This is the first post in a series about the critical reports and metrics that claims departments can use to improve how they operate.
I recently chatted with Vince Venturella and Bill Sowinski, the authors of our new white paper: Seven Core Metrics for Claims Litigation. I talked to them about the concepts behind the white paper and how claims organizations can apply the metrics they wrote about for improved performance.
Bill and Vince are very strong proponents of the concept of claims defense metrics maturity and helping claims organizations grow their metrics programs. They impressed upon me that it is not the quantity of metrics that matters, but how metrics are used to drive better decision making. Here are their responses to a couple of my key questions:
Q: How should claims organizations start to think about using data to improve their operations?
Vince: “A lot of claims organizations know they have a ton of data at their fingertips but run into data overload when they try to report on everything. There are too many rabbit holes to potentially fall into if you don’t prioritize the types of metrics to examine.”
Bill: “I agree and would add that, first and foremost, claims professionals need to measure what they want to manage and improve. And they can start with a couple objectives, they don’t need to tackle everything at once.”
Q: How can claims organizations move from the chaos of too much data to a more disciplined and mature metrics program?
Bill: “Once you’ve identified what you want to really understand – total legal spend or case cycle times or whatever – you can pull that data into different types of reports to slice and dice it any number of ways depending on what you’re looking for.”
Vince: “Bill really hit the nail on the head and we’ve identified five report types that we think are fundamental to any metrics program. Stick with these five types of reports and you’ll know exactly what you’re looking at, regardless of the data you’re pulling. For example, a performance report is always going to show you a set of data against a performance goal. Say you pull a case open/close churn report segmented by claims professionals. You can then determine your target open to close rate, and who performs above and below that line. At that point, you have a list of folks who need to bring their performance in line with expectations.”
Here’s a summary of what Bill and Vince explained about the five core report types:
- Great for management
- Provide information on overall results
- Usually segmented at a higher level, such as line of business or claim type
- Mirror outcome reports, but at a more detailed level
- Establish performance thresholds to meet a goal or objective
- Usually a performance indicator for individuals, teams, firms, etc.
- Provide specific information about people, claims, firms, or activities that could significantly impact financial performance, claims outcomes, or case inventory
- Pulled and examined frequently to stay on top of risk
- Used to achieve success toward a very specific goal
- Provide multiple types of information on one or more claims or firms
- Summary of relevant information for performance evaluation and strategy development
- Show areas of greatest possible improvement
- Used to prioritize initiatives, disciplines, and metrics to better control or improve performance
- Most challenging report type, as by necessity, requires human intervention to synthesize the data and provide insights
With an understanding of these five report types, I wanted to dive deeper and see how these reports were applied to some of the specific metrics discussed in their Seven Core Metrics for Claims Litigation white paper. We’ll get into that in upcoming posts, where I’ll take a detailed look at some claims metrics and how these reports help us understand the data.
Download the white paper Seven Core Metrics for Claims Litigation to learn more about how your organization can use metrics to improve decision-making and performance.