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Doing things differently to get different results
Markets are coming under pressure, not only from local competition but often from increasingly active international competitors who, more often than not, bring their own systems and processes
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arkets are coming under pressure, not only from local competition but often from increasingly active international competitors who, more often than not, bring their own systems and processes.
The year 2013 was not an easy year either as, according to the International Monetary Fund (IMF), the global economy grew by only 3 percent compared to 3.2 percent in 2012. Our domestic economy grew by 5.78 percent, which was lower than the 6.33 percent in 2012.
As always, in spite of difficult market conditions, the pressure is on for companies to sustain growth while at the same time reducing costs.
Thinking creatively and being innovative can be the game changer that your company needs in order to shift and improve profit levels.
Traditional ways of working should be examined more closely to see if they are still relevant and to explore better and smarter ways of running a business.
The fact that we are in the middle of a technology and 'mobile smart device revolution' can perhaps be used to our advantage. Could this really help a financial distribution business?
As for life insurance, the agency is a key channel for developing the environment in Indonesia. Agency productivity is the critical success factor of the agency channel.
There are two areas of Indonesia's financial product distribution that are inefficient and hence costly:
1. The numbers strategy
The real cost of this model is training and managing sales agents through their life cycle, particularly to maximize productivity. This undoubtedly puts a strain on the available resources of the business, coupled with high agent turnover and/or low productivity that can become a considerable constraint with little return on investment (ROI).
Agent productivity is an industry-wide challenge. The key is to identify the star performers and spend time and energy on them rather than depleting resources on underperforming agents.
2. The dependence on paper processes.
Paper has been the mainstay of financial product distribution for many years and consequently companies have become overly dependent while continuing to absorb the rising costs of printing, distributing, collecting, capturing and finally storing and paper archiving.
Paper touches every part of a sales transaction: from product information, illustrations and applications, all the way to product issue and eventual storage. Often paper is simply destroyed after many years of safekeeping. The financial implication is considerable over the lifecycle, but there are ways to change the manner in which things have been done traditionally.
To sell successfully, a modern sales agent needs access to client and product information, email and internet communications as well as a simple sales process to support the sales.
Mobile tablet technology is already proving to be a great benefit in many sales environments due to its ease of use and particularly its ability to display product information and capture basic sales data and client information in an application form.
Another benefit of the mobile sales solution is that once the product is sold, processing is much quicker as the data is actually validated at the tablet stage, thus also greatly reducing errors and queries, not to mention that sales are recorded immediately, the client is covered more speedily and sales agents' commissions are credited faster.
Changing systems and moving on to mobile technology can appear to be an expensive investment, but the upside is a significant increase in ROI, due to the double benefit of cost savings and agent productivity improvements.
Re-enforcing the change
As with any new technology, especially where a newer and innovative approach is necessary for successful implementation, management changes also require a strong focus. It is important that the executive team drives the changes to ensure that the advantages are brought home throughout the channel from the back office and admin, through to the distribution channels and the agency force.
Experience also shows that it can be a phase-in and phase-out approach, as a set timeframe needs to be planned for changeover periods, where the new methodology and systems can be phased in, while good agents are given adequate time for coaching and adapting to the technology.
From paper to paperless is a big leap; our approach is to first move to less paper and then over time, as the new processes become normal, to paperless.
One thing is for sure, the implementation of mobile solutions needs to be supported by an intelligent and user-friendly system.
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Eddy KA. Berutu is a co-founder and CEO of Avatar Global Consult Ltd. Trevor Stacey is an Avatar@WORK consultant for Avatar Global Consult Ltd and business development director of atWORK Internet Software Solutions based in Johannesburg, South Africa.
