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How Improved Financial Systems Can Help Your Business

by Precise Leads

July 14, 2017

Bundling your agency’s financial and human capital management functions on one SaaS platform reduces costs, saves time.

For small and mid-sized P&C agencies, software-as-a-service (SaaS) products can be a boon to their operations. Instead of purchasing an expensive network and maintaining an on-site server, agencies lease the off-the-shelf software from a vendor that hosts the program.

Perhaps the biggest advantage of SaaS is the pricing surety these products provide. Agencies pay a monthly fee for the service, and since the program is overseen by the vendor’s IT staff, agencies needn’t staff up to service and update the SaaS.

“SaaS models are an increasingly attractive and viable option to the traditional on-premise, upfront cost model, Denise Garth, SVP - Strategic Marketing, Industry Relations and Innovations at software company Majesco, wrote in InformationWeek. “There is a decreasing appetite among insurers for high, initial license fee agreements and customized implementations, making SaaS models more attractive.”

Unfortunately, many P&C agencies remain saddled with outdated and labor-intensive systems developed in-house. “These are often homegrown systems that, over the years, have evolved into a Frankenstein’s monster of numerous stitched-together plug-in applications,” writes Jaime Leonard, Senior Associate, Global Delivery Consulting at GEP, on PropertyCasualty360. “This leads to increased maintenance costs, as more time and resources need to be expended nursing the system along so that it can function on a day-to-day basis.”

If P&C agencies want to improve productivity and reduce costs with technology, they need to consider bundling SaaS products. In that way, agencies achieve efficiencies by combining two vital functions: financial (accounting and expense ledgers) and human capital management (HCM), which manages recruitment, payroll, and benefits.

Why Bundle

Bundling financial and HCM SaaS programs offers several advantages. Luckily, a number of well-known vendors such as Workday, Oracle, SAP, and Microsoft Dynamics 365 provide dual solutions for insurance agencies. Working with those vendors means agencies:

Reduce costs: vendors are more amenable to negotiate on price if agencies buy two programs. By purchasing financial and HCM modules at the same time, Leonard estimates agencies can save up to 40%.

Pare down applications: a combined financial/HCM program eliminates the need to scatter applications across multiple platforms. Users plug into one application for both tasks.

Centralize the processes: instead of shuttling between two separate systems, a bundled solution shares data between HCM and financials. Updates in one system automatically transfer to the other as well.

Consolidate implementation: implementing a SaaS can be a time-consuming, disruptive process, sometimes as long as 15 months depending upon the system, Leonard notes. Equipping your agency with both SaaS at the same time streamlines the integration process across the agency.

Choosing a SaaS

Each SaaS features a variety of capabilities. Some are all-inclusive, while others coordinate with other partners, Leonard points out. It’s up to the agency to choose which one meets their requirements now and in the future.

Research the SaaS before purchasing and speak to a number of vendors. Know exactly what services you require and if that program delivers those functions. Be sure to train employees on the software, and consider how easily you can migrate to another SaaS vendor if the need arises. While you’re at it, consider digitizing other areas of business to improve performance and increase efficiency, such as investing in a CRM or partnering with a qualified internet leads provider.

And given today’s concerns over cyber security, inquire about data protection as part of your agency’s due diligence, advises insurance business development expert Edward Halsey in a RiskHeads.org article. “Have safety nets in places to overcome data loss in the cloud (such as backup systems) and ensure that your security measures, such as up-to-date encryption methods maintains the integrity of your system,” he writes.

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