If you use a TPA or outsourced claims handling organisation, how do you measure performance?

Performance and value are more than KPIs and SLAs. There can be no doubt that they have a place in any contract, however, relying only on these two methods of measuring performance and value can inhibit both the client and service provider from unlocking greater benefits and developing better relationships which drive behaviours that add both financial and intrinsic gains.

In our experience, we too often hear the praise or criticism that: “We have met our KPIs” or “We have just been following the SLA”.  KPIs can be used as a stick with which to beat, or a carrot with which to tempt,  but do they really create value and foster the development of long term relationships?

Value and performance should be measured by more than a ‘cost per claim’ or a ‘reduction in a reserve’.  Whilst both of these things are important in any claims handling process there is more to consider. Value should encompass the behaviours of both parties, how well the client’s business is understood, what the service provider can contribute to the relationship and how included they feel in the growth and success of the clients business.

Independent, objective assessments can challenge and improve relationships.  They provide both parties with a view which is untainted by any past transgressions or historical issues which may have festered unaddressed and which may have created barriers to performance improvement. A ‘fresh pair of eyes’ can be integral to helping both parties succeed in both growing and retaining the business.

At a time when margins are tight, we need to find and develop the greater value  that should be brought to a relationship  by allowing both parties to perform at an optimal level.

This value can be unlocked by bringing in experienced external support who can challenge the status quo and bring clarity to situations and expectations which may have become confused or clouded over time.

Both clients and Claims Service Providers can benefit from taking a step back and refreshing their relationships to make sure that they are on track and that both parties are maximising the potential. Failing that, changes may need to be made and quantifiable, measurable, data is then available, collected independently to allow informed decisions to be made.

Customers want to get value form their partnerships; they want suppliers to perform. Equally, suppliers want to provide a value added service and perform profitably. Sometimes, however, one or the other, or indeed neither side fully understand how to do this.

There are many areas where value can be given and gained which are specific to the client’s business, just as there are a number of different ways by which performance can be measured.

Sometimes it needs an ‘outsider’ to help identify these areas and structure the relationship to deliver.

It’s crucial to take a step back and look at your relationships and then ask: “Do we understand the value? Are we maximising the relationships? Are we leveraging the benefits? Are we measuring performance correctly?