IT Cost Optimisation – Insurance
Introduction
As one of Australia’s Leading medical defence organisations, our client had commenced its largest investment to date in technology transformation that delivered personalised member services, strengthened its Environmental, Social and Governance (ESG) commitments, and deepened healthcare partnerships.
The Challenge
To optimise technology run and change costs for this wave of transformational change, while also developing a blueprint for future model that would assist reduce the technology elements contributing to the expense ratio. This would identify the optimal RUN model without compromising member experience.
Our Work
Frazer Walker developed a set of RUN operating model options in conjunction with the client and key managed service providers with each option assessing the internal/ external sourcing, capabilities, strengths, weaknesses, costs and risks. It also ensured alignment with APRA CPS 230 and the Financial Accountability Regime (FAR) requirements.
In preparing the options, Frazer Walker business consultants approached key MSPs within the Insurance technology space to build an understanding of the relevant factors that would establish the best engagement structure. In parallel, the consulting team assessed guidance from frameworks such as Service Integration and Management (SIAM) and ITIL seeking scalable right-sized governance so the organisation could remain agile. FW team’s experience in operating models provided the client with a comprehensive analysis of issues and impacts on Run Costs as they transitioned into Run.
Frazer Walker delivered a highly effective Board presentation and report detailing the findings, options and recommendations, for with a repeatable model for future procurement.
The Outcome
FW was able to provide the client with:
- Visibility of the highest impact “levers” for consideration to optimise run costs
- Propose Ways of Working to improve efficiency and avoid cost overruns.
- Identify internal upskilling opportunities to meet service levels and cost optimisation objectives.
- Advise improvement in both the service procurement and contract negotiation activities.
- Confidence to decide the right support model and its financial impacts to the organisation