OPERATING PERFORMANCE

Operations

Operations provides support to the Australian customer-facing divisions and is responsible for claims and operational functions such as procurement and supply chain management. It was formed as part of the new organisational structure which took effect from December 2015, and has assumed much of the work formerly carried out by Enterprise Operations.

With an underlying emphasis on customer and service delivery, Operations’ key actions during the financial year included:

• realising residual benefits from the combination of the integration of the former Wesfarmers business and the move to a new Australian operating model mid-calendar 2014. IAG met the targeted run rate of $180 million of pre-tax non-reinsurance benefits by the end of the 2016 financial year;
• consolidating claims into long tail and short tail platforms to simplify processes across brands, leverage scale and improve customer service;
• expanding the Guidewire claims centre to cover areas such as home lodgement, improved ease of use for motor claims, and lodgement and enquiry for intermediated claims; and
• ongoing consolidation of preferred repairer networks in home and motor, delivering improved customer service and reducing costs.

During the 2017 financial year, Operations will pursue a broad-based program to improve customer service and IAG’s own operating efficiency, including:

• expanding the operational partnering program, outsourcing and offshoring some activities to global service suppliers that offer superior expertise and economies of scale;
• improving the management of personal injury claims to match claim complexity with capability, optimising service and cost outcomes;
• increasing the use of preferred supply chain partners in both property and motor claims;
• embedding IAG’s supplier management framework, further consolidating and leveraging chosen suppliers to increase value and reduce risk; and
• consolidating the business’ properties and increasing adoption of flexible working practices.