Digitalization of existing manual processes can create huge cost savings. Online tax reporting in my home country (Finland) has saved somewhere around 1b€ for the government once they moved from the manual process to an online process. Each manual (human) processing event costs 20-50€ whereas the online processing falls somewhere between 0.1 - 0.2€. If you consider that there are only about 3.5 - 4 million citizens reporting taxes, the 1b€ cost savings is quite a lot.
In 2008, I moved to Italy and was very surprised to find out how many organizations still cling to the manual processing of all kinds of things from car insurance to energy. Each year I received several documents from my car insurance company stating my bonus level and an agreement to be signed. This paper form was then scanned (if possible) and sent to the insurance company customer service e-mail AND sent by regular post to them. After a few weeks, I got my insurance papers via mail – a very inconvenient process for the customer and a huge cost item for the insurance company if we look at the numbers:
There are around 42 million cars in Italy. If we say that my insurance company has a 20% market share, they insure 8.4 million cars annually. Each signed insurance form needs to be handled by a customer service rep. If we take a moderate approach and estimate that the cost of handling a single insurance costs 20€, we end up with an annual cost of 84 000 000€ just for handling the same papers year in year out. In many countries, renewing or acquiring car insurance is much easier.
The same problem persists through multiple industries. Energy & electricity is another good example where traditional processes still exist.
The challenge for digitizing these processes relates to identity. Companies offering these types of services require an appropriate level of assurance when they deal with online identities. Level of Assurance, or LOA is a concept that usually describes the strength of the online identity and in many cases also the registration process. Facebook identity is a LOA 1 identity with poor strength and non-existent validation during the registration. A LOA 4 identity would be a government issued eID card with PKI security and a well established visual identity vetting during registration.
Companies moving from a manual process to a digital process typically need identities from LOA 2 to LOA 4. In most cases LOA 3 is strong and trustworthy enough. LOA 2 and 3 identities are issued by multiple parties. Mobile network operators issue various kinds of mobile based identities, and banks create digital identities and use one-time-password tokens. These digital identities are based on a vetting process that at some point involves visual confirmation of the users identity using an existing valid identity document. These identities can be trusted.
For a company trying to move from the costly manual process to an automated process the challenge is that they cannot rely on a single category or issuer of a digital identity. To reach their whole customer base, they need to be able to support the most relevant strong digital identities within their market space.
GlobalSign Trust and GlobalSign SSO, components of our Customer-Centric IAM solution, are the products that have helped my government save 1b€ after deployment. They can connect to dozens of different identity repositories from Facebook to Mobile PKI. If your organization wants to save tens of millions of Euros (or Dollars) per year, we can help you make that happen. Contact us!
