HBF Group

SAS provides foundation for enterprise-wide efficiency gains and cost savings

Recognised as Western Australia's largest provider of health insurance with approximately 65 per cent marketshare, HBF has a stated vision to: Create and maintain Western Australia's most valued membership organisation through the active provision of a unique combination of personalised products, services and benefit.

Enabling the realisation of this vision has, since 1997, been enhanced by the growth within HBF of SAS-based solutions and the formation in 2001 of the company's Business Information Services (BIS) unit. Headed by Mark Pereira, Manager BIS, the unit employs SAS Business Intelligence tools to support initiatives and business efficiency programs across all areas of its operations.

Doubled marketing response rates
One of the areas in which the benefits of SAS solutions have been particularly strong for HBF is marketing. Where traditionally, much of HBF's marketing efforts were based on a blanket approach; getting the information out to everyone, the introduction of SAS-based data mining and reporting has brought about an enormous and financially more rewarding change.

Once the demographic information has been defined, the HBF BIS team develops a SAS model that is used to extract matching membership details from the HBF data warehouse. Prior to the application of SAS tools to this business requirement, a similar process used to take two people approximately eight weeks to accomplish. Now, those figures have been reduced to a single person devoting barely a week to the project. "The savings are really quite enormous," states Pereira. "Aside from cutting down the modelling and mining time/personnel requirements to around six per cent of what it used to be, the marketing results are great.

"Reports we've received from marketing teams are that the marketing success rates have more than doubled. Add to this the enormous amount of money saved by avoiding mail-outs to incorrect demographics, and it's fairly obvious why the marketing teams are among our greatest supporters within the company."

Identifying aberrant behaviour
While the ability to reduce marketing expenditure and simultaneously increase marketing's results is undoubtedly a strong measure of SAS success within HBF, Pereira and his BIS team have also made significant achievements in addressing one of the medical insurance industry's most long-standing challenges – identifying aberrant claim patterns.

Having developed comprehensive SAS models, BIS can generate accurate reports that highlight and pinpoint 'aberrant behaviour' from within the company's membership and suppliers, such as health service providers. Once these reports have been generated, they are passed on to relevant HBF business units that undertake any further action that may be required.

"In the vast majority of cases," Pereira says, "the aberrant behaviour we identify is actually caused by clerical errors rather than intentional fraud. But the fact remains that with the SAS models in place, our organisation is able to act quickly, then work with members and providers to identify and rectify any particular issues."

Making everyone else look good
In commenting on the specific role of the HBF BIS team, Pereira states quite frankly: "It's our job to make other business areas look good by delivering the right information to the right people, using appropriate tools from a single trusted source."

Having taken on the role of Manager, Business Information Services in January 2001, Pereira developed a business unit model that has been a strong factor in the ongoing SAS-based successes within HBF.

"The most important point is that BIS is an independent HBF business unit reporting to an executive sponsor rather than to the IT department," Pereira explains. "We also have a steering committee comprising representatives from various operational areas within the company, which is a major boon for us in ensuring we maintain our focus on providing strategic support across the entire business."

Another point is that Pereira has ensured consistency between complementary IT and BIS disciplines. "Instead of reinventing the wheel, we have adopted a number of the HBF IT disciplines, such as coding standards and change management," he says. "In doing so, we have achieved a strong position of support between the two business areas – business areas that under a different model, might otherwise be at odds with each other."

Achieving productivity gains
As the positive impact of SAS solutions becomes more widely felt within HBF, Pereira and his team have looked to SAS®9 as a platform upon which even greater efficiencies can be based.

With the upgrade from SAS® v8.2 to SAS®9 already underway, Pereira comments that its benefits will be felt at both the user and BIS unit levels. "Throughout the company we have around 35 users – in various business areas – of SAS PC-based data mining, analytic and reporting tools," he says.

"Even though these users have received training and are quite proficient in the use of those tools, the vastly improved user interface with SAS®9 is set to make it even easier and faster for them to gain access to the right information and generate effective reports."

A flow-on effect of the improved user interface is that demands on Pereira's teams from the users is expected to drop by an estimated 10 to 15 percent. "Essentially, through just this one improvement – one among many that come with version 9.1 – we could realistically expect up to 15 per cent productivity gains within BIS," Pereira states.

When discussing the enterprise-wide acceptance and appreciation of the SAS-based work being carried out by BIS, Pereira comments: "SAS enabled us to establish BIS as a unit that delivers quantifiable benefits to the business. Where it used to be the case that we would need to approach other business units for projects, we're now in the space where they regularly come to us.

"That," he says, "is one of the very real measures of success."

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