CASE STUDY QUESTIONS

#1. What were the problems faced by Income in this case? How were the problems resolved
by the new digital system?

In this case income was facing the following problems:

In terms of time: Because the process is cumbersome and paper-based, income takes longer to
process their insurance. It usually takes them extra days and time to complete an insurance
request.

Additionally, Income’s HP3000 mainframe is always down; the back-up system only allows
restoration to the previous day's back-up data; if the daily data back-up is not finished, the data is
lost, and recovery takes time. In the end, it will have an impact on the progress of the project.

In terms of money: Income needs to always invest and upgrade HP3000 mainframe that
frequently breaks down and it might be costly.

In terms of space: Due to the company is paper-based, there are tons of paper need to be stored
and it occupying 3 warehouses.

Real-time information: Income lost opportunities to cross-sell because transaction processing

for the policy underwriting was still a batch process and the information is not available to the
insurance agents in real-time. The agent was unable to check whether the applicant was an
existing customer of Income.

Income’s main problems were solved in year 2003 when they switched to Java based eBao Life
System invented by eBao Technology. The software comprised 3 subsystems, which are Policy
Administration, Sales Management and Supplementary Resources. The paper-based insurance
processes were replaced by the paperless platform. By using the eBao technology, all of the
documents are being scanned and stored in the trusted storage. Frequent breakdowns were solved
by the high-availability platform. The new eBao technology also addressed the downtime caused
by breakdowns with the hot back-up disaster-recovery centers.

#2. What types of information systems and business processes were used by Income before
migrating to the fully digital system?
Before migrating to the fully digital system, Income was using the HP3000 mainframe that hosted
the core insurance applications, for instances their accounting and management information
systems. However, this mainframe is unreliable due to frequent breakdowns and it resulted
downtime and decreased productivity. They were also using the COBOL program that was
developed in the early 1980s but it was very slow in developing new products for the company
resulting lost sale opportunities. Income does all the work manually and paper intensive, from the
agent submitting the forms to branches manually or by courier, the office services will then sort
them for underwriting; proposals were allocated to staff randomly; the storage is being done by
sorting all the documents and gather it in cartons and stored in the 3 warehouses and since there is
no proper document management system, retrieval of documents take days to complete. As well,
policy writing is in batch process and information was not available to the insurance agents where
they need the real-time information and this caused them to lose the opportunity to cross-sell.

#3. Describe the Information systems and IT infrastructure at Income after migrating to the
fully digital system.

The CIO of Income, James Kang stated that, using the Java based eBao Life System from eBao
Technology is very customer-centric. The software comprises of 3 subsystems, which are policy
administration, sales management and supplementary resources. The new system was operated
with high quality platform and with multiple servers and communication lines. All applications
resided on 2 or more servers where each connected by 2 or more communications line which were
load-balanced. The entire IT infrastructure is replaced with more robust and scalable architecture.

It contains a product definition module that supports new products, new channel and changes in
business process. According to the CEO Tan Kin Lian, the new system has the best straight
through processing workflow and it is very flexible, it cuts the new product launch time from
months to days. And it helps them to save a lot of time and cost. As well, the new system saves the
company and provided them with the company’s disaster recovery plan. A real-time hot back-up
disaster recovery center was implemented and it was super useful for the company. The new
system helped the company to bring their business processes from paper-based to paperless
through digital storage and records. Many users can access to the system at one time and anytime
anywhere. The insurance agents can access to the information real-time and help them to gain
their cross-sell opportunity.
#4. What benefits did Income reap from the new system?

The following are few benefits that can be obtained using the new system.

 For the staff who working outside of the office and need to telecommunicate, it enabled them
to gain faster access to the information, as fast as those staff working within in the office.
 Enable the insurance agent to gain the opportunities to cross-sell because it allows them to
access to the real-time information so that the agents know whether the customer is the
existing one.
 The new system cuts the new product launch time from months to days because it has the best
straight through processing workflow and it is very flexible.
 All documents are being scanned and stored in the trusted storage device, it helps the
company to eliminate the overload uses of paper and they can access to the information
easily.
 Minimizing downtime occurrence due to the hardware or operating system failures.

#5. How well is Income prepared for the future? Are the problems described in the case
like to be repeated?

 To survive in the insurance industry, information system is very important in ensuring the
product and services quality and competitiveness. Products should be constantly improved
and new designs should be always invented. As well, customer queries should be handled
accurately and promptly. With the new information system, Income is now equipped to face
the challenges and obstacles of the industry, the new system helps Income to enhance their
performance and giving them competitive advantage to survive in the industry.
 To ensure that the company is keep improving and not returning to the old bad times, proper
implementation and control should be done well. Continuous training should be given to the
staff to ensure the proper use of the system and to use it in the best way to maximize its
potential. Besides, the system should be continuously improved through the proper
management of feedback from the users as they are the one who using and understand the
problem. System upgrades should also be done periodically to ensure that it copes with the
changes of the industry and the market.