How This Local Motor Insurance Company Improved Their Processing Output by Over 600

How This Local Motor Insurance Company Improved Their Processing Output 

You and I already know that Six Sigma has brought positive results to many organizations and having most of the Fortune 500 companies using and applying the methodology says a lot. However, you may ask if the principles are transferable, and applicable in the local setting.
Today, let’s look at my client, where Six Sigma was used to improve their processing output by over 600%. Yes, you read that right - six times!


Of course, as part of client confidentiality, I cannot reveal the name of the client. However, I can let you know that they are in the motor insurance business. Normally, their policy processing time could go as long as 30 days, resulting in poor customer satisfaction. As you know, buying a car is a big, important and happy decision for many and having to wait for such a long time is indeed a killjoy (or as the locals would call it, potong stim).
Our company, Lean Partners, went in and over a period of 3 weeks, as we study the processes, my team and I took note of the workflow, reviewed all the documents and checklists, interviewed the managers and employees, administered micro assignments and more. We then used the data, applied the Six Sigma methodology on it and tested it.
The results? From the 30-day processing period, we managed to cut the time down to only five days! And the best part, that was done without any technology or software upgrades. In our proposal to the client, if they implemented the latter, the processing time would be further pushed down to 2 days! That's over 1500% improvement!
But let’s just not look at the end results. Instead, I have listed out the top four factors that caused this company to suffer from slow processing time and reduced customer satisfaction, and over my years of consulting, I realized that most of the other local companies have the same issues as well.

Issue 1: The Mouse

No, they didn't have any rodent problems! During our observations with the department staff, we realized that most of their work was data entry, which meant they needed to be on the keyboard most of the time. However, while shifting to different sections of their software, they required the use of the mouse. Although it may not look like much time was lost, but when it was added up over a long period, the loss of time was significant. Plus, we also noticed that anytime they used the mouse, there was a considerable chance that they would be distracted with other things happening around their office and getting them back on the previous momentum took a few minutes (up to 20 minutes at times). We talked about the Context Switching and the problems with multitasking a while back, so check out this post if you missed it.
Our recommendation:
  1. Train the staff to use more keyboard shortcuts, and even preprogrammed some of the common functions into the software (before you say that you can’t just upgrade the core software of your company, I’ve covered that in point 2).
  2. We know that we cannot upgrade the software used for the data entry, as it interfaces with the international servers. Instead, a simple web app was used as a layer where the staff could enter the details and the web interface will insert the data into servers. We were able to customize the web interface to make it user-friendly, 100% keyboard operated and designed it to be in-line with the actual physical forms, reducing back and forth references.

Issue 2: Pre-Set Data

Granted, there were common mistakes and typos, especially in addresses (which affects the legal documents and mailing). Postcodes, states, cities were commonly misspelled, causing unnecessary errors. Sometimes, phones numbers and email addresses could be entered wrongly as well, an issue that would results in extensive database cleanup later down the road.
Our recommendation:
Since we had created the web interface, it opened up a whole new level of possibilities for the client. A lot of info could be pre-setted, such as the postcodes, city names and states. Instead of having the staff to key in the details, they could choose it from a drop-down menu (which were triggered by a keyboard command, not a mouse click). Also, by applying data validation rules, phone numbers and emails could be checked the moment they were entered. Names were also properly formatted (to capital letters, for example).

Issue 3: Legacy Habits

You may relate to this: ever had someone show you a process at work and you notice something additional that seemed redundant and when you asked him or her about it, they just said it has always been done that way? You are a leader, so you will pick up issues like these easily and question them. However, at the staff level, most of the time they are trained On-The-Job (OTJ) and while they were used to being told "what" to do, they weren’t given proper explanation to “why”.
In our work with this specific client, we uncovered a lot of these legacy habits. For example, during the data entry process, we noticed the staff pressing the F10 on the keyboard after a few sections of the form. When we asked what was the function for, they admitted that they did not know for sure. They were simply told to do that before progressing to the next section. As it turned out, a couple of software versions ago, F10 was used to save the entry progress, but that function had been automated and worked in real time for the past few years. Now, you may chuckle at this, but truth be told, in our consulting work with many service-based businesses, there were a considerable number of cases as such. As a matter of fact, more than the manufacturing industry! Yes, it’s hard to believe that despite dealing with physical products and requiring more manual labor, most manufacturing lines are way more optimized that the service processes.

Issue 4: Unnecessary Bottlenecks

During the processing of the application forms, my team noticed that there was usually a long queue at the scanning machine. You see, it’s company policy to keep a soft copy of the documents for filing purposes (seeing that ink may wear off over time). However, there was only one scanner per floor and while the staff were there waiting for their turn, they usually ended up being distracted by other conversations that further impacted their productivity.
Our recommendation:
Because getting additional scanners will cost the client more money (which I’m happy to inform that they got extra units anyway after our consulting session), we decided to swap the process flow. When a staff noticed that there was a line at the scanner, they could proceed to move to the next step of the work flow, so that the subsequent departments could proceed with their work and scan the documents at a later time. If you’ve read a previous email on “batching”, we suggested that too, which was to have the staff compile X number of documents before scanning them all of it in one go.


Now, as a leader, you may look at these few issues and chalk it up to common observations and you’re right. A lot of the process improvements made sense and the redundancies ought to be removed. However, do know that you are also looking at the issues from a neutral perspective, i.e. third person view. Usually, when we’re in the midst of any issue, the solutions are less apparent.
That’s where the Six Sigma methodologies come in handy -  identifying redundancies, improving workflow, reducing mistakes and more. It serves as a checklist that you and your team can confirm against, so that you will know if you are on track and also spot areas for improvement. And yes, clients who have gone through the Six Sigma program with us - on top of positive ROI on their training dollars - enjoyed additional, non-tangible benefits too - staff's work time has reduced, over time was eliminated, employee satisfaction increased and the team were able to cope with high workload when necessary.
Sounds like something your department or company may want to explore for 2019? Reply to this email and one of our consultants will schedule a strategy discussion with you. No obligations, but at least you will be aware of the options you have, should you and your company are ready to improve your businesses results.