The Claim Status App That Costs More Than It Saves
Meridian Mutual's operations VP has requested a claimant-facing "claim status" mobile app for the Q3 roadmap, citing 1,200 calls per month to the service center at an average handle time of 4.5 minutes and a loaded agent cost of $18 per hour. She has already announced the initiative at a town hall. You are the BA asked to write the business case. IVR data shows 62% of calls are status-related, but agent notes indicate most repeat callers are actually waiting on missing documents, not seeking status. No claimant satisfaction baseline exists. Build is estimated at $180,000 with ongoing support of $30,000 per year. The only available mobile team is already committed to a policy-renewal feature in Q3.
1. Before accepting the mobile app request, what must you establish? Show the reasoning, including any arithmetic that matters to the decision.
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Separate the problem from the proposed solution. The VP has supplied a solution, not a validated need. The need statement must be something like "reduce cost and effort of claim inquiries and improve claimant confidence in claim progress," not "build an app."
Do the arithmetic on the stated benefit before anything else:
- 1,200 calls/month × 62% = 744 status calls/month
- 744 × 4.5 min = 3,348 minutes = 55.8 agent-hours/month
- 55.8 × $18 = ~$1,004/month ≈ $12,000/year
That figure assumes 100% deflection, which is unrealistic. Against $180,000 build plus $30,000/year support, the payback exceeds fifteen years even under a perfect outcome. The business case as stated does not survive its own numbers.
Check the root cause before endorsing deflection. Agent notes suggest document-waiting drives repeat calls. If so, an app that displays "pending" status does not remove the call driver - it may increase calls from anxious claimants.
Therefore, before accepting the request: define the measurable business outcome; validate the call-driver mix with a sample of call records; establish a satisfaction/confidence baseline (none currently exists); and evaluate whether the problem is cost, satisfaction, or both. Without this, the Q3 commitment is a solution in search of a justification.
2. How much analysis is proportionate here, and what would you actually examine? Justify the scope of your investigation.
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Proportionality argument: the decision at stake is $180,000 build plus $30,000/year recurring, and it will consume the only mobile team for a quarter, delaying the renewal feature. A decision of that size justifies roughly 30–50 BA hours of investigation - enough to be defensible, not enough to become a study.
Evidence to gather (two weeks, timeboxed):
- Call-record sample - 100 records through the IVR and agent notes, coded by actual reason (status / missing document / payment / other). This directly tests the 62% claim, which measures IVR menu selection, not need.
- Agent interviews - 6–8 service agents, because their notes contain the pattern the VP has not seen.
- Claimant input - 8–12 interviews or a short survey, primarily because no satisfaction baseline exists. Without a baseline, no future benefit can be demonstrated.
- Repeat-caller analysis - you were told 40% of status calls come from 15% of claimants in the source data; confirm it, because a concentrated population changes the solution (proactive notification beats an app).
Decision rule: if the sample confirms document-waiting dominates, the defensible recommendation is a root-cause solution (proactive document-request notices, upload capability, status on the existing web portal), not a native app. State the confidence level of your sample explicitly so the sponsor can weigh it.
3. The VP has publicly committed to the app. How do you present a contrary recommendation without being overridden or ignored?
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Reframe, do not contradict. Lead with her outcome (fewer calls, happier claimants), not with the rejection of her solution. The conversation is "how do we hit your Q3 outcome," not "your app is wrong."
Present a decision, not a verdict: three options with cost, time-to-value, deflection estimate, and risk - (a) mobile app $180k / 2 quarters / low deflection because it does not address the call driver; (b) proactive document-request notification plus upload on the existing portal / much lower cost / directly targets the call driver; (c) do nothing and measure for one quarter.
Make the arithmetic visible. A sponsor who has announced a project will not withdraw it because a BA says so, but most will react to "$12,000 annual benefit against $180,000 plus $30,000/year." Bring the calculation as a one-page model she can challenge.
Manage the announcement separately. Note in the decision record that the town hall was a solution commitment made before needs validation. Do not editorialize; simply record it as an assumption and a risk so the governance body sees it.
If she still proceeds: do not stonewall. Document the benefit assumptions, add a defined pilot or deflection measurement to the plan, and let the measurement govern the next decision. Record that the decision was the sponsor's, with rationale - that is the BA's accountability, not winning the argument.