February 2001

Words From The Editor:

Solutions That Hit the Spot

Great technology can almost always be applied across industries, solving universal challenges such as customer service, accounting, human resource management and business collaboration. As a result, many technology vendors sell successfully in several markets, yet some now realize that they have to be more relevant. They're not just targeting industries, they're targeting specific problems within those industries.

Take, for example, the health insurance business. For years, forms processing vendors have offered solutions for automating health claim forms. Dakota Imaging, Columbia, MD, has been among them, but more recently it has been racking up client wins by focusing very specifically on the challenge of adjudicating claims.

Health insurance payers certainly benefit by automating handling, sorting, data entry and archiving, but what really drives up cost and slows customer service is manual adjudication, which demands highly trained (read highly paid) individuals. This is the big culprit in pushing manual processing costs to an average of about $20 per transaction, vs. 85 cents for EDI, according to Dakota. When the company talks about increasing auto-adjudication rates, industry insiders know this is aimed at the heart of the problem.

In another example, online brokers are struggling to sign up new customers. To drive growth, they need to make enrollment as easy as possible. The trouble is, signatures, credit checks, funds transfers and SEC requirements can't be taken lightly.

Despite last year's passage of the e-signature bill, more than 50 percent of online brokerages still rely on paper-based processes, according to Datamonitor. Even among firms with online forms, only a handful have been able to avoid follow-up paperwork. Aside from the cost of paperwork, research shows that more than half of potential enrollees fail to follow through.

While enrollment is a problem in many industries, PureEdge, Victoria, British Columbia, is now targeting brokerages with its Assured Enrollment solution. The system lets prospects fill out and digitally sign account applications purely online, and it then automates processing, account funding and SEC-compliant archiving.

Other examples of focused solutions include DocCompliance from Qumas, Florham Park, NJ. While other vendors call this technology "document management," Qumas' "compliance management" solution is aimed at specific regulations faced by the company's pharmaceutical, medical device and biotech customers.

Looking ahead, ActionPoint, of San Jose, CA, and Eastman Software, of Billerica, MA, are among a handful of companies expected to debut process-specific financial services solutions within the coming months.

As computing platforms from the likes of Oracle and Microsoft become more and more capable, there's no doubt that the smaller players will seek out the big problems and opportunities within niche markets. That's not to say that they won't offer the same technology across several industries, but the market is demanding that they be more focused in every niche they serve.

The big winners in this trend will be you, the information technology customer. The more you have to spend, the more reassuring it is to know that the solution proposed was designed specifically for your biggest challenges.

—Doug Henschen, Editor-in-Chief