Modern CRM Solutions


Thilaga K. Ganapathy

May 2007

Summary: This article covers how a modern customer-relationship management system solved the business loss faced by Humongous Insurance. (6 printed pages)


Meet Judy
Designing for Customer-Information/Customer-Relationship Management
Critical-Thinking Questions
Further Reading


Our group of consultants was informed by our customer, Humongous Insurance, that in the past year, customer statistics had fallen and they suspected a potential loss of 10 million dollars. They wanted us to investigate the reason behind this loss. We had a number of meetings and long discussions with the Board of Directors and managers. We questioned payroll records, primary costs of business, and comparison statistics of business performance. The data clearly depicted that the customer statistics had been badly affected—thus, most likely accounting for the loss of revenue.

We then called in the director's secretary to pull out a few policyholder files, which included active policyholders, defaulted policyholders, and recent policyholders. We made an effort to call up some of these policyholders personally for their feedback. During the second week of investigation, we found that many of the customers were unsatisfied with the services provided by Humongous. This investigation led us first to the case of Judy.

Meet Judy

Judy is a customer of Humongous Insurance who was covered by a medical policy and a protection policy. The following is a brief explanation of Judy's case:

Judy was suffering from a leaky aortic valve and needed an operation. The medical staff apprised the family of the gravity of her condition. Judy's family made the decision to admit her to the medical center without a second thought of the high costs that would accrue from the surgical procedure. She was that sure her incurred costs would be well covered by Humongous Insurance.

The medical card was presented upon Judy's admission to the medical center, only for her to discover that the medical-card information was not found in their system. Her family was informed that the card was invalid. When her family inquired further, Judy clarified that she had made the monthly premium payments to the agent, named Josh Edward, who regularly did the follow-ups with her.

Puzzled and disappointed with the unexpected response, Judy's family then sourced for funds and sponsored her medical costs.

We laid out the following questions for ourselves:

  • What did the account's agent, Josh Edward, do with the collected premiums?
  • Were there other cases like Judy's that had led to loss of business for Humongous?

Further investigation ensued. We investigated Judy's case and suspected the root cause could be the agent, Josh Edward, who had been employed with Humongous Insurance for about a year. His record had been kept untracked. Josh Edward misused his position by continuing to collect premiums even after he had resigned from Humongous. The premiums that he collected obviously did not reach Humongous Insurance; instead, he kept the premiums for his own use.

We then checked a number of other agent's folders to investigate their agency licenses and their employment records. To verify further, we checked with many more policyholders, including older policyholders, and confirmed the names of the associated agents. The results of the investigation told us that Josh Edward was not the only agent who engaged in this type of activity. From the similar feedback of the customers whom we called up, we were able to determine the root cause: The premium payments had not reached Humongous, which resulted in defaulted policies for many unaware customers. When these customers tried to access their medical cards, they were given the same story as Judy.

Designing for Customer-Information/Customer-Relationship Management

We then discussed the following questions:

  • How do we prevent such fraud and misuse of position and trust?
  • Why was the customer information not in the current system?
  • What is lacking in the current system or procedure at Humongous Insurance that led to such fraud, which resulted in customer dissatisfaction and now loss of potential business?

Humongous Insurance has over 1 million policyholders. Judy's case was one of many in which customers discovered at a later stage that their policies were nonexistent and could not be accessed for their critical needs.

"Customers" were and are very important to any business. They were and are the number-one asset of any company; therefore, it was important that customer needs were well taken care of, to ensure the current and future business of Humongous Insurance. Any disappointment that we caused to the customers would only hurt potential business to Humongous. We needed to investigate why information pertaining to the customers was not found in the current system and how to prevent fraudulent acts.

We then scheduled a study of the current system and procedures at Humongous Insurance in the areas of customer and agency management. We found that the existing system did not validate and track the agents, prospects, or their sales. Thus, uncontrolled agents were allowed to commit fraudulent acts that resulted in the nonexistence of customer information.

Humongous not only lost customer information and lost track of agents, but also lost potential business and trust from the majority of customers. The customers were now unsatisfied with the unreliable services, and they were not willing to continue or refer potential business to Humongous. This was the current major issue within Humongous.

With these challenges in hand, we then realized that there was a need for not only a customer-information system, but also a customer-relations management (CRM) system—a system that could control, track, and validate the agents, and would do most of the monitoring and coordinating of agents and their customers. We needed a good CRM system that could prevent the misuse of the customer relationship, protecting both the customer and the company.

How, Why, and What

Faced with this information about our customer, Humongous Insurance, we realized that there was a huge gap in the current system and procedures that Humongous had been using, compared to the modern customer-relations management system. We decided to help Humongous Insurance with the use of a modern customer-relations management system. We laid out the expectations and requirements that would solve the issue that Humongous Insurance was facing.

What Is a Customer-Information System?

Obviously, it had to be a system that registered every detail about a customer. "Every detail" means that all relevant information that pertains to the insurance policy about the customer had to be acquired.

Why Is Information Not in the System?

Forms with document-identification numbers would be distributed to agents. These forms then would be used by the agents to fill in information about their customers during the initial stage of closing their prospects.

How Would the Form Provide Control?

Forms implemented with document-identification numbers would be used to keep track of the agents and their business conduct. For instance, any omission of a form could be identified and would require the agent to provide valid reasons for that omission. This would bring not only control in managing the agents' conduct, but would ensure also that none of the customers' information would be lost. The contents of these forms could then be entered into the customer-information system.

Agent Management

The customer-relations management system had to be implemented with a special system for the agents. Upon recruiting agents to Humongous Insurance, all relevant information—such as agency-license validity, personal identification, relevant qualifications, and personal particulars—had to be acquired. The information would then be registered into the agency-management system, which would work in an integrated environment with the customer-relations management and the customer-information systems. Interviews and evaluations would be carried out to ensure that Humongous recruited only the right candidates. This system had to keep track of their agency licenses and their employment contracts with Humongous Insurance. Nevertheless, freedom could be practiced by the agents, but some form of tracking on their daily schedules and appointments would have to be carried out by the agency managers.

How? The agency-management system had to be implemented throughout the agency department, whereby the agents would be required to enter into the system their daily working hours, their list of contacts, and schedules of appointments for the day. This routine data entry by the agents would be used to evaluate their performance by keeping a record of their business. In return, good agents who achieved their business quota would be rewarded and vice versa. This would ensure that the agents' business conduct fell under the right track—thus, safeguarding the image of Humongous Insurance and ensuring the business stability. With these measures in hand, we then could ensure that fraudulent acts would not happen and keep many people from falling into Judy's case.

Identification numbers for the agency and customers had to be implemented to ensure that, during inquiry, the customer's profile and the relevant agency's profile became available. All relevant information about the policy had to become accessible as easily and quickly as possible. There had to be more than one identification number to enable a flexible searching mechanism. For example, the agent's code, license number, and passport number could serve as multiple points of reference in searching for information. For customers or policyholders, identification numbers—such as personal identification, policy number, and special call-center identification numbers—could be implemented—thus, providing means of alternative search, if one of the other numbers was forgotten. This would ensure that the relevant information would be accessed quickly and easily to meet the customer's needs. This would also serve to eliminate the issue of nonexistent records of customers, such as in Judy's case.

Customer Management

Information about customers and their medical policies are assets to the company. We had to provide assurance to the customers that their particulars are kept private and confidential, and were used only for the company's purpose and for their benefit. To do this, we had to implement an approach to the accessibility of customer information, whereby specific verification was implemented. This would be accomplished by requesting that the caller or inquiring person provide valid information, such as agency code, date of birth, personal identification, and password/PIN numbers. This would eliminate unauthorized access to customer's information and would ensure that only the medical-card policyholder or the agency in charge of the policyholder had access to the information.

Besides information availability and accessibility, every transaction for the premium payments had to be tracked. Financial statements had to be generated to ensure that all payments from the customers reached Humongous Insurance. Any omission or delay in payments should be followed-up by the customer-service executive via reminders or a simple phone call, to ensure that the customers were well-informed and taken care of with their protection plans. The customer-service executives also would impart to the customers the possible outcome of lapsed or defaulted policies. This reminder would ensure that the information would be accurate—thus, eliminating the possibility of the policy being defaulted. Besides the agent's follow-up, the direct follow-up from Humongous Insurance would ensure that any suspicious acts would be identified. For instance, if any premium payment did not reach Humongous, the second direct follow-up would identify the fraud. This would be a good practice to prevent further fraud and ensure that customers, like Judy, would not be cheated by their agents.

Customer responses and feedbacks would be recorded in the system to ensure that no fraudulent act by the agent had taken place. Any suspicious acts could be identified from the feedback given by the customers, as customers would be the number-one stakeholder in Humongous. Every customer-feedback entry in the customer-relations management system would be accompanied by the identity of the customer-service executive who had handled the feedback.

Customer-service call centers would be established by training the customer-service executives, who would then handle customer calls professionally and, thus, assist in providing optimum services to the customer. Authorized officers would be appointed to monitor the agents and the customer-service executives. A system that could record a telephone conversation would be implemented to ensure the quality of services to the customer. Every customer-service executives would be assigned a unique telephone identification to ensure that any unsatisfactory handling of customer calls could be tracked and monitored.

Inquiries about the available medical and protection plans would be provided to the customer respectfully. The customer-relations management system must have been able to keep record of customer feedback, requests, complaints, and inquiries. This registered data would identify who received the call of inquiry, request, or complaint from the respective customer. Progressive actions would be registered and prompt actions taken to ensure that the customers' requests were met, guaranteeing customer satisfaction.

By implementing this practice, any calls or services requested by the customers would be revealed earlier and, thus, provide a means of taking earlier corrective measures before they spread to acts of fraud. This, then, would ensure the stability of business and the satisfaction of the customers.

Statistics for Business Intelligence

Daily, weekly, monthly, and yearly statistics and reports would be generated for an overview of current and past performance of the agents, customer services, and the overall statistics of customers and business of Humongous Insurance. These statistics would provide comparisons and the means of evaluating the situation and the progress of Humongous Insurance. Any suspicious figures or statistics would be encountered at an earlier stage—thus, providing a means of solving challenges quicker and earlier, prior to any loss of business.

These expectations and requirements were submitted to the Board of Directors for further discussion. Upon approval by the Board of Directors, these expectations and requirements were converted into designs by the system analysts. The implementation consultants then executed these requirements.

Although there could be some level of limitations, we had to ensure that we could meet customer needs as optimistically as possible in order to ensure a good flow of existing business, as well as future business growth. Customers are assets; customers bring business to us. Meeting the demands of customers meant implementing a system that not only best supported and serviced customers, but also managed every possible scenario of the business from start to end. This included such integrated capabilities as information accessibility and availability, data validation and verification, manpower and information monitoring and tracking, and the ability to provide reporting and statistics of every aspect of our business.


The lesson that we learned from Humongous Insurance is that a good customer-relations management system not only keeps information, but also tracks corporate business performance that will prevent the misuse of customer relationships and protect both the customers and the company.

Although the criminals were never caught, Humongous enjoys a profitable business today, because they have more intelligence with regard to their customer performance. The security controls introduced by the new system continue to help prevent the type of fraud that they had once experienced, and their customers remain happy to this day.

Critical-Thinking Questions

  • In the fast-paced growth of technology and modern lifestyle, how do we maintain the satisfaction of customers as their expectations change?
  • What will be the customer-relations system of the coming 5 to 10 years? How will it use business intelligence?
  • How do you think that Humongous Insurance, or any customer-services–related organization, will match its products with continued developments of lifestyle and technology? How will it apply data modeling and data mining?
  • Envisioning the fast growth of technology in the coming 10 years, we believe that it can bring great advantages in convenience, but also disadvantages, as in the case of the agent's fraudulent acts stipulated earlier. How do we counter the possibility of disadvantages, as evolution of technology works for both good and ill?
  • Human values—such as trust, integrity, reliability, respect, and satisfaction—are now considered very important for business growth. Will these values still be held in the coming 10 years?

Further Reading

  • CRM Today. A portal for customer-relationship management and marketing, offering CRM news, events, CRM articles, white papers, analyst gurus, and strategy views. (Accessed January 10, 2007.)
  • Dyché, Jill. The CRM Handbook: A Business Guide to Customer Relationship Management. Boston, MA: Addison-Wesley Professional, 2001.
  • Greenberg, Paul. CRM at the Speed of Light. New York, NY: McGraw-Hill/Osborne, 2004.
  • Newell, Frederick. Why CRM Doesn't Work: How to Win by Letting Customers Manage the Relationship. London, England: Kogan Page Ltd, 2003.


About the author

Thilaga K. Ganapathy is currently a technical writer for a software-development hub, Exact Asia Development Center in Malaysia, a division of an international software company, Exact Software, which is based in the Netherlands. She has acquired 10 years of professional experience in the area of IT—performing teaching, programming, testing, consulting, implementing, end-user training, internal support, project management, and documentation.

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