Belgian Ministry of Finance improves claims processing and communication with IBM ECM solution — realizes 173% ROI

Independent audit details value of IBM ECM solution in helping Belgian federal tax agency
reduce operational costs, increase transparency and optimize processes

SAN FRANCISCO, California, May 24 2006  — Belgian Ministry of Finance realizes 173 percent return on investment leveraging IBM ECM solutions, implemented and customized by Getronics, to automate the historically paper-based, manually intensive tax reclaim process according to an study conducted by Thoughtware Worldwide, LLC, an independent research and consulting firm specializing in value measurement.

Belgian Ministry of Finance (BMoF) is one of the largest federal public service organizations within the Belgian Government.  BMoF is responsible for tax administrating and claims processing for Belgium’s over 10 million citizens.  This enormous responsibility is further complicated, when factoring in BMoF’s task of aligning the interests between law and compliance to serve both citizens and policy makers.

In 2002, BMoF realized it was time to do things differently.  Facing an ever increasing backlog of tax reclaims, fragmented across multiple tax regions combined with limited visibility into the process, resolution or citizen communication, BMoF knew there had to be a better, more efficient way.

Historically, BMoF had been a decentralized organization, which resulted in the unique treatment of each case by location, constantly ‘reinventing the wheel’ without the benefits or organizational learning.  This required BMoF to rethink its process and approach, causing it to develop a holistic, innovative solution, whereby BMoF could digitize its workflow; increasing visibility, transparency and accountability along the entire end-to-end process.

In searching for a solution, BMoF turned to IBM, a proven partner used elsewhere within the ministry, and its partner Getronics to develop a complete integrated solution for tax administration.  Working with IBM and Getronics, BMoF outlined a detailed step-by-step process, looking at how to remove bottlenecks, improve business processes and the underlying activities by integrating content with other applications.  With the IBM ECM solution, BMoF is now better able to manage the complete information lifecycle, eliminating double coding, while collecting new statistics that allow BMoF to manage claims as a group.  This new approach presents BMoF with opportunities to learn from claim filings, creating better alignment between legislation and compliance, better meeting the needs of the citizens.

By using the solution developed by IBM and Getronics, BMoF has reduced operational costs, increased transparency and accountability, and improved visibility and communication; generating a Return on Investment (ROI) of 173% in five years, with an impressive 31% Internal Rate of Return (IRR).

Business Challenges

Prior to investing in the IBM platform, BMoF had limited visibility into the number of incoming claims.  Managers constantly had to monitor workload and redistribute cases, further complicated by delays and backlogs resulting from manual, paper-based, and physical routing of, files.  This cascading problem challenged BMoF in answering inquiries from citizens, let along meet new legislation requirements like the Copernicus Project, new legislation that puts the citizen in the center of the process.

Crafting the Vision for IBM

As a governmental agency, BMoF continuously strives to serve two masters – policy makers that run and govern the Ministry and the citizens that elect them.  Historically, this model put BMoF in the middle, never fully satisfying either party.  With the IBM ECM solution, BMoF realized an end to end solution, managing the complete information lifecycle, allowing BMoF to refine its processes and activities, while integrating with other applications, departments and regions.  BMoF also believed IBM would provide it with the ability to leverage statistics and reporting to share best practices across the organization reducing its overall workload.  Now, with the IBM ECM solution, BMoF will be able to bridge the gap between the needs of the citizens and the policies causing claims.

Finding a Better Way

Historically, as volume of paper increased, processing of the incoming paper-based claims slowed and the corresponding issue-resolution time grew.  BMoF recognized that the volume of paper was unmanageable and the organization was drowning under a sea of physical content.  To overcome these challenges, BMoF turned to automation.  Using the IBM ECM solution, BMoF was able to organize incoming paper, digitize the documents (via scanning), from which electronic case folders could be created.  Now, BMoF is able to collaborate across the organization and leverage workflow for better reporting, analysis and distribution of cases to shorten the processing timeline while providing all parties and departments with transparency into the process and status.

Aligning Collaboration and Knowledge Sharing

A cornerstone of BMoF’s successful implementation of the IBM ECM solution was it partnership with Getronics, where BMoF and Getronics formed a unique team comprised of extensive tax experience complemented with deep technical skills.  Flexibility and systematic testing of capabilities further contributed to the positive outcome, testing all the uncertainties to ensure a successful pilot and deployment of the solution.  The collaboration model between BMoF and Getronics, involved significant knowledge transfer from the beginning, resulting in improvements in the workflow and process mapping which has translated into an increase in quality, accuracy and efficiency for BMoF.

Quantifying the benefits from the IBM ECM Investment

Thoughtware Worldwide, LLC.’s analysis showed that BMoF’s investment in IBM delivered significant productivity gains and sizeable headcount benefits.  BMoF has been able to achieve actual labor reduction, as well as considerable headcount avoidance.  Additionally, BMoF has been able to use natural attrition to ‘right-size’ its workforce as productivity has improved, where in the past they would have needed to re-hire for those positions.

IBM Qualitative Benefits

Beyond the financial returns, the Thoughtware Worldwide study uncovered a number of operational and technological benefits resulting from the IBM ECM solution:

·        750% Increase in Files Treated within 6 Months The number of files treated within six months has dramatically changed, using the imaging, workflow and policy administration components of the overall solution

·        5X Improvement in Claims Routing With IBM, claims now move from registration to inspection immediately; previously it took an average of 5 working days.

·        50% Reduction in Judicial Preparation Time  Using IBM, preparation time of a specific claim requiring judicial review has decreased by 50%.  Before it took on average five working days – now it is less than half that with opportunity for additional improvement.

·        3X Improvement in Time Generating Statistics   IBM’s built-in statistics reporting provide BMoF Inspectors with 3 more working days per month; prior to the IBM ECM solution, BMoF Inspectors spent 3 days compiling data and producing reports, now automatically performed by the system.

“In analyzing BMoF’s results, the overarching theme for us was digitization and collaboration.  We believe BMoF’s results are indicative of what is possible when the right combination is brought together – a holistic vision looking at the end-to-end value chain, proven technology – incorporating all the information components; digitization, workflow and statistics and a highly collaborative team – comprised of customer and solution provider bringing both deep industry knowledge and requisite technical skills to deliver true business transformation,” said Timothy Guyre, Managing Director, Thoughtware Worldwide, LLC. 

To view the comprehensive Belgian Ministry of Finance ROI study by Thoughtware Worldwide, LLC, please visit http://www.ThoughtwareWorldwide.com/downloads/BMoF_F.pdf

About Thoughtware Worldwide, LLC

A privately held company, Thoughtware Worldwide, LLC is headquartered in Boston, Massachusetts, USA and was founded in 2005 by a team of leading experts in value management bridging the best of academia and real-world execution. Thoughtware Worldwide delivers credible, comprehensive research and analysis that gives clients and their customers the means to make sound and insightful business decisions in today's volatile economic climate. Thoughtware Worldwide works with companies around the globe to audit and understand the value realized from their investment decisions.

For more information about Thoughtware Worldwide, LLC, please log on to www.ThoughtwareWorldwide.com.

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