Case 1 The Balboa Insurance Agency

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Case 1The Balboa Insurance Agency

• Team 5
• Lee Vaccaro
• Rachel Lee
• Jeffrey Kanell
• Angela Welch

http//www.prenhall.com/stamper/bdc/student/cases/
case1.pdf
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Balboa Insurance Agency Overview

• Location Meridian
• Population 60,000Rural 25,000
• Owner Jack Triplett
• In Operation 25 years

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Tripletts Business Philosophy

• Operate in two offices
• Customer convenience
• Each office two broker/agents
• Each office two office administrators
• Personal touch
• Jack sells agency to Barbara Holmes

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Barbara Holmes Business Philosophy

• Central location
• Consolidation
• Reduce overhead
• Expand commercial business segment

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Types Of Insurance

• Automobile
• Home
• Life
• Business
• Medical

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Four Major Business Applications

• Sales
• Claims assistance
• Client administration
• Accounting

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Sales

• Under Jack Tripletts administration the sales
  cycle consisted of
• Gather client data
• Analyze data
• Access Insurance carriers system
• Present proposal and close sale

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Sales

• Holmes saw marketing flaws in this procedure.
  Often the first proposal was not satisfactory and
  the agent would have to repeat the process.
  Holmes wanted to complete the process in one
  client session.

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Sales

• Another flaw Holmes perceived with this sales
  system was the time span between client contact
  and closure of the sale.
• Sell in one session
• Pursue new clients

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Claims Assistance

• Claims asst. consists of five activities
• Forms handling
• Coverage determination
• Explanations of claimants rights and obligations
• Providing an interface between clients and
  carrier
• Record keeping

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Client Administration

• Balboa maintains a database to keep track of
  clients, prospective clients, claimants and
  Insurance carriers. The database consists of
  both computerized and manually maintained files
  that is updated whenever changes occur.

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Accounting

• Prior to Holmes acquisition all accounting
  applications were manual
• Holmes intends to computerize most of all
  accounting functions

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Anticipated Applications

• Since the Balboa agency required basically one to
  one presentations for sales to individuals,
  marketing to the business sector would take a
  more formal presentation to business management.

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Anticipated Applications

• Holmes anticipates adding
• Desktop publishing software
• Business graphics software
• Color printer
• A plotter
• All this should be available to the entire staff.

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The Balboa Building

• Renovated house in the downtown business district
• The company can remodel the building to meet
  their needs
• C/A heating and air was installed
• Grounded power outlets
• 2-3 telephone outlets in each room

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Balboa Building

• UTP connected phones in building to hub in the
  utility room on main floor
• No accommodations were set up for computing
  facilities
• Building was two story with unfinished basement
• Main floor houses reception area, brokers office
  and BHs office15

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Balboa Building

• The second floor consisted of four rooms, two
  occupied office administrators, Chief Admin. R
  Pagano occupied one, and two admin. S. Romansik
  Marty Ahrens share one.
• Either Romansik or Ahrens is on duty in the
  reception area.

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Computing At Balboa Before Consolidation

• Balboa was not a heavy user of computing.
• Balboa entire computing system consisted of two
  dumb terminals with modems, two microcomputers
  with laser printers, and three microcomputers
  with dot matrix printers.
• Microcomputers were used primarily for word
  processing, mail merge application, and some
  client data.

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Computing at Balboa Before Consolidation

• Data on clients and claims had been kept in paper
  format and stored in filing cabinets.
• Data sharing among the staff was not a problem
  because of the small offices.
• Office staff knew clients personally.
• Each office was responsible for obtaining
  compatible software.

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Computing at Balboa Before Consolidation

• Sometimes the offices would run into problems
  when two people wanted to use the same software
  that was kept on floppy disk.

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Problems of Consolidation The Central Computer
Alternative

• Balboa consults with an outside source who
  develops an outline of its computer configuration
  and concerns.

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Outline of Balboas Computer Configuration and
Concerns

• Needed data on clients is stored as only hard
  copies in files on the 2nd floor.
• Each computer has a printer that is not
  necessarily the ones each user needs.
• There is inadequate software sharing.
• Data files involving high security are stored in
  a staffs filing cabinet with lock and key.
• There are not enough microcomputers for users.
• The existing computer system is limited to remote
  sites.

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Outline (contd)

• Balboa has a 12,000 budget to work with and 6
  months to decide on a solution.
• Balboas equipment consists of 5 IBM compatible
  microcomputers (2 XTs and Ats), 2 laser printers,
  3 dot matrix printers, 2 terminals, and 2 modems.
• Balboa has a 2-story building with offices on
  both levels that allow flexibility to make
  changes.
• Balboas personnel consists of a president, 3
  broker/agents, and 3 office administrators, all
  of whom have minimal computer literacy.

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These concerns bring rise to the use of shareware
as a strategy for a solution. Balboas
consultant realizes that microcomputers work
better with shared printers, data, and disk
drives. A microcomputer equipped with the right
operating system can provide multi-user
capabilities. The approach would be a central
computer system. This system would require a
high performance microcomputer, a multi-user
operating system, asynchronous terminals, and the
microcomputer application software. Figure 1-4
and 1-5 shows the configuration.
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Fig. 1-4. A Multi-user System
Terminal
Central Computer
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Fig. 1-5. Clustered Microcomputer Configuration
Microprocessor Boards
Host Processor Cabinet
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Diagram explanations

• Fig. 1-4 shows terminals connected to a central
  host computer, and Fig. 1-5 shows clustered
  microcomputers connected to a central host
  computer. The host shown in Fig. 1-5 has an
  on-board processor board for each user. The use
  of a terminal provides lower user costs than use
  of a microcomputer. End users of the terminals
  or microcomputers can access all programs and
  printers that are ran at the central host.

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Advantages to Implementing a Central Computer
System

• It would allow Balboas staff to concurrently
  share data at the ease of ones terminal.
• A staff member can access any type printer when
  needed without leaving his/her workstation.
• This alternative system falls within the range of
  Balboas cost budget.

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There are disadvantages to using a central
computer system in that it is not nearly as
developed as LAN technology.

• The number of concurrent users is more limited,
  and it has a limited expansion ability for
  supporting all of Balboas users.
• It does not provide strong security for files and
  concurrent access to files.
• The communication links to the host is only 19.2
  Kbps however, this is sufficient for Balboa
  since data communications traffic is for display
  on the monitor only.

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Disadvantages (contd)

• Pointing input devices are not supported. This
  would disable the use of Balboas graphics
  software.
• Provides remote access.
• Since Balboa already has microcomputers and would
  be adding several more, this system would not be
  as cost-efficient.

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LAN Alternatives

• Requires an investment in software and cables.
• May require additional hardware.
• Most likely MediumTwisted Pair wire
• Possible existing telephone wires might work.

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LAN Alternatives

• LAN Options
• High speed LAN, with a dedicated server.
• Lows speed LAN, with one or more user
  workstations performing the functions of a
  server.
• Use existing microcomputer hardware for connection

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LAN Alternatives

• File and Printer Server
• Relatively powerful microcomputer.
• Holds files that must be shared among users.
• Collects printer outputs and routes them to a
  user designated printer.

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LAN Alternatives

• File and Printer Server
• Allows each floor to have a laser and dot matrix
  printer.

• Major problem with a dedicated server
• Balboa would have to purchase a new computer to
  act as the server.

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LAN Alternatives

• LAN Software
• Must reside both in the server and in each
  workstation
• Directs data traffic between server and
  workstation
• LAN Software in a workstation provides the
  software interface to the LAN medium.
• May provide contention resolution.

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LAN Alternatives

• Use of existing hardware
• Additional cost will include
• Cables
• LAN software
• Perhaps file server and printer controllers
• Existing serial ports will be used as the medium
  interface.

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LAN Alternatives

• Disadvantages to using serial ports
• The speed of the LAN would be slow.
• Such systems operate at speeds under 100,000 bps.
• Many have a maximum speed of 19.2 Kbps.
• Perform poorly in a shared environment where
  large files and programs are down-loaded.

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LAN Alternatives

• Summary
• High performance LANs require each workstation
  to have a LAN adapter card.
• High performance LANs provide high speeds.
• Some LAN options will exceed Balboas budget, but
  there are many options within the budget.

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Sub-Local Area Network

• Allows peripheral sharing and file transfer
  capabilities.
• Differs from a LAN in that a sub-LANs data
  transfer rates and costs are lower than those of
  a LAN.
• Additionally, a user must establish a connection
  with another user before data can be transferred.

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Sub-Local Area Network

• Data switches provide connection between
  microcomputers.
• Many data switches are designed specifically for
  sharing peripheral devices.
• The user would have to manually turn a selector
  knob to establish the connection.
• More advanced switches allow for switching via
  keyboard commands and support file transfers and
  modem pooling.

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Sub-Local Area Network

• Operators at the sending and receiving computers
  must coordinate the file transfer by starting the
  file transfer software at each end of the
  connection.
• This type of connection would use the computers
  existing serial port.

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Sub-Local Area Network

• This configuration is relatively inexpensive
  because of
• The use of existing computer equipment
• The switch is relatively inexpensive
• This solution has the lowest cost of all the
  alternatives.

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Sub-Local Area Network

• Disadvantages
• The speed of the communications link
• The speed is adequate for small file transfers
  but not for large ones such as down-loading
  program files.
• Lack of user transparency.

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Sub-Local Area Network

• Microcomputer software that allows files to be
  transferred between two computers over a serial
  connection can be purchased relatively
  inexpensively.
• Both sender and receiver must use this software
  and both must be running it to transfer software.

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Sub-Local Area Network

• Contention can also occur when using data
  switches.
• Data switches with on-board RAM can be used to
  enable the switch to accept multiple requests at
  once.
• The switch then processes the request in the
  order that they were received.

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Sub-Local Area Network

• Summary
• Data switches are an effective, low cost way to
  share peripherals and for infrequent transfers of
  small files. They are not so well suited for
  down-loading software programs or large data
  files and for frequent file exchanges.

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Service Bureau Alternative

• Uses existing computers and terminals to connect
  to the host system
• Computers can continue to operate in a
  stand-alone mode when not connected to the
  service bureaus system
• Multi-tasking operating system allows local
  applications to run concurrently with host access.

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Advantages

• Provided the service bureau is located in the
  local calling area, the line costs will not be
  too great.
• Management and support of all but the local
  components of such a system will not be Balboas
  responsibility.

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Disadvantages

• Down-loading programs from the host over a
  typical communications link of 9,600 bps will be
  very slow
• This assumes 100 line utilization for data, an
  unrealistic assumption.
• Program files still need to reside either locally
  on each system or be programs which run on the
  host ( more host resources used more to
  Balboa).

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Balboas Alternatives

• Continue as is
• Continue mostly as is, but provide better
  organization and data flow
• Use a central multi-user system
• Use a data switch to form a sub-LAN
• Implement a LAN
• Contract with a service bureau

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Implementation Concerns

• Management of the system

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Currently

• Each employee
• Back up files
• Archive full disks
• If one of the microcomputers malfunctions, only
  the person using that machine is inconvenienced.

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LAN Management Responsibilities

• System administration
• Training
• Maintenance
• Software
• Communications speed
• Communications with insurance carriers

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System Administration

• File user security
• Installation of new versions of file servers
  operating system
• Upgrade LAN software on individual systems
• Connect new systems LAN devices
• Report problems to vendors

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Training

• 2 people are needed for admin.
• All users need a few hours of education.

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Maintenance

• Balboa has no maintenance contract, if the file
  server fails
• Files and programs on the server will not be
  available.
• Printers will only be available if reconnect to
  individual work stations.

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Software

• Vendors upgraded
• Time consuming

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Communications Speed

• Holmes needs to decide how the computer solution
  will be used immediately and predict how it will
  likely be used in the future.

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Comparison of Data Communications Speeds
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Communication with Insurance Carriers

• A shared system ought to be able to accommodate
  modem pooling and switched data communications
  with carriers a LAN can do this by having the
  modems attached to the server.
• To prepare a quote a standard input form can be
  used with a program to translate the data into
  the formats required by individual carriers.
• Balboa will need to contract with someone to get
  the program written.

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Time

• The major investment in time and training tends
  to occur when the system is new. Once things
  settle down, the amount of time required to
  manage a system of Balboas size ought to be
  relatively small.

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Student Questions
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1. What is a Sub-LAN and what are its drawbacks?
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2. What is a central computer system, and what
are its capabilities?
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3. What are the responsibilities of managing a
LAN system?
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4. What are Balboas Alternatives?