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Good Practices in Social Security

Good practice in operation since: 2004

Social insurance management information system A case of the General Organization for Social Insurance

General Organization for Social Insurance Saudi Arabia

Published 2009

www.issa.int

Summary
The General Organization for Social Insurance (GOSI) is the national authority to administer social insurance schemes for wage earning workers. GOSI had IT systems that were developed approximately 20 years ago. Also, service delivery problems, increasing administrative overheads, increasing difficulties in implementing apparently modest changes in the IT systems and anticipated changes in the schemes as mandated by law are pushing GOSI to go in for a new system using state-of-the-art technology that will be a solution to the above problems. The new system called SIMIS (Social Insurance and Management Information System) is a customized enterprise resource planning (ERP) that developed in-house to administer Social Insurance schemes to the working population of Saudi Arabia, through their respective employers. The schemes are the occupational hazards (for hospital treatments and related benefits) and annuities (for old age, disability and heirs) as governed and administered in compliance with the regulations. SIMIS also supports GOSI in the various administrative functions such as Investment management, Real Estate management, etc. SIMIS is helping GOSI in improving the quality levels of service, achieving an improvement in ratio between contribution income and administrative cost, and improve administrative efficiency.

CRITERIA 1: What was the issue/problem/challenge addressed by your good practice?


As the population of the Kingdom increased in the 20 years following the implementation of the previous IT system, the number of registered beneficiaries increased and expanded in more geographical areas leading to service delivery problems, increasing administrative overheads, lose management control, increasing difficulties to scale the system to implement modest changes mandated by law were pushing GOSI to go in for a new system using state-of-the-art technology that will be a solution to these problems.

CRITERIA 2: What were the main objectives and the expected outcomes?
The main objectives of developing SIMIS are to improve the organization efficiency, provide effective service to stakeholder, improve quality service and assist in the strategic future plans. SIMIS, as any other ERP, covers the organizations main functions: occupational hazards (for hospital treatments and related benefits) and annuities (for old age and disability) as governed and administered in compliance with the regulations. SIMIS also supports GOSI in the various administrative functions such as, investment management, real estate management, human resources management, etc. Additional objectives were achieved through:

eliminating work duplication;

replacing paper with digital format; implementing electronic check; automating the work process and installing electronic workflow; utilizing public service such as internet; improving the existing function by implementing new standards e.g. financial system; retrieving timely and more accurate data and reports; establishing electronic connection with external entities.

CRITERIA 3: What is the innovative approach/strategy followed to achieve the objectives?


A strategic study of the Information Systems in accordance with the latest systems and specifications made for all SIMIS sub-systems. BPR principles have been applied on GOSI business processes. Here is a list of examples:

In order to eliminating work duplication an interface has been established between the purchasing, inventory and finance systems. Before SIMIS, there was no system to manage GOSI purchasing. So, inventory users entered items into the system one-by-one and same thing with finance users when they entered invoices. Both departments Inventory and Finance are provided with hardcopies of purchase orders. But after implementing SIMIS, all purchase orders are available in the DB. Inventory users just enter the quantities of received items and this action will affect invoice screen on the finance system. In order to replacing paper with digital format and implementing electronic check, the process of receiving recruitment and scholarship requests before SIMIS were handled manually as papers were received from citizens over the kingdom. Those requests were inspected manually with a view to filtering them and selecting suitable candidates. After the implementation of SIMIS, recruitment and scholarship requests are enabled on internet with facilities of filtration on the time of filling the form. Each citizen is asked to enter his national ID, then the system will check eligibility of candidates against some condition like age, gender, grade of high school (these data are available through the government service bus which is responsible about data exchange between government agencies). In order to automating the work process and installing electronic workflow the communication overhead between medical board and annuity department was minimized using SIMIS. It used to be manual and time consuming where beneficiaries had to go to several departments to finish requests. Now with SIMIS, a transaction goes from one department to the next in accordance with workflow rules. It does not need any involvement from the beneficiary. Improving the existing function by implementing new standards e.g. financial system

3 transformation from cash basis accounting to accrual basis accounting which has more flexibility. The accrual basis shows the balances for the due and actual accounts in both side income and expenses.

Retrieving timely and more accurate data and reports:


time of generating accurate financial reports when financial year end reduced to several minutes instead of several months; SIMIS is supporting GOSI with set of reports that alert about possible instances of fraud in relation to the benefits extended under the Occupational Hazards branch. For example: list the cases where the number of injuries recorded against a particular worker in an establishment exceeds the normal limit set; numerous injury cases reported immediately after registration; similar injuries across workers of the same establishment (injury nature), indicating that safety procedures for a particular occupation needs to be revised; frequent incidence of recurring complications/deterioration, against injuries treated by a hospital - indicating that the treatment was not effective.

Accounts Reconciliation: Establishing electronic connection with external entities allows GOSI to automate the process of accounts reconciliation that reduced the reconciliation effort to several minutes instead of several days (sometimes it took about 15-20 days) with more accurate results.

Latest and a state-of-art technology were used by GOSI to develop and operate SIMIS: Component Based Development and Iterative Development Methodology was adopted, based on OOAD principles, in compliance with development methodologies assessed at SEI-CMM Level 5 , and "n"tier architecture using J2EE framework. All these things have provided SIMIS with unmatched scalability and portability. Developing human resources: GOSI always invests in people. It sends employees for abroad scholarship to gain the required knowledge and practice in IT and other fields.

CRITERIA 4: Have the resources and inputs been used in an optimal way to implement the practice?

GOSI recruited qualified employees and trained them on the technologies used in the project. Those employees now are taking care and maintain SIMIS in a proper way. Also GOSI gave orientation sessions and training courses for all the end users in all levels so to highlight the new features of SIMIS and to help the users get acquainted with the system. This has paid off since the users have personally experienced the benefit of the system on their overall work and the degree to which it has simplified and speed up the work process. At any organization, data is one of the most important resources. GOSI has migrated

4 30 years old ADABAS data to Oracle DB. GOSI used an implementation-oriented methodology, which was recommended after carrying out an implementation of a detailed pilot study. Preparation for migration and implementation of data migration were two distinct stages in data migration. The typical testing activities, such as unit testing, functional testing and acceptance testing were carried out to certify the migration. Finally, the post migration phase was planned in order to fill in the gaps after data is successfully migrated to the target ORACLE database.

CRITERIA 5: What impact/results have been achieved so far?


Managing all business (core and backoffice) of GOSI in unified and integrated framework (SIMIS) that allowed GOSI to integrate processes and different systems. Major reduction in paper use (process automation): Paper usage has been reduced around 80 per cent. Major reduction in processes cycle time (streamlined process and workflow system and document management system): Transactions Cycle time has been reduced around 90 per cent. Major change in control (integration between all GOSI systems): Control has been increased the 90 per cent. Cost saving by exploiting e-Services. This decreases load on GOSI resources; hence, they have started to focus more on GOSI business. Flexibility of SIMISs design allows GOSI to implement one-stop-shop concept for customers. Predicting the future (by implementing data warehousing). Increased customer satisfaction. Increased data accuracy. Remote Management: SIMIS allowed GOSI to apply the concept of remote management (GOSI has 21 branches and one headquarter over the Kingdom). Using of workflow engine and document management system facilitate this task.

CRITERIA 6: What lessons have been learned?


Continuous support from executives should be available to ensure continuity of software journey. You need to convince them first. Strong project management should be available to ensure project success. Be strategic as much as possible. Consultation while implementing the project is very important to ensure quality of assets. It is very important to establish change management process at the beginning of the project. Design flexibility and scalability is very important.

Proper documentation has significant impact in maintaining the system. There must be a rigorous strategy to provide high quality documentation for all project aspects. In order to provide quality product, testing must be planned properly and efficiently. In addition, it must start in very early phases of the project. It should not wait until the end which will increase maintenance overhead.

CRITERIA 7: To what extent would your good practice be appropriate for replication by other social security institutions?
SIMIS idea and all concepts behind it are applicable for all middle and large sized organizations. There should be comparison between costs of implementing such solution and benefits gained from it. The comparison should be strategic and for long-term. In GOSIs case, a strategic study was established before implementing SIMIS to ensure that SIMIS really will get benefit.