Test $2--$ Business $2710$

All these questions $($except number one$)$ are from the book $$Fundamentals of Business Process Management$,2$nd

Edition, by Marlon Dumas, Marcello La Rosa, Jan Mendling, Hajo A$.$ Reijers, Springer.

$1-$ This question includes two parts: $($a$)$ and $($b$).$ Please go through each part carefully and answer them.

$($a$)$ Please complete the following table. First one is done as an example for you, which shows

Crowdsourcing is an Outward$-$looking process redesign method located in the quadrant of

Transactional$-$Creativity.

Business Process

Redesign Methods

Inward$-$looking$/$Outwardlooking

Quadrant

Crowdsourcing Outward$-$looking Transactional$-$Creativity

Theory of Constraints

Product$-$based Design

$7$FEs

ERP$-$driven Redesign

Process Model Canvas

Heuristic Process

Redesign

Design$-$led Innovation

Business Process

Reengineering

Lean

NESTT

Positive Deviance

BPTrends

Benchmarking

Six Sigma

$($b$)$ Please explain two differences between each of the following process redesign methods:

$-$ Transactional and Transformational Methods

$1)$

$2)$

$-$ Analytical and Creative Methods

$1)$

$2)$

$-$ Inward$-$looking and Outward$-$looking Methods

$1)$

$2)$

Test $2--$ Business $2710$

All these questions $($except number one$)$ are from the book $$Fundamentals of Business Process Management$,2$nd

Edition, by Marlon Dumas, Marcello La Rosa, Jan Mendling, Hajo A$.$ Reijers, Springer.

$2-$ Scenario: Disability Insurance Claims Handling at InsureIT

We consider the following business process for handling insurance claims for disability insurance

$($Disability Insurance is a form of insurance that insures the beneficiary's earned income against the risk

that a disability creates a barrier for a worker to complete the core functions of their work$)$ at an insurance

company InsureIT.

The process starts when a customer lodges a disability claim. To do so$,$ the customer fills in a form

describing the disability. Then, customer performs a basic check to ensure that the insurance policy is valid.

If insurance is not valid then there would be no claim. If the insurance is valid the customer submits the

form to a senior claims handler via post.

The senior claims handler first determines the type of claim. In this stage $80\%$ of the claims are determined

to be long term and $20\%$ are determined to be short term, for both of which the senior claims handler

performs benefit assessment. Then, a response letter is sent to the customer $($by e$-$mail and post$)$ informing

them about the monthly entitlements. Finally, insurance is granted.

In the case of short$-$term disability benefits, the senior claims handler can perform the benefit assessment

without requiring further documentation. In these cases, the benefit assessment takes $20$ minutes.

However, in the case of long$-$term disability claims $($more than three months$),$ the senior claims handler

requires a full medical report in order to assess the benefit entitlements. Senior claims handlers perceive

that these medical reports are essential in order to assess the claims accurately and to avoid fraud. Once the

senior claims handler has received the medical report, they can assess the benefits in about one hour on

average.

Later, a finance officer triggers the first entitlement payment manually and schedules the monthly

entitlement for subsequent months. The finance officer takes on average $20$ minutes to handle an

entitlement. Finance officers handle payments in batches, once per working day.

When a medical report is required, a senior claims handler contacts the customer $($by phone or e$-$mail$)$ to

notify them that their claim is being assessed, and to ask the customer to send a signed form authorizing

InsureIT to request medical reports from their health provider $($hospital or clinic$).$ Health providers will not

issue a medical report to an insurance company unless the customer has signed such an authorization.

Once the authorization has been received, the senior claims handler sends $($by post$)$ a request for medical

reports to the health provider together with the insurer's letter of authorization. Hospitals reply to InsureIT

either by post or in some cases via e$-$mail. On average, it takes about $15$ working days for InsureIT to obtain

the medical reports from the health provider $($including $4$ working days required for the back$-$and$-$forth

postal mail$).$ This average however hides a lot of variance. Some health providers are very cooperative and

respond within a couple of working days of receiving the request. Others however can take up to $30$ working

days to respond.

As a result, the average time between a claim being lodged and a decision being made is $3$ working days in

the case of short$-$term disability claims, and $20$ working days for long$-$term disability claims.

Naturally, so long waiting times cause anxiety to customers. In the case of long$-$term disability claims, a

customer would on average call or send an e$-$mail enquiry twice, while the disability claim is being

processed. Such enquiries ar