SAP Cloud for Insurance Partner

April, 2013

Driving Innovation in Insurance

with SAP Cloud

© 2014 SAP SE. All rights reserved. 2

Dynamics SAP Cloud Innovation

Why SAP? Next Steps

For internal and SAP partner use only

Dynamics in the insurance industry

Procurement, Operations & IT Cost & Complexity

Risk & Finance Profit & Regulation

Sales & Service Time to market

Human Resources Workforce restructuring

• Underwriting new policies

• Lack of visibility into customer

base and lifecycle

• New non-traditional

competitors

• Pressure for greater ROI

• Establish compensation plans

with reduced scrutiny

• Attracting leading talent to

insurance industry

• Extended workforce

• Hindered succession planning

• Ongoing M&A activity

• Capital reserve requirements

• Regulatory rules & auditing

requirements

• Increased losses due to

insurance fraud

• Market volatility

• Complex, aging siloed systems

• Pressure on operational costs to

streamline processes

• Costly replacement-of-goods

processes

• Optimized billing and payments

Increased pressure on decision makers across the enterprise



Why SAP? Next Steps


Insurance is at an inflection point

Engage clients and drive

profits while maintaining

regulatory compliance

Cloud

Real-Time

Computing

B2B/B2C

Social

Big Data

Mobile

Personal Computer

WWW

New Business

Models

Changing

Demographics

Volatility Government

Regulations

Distributed Computing

Internet Self-Service

Multi-Channel

End-of-Life

Scalability Limitations

Application Silos,

Data Sprawl Service-Level Challenges

Technology

Debt

Technology

Value



Why SAP? Next Steps


Insurance and the cloud imperative

Source: SAP Performance Benchmarking,

Of financial services firms surveyed believe

that cloud computing will transform their

organization and/or industry

91%

Of financial services firms surveyed expect a

major impact on company performance

within five years

67%

Of financial services firms surveyed expect

cloud to amplify and accelerate other

technology megatrends (e.g., big data,

mobility, analytics)

70%

Note: Financial Services consists of Banking and Insurance



Why SAP? Next Steps


Cloud solutions deliver agility and innovation

Faster deployment • Full deployment in weeks

• Mobile-grade user experience = less training

• Applications on the web – easy access for contractors

More frequent innovation updates • Multiple innovation releases per year

• Customer feedback and changing market demands a

cornerstone of updates

• Cloud is always on the latest release

Agile deployment, configuration, and integration • Rapid process configuration

• Faster adoption

• No lengthy upgrade cycles

• Pre-Packaged integration

Lower TCO & faster time to value • Lower initial solution and deployment fees

• No maintenance or upgrade costs

• More standardization and best practices



Why SAP? Next Steps


Market Insight and Customer Intimacy: Serve clients

with tailored insurance products and services in real-

time, gain better market insights, react faster to market

demands and increase customer loyalty

Insurance Operations: develop targeted products

quickly and settle claims rapidly

Finance & Risk: Improve margins; close books faster

and predict and prevent claims fraud, reduce CAPEX

Human Resources: Empower employees to meet

business goals and recruit the best talent, better

engage external agents

Procurement: Reduce operating and supply change

costs, as well as optimize the replacement of goods

process

CIO: Reduce infrastructure costs, increase business

agility

The time is now: Transform insurance with cloud


Dynamics SAP Cloud Innovation Why SAP? Next Steps


BUSINESS NETWORK BUSINESS TO BUSINESS COLLABORATION

SOCIAL People-to-People Collaboration

PEOPLE CUSTOMER MONEY SUPPLIER

MARKETPLACE

PARTNER/

ISV APPS CUSTOMER

APPS

SAP HANA CLOUD PLATFORM

APP DEV & INTEGRATION SERVICES | DATABASE SERVICES | INFRASTRUCTURE SERVICES | INTEGRATION

LINE-OF-BUSINESS CLOUD APPLICATIONS

SUITE ON

HANA

BW ON

HANA

MANAGED CLOUD

BUSINESS

SUITE

SAP cloud solutions power operations across the insurer

Drive sales,

service and

workforce

strategies

Optimize

sourcing

strategies and

operations and

3rd party

replacement of

goods

Innovate with

social collaboration

with insurance

ecosystem

(agent/brokers,

reinsurers etc.)

Listen to

markets, create

promoters and

and equip sales

with 21st

century tools Gain a real time

and holistic

view of finance

and risk

Commercially

collaborate with

your supply chain

Manage your

entire insurance

business powered

by our real-time

platform – without

hardware

investment

Build, run and

integrate

innovative

business Apps on

the world´s leading

in-memory cloud

infrastructure

From the front to the back office enabled in the Cloud

Extend and

scale

innovation




Challenges in insurance With customer interactions for sales and marketing head

Poorly executed sales strategy

Monetizing the call center

End-to-end sales force automation

Support for omnichannel customer interaction

Effectively managing the multiple partner channels

Timely management of billing and real-time revenue

reporting

Lack of holistic view of marketing cycle

Percentage of financial

institutions that have a

unified 360° view of the

customer and are able to

provide a consistent

experience

Greater ability to use Big

Data with a well-defined

analytics strategy

27%

Higher percentage of field

sales achieving quota

where sales pipeline is

optimized

17%

68%

Source: SAP Performance Benchmarking




SAP 360 Customer solution Delivering better marketing, sales, & service

Engage with and retain your

customers while converting

loyalty into revenue and

profitability

• Delivering insights across all

channels (incl. agents/brokers)

• Engage customer like never before

and get them to promote you with

easy-to-understand, enterprise-

wide, social customer insights

• Make fact-based decisions

Attract customers while driving

profitability & growth

• True customer 360 insights with

embedded predictive analytics

• 1.1 customer engagement

• Meet customer needs and

expectations

• Better listen to and engage with

your customers

Market

Better

Sell

Better

Exceed customer expectations

and drive customer loyalty

anytime, anywhere and on any

device

• Solve issues proactively

• Streamline application, claims and

service operations

• Deliver a cohesive customer

experience across all channels incl.

social media

Service

Better




Challenges in insurance With ISO circulars in insurance core operations

Bring complex products to market quickly

High cost of premium leakage

ISO releases hundreds of changes each year,

described in thousands of circulars across

all lines of business

Many property and casualty carriers use ISO

as a resource to help them stay current with

loss cost trends, new product forms and

regulatory changes.

Maintaining rates, rules and forms across 50

jurisdictions is a complex and labor intensive

process




SAP circular authority for insurance Better product development keeping up with ISO

Improve quality and compliance

of an insurer’s ISO-based

products. Content is interpreted

by ISO, delivered electronically,

and presented in a business-

friendly way.

Improved compliance

Reduced state fines

Better legal protection

More accurate pricing

Improve speed to market and

reduce the effort required to

analyze and interpret ISO

circulars

High-value workers freed up from

interpretation task

Increased capacity for product

change

Cloud-based: low acquisition and

operating cost

Keep up with ISO

Latest ISO Product = Solid

Foundation for Competitive

Company Products

Pricing Accuracy = Greater

Profitability

Latest Policy Language = Reduced

Legal Exposure

Formal Specifications = Business/IT

Alignment




Challenges in insurance With financial management for CFO

Lower financial closing

FTE cost when the

financial system supports

internal and external

accounting requirements

56%

Lower general ledger and

financial closing costs when

general ledger and financial

systems are integrated to

produce accurate data

90%

Lower days to annual close

when general ledger system

supports multiple-currency

accounting processes and

entries

19


Little transparency across the enterprise

Ever-changing regulatory requirements

Slow response to market dynamics

Managing risk and compliance in real-time

Reducing claims fraud

Fast and timely closing of the general ledger




SAP cloud for financials solution Delivering better financial transformation

SAP on Cloud benefits

Complete coverage of end-to-end

accounting value chain

Real time insights and

collaboration

One single source of truth with

central financial data repository

Equip cost center owners with

easy-to-consume real time apps

Trusted reporting and analytics

Detect, prevent, monitor and

investigate claims fraud

Streamlined and integrated fast

close processes

Comply with global

financial reporting

requirements

Overseeing all

accounting operations

Define and execute

business plans Provide strategic insight

across the enterprise




Source: SuccessFactors impact study for Financial Services

Loss of key talent: Recruit and retain leading talent to the

insurance industry

Ability to support and motivate diverse sales organization

including agents and brokers

Establish focus and accountability, resulting in clear

correlation between performance and pay

Globalization of workforce: Increase support for domestic

and global compliance and reporting

Recruitment & training of multi-channel workforce requires

multi-channel strategies

Align workforce with business strategies faster and

sustainably

Engage employees and contractors with modern learning

capabilities

15.2% decrease in turnover

13.8% decrease in low

performers

13.7% increase in internal

job fill rate

14% increase in project

completion

Challenges in insurance With human resources management for HR executives




SuccessFactors, an SAP company Delivering one set of HR Solutions across the entire employee lifecycle

SuccessFactors is the leader in Gartner's’ Magic Quadrant and the leader in Forrester’s Wave

SuccessFactors Delivers

Complete global solution

across all HR functions

Business applications

designed for how people

work

Data analysis, insight and

guidance across the

enterprise to help drive

maximum business impact

Flexible and extendable

architecture to start

anywhere, go everywhere

Succession and

Development

Core HR & Payroll: Employee Central

Employee Record | Organizational Management | Payroll | Shared Services

Time Sheet | Global Benefits

Compensation Performance

and Goals Learning Recruiting and

Onboarding

Competencies, Skills, Best Practices

Analytics

SAP HANA In-memory Computing Platform

Mobile and Social




Challenges in insurance With B2B networks for head of procurement

Improvement in

compliance

60%

Reduction in price

4-15%

Improvement of

working capital

20%

Source: Ariba Benchmarking

High expense ratios due to missed cost savings for both

internal and claims procurement

High operating and supply chain costs

Manual paper-based collaboration, point to point EDI,

portals and single process solutions

Long sourcing and contracting cycles

Wasted time in identification of new, competitive sources

of supply

Manual and ineffective insight into supplier behaviors and

capabilities




Ariba Delivers

Lower claims costs and

improved customer service

Enhanced buying power and

reduced costs

Discovery of new sources of

supply

Reduced supply chain costs

and risk

Better visibility and predictability

Suppliers Buyers

Ariba Source-to-Pay Solutions and the Ariba Network Delivering Realized Savings

Spend

Analytics Sourcing Contract

Management

Operational

Procurement

Invoice

Management

Supplier Management

© 2014 SAP SE. All rights reserved. 18 For internal and SAP partner use only

Challenges in Insurance Strategically engaging your workforce with collaboration


Increasing speed, lowering costs, and improving onboarding

and ongoing skill development of global workforce

Increasing competitive edge by connecting sales and

marketing to collaborate and deliver superior content

Enhancing collaboration, innovation, and issue resolution

with suppliers throughout procurement lifecycle

Lowering financial risks, streamlining compliance processes

and reducing exception handling costs

Deepening innovation with customers and communities

throughout product development to speed market delivery

Increasing customer satisfaction and developing enduring

customer loyalty through prompt issue resolution and deep

engagement

2X Value from better enterprise

communication and

collaboration*

$1.3 trillion Annual value that can be

unlocked by social

technologies*

Value from improvement in

customer interactions*

40-60%

*Source: McKinsey Global Institute (2012)


SAP Jam Bring together people, data, content and process to deliver results

SAP Jam delivers

social collaboration

Where you work

To drive results

On a secure social

foundation


SAP Jam is a Visionary, Gartner Social Software Magic Quadrant 2010-2013 and a Leader in IDC MarketScape 2012




Challenges in insurance With big data and data management for CIO

Of companies have a

360 degree view of their

customers

16%

Greater ability to utilize Big

Data to gain insights with a

well-established analytics

and data-modeling center

of excellence

40%

Higher operating

effectiveness with ability to

monitor business in real-time

39%


Exponentially increasing amounts of structured and

unstructured data

Global compliance reporting

Ancient data silos and aging infrastructure

Data cleansing and separating good data from the white

noise data

The need for real-time data

Risk data aggregation


Challenges in insurance Innovate faster at minimized investments and risks


Eliminate capital expenditure for infrastructure and

operations

React faster to emerging trends

Leverage cutting edge technology

Minimize disruptions to running systems

Leverage the best suited deployment options





Cloud options with SAP HANA Subscription or bring your own license, elasticity, ubiquitous access

SAP offers a wide range of deployment options to support your requirements

Private Cloud,

Hybrid Public Cloud On Premise

Partner Scale Any Scale Elastic Scale Limited Scale

SAP HANA One

Public Cloud (AWS)

• Subscription license at

99 cents / hour

• 30GB of compressed

data max

SAP HANA

On Premise

• Ten certified hardware

partners

• Scales to any size

SAP HANA

Enterprise Cloud

Managed Cloud

• Enterprise-grade cloud

• Mission critical 24 x 7

Open

Cloud Ecosystem

• Cross-license

reference architecture

• Portability




Managed cloud as a service from trusted partners

Subscription pricing with cloud agility and economics

* VMS AG SAP Managed Cloud as a Service (MCaaS); July 2013

SAP-proven solutions available via partner-

delivered private cloud environment

Cash preservation/optimization with

subscription-based opex model

Reduced IT costs – 30% lower total cost of

ownership (TCO) over on premise*

– 51% of the savings realized in the first year*

Rapid time to value

– 90% improvement in implementation time *

Fully managed, enterprise-class solution with

proven partners




Cloud computing benefits for insurance Dramatically improve the economics and business agility of your company

Shorter time to value

• Adopt new technologies

quickly

• Always have the latest

versions of the

application

• Leverage well-tested IT

best practices

Cost reduction

• Cloud-based solutions

require less up-front

capital investment

• Eliminate capital

expenditure for

infrastructure and

operations

Lower barrier

to innovation

• Bring new, compliant

products to market more

quickly

• Expand domestically

and even internationally

more rapidly with a

lighter IT footprint

Scalability

• Add new channels,

partners or suppliers

more easily and in far

less time than traditional

application architectures

would have needed

• Support M&A activity

flexibly




Best-run customers in the cloud

1.2 million connected companies

from 190 countries

collaborating on >$600B

worth of commerce

annually. That’s 3X-50X

the size of any other

business network

30 million cloud users

2 million Cloud deployments




Unmatched SAP expertise and traction

Source: SAP analysis of Forbes 2000 rankings (May 2013) and SAP customer database as of May 2013

Insurance companies run SAP

• Ten of the top 10 property and

casualty insurers

• Nine of the top 10 life insurers

• The top 4 reinsurers

19 out of

Top 20 All lines of business supported

on a single platform

Deep industry-specific

capabilities

Embedded preconfigured

best practices

Clear industry road map

4500+ Insurance customers worldwide

Insurers 88%

88% of the insurance providers

in the Forbes Global 2000 are

SAP customers.




Analyst sentiment about cloud offerings from SAP

Source: Gartner “Magic Quadrant for Talent Management Suites”, March 2013; Gartner “Magic Quadrant for Strategic Sourcing Applications Suite, July 2013; Ovum

View, December 2012 http://ovum.com/2012/12/18/saps-financial-services-network-offer-may-provide-lessons-for-ariba/ ; PAC Blog, July 2012 http://blog.pac-

online.com/2013/05/sap-builds-cloud-offering-around-hana/

SuccessFactors is

the leader in

Gartner’s 2013

Magic Quadrant

for Talent

Management

Suites.

Ariba is a leader in

Gartner’s 2013

Magic Quadrant

for Strategic

Sourcing.

SuccessFactors

Named a “Leader"

for Fifth

Consecutive Year

in IDC

MarketScape

Worldwide

Integrated Talent

Management

Report for 2013

“HANA Enterprise

Cloud offers

companies a good

way to deploy SAP

HANA without

heavy investment

into hardware.” PAC

http://ovum.com/2012/12/18/saps-financial-services-network-offer-may-provide-lessons-for-ariba/




















http://blog.pac-online.com/2013/05/sap-builds-cloud-offering-around-hana/

















SAP: Your partner for co-innovation

SAP for Insurance:

SAP customers represent

Ten of the top 10 property and

casualty insurers.

Integrated insurance platform

Leveraging key breakthrough

innovations

40 years of delivering value to

insurers




Initiate

the benchmarking

process with a free value

assessment at valuemanagement.sap.com

Engage

in Design Thinking

workshops

Contact

our account team to

schedule a meeting

Next steps

Experience

it yourself at the next SAP

event near you or check

out SAP global events, or

arrange an individual

demonstration

http://valuemanagement.sap.com/sapglobal

http://www.sap.com/events/index.epx

© 2014 SAP SE. All rights reserved.

Thank you

For internal and SAP partner use only .

© 2014 SAP SE or an SAP affiliate company. All rights reserved. 31 For internal and SAP partner use only

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