From mountains to molehills: Work backlogs can be cleared if agencies attack the inefficiencies and change their procedures. (Property/Casualty).

In my many visits to agencies, I see chronic backlogs that sometimes have existed for years. Although these agency managers are aware of the backlogs, they feel powerless to end them. Some agencies actually have the staff count the backlogged work each week to determine if it is growing or staying the same. Others allow their customer service representatives to work overtime at their own discretion to try to clean it up. This incurs additional salary expense but does not correct the problem.

Customer service representatives deal with backlogs in various ways. Some start their day by counting the pieces of mail and bemoaning the fact that they can't possibly process that much in a day. Some seek to make order of the chaos; they have a system: They organize the paper into folders by renewals, endorsements, correspondence and other categories. When a customer calls, they go through the files, looking for the unprocessed transaction and may feel better in being able to find it. Most, however, express frustration with having to work late and on weekends, but never getting caught up. The stress from their workloads actually slows them down, further compounding the problem.

Backlogs develop for a variety of reasons. Sometimes, they result from employee turnover and the fact that replacing experienced people is very difficult in the insurance marketplace. If a few employees take disability leave at the same time, their absences can create a temporary backlog, from which the agency never recovers. Mergers and acquisitions often produce backlogs as employees attempt to deal with new customers and new procedures. A new computer system can be the culprit when staff members struggle with new software or data that doesn't convert.

Many times, however, backlogs result from inefficient procedures, especially when producers pass on their work to customer service representatives. Producers who don't complete applications contribute to backlogs. So do those who don't make collection calls or review and correct their own proposals. Other producers want to see copies of routine transactions, such as changes, certificates or claims, which the customer service representatives then must produce for them. Sometimes, it is the customer's perceived needs that create inefficiency. Notifying customers of late-payment notices on direct-billed accounts, sending copies of endorsement requests, preparing summaries on small accounts or reading and advising on contracts all add extra work that may not be necessary or cost effective.

One of the biggest inefficiencies results from not using the computer system. Duplicating information that is in the computer file, not using the system to send faxes or handle a transaction while a customer is on the phone wastes time that could be spent processing. Reviewing procedures in detail and streamlining them can go a long way toward finding these inefficiencies.

Considering how customer service representatives grapple with backlogs, it is clear they need help. Often, they need temporary resources, which only management can identify and allocate. If your agency has a backlog, you'll need to take several steps. First, determine the extent of the backlog--what are the oldest renewals, how many days or weeks behind is the mail, on what desks is the backlog the most serious, etc. Then look at the workloads for customer service representatives to see who has the smallest workload or who is more caught up.

It's valuable to identify other resources--such as customer service representatives in other departments, claims people, retired or at-home workers--who can help with policy checking or processing changes. You'll need to work with the staff to develop a backlog plan, which will spell out what work should be done daily and weekly. The customer service representatives probably will need to work overtime, but it should be organized so that the time is used effectively. There should be a definite zero-backlog date set, so they know there is an end in sight.

Once the backlog is gone, standards need to be set for completing transactions and keeping work current. Desk checks must be performed to see how customer service representatives are doing. Periodic reviews of workloads also will be necessary to determine if they are uneven and need to be adjusted.

If managed properly, backlogs don't have to exist for long. Clearing them can go a long way toward improving customer service, employee morale and agency efficiency.

Sharon Cunningham, a Best's Review columnist, is president of Business Management Group, a management-consulting firm in Hartford, Conn.