate. However, a design process is more complicated and intricate involving more steps than the previously mentioned four.
The subject company is an insurance company known as Carter and Company Insurance. Carter and Company primarily deal with the provision of automobile, home, commercial, life and health insurance. The firm’s has its headquarters in Luling, Texas and serves clients from eighteen states in the US. Carter and Company are designing a new system that will handle their claims processing. The new systems are expected to fasten the processing of insurance claims and in doing so increase the trust of the clients in the company. The following questions will analyze the firm’s technology design process and look into all the factors that the firm has to consider along with the steps that need to be followed.
Review of Questions
Carter and Company are an insurance company that provides cover for both homes and commercial enterprises. The most significant process for Carter and Company is claims processing. Claims processing is an insurer’s fulfillment of their duty to receive, investigate and act on any claims filed by their clients. The execution of the process involves action by the administrative and customer service layers in which the claim is reviewed, investigated and then paid or denied (Claims processing). The processing of claims is a crucial step of the payment process because delays lower the client’s trust in the company. For Carter and Company, the claims processing systems should be overhauled to be replaced with a system that is up to date and capable of processing claims in real time. The new systems should also minimize errors in the processing of claims and prevent situations where rightful claims are denied and clients with unjustified claims receive remittance. An overhauled system could help Carter and Company attract new clients and reduce losses caused by errors in claims processing.
The current situation in the business world means that an updated system should be accessible through portable devices such as cell phones and tablets. Clients should be able to file claims remotely through different kinds of devices and receive regular feedback from the company. This can be executed through using a mobile phone application, app, which allows the user to file a claim and check the claim’s progress through the app. For this to be possible, the firm’s systems should be capable of processing claims in real-time as they are received. Using an app to deal with claims processing would be particularly helpful for Carter and Company because the firm’s clientele are from eighteen different states. The process of reviewing claims involves a all sections of the firm’s hierarchy and real-time processing could help claims from clients who live far away from Texas have receive their service faster.
Carter and Company mainly offers insurance services to individuals, home businesses and oil companies. The firm has working partnerships with local banks in Texas, oil companies within the region and the association of energy service companies. These partners cannot provide any direct assistance in the firm’s quest to overhaul its claims processing systems. However, the bank could provide Carter and Co. with loans at subsidized rates to fund the systems overhaul. Carter and Co. could form a partnership with an IT company so that the company can overhaul the system, develop software for them and provide consultancy services. In this partnership, Carter and Co. could insure the It company at a discounted rate while the company also provided its services at discounted rates.
The systems overhaul gives Carter and Co a chance to strengthen bonds in its customer/supplier relationship. The systems change creates an opportunity where the valued customers can voice their opinions and inform the firm on the shortcomings of the old system. There is also an opportunity to suggest any additions that they feel could make the system better suited to serving them. Another opportunity created by the systems control is improved customer care. The introduction of real-time analysis of claims gives the company a chance to give customers better feedback through messaging services and e-mail. This could help strengthen the relationship that Carter and Co has with its customers
When choosing a strategic organizational structure, the firm should take into account various factors. Region is one of the main factors influencing the organizational structure because Carter and Company need to look for a structure that ensures clients in all eighteen states are well covered. Henry Mintzberg came up with five structural configurations simple structure, machine bureaucracy, professional bureaucracy, divisional form and adhocracy. Divisional form is a configuration where the organization is composed of different divisions, each with its own organizational structure (Aquinas, 2008). Carter and Company could use this structure by separating their operations by state and having their offices in each state operate with some degree of autonomy. Claims filed would then be processed according to state or region. The office in Texas would then have an oversight role by making the key decisions that affect the firm as a whole or stepping in whenever a specific division fails to operate efficiently.
Carter and Co’s competitive strategy is to broaden its range of services and start providing a wider range of covers. The firm plans to use the offices it has in other states to expand the range of services. This strategy has three main targets. The first is to retain the existing market share that it has. The firm will achieve this by sustaining the services that it presently provides and in so doing keep all of the current clientele. The second target is to capture new market share. Carter and Co. plan to do this by providing introducing new insurance cover into its bouquet. The new insurance covers will attract new customers who might then be drawn to the services that the company already provides. The last target in the company’s marketing strategy is to gain a competitive advantage over its rivals. This can be achieved by executing the first two targets, which will enable the company to provide a wide range of services and attract a larger number of clients.
The implementation of the new systems is a crucial step in the company’s marketing strategy. Firstly, the new systems will enable the firm to process claims faster and this will be crucial when Carter and Co. start dealing with a larger number of customers. With the current system, the firm would be unable to sustain such a large number of customers because claims would be processed too slowly. The systems overhaul also gives Carter and Co. an advantage over its rivals because it will enable the firm to provide its services more efficiently. This could give the company a good reputation and perhaps even help it attract more customers as the praise spreads through word of mouth.
The biggest process in Carter and Co’s operations is the processing of the insurance claims. For purposes of speed and efficiency, Carter and Co. break down the claims processing process to three operations, each with its sub-processes. The operations are then handed down to different employees and department to be handled. The first operation is the verification of the claim. After the claims are received, they are taken through a process to verify them and see whether they are legitimate claims. The investigation of the claim’s eligibility and their authorization are two processes that must be done manually. The claims are then entered into a processing queue. Here the process becomes automated as the claims are checked for any issues that need to be sorted out. If an issue is found, the department manager must be consulted to iron it out. If no issues are found, the claims are moved onto the last step, the payment step. At this step, the amount of money to be paid for each claim is checked and the check is mailed to the claimant. This step in the process is fully automated.
Claims being processed are separated into categories based on the type of insurance cover involve. Separate departments deal with claims from different covers. Employees are thus assigned to deal with claims depending on their expertise and department. An investigation department exists to look into claims that have questionable eligibility while the authorization is carried out by the respective department heads. The overhauling of the systems looks to make sure that only key parts of the process are manual. This would be the investigation process and the authorization process. The rest of the process should ideally be automated to help speed up the completion of the process. Automation could help decrease the number of levels in the organization by removing one of the bottom layers involved in the processing of claims. The systems overhaul would leave the whole process with only two manual steps with the rest of I handled by computers.
Managerial hierarchy refers to the different levels of management found in an organization (Gitman & McDaniel, 2009). The traditional configuration will contain the top level, the middle level and the supervisory management level. Each level responds to the one above it except the top level. Not all companies follow this structure anymore. Carter and Co. would require a similar configuration but implemented in a different way. The top level of management would remain the same and exercise authority over the firm’s different divisions while making the key decisions. The second level of management would be the leadership in each of the different divisions that the firm has. This level would respond directly to instructions from the top level and would have minimized contact with the lower level employees. The third level of management would be the supervisory management. They would be in-charge of the various departments of the company and would deal directly with the lower level of employees.
The introduction of technology could see the firm do away with several departments that are no longer in need by replacing them with automated systems. For instance, when the claims are entered into a processing queue the process becomes fully automated needing only a few employees to look over it and ensure it all goes well. This could help remove one layer from the lower levels of the organization and see those employees assigned to different departments. Technology could enable matrixing, which could help form temporary structures by enhancing communication through electronic medium such as e-mail and faxes (Lytras & Ordóñez, 2009). This matrixing will make the organization more efficient because workers are able to multi-task and remain useful to their own departments while still dealing with other issues that need to be solved. The systems overhaul will make this matrixing possible by automating the whole process, which will mean that data can easily be transferred from one department to another making it easier for employees to co-operate when needed.
Aquinas, P.G. (2009). Organizational structure and design: Applications and challenges. New Delhi: Excel Books
Claims processing. (n.d.). In BusinessDictionary.com. Retrieved from http://www.businessdictionary.com/definition/claims-processing.html
Lytras, M. D., & Ordóñez, P. P. (2009). The China information technology handbook. New York, NY: Springer.
Gitman, L. J., & McDaniel, C. D. (2009). The future of business: The essentials. Mason, OH: South-Western Cenage Learning.
Shelly, G.B., & Rosenblatt, H. J. (2010). Systems analysis and design. Boston, Mass: Thomson Course Technology.
Trevallion, D., & Strazzari, S. (2003). Design and technology. Glebe, N.S.W: Pascal Press.
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