Canadian Insurance Firm Wins Cost-Recovery Award Using IP Communications

November 24, 2004

By Susan Maclean, News@Cisco

Johnson Inc., a leading Canadian personal insurance and benefit consulting and administration organization, recently won the Cost Recovery Project of the Year Award at Telemanagement Live in recognition of business telecom costs savings. But this insurance firm's executives were already feeling like winners even before they were given one of the 2004 Management & Industry Commitment Awards by Telemanagement Live*, an annual Canadian conference on business telecom and networking.

About six years ago, the 124-year-old firm's CEO and President C.C. Huang and his IT staff began watching the potential of Internet Protocol (IP) based communications to bring relief to the long distance telephone charges incurred from branches spanning from the head office in St. John's, Newfoundland to Langley, British Columbia. They began preparing for the maturing technology by building a network infrastructure that included IP communications-ready switch and routers from Cisco.

In 2002, the decision was made to proceed with replacing their Centrex telephone system. "The improved communication capabilities of IP telephony offered us a way to build on our competitive strengths in serving our customers, while maintaining a national presence from our St. John's headquarters," Huang explains.

After assessing various IP telephony providers and testing to ensure the technology was stable, Johnson chose the Cisco IP Communications solution. In the spring of 2003, the head office telephone system was cut over to IP, with the assistance of telecommunications provider Aliant Inc.

"Cisco fit the mold for leveraging what we had for our network across the country to run our voice traffic as well as our data traffic," recalls Glen Ryan, manager of network operations. "For call overflow and redundancy on a national configuration level, Cisco provided the least amount of constraints or obstacles in our way to put us in position to leverage it from day one."

Once the head office proved to be a successful testing ground, Johnson began equipping the rest of the 650 employees with close to 1,000 Cisco IP phones at its provincial contact centres and 43 branches across the country. That's when the savings really started racking up. Long distance charges for interoffice and outbound calls were eliminated. So were maintenance fees for telephone additions, moves and changes which were now easily done in-house.

"We were spending a lot of money on Centrex lines annually," Ryan explains. "Already we're recovering more than $400,000 a year - and there's even more to be had! Whenever we do an outbound call, we save on our long distance. Even if we're calling a hotel in Toronto, we can go over our WAN (wide area network) and out through our Richmond Hill office."

Those savings have been compounded by productivity-enhancing capabilities such as call routing coupled with interactive voice response (IVR). Already, the firm has confidence that the skills of staff in their network of branches are being used to provide the best service possible to customers. The Cisco IP Contact Centre technology enables incoming calls to be routed to employees based on their skills - including fluency in French - and availability.

For example, although the national call centre is intended to handle requests for quotes, existing clients often dial that number instead of calling their assigned personal advisor. As a result, the skilled sales staff was too often serving as "glorified receptionists" forwarding the calls to the appropriate representative, says Ryan. Now, an IVR data interface process (DIP) identifies the phone number and compares it to the company's database. If the number matches their records of an existing client, the system links the number to the client's electronic file and directs the call to the appropriate advisor - all behind the scenes and without any manual intervention.

Prior to that capability, about 50 per cent of the 7,000 calls the call centre received each month had to be manually redirected, Ryan adds. The time now saved by automatically redirecting those calls frees up call centre staff to better serve new or potential clients.

Another benefit of the Cisco IP Communications solution is that valuable reports are easy to create in-house. Ryan says a weekly report on the call centre automated redirected calls helps them ensure adequate staffing is in place to handle the call volume. It also reveals how many existing client calls are still being re-routed which, in turn, indicates the need to better train staff when the policy is sold to ensure clients understand they have their own personal representative. That all boils down to higher productivity and better customer service.

Now, rather than cost recovery, the primary focus is developing and leveraging the technology to improve customer service and employee productivity. "We're already developing applications to make sure we have a better use of the technology that we have at our fingertips," says Ryan.

While he estimates an 18-month return on investment, he is clearly excited about future spin-off capabilities they will develop to further boost productivity and customer service. "IP technology brings us to the next level of Web development with the phone on the same network as servers," he explains. "There's a lot of development activity we're doing right now and there's a lot more we have coming up."

• screen pops where a client's call in to his/her personal representative will prompt that person's profile to appear on the rep's screen. This will cut down on preliminary questions and make customers feel uniquely well served;
• putting the corporate intranet on the telephone display for better internal communication;
• developing Java applications to create a tickerboard display of top sales staff in the call centre as an employee incentive to enhance agent participation;
• providing a live Web response at the request of visitors to the company's website since the phone is on the same network.

"The Internet is the backbone for 90 per cent of the way business is done," he continues. "We have an IT department staff of 40 here that is skilled to leverage technology to best advantage. It is exciting."

Although the long distance cost savings were what first attracted the company's president, the cost recovery benefit has proven to be like the tip of an iceberg. "We really believe voice over IP is helping us provide better customer service, improve our productivity and outperform the industry," C.C. Huang summarizes.

* Telemanagement Live (www.telemanagementlive.com) is an annual Canadian conference on business telecom and networking organizated by Angus Dortmans Associates and P.W. Ritchie & Associates.

Susan Maclean is a freelance journalist located in Guelph, Ontario, Canada.