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Case Studies
Transforming Business Operations for a Mortgage Insurer
The Client
With a revenue of about US$ billion in FY 2004, PMI (NYSE:PMI) is a leading provider of credit enhancement products and lender services that promote homeownership and facilitate mortgage transactions in the capital markets. Headquartered in the US, PMI also operates in Australia, Europe and Asia.
Business Need
The mortgage insurance industry is very competitive. To sustain revenues and margins, companies must be operationally efficient, client-service focused and nimble in introducing new products rapidly in the market.
As a leading provider of private mortgage insurance, PMI faced several challenges:
- As a result of rising transaction volumes and increasing business complexity, PMI needed better and timely information to make effective decisions
- PMI's core applications ran on legacy platforms that had evolved organically over 25 years. With PMI's existing IT infrastructure, characterized by limited scale and disparate systems, it was cumbersome to support the launch of new products and other business enhancements
- Core processes were supported either manually or by using spreadsheets and thus lacked scalability
- Create an information management system that improves ease of use at every point of customer connection, resulting in improvements in servicing and administration of PMI's insurance portfolio
- Support PMI's global diversification efforts
Infosys was selected to help design and deliver pmiCentral™ because of its proven end-to-end capabilities in systems integration, complex program management and organizational change management.
Infosys' Solution
After an initial assessment phase, Infosys recommended an integrated system that addressed PMI's objectives. Infosys' business consultants worked collaboratively with PMI's executives to develop the business case and define a two-year roadmap to build a web-based, integrated application suite that would address key areas of PMI's business operations.
The Infosys and PMI technology teams then jointly designed the system architecture, completed the application design and development and rolled out the system in planned phases that maximized business benefits for PMI.
Infosys leveraged its highly efficient Global Delivery Model to deliver a high-quality, cost-effective solution. A customized version of Rational's Unified Process was used to support the iterative development methodology. As the system was being rolled out and adopted across the enterprise, PMI realized significant business benefits in the areas of financial reporting, operational effectiveness, client servicing and operational cost savings.
Key Challenges
- Cross-system project planning: Interfaces with several systems (both legacy and modern) created both technical and logistical challenges. Cross-system project planning posed a key challenge, as the development and testing plans of several enterprise systems needed to be synchronized. This was important as unplanned downtime of systems could lead to delays because of mean loss of development time as well as the need for additional time to test other systems that interfaced with the systems that were down.
- Legacy data: During the cleanup, transformation and migration of approximately 25 years of historical data from legacy to new systems, maintaining the integrity of each data point was of paramount importance. Over nine months, tens of millions of data points were assessed for problems in data quality. Each identified problem was discussed and appropriate correction measures were identified and implemented.
- Data Migration: The data migration was the largest in PMI's history. It took six server-class machines to effect the migration. Approximately 1,200 unique data maps were developed in support of this migration.
- Interpretation of business policies: Complexity and ambiguity around business rules required interpretation of contracts dating back to earlier decades.
- Involvement of infrastructure support groups: The footprint of the pmiCentral™ implementation was all encompassing - covering approximately 15 enterprise systems from online, external-facing servicing systems to back-end accounting systems such as PeopleSoft. The implementation footprint required the active involvement of almost all the infrastructure support groups in PM - viz. the database support group, Unix administrators, desktop support, Intel Systems support, PeopleSoft support, etc.
- Largest-ever production rollout: The production rollout of the pmiCentral™ claims and delinquency systems was the largest ever in PMI's history. Approximately 130 people were involved over five days. Over 230 tasks across several systems, performed by different groups, were orchestrated in a defined sequence. Several person-months of effort went into mapping each point of failure and defining contingency plans and mitigation strategies. A 24x7 'Command Center' was set up to manage the deployment effort.
Infosys consistently delivered excellent quality throughout the program, which enabled PMI's IT organization to exceed the expectations of its user community. The engagement leveraged Infosys' wide array of service lines including Business Consulting, Program Management, Technical Architecture, Systems Design and Development and Independent Validation Services.
Several key business outcomes were achieved by the pmiCentral™ program:
- Optimized Claims Payouts: Well-defined business rules have increased the accuracy of claims calculation, specifically in the areas of rules associated with perfection, scheduled payment and bankruptcy delays. The resulting optimization of the claims payouts directly impacts the bottom line favorably.
- Productivity Improvement: There is considerable improvement in productivity in core business processes such as claims processing, delinquency management and reinsurance operations. This was achieved through mechanisms such as easy maintenance of claims processing factors, customized work lists, limit-based workflow and authorization and better management of electronic batch processing.
- Flexibility in structuring new products and contracts was enabled through the abstraction of the business logic around claims processing from the product. For example, the pmiCentral™ Risk Share system offers the flexibility to define complex, multi-dimensional, layered re-insurance product structures that earlier were manually supported through spreadsheets. This has significantly strengthened PMI's competitive advantage.
- Improved ability to manage portfolio risk: Sophisticated forecasting mechanisms have improved PMI's ability to manage portfolio risks.
"As a strategic partner, Infosys has consistently demonstrated commendable technical and business knowledge, innovativeness and delivery excellence. Their end-to-end capabilities in complex program management, systems integration and organization change have complemented our efforts to serve our customers better."
- Dan Roberts, CIO
PMI Mortgage Insurance
"Implementation of the pmiCentral™ Delinquency and Claims projects went very smoothly. You (Infosys) should all feel proud of your accomplishment. It is a testament to your dedication, work ethic and stamina."
- Chuck Starkovich, VP
PMI Mortgage Insurance
Testimonials
“After carefully examining our options, Conseco selected Infosys for this strategic outsourcing initiative because we are confident that Infosys understands the rapidly shifting dynamics in the insurance market, and brings to bear deep technical skills in an innovative service model...”-Russ Bostick,
Executive VP and CIO,
Conseco
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