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From Resource, April 2008
Does Your
Testing Practice Get a Passing Grade?
Insurers Move Testing Offshore for Independent Validation and Lower Costs
Software defects that make it
into production cost an estimated four times as much to fix as defects found
during system testing — and an astounding 200 times more to fix if spotted
during the requirements phase.
Beyond
the cost of fixing the bugs after the fact, inadequate testing can result in
dire consequences for insurance companies, such as interruptions in business,
erroneous calculations and compromised security.
In
this age of increasingly complex IT environments, most insurers don’t have the
resources to sustain a dedicated testing unit at the enterprise level. Rather,
quality assurance is handled somewhat haphazardly at the project level. These
teams typically lack uniform standards, and with specialized testing tools
costing up to $2 million for 100 users, they usually don’t have the budget to
be effective.
“Testing
used to be seen as the final to-do at the end of a long project checklist, but
it’s really an integral part of the entire process,” said Michael W. Risley,
president of CSC’s Life and Annuity Division. “Unfortunately, most companies
underestimate testing requirements and they’re unwilling to make the
investment in a testing center of excellence. They’re missing out on the
opportunity to continually improve their processes, share common tools and
retain a lot of specialized business and systems knowledge. That’s why
offshore testing has become such an attractive alternative.”
Focusing on Insurance
Experience
Offshore testing can help
companies establish better controls and track metrics where there were none
before.
U.S.
companies can access new expertise in performance testing, automation testing
and test management while cutting the cost of quality control by up to 75
percent. Outsourcing also helps organizations address the peaks and valleys for
staffing needs around key projects.
But
insurers are looking for more than just low costs. They are placing a higher
premium on the offshore
vendor’s industry experience — not just a good testing methodology.
“Too
many insurance companies have found out the hard way that you need to work with
someone who understands your business,” said Sharad Srivastava, Vice President
of CSC’s Financial Services Sector in
India
. “While most offshore testing vendors offer automated testing, few possess
the background to create testing scripts with the real-world business cases
insurance companies need.”
Testing
Center
of
Excellence
Unlike most companies in
India
, CSC is based in the
United States
with mature operations established more than a decade ago. CSC has more than
16,000 employees in
India
alone to perform offshore work.
With
last year’s acquisition of Covansys, one of
India
’s key players in the independent testing and verification market, CSC can
offer clients a unique service specifically tailored to insurance.
CSC’s
Testing Center of Excellence, which has a strategic alliance with top testing
software providers Mercury and Rational, provides end-to-end testing services.
Specialists at the
Center
of
Excellence
institutionalize testing knowledge and optimize each step in the development
and testing process. Common frameworks and repositories reduce effort and
accelerate the work.
What
sets CSC apart is its 30-year heritage in insurance systems. Most of the top 50
U.S.
life and annuity carriers use CSC’s software for policy administration, new
business, customer service or compensation management, and CSC’s operations in
India
are fully integrated into the development and testing of those applications.
“We
test our own products every day, so testing is a core competency to us—not
just a service,” according to Srivastava. “That’s why we’ve invested
heavily in standardization and process improvement programs such as CMMi Level 5
and PCMM Level 5. Our strategy is to identify the root cause of defects and
drive them out of the process.”
Access to Global Operations
India
remains a key player in the growing offshore outsourcing market. Insurance
companies worldwide are realizing they need to take a global approach to
resource allocation. CSC offers a full range of outsourcing services including
application outsourcing, business process outsourcing (BPO) and infrastructure
outsourcing. In fact, CSC manages millions of policies for insurers worldwide.
An
interconnected, global network of outsourcing centers allows work to be shifted
to the best available resources regardless of location. For example, a leading
global financial services company, which uses CSC’s BPO services, arranged for
CSC employees in the
United States
to provide call center services with back-end policy changes handled offshore.
CSC’s
clients have saved millions of dollars by shifting the ongoing maintenance of
applications to CSC’s offshore resources. Even companies working with their
own legacy systems or third-party software, or both, are looking to tap into
CSC’s offshore presence.
“Insurance
companies are smarter about what they outsource and who they outsource to,”
said CSC’s Risley. “That’s why we’ve tailored our operations to make the
best possible use of the skill sets available while promoting best practices
throughout our global operations. This ensures that we can apply the level of
insurance focus that’s needed to do the job right the first time.”
CSC’s Offshore Testing
Services include:
Business Process/ Functional
Testing
Integration and Regression
Testing
Compliance Testing
ERP Testing
Recovery Testing
Application Security Testing
Usability/Compatibility Testing
Quality Assurance Consulting
For
more information about CSC’s offshore outsourcing services, visit
www.csc.com/insuranceoffshore.
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