USAA's Greg Schwartz Delivers Superior Member Experience
The fun is only enhanced by USAA's (United Services Automobile Association) branchless financial services model. Conceived to accommodate its military customer base, the operating model might have seemed a competitive disadvantage to more conventional companies. But the necessity of USAA's far-flung and highly mobile customers has been the mother of invention at the San Antonio, Texas-based diversified financial services company, according to Schwartz, who asserts that coping with those unique challenges has helped make USAA (more than $17 billion in net worth) a leader in customer services both from a systems integration standpoint and in terms of remote and mobile capabilities.
"We have a membership that is comfortable with our model already," Schwartz comments. "They trust our brand, and they know that we're working very hard to improve the member experience for them, so they eat up the new functionality as we put it out there."
Among the company's latest insurance services offerings are its Auto Circle and Home Circle mobile applications. The free Auto Circle app gives USAA's members the ability to find, finance and insure a new vehicle on an iPhone. Users get prenegotiated, guaranteed low prices through more than 3,000 dealers and are offered options for insurance coverage and financing, Schwartz explains. Home Circle offers analogous services related to financing, renting and insuring a home.
USAA's IT organization also deployed recently advanced geographic information system (GIS) capabilities for underwriting, allowing more precise risk assessment -- and potentially better pricing -- than traditional approaches using ZIP codes that may bundle low and high risks into the same category, Schwartz reports. Additionally, within the past 18 months, USAA delivered what it calls a Quick Quote Widget pop-up screen that alerts both member service reps and self-service users to quotes on other risks for which the customer may need coverage. Within five months of launch, the application had delivered 268,000 quotes that resulted in 40,000 additional endorsements or policies, according to USAA.
And over the past two years, Schwartz adds, USAA's IT organization has automated a variety of formerly manual claims processes, including issuing payments for approved auto estimates and medical bills; generating correspondence for claimants; notifying members of the availability of new information on claims; notifying service reps when they need to perform critical tasks; performing workload balancing and skill matching to assign tasks to appropriate member service reps; and storing and filing claims documents in electronic content management systems.
Customers for Life
Schwartz admits that he is excited by how "cool" the firm's mobile technology is perceived to be. But he emphasizes that USAA's development is focused on the real problems of members, who are prone to relocation. "It's fun, but at the end of the day we really care about how our members use our technology and whether we have really simplified their lives," he says. "And to the extent that you create that compelling member experience, customers become customers for life."
One of the keys to ensuring that compelling experience is USAA's concept of "one company." In terms of systems, this means that there are no divisions among the industry sectors in which USAA operates. "I have a person underneath me who is responsible for development for USAA, and in that shop we work on development for all the different lines of business," Schwartz explains. "In each of those shops there are subject matter experts and architects knowledgeable about P&C, for example, but there isn't a person who is a P&C CIO."
As a result, rather than having a proliferation of systems, the company has a single back-end system with services exposed to multiple front ends. "I'm using the same application systems to support all these different mobile devices, all the different reuses across USAA in the different lines of business," Schwartz emphasizes. "I don't have two or three of everything -- I have one of everything, for the most part. ... Many people say, 'Buy before build'; we start with reuse, we buy second and then, if we absolutely have to, we build."
Schwartz makes what he calls the "obligatory" statement that USAA doesn't do technology for technology's sake. He insists that, as innovative as USAA strives to be, only a small proportion of the budget goes to technology lacking a direct connection to business enablement. "I have what we call an 'applied research lab' because we focus on technology that can be applied to the business," he says.
Schwartz explains that USAA's wealth of innovation is compatible with its parsimonious management of IT resources because of strict process discipline. "We have worked very hard to engineer our processes over the last decade," he notes. "The biggest contribution we make as leaders is to implement processes that will last long after we leave here."
USAA's IT organization monitors its initiatives closely through standardized metrics such as quality, time to market, project on schedule, project within cost and customer satisfaction, Schwartz reports. "We have developed rigorous scorecards and have been tracking history religiously for the last 10 years," he says.
That tracking enables accurate measurement of IT performance, which in turn enables the organization to set goals for improvement, Schwartz insists. "I'm a big advocate of a process-disciplined organization with empowered leaders with whom I collaborate rather than micromanage," he says.
Anthony O'Donnell has covered technology in the insurance industry since 2000, when he joined the editorial staff of Insurance & Technology. As an editor and reporter for I&T and the InformationWeek Financial Services of TechWeb he has written on all areas of information ... View Full Bio
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