If the Compensation Advisory Organization of Michigan can do more work in 20 percent less space, spending many fewer personnel hours than it did two years ago—that’s productivity.

And if telephone callers no longer have to be put on perma-hold while panicky clerks scurry to find a missing file—that’s a big step forward in client relations.

The Compensation Advisory Organization of Michigan (CAOM) took that step two years ago, when it converted its paper files to document imaging by Laserfiche. And, says Senior Vice President Jon Heikkinen: “We can’t say how much we’re pleased with it, it’s just been excellent, in our opinion.”

CAOM is a nonprofit service agency supported by the 200-some insurance companies— which supply a quarter-million Michigan employers with workers’ comp insurance, required by state law. It runs annual computer studies comparing individual employers’ loss experience against their premium rates; then it reduces rates for businesses with good safety records, and raises them for the higher-risk companies. Simply put, one of CAOM’s assignments is to make sure that safety pays in Michigan.

Another is to operate the Michigan Workers’ Compensation Placement Facility, an assigned-risk pool, to make sure that every employer, even those with high loss experience, can get some kind of insurance protection. About 10 percent of Michigan employers must take this relatively expensive high-risk insurance.

That’s not all. The organization also receives and files copies of each company’s workers’ comp policy; and makes them available, on demand, to the state Labor and Insurance Departments—thus making sure there are no uninsured employers. Finally, for the Insurance Bureau, it submits an annual report of the entire insurance program. All these functions added up to quite a big job for a staff of 45 persons, working desk-to-desk in one vast office nearly a quarter-acre in size. As Mr. Heikkinen put it recently:

“We had massive amounts of paper files. Companies or agents would telephone in to our client service area—say it was something about an application for [high risk] pool insurance. Well, the service person would not have a copy of that document on his desk; he’d have to go back in the file room, somewhere in 2,000 square feet of open-bay storage. Some of those files were 40 years old and still active. Anybody could request them; we’d have to come up with them.”

Misfiling was a continuing problem, Mr. Heikkinen said.

“It would be very crucial … quite a few people would have to go on a file search. They would spend half an afternoon looking for a single file. It might be sitting on some person’s desk or anywhere in the place… they’d spend a good part of an afternoon looking for an important file. That doesn’t happen any more, because with Laserfiche Document Imaging, we were able to reorganize our office. We threw out 250,000 files. We have a huge waste basket on wheels, probably twice as big as the average garbage can in somebody’s garage. We filled that thing and rolled it down to the dumpster— somebody counted—250 times. First, of course, they were all scanned into the Laserfiche document imaging system.”

The two-year changeover saved CAOM about 2,000 square feet of expensive storage space, Mr. Heikkinen said. The collection of side-by-side desks, filling a barn-like office has been reorganized into friendly clusters of private cubicles. Each cubicle has its own PC, and all are linked in a Local Area Network tied, through a server, into a “jukebox” CD-ROM player the size of a small office-type refrigerator. Now, when there is a call for a file, the clerk doesn’t leave his/her cubicle: a few key-taps and the document appears instantly on the clerk’s monitor screen. Up to 25 people can read the same document simultaneously, if they desire.

The system was planned and set up by Oak Soft Consulting, Inc., of Southfield, MI, a suburb of Detroit. “Terry Warns (president of Oak Soft) was a big, big asset to us.” Mr. Heikkinen said. Oak Soft has enjoyed a steady working relationship with CAOM. Oak Soft provides Laserfiche planning, installation and support for companies in the Midwest.

The CAOM executive said that originally, cost had been a troubling factor. “I’d had quotations from other companies in the six-figure range, for software alone,” he said. “I wasn’t going to go to my governing committee and say ‘Give me a million dollars and I’ll make the system work.’ I didn’t know whether it would work. Then Terry came along and said ‘Why don’t we start small, with this system that we can make work, for an initial investment of $50,000, including hardware and software—just five users, and, if you like it, we can expand from there ?’ So we did that. We made that initial investment of $50,000. And we liked it so much that we made another investment of $50,000 right after it. And we’re probably going to expand some more.

“Frankly, for the money we spent, I think we got a lot.”

Tags: agency, non-profit

Posted on Saturday, October 24th, 1998 at 4:03 pm under Customer Stories, Other Industries. You can comment on this post.