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Plenty powerful, but too
hard to use. Too much computer skill required. Too many problems
converting to user-friendly format. Too little support. Too little
flexibility.
Those are risk managers' biggest complaints
with current risk management information systems, according to a
highly unscientific sampling of opinion.
On balance, though,
many risk managers praise their systems far more than they criticize
them. ``It has saved us a lot of time and reduced a lot of
paperwork,'' said Keith K. Kovash, manager of risk management and
benefits at The Montana Power Co. in Butte, Mont.
The
self-insured utility has used an RMIS to track long-term disability
claims for the past year. It plans to expand its system to include
first-party property exposures and other areas of risk management over
the next several years, Mr. Kovash said. While the system is not
comprehensive, the software provider, which he would not identify,
offers upgrades to expand the use of the system, Mr. Kovash said.
An RMIS can be too complex for risk managers without
extensive computer backgrounds. ``You have to be fairly computer
literate to use them,'' said Walter Buce, vp of risk management at
National Service Industries Inc., a manufacturing company in Atlanta.
National Service has used a Risk Science Group Inc. RMIS for several
years and it is now the ``backbone of the risk management
department,'' though it needs to be modernized, Mr. Buce said.
Risk
managers have also found that it is not always easy or convenient to
convert from old-fashioned systems to more user-friendly ones. Many
RMIS products based on Microsoft Corp.'s widely used Windows software
are still in the developmental stage, so it may be too early to make
the change from less user-friendly DOS-based programs, said Nancy
Smith, director of risk management at Long John Silvers Restaurants
Inc. in Lexington, Ky.
"Windows systems seem to have
been in developmental stages for the past two years and they are still
working the bugs out of them,'' she said. A Windows format would add
more flexibility to existing systems, though it would be a mistake to
move from a DOS system until all the problems have been corrected, Ms.
Smith contends.
With the rollout earlier this year of
Microsoft's Windows 95, many RMIS vendors are creating new versions of
their software to run on the new operating system, though others plan
to do so only if clients demand it (BI,
Aug. 21).
At National Service, switching to a personal
computer-based system from a mainframe system would make using it
easier and cheaper. Converting would be an arduous process, said Mr.
Buce, but probably worth the effort. National Service will likely move
to a PC-based system within the next two years, said Mr. Buce, who
added that he would like one compatible with Windows. "Using a
Windows system as a foundation block would make it more user
friendly,'' he said. Difficulty of use is another common complaint of
risk managers.
At Long John Silvers, the current Pyramid
Services Inc. system is used for a variety of tasks, including
generating first reports of injury, registering customer and employee
claims, data analysis and preparing materials to renew coverages. Were
the system easier to use, it could probably accomplish more, said Ms.
Smith. "There are a lot of modules on the system that we don't
use because they are not so user friendly.''
Similarly,
Phillips-Van Heusen Corp. in New York uses its RMIS for claims
management and analysis but does not use the system to its full
potential. ``It's overwhelming to get into and to understand the
capacity and figure out exactly what you can do with it,'' said Carla
Eberling, director of risk management for the clothing manufacturer.
Many risk management departments have undergone cutbacks in
the past few years and often risk managers do not have the time to
learn how to make best use of the systems, she said. "We always
seem to be waiting for a lull,'' Ms. Eberling said.
Related
to ease of use complaints are complaints that systems are not flexible
enough. At Phillips-Van Heusen, for example, codes on workers' injury
claims cannot be easily changed if the injury is re-diagnosed, such as
a wrist strain eventually turning out to be carpal tunnel syndrome,
explained Ms. Eberling.
But, despite those faults, the RMIS
has been a great benefit to the company, Ms. Eberling said. ``For
example, local facilities can just call up their own claims on the
system without having to call us on the telephone. It makes their
lives a lot easier and that in turn makes my life easier.''
Finding
a flexible risk management information system can frequently be a
problem, said Timothy J. Bunt, vp of corporate risk management at the
Prudential Insurance Co. of America in Newark, N.J. "A lot of
vendors say, `This is our RMIS. Do you want to buy it?' There is no
flexibility,'' he said.
A way around the problem is to work
with RMIS vendors willing to design a system specifically for the
customer and also to require upgrade options be built-in to the
contract with the vendor, Mr. Bunt said. Prudential currently is
developing its own tailor-made system with Anistics, a unit of
Alexander & Alexander Services Inc.
"We have the
flexibility to design the screens and the modules and it will allow us
to manipulate our data in the way that we want to,'' Mr. Bunt said. In
addition, an option to upgrade the system will help Prudential keep up
with the fastpaced changes in technology that affect risk management
information systems, he said. Other risk manager complaints focus on
RMIS service and support.
Servicing and upgrading systems
after they are installed can sometimes be a problem, said Ms. Smith of
Long John Silvers. While many systems are designed by people who have
a thorough knowledge of risk management, the support staff of some
vendors are not so familiar with the job, she said. Support staff who
readily understand risk management and understand what risk managers
require of their systems are rare, Ms. Smith said. ``Support staff
that know about computers and insurance are hard to find.''
Some
of the problems risk managers encounter with RMIS are related to
general data transfer problems, said Mark Michaud, director of risk
management at Collins & Aikman Corp., a textile manufacturer and
retailer in Charlotte, N.C. ``The industry has to develop a better way
of exchanging data between carriers and policyholders,'' he said.
Collins & Aikman uses two main insurers that format data
differently so it all has to be re-entered into the company's computer
system, Mr. Michaud said.
RMIS vendors that produce a system
that can accommodate different data formats from a variety of insurers
would have a distinct advantage, he said. ``The industry recognizes
this and is fitfully trying to meet our needs,'' he added.
But
like other risk managers, Mr. Michaud is quick to point out that the
RMIS has enhanced his ability to do his job. For example, he said, the
systems readily enable risk managers to keep track of department
budgets and determine how funds are being spent. ``Everybody wants to
know what we are spending are money on and how we use it and the
system helps us to answer those questions,'' Mr. Michaud said. |
