Evaluating RMIS Software

For a risk management professional, deciding between the numerous risk management information systems out there goes a little beyond challenging. That's because RMIS software prices can range from $5,000 to $800,000. The vendors can be small two or three people firms or huge international corporations. Yet, believe it or not, most of the software is similar, with the exception of a few bells and whistles. Before you began what will seem like an endless road of online demos, conference calls, and presentations, here are a few things you should consider.

What is the main focus of your system? Risk Management can be broken into three main sections, claims, safety, and risk. Unfortunately most RMIS systems cannot effectively integrate all three. Some systems are more geared toward risks. These systems are good for trending and showing the financial impact of the risks that effect your organization. Safety systems are generally modular and focus on job hazards, incident tracking, and training. Systems that are claims based focus on claims management, workers compensation, and OSHA standards. So, it is important for you to know the type of system you are looking for, because it will keep you from wasting a lot of time.

How important is reporting to you? For most Risk Managers, reporting is the single most important aspect of a RMIS system. So far, the best system for reporting that I have seen has been RiskPro. With it's two levels or tiers of reporting, the RiskPro software leads the pack and has the ability to produce the lost forecasting triangles. The knowledge of the type and number of reports that come "out of the box," or with the basic system is something you should ask during or the demonstration. Is ad-hoc reporting possible? Are standard OSHA reports apart of the standard package? What can be reported on? RMIS systems usually capture much more data than they can report on. So the knowing which fields are reportable will tell you immediately if the system can produce the reports that you will need.

How much will it cost to customize? When looking at software, the word customization will send ripples through the pages of your bankbook. The laws and standards associated with risk management change often; so, the data that you capture today may not be what you need to track tomorrow. You may find there is more or less information needed for mediations, actuarial reviews, or OSHA inspections. Can your new system adapt without breaking the bank? Can you add the new fields yourself, or will you have to call the vendor? Will the basic system need a lot of customizations to fit your needs? It's hard to pick a system for customizations because it user specific. Different organization will require various levels of customization. The key to customization will be to lock the vendor in to a flat fee or ceiling, to keep you from having a panic attack when the invoice or bid price arrives.

Will it make your life easier? Regardless of how good the salesperson's pitch is the majority of RMIS systems do not automate a lot of tasks. These systems are packed with notifications, ticklers, and alerts. Different ways to let you know there are tasks to be completed and you have to complete them. If you are looking for automation, the key phrase is Business Rules. Business Rules are a set number of tasks that the system can be programmed to do automatically. The best system I have seen for automation and workflow is Filehandler. The Filehandler system can automate tasks like sending out an email after (x) number of days. There are many systems that claim to be able to do these things, but only few deliver.

How will you get your old data in the system? Data conversion can easily become the most costly aspect of obtaining a new system. The key question to ask here is what type of format can the data can be in? I found that most vendors are unable to convert data in Lotus Notes. You need to know if the vendor has ever converted data from the Third Party Administrator or current system that you use. I have heard that the cheapest formats are the common ones such as, Access or Excel.

There are other things you need to consider such as, annual maintenance costs, price, upgrades, cost per user, security, and hosting. But, these issues should be addressed once you have narrowed you're the playing field. Evaluating RMIS software can be like walking down the yellow brick road, and this is just a beginning.