ICRB Vision and Strategic Intent

ICRB Vision and Strategic Intent

Vision and Strategic Intent Worksheet

Last updated (3/9/2005)

Introduction

Mission

Core Values

About ICRB

Value Proposition

Strengths and Weaknesses

Threats

Problems and Opportunities

Next 3 to 5 Years

Strategic Initiatives

Action Steps

Appendix

Introduction

To continuously improve ICRB services, the ICRB Governing Board asked the General Manager at the December 16, 1999 Board meeting to begin a strategic planning process. Our initial efforts were presented to the Board in the first version of this document dated July 26, 2002. This is an on-going process that will be updated periodically, as needed.

Our Vision and Strategic Intent outlines initiatives to be implemented over the next two to three years. This pro-active outlook generates strategic directions to ensure the Bureau’s success in the coming years by analyzing our strengths, weaknesses, threats, and opportunities.

Mission

The experts in workers compensation insurance for the State of Indiana

Core Values

§  To be the "best deal"

§  Create an environment where people are happy to be here

§  Expect individual responsibility for personal growth

§  Foster a "try it" and "can do" attitude

§  Guided by openness and honesty in all we do

§  Easy to do business with

Our Customers

·  Member insurance companies

·  Agents

·  Regulators

·  Trade Associations

·  Employers and employees.

About ICRB

The Indiana Compensation Rating Bureau (ICRB) is a private non-profit, unincorporated association of all insurance companies licensed to write workers compensation insurance in Indiana. The ICRB is a statutory rating organization as set forth in Chapter 27-7-2 of the Indiana Insurance Laws.

The law empowers the ICRB to gather information from its member companies that may be necessary to establish fair and adequate advisory rates. This information is submitted to the Indiana Department of Insurance for review and then distributed to all member companies who use the rates or file their own rates.

In addition to the data collection and ratemaking functions, the ICRB is responsible for various workers compensation programs: rules promulgation, experience rating, inspection and classification, assigned risk administration, industry education, and dispute resolution.

Value Proposition

§  Uninterrupted, on-time delivery of services that encourage safety in the workplace and competition among workers compensation insurance companies.

§  Provides the bridge or balance between the insurance regulators and the private sector (carriers, employers and workers)

Components of the Value Proposition:

§  Data Collection - provides a one-stop source of information to be used for credible analysis of experience rating, ratemaking, and research for workplace safety.

§  Ratemaking – provides statewide benchmarks for pricing workers compensation policies.

§  Experience rating – creates an incentive for safe workplaces, tailors costs to individual employers, and provides a mechanism for carriers to be fairly compensated for assuming risk.

§  Insurance for the uninsurable – provides a safety net or last resort for employers and workers who otherwise would not have workers compensation insurance protection.

§  Rule interpretation and enforcement – provides consistency, clarity, and impartiality in the application of rules.

§  Inspection – assures proper classification of employers so that business competitors are treated the same.

§  Education – proactively transfer knowledge about workers compensation.

§  Delivery of timely and accurate information - forms the basis for decision making by carriers and employers for issues related to workers compensation insurance.

§  Dispute resolution – provides a first step, low-cost solution to resolving conflicts that arise between various parties.

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ICRB Vision and Strategic Intent

Strengths and Weaknesses

Category

/ Strengths / Weaknesses /

People

/ Stability; customer service orientation; customer care; low turnover; pattern of productivity improvement; cross training / Need to guard against staying in their comfort zones; need new goals/measurements that challenge and expect each person to grow. Long length of service impacts benefits’ costs.
Management / Capable management with succession / VP – Administration expected to retire in 2006
Structure / Flat organization; broad Board representation and participation / Board members’ level of participation sometimes limited due to background/specialized expertise and/or time demands presented by employers
Systems/
Technology / Growing web site; reliable technology, new Content Management System, up-to-date - leased equipment / Somewhat dependent on NCCI; lack of in-house IT specialist; outdated disaster recovery plan; lack of documented, detailed procedures.
Reputation / Strong reputation with agents and others; high customer satisfaction level / Often perceived as a state agency, state employees
Financial / Funded by insurance industry; strong financial controls in place; history of fiscal responsibility; A/R are timely / Tracking mergers and acquisitions are time consuming; reapportionment is complex; limited access to capital due to absence of capital fund
Size / Small size enhances flexibility / Higher benefit costs
Equipment & Facilities / New Board meeting room offers flexibility / Clientele in building creates security concerns
Services / Growing web site; high customer satisfaction / Limited field back-up; no true random sampling of classification system (can’t prove integrity); service requests beyond present capabilities are limited:
·  State by state comparisons
-  average rates
-  costs per employee
-  average premiums per employer
·  Appropriate medical charges (fee schedules)
·  Carrier contact information
·  Carrier filings
Other

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ICRB Vision and Strategic Intent

Threats

Threat = any action, void, or entity that could interrupt the value proposition of the ICRB to its members (customers).

§  Loss of state specific knowledge and expertise as well as ancillary, value added services

§  Limited ability to quickly respond to the needs of customers due to natural or other disaster

§  Loss of credibility with regulator (Department of Insurance)

§  Change of state statute

§  Nationalization of Workers Compensation

§  Future terrorists attacks could cause carriers to stop offering regular market coverage which could place an unusual burden on the assigned risk market

§  Politicizing of the licensing process of the rating bureau

Problems & Opportunities

A Problem is a discrepancy or difference between what is desired and what actually exists. An Opportunity is a favorable time or occasion for undertaking a new initiative that will strengthen the organization.

The following lists are prioritized according to the time frame in which the items will be addressed and action taken, starting January 1, 2004.

The following items will see action taken within the next 6 months:

1.  No remote access to systems.

2.  Inadequate anti-virus software.

3.  Out of date software e.g. Windows, Sharepoint

4.  ICRB tied to NCCI systems.

5.  Small size makes ICRB susceptible to service interruptions.

6.  Introduce change management focus as the prelude to staff development; employees will define needs and address development of new skills to address future service offerings.

7.  Provide access to downloadable data from ICRB website.

8.  Evaluate Assigned Risk pooling alternatives.

The following items will see action taken within 6-12 months:

9.  Incompatibility of Lotus Notes with other applications.

10.  Limited field back up for inspection function.

11.  Expand service offerings to include: state-by-state comparisons, carrier contact information, and carrier filings.

12.  Peer review (self-audit) process.

13.  Develop replacement plan for VP Administration.

14.  Evaluate actuarial services alternatives.

15.  Expand scope and detail of procedures’ documentation.

The following items will see action taken within 12-24 months:

16.  No system or procedure to ensure integrity of classification (compliance verification), and experience modifications.

1. Study the needs of Indiana’s growing Hispanic population and determine how the ICRB should address them.
2. Define qualification guidelines for Board representation and orientation program for new members.
3. Study data collection and storage options.

What is your understanding of the situation likely to confront the ICRB during the next 3-5 years?

·  What Business will it be in?

Workers compensation insurance rating and services business.

Information dissemination; data collection (currently outsourced to NCCI); data analysis; interpretation of statutes; set rules.

·  How will it Create Economic Value for its Customers?

Analyze and solve tough coverage and rate issues; catch and correct mistakes by NCCI, provide rules for consistency (level playing field for competitors); partner with State and local agencies to leverage the advantages of Indiana’s workers compensation system in attracting and keeping businesses in State; provide training seminars and presentations at industry-sponsored events; direct customers to appropriate resources for problem solving; enhance on-line reference library to address customer needs:

·  How to find an agent

·  How to find a carrier

·  How to control losses

·  Understanding my mod.

·  How will it be Organized and Managed?

Maintain current structure: non-profit, unincorporated association of insurance companies with Governing Board comprised of carrier representatives. Organization and structure subject to ongoing evaluation, and consideration of outsourcing options.

·  Which Customers/Markets/Segments Will It Serve?

Currently dictated by State Statute; could serve customers in other states.

·  How will Customer Needs Change?

Insurance companies will continue to consolidate with mergers of banks and insurance companies. Customers will be bigger and more powerful (potential threat). Customers will prefer/demand more technology-based interaction. For example, customers will desire web-enabled electronic transfer. Service from insurance companies may suffer from loss of expertise and impersonal customer service centers (which creates increased service value and opportunities for ICRB). Knowledge-based economy changes the dynamics of employee injuries. Escalation of health insurance costs may impact incidents of fraudulent workers compensation claims (increasing claim frequency).

·  Who will be your Competitors, and how will they compete against you?

There virtually are no competitors as the ICRB is the only Indiana-licensed entity providing rating bureau services.

·  What will happen with Suppliers?

More competition among vendors; ICRB to focus on "best of class" for vendor selection; more vendors, more choices; cheaper prices; better service.

·  Will New Products or Entities Impact the Organization?

PEO's, Internet brokered insurance; 24-hour coverage. Federal solution to the health care crisis could impact workers compensation statute and policy provisions.

·  Will Government Regulation Change?

May move from payroll-based rates to hours worked rates. Will move toward blended state/federal regulation; commingling of WC with other financial services; HIPA refinements will continue to impact data collection; group insurance expansion; TRIA elimination would necessitate alternative reinsurance mechanisms; another major terrorism event could radically change existing TRIA structure.

·  How will the Company be Stronger or Weaker?

Improved facilities and technology advances will allow the Bureau to better serve the needs of our customers; strategic planning process allows the organization to be stronger; new vendors will allow more flexibility and build on stronger vendors; challenge will be to constantly reinvent the organization incrementally to keep pace with technology and the new economy. Staying relatively small will keep organization strong, flexible, and pro-active. Loss of institutional memory with departure of VP Administration.

·  Management Succession?

Jeannette plans to retire in early-2006. No obvious replacement from within. Replacement should be hired at least one year prior to Jeannette’s retirement.

·  Administration, Control, and Reporting Systems/Procedures - Timely/Accurate Information?

Lack of in-house database limits analysis and timeliness of delivery of information to customers. Procedures manual needs updating and enhanced documentation.

·  What kind of Human Organization is the ICRB Becoming?

Already implemented many of the attributes of “Employers of Choice.” Flexible work schedules.

STRATEGIC INITIATIVES

1. Develop IT architecture and e-business concepts that make the ICRB the “best of class” in rating organizations.
   
2. Utilize technology to deliver customer service that matches or surpasses that delivered by other rating organizations.
   
3. Implement “best practices” in Human Capital management that result in ICRB becoming an “Employer of Choice.”
   
4. Develop the resources that will ensure that the requisite skills and experience are in place to provide continuity of leadership of the organization.

ACTION STEPS

Note: Action Steps address issues identified in the Problems and Opportunities (P&O) list. The associated issue(s) is shown in parenthesis as “(P&O #_)” following each Action Step.

Action Step 1: Develop staff to a higher overall level of performance.
Action Steps:
·  Require employees to read, Who Moved My Cheese, a guide and training tool for change management.
·  Follow-up seminar with staff
Estimated Costs:
Status: In progress. Textbooks have been purchased.
Action Step 2: Clarify role of Board, establish ongoing orientation process and outline ways to improve desirability of the position.
Action Steps:
·  Prepare 1-hour to 2-hour presentation for future Governing Board meeting on the role of a Governing Board in a non-profit organization.
·  Solicit Chairman’s guidance in the extent to which we pursue a Governing Board Members’ retreat.
·  Arrange lunch meetings of ICRB management and individual Board members.
·  Explore methods to elevate Board Members’ prestige, e.g. Photos in Board room, recognition plaques.
Estimated Costs:
Status:
Action Step 3: Develop succession strategy for VP Administration, who is expected to retire in 2006.
Action Steps:
·  Define roles and outline options for future organizational structure/separation of duties
·  Evaluate potential to outsource certain functions (remotely) to retiree
·  Initiate interview and hiring process with goal of having successor in position at least one year prior to VP’s departure
Estimated Costs:
Status:
Action Step 4: Develop and coordinate annual comparison of operational costs of independent Bureaus.
Action Steps:
·  Discuss coordination strategy at the Fall meeting of the WCIO
· 
· 
Estimated Costs:
Status:
Action Step 5: Implement internal peer review process and evaluate expansion to include input from other independent Bureaus’ personnel.
Action Steps:
·  Document internal peer review process and procedures
·  Solicit input of DOI
·  Establish schedule for completion
·  Initiate discussion with other Bureaus of feasibility of employee sharing, for this purpose
Estimated Costs:
Status:
Processes and procedures have been written and reviewed by HR consultant. DOI feedback indicates they want to distance themselves from the process.
Action Step 6: Research options which would reduce costs of employee benefits
Action Steps:
·  Solicit presentation by vendor(s) to explain the new Health Reimbursement Accounts
·  Consider costs vs. benefits, and feasibility for the ICRB
· 
Action Step 7: Develop disaster recovery/business continuation strategy
Action Steps:
·  Establish remote connectivity capability
· 
Estimated Costs:
Status:
Work in progress – additional steps to be identified
· 
· 
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