Most data networks use an Internet Protocol (IP) to transmit data. Sending voice over an IP network is called voice over IP (VoIP), or more broadly, IP telephony. Video and videoconferencing can travel on the same network in an IP format.

A single converged voice and data network lowers expenses in many ways. One staff group (after appropriate cross-training) can perform installation, systems integration, configuration and maintenance. Network utilization increases, fewer servers are required, and a unified storage and retrieval system can support both voice and data.

Changing the phone numbers and telephone instruments becomes easy. With an older phone network, moves, additions and changes can require hours because of the need to manually rewire a telephone closet. With VoIP, a person takes an IP telephone, unplugs it at one work location, plugs it into an IP jack at a new location, and is ready to go--the system automates the move. Last, but not least, long-distance charges are reduced substantially, because VoIP calls are routed from region to region over the insurer's network.

Converged networks provide significant operational benefits over multiple, disparate networks: people become more accessible, information is more available, and time and place are less constraining. Putting voice and data on the same network allows voice mail and e-mail to be placed in a single inbox. This type of unified messaging service allows a person to see all messages in one place at one time, and to prioritize accordingly. IP telephones have small screens that can display useful, as-needed information, such as internal phone directories, key data about a caller or corporate news.

An even more powerful feature allows conference calls (and videoconferences) to be set up in real time. A phone call between two people can be expanded to bring in other people to access specialist knowledge or to reach a decision quickly. Insurer staff on the conference call instantaneously can share screens, documents and data--because everyone is on the same network. Videoconferences allow an additional level of communication--participants can see facial expressions and body language. Visual contact makes it easier to establish trust and commitment.

Another significant benefit of a converged network is that it is easy for an insurance call center to become a multichannel contact center. Policyholders, agents and brokers want to interact with insurance companies in many ways--by telephone, the Internet, even by mail and fax. Traditional insurance call centers have legacy issues, including multiple locations with incompatible hardware and software, inflexible and labor-intensive call routing, limited management reporting, difficult access to caller information, and high staff turnover.

Since the late 1990s, insurers have made large investments in Web-based information and self-service functions for the same people who use the call center. Many insurers are now taking the logical next step by directing communications across all channels to a contact center.

A converged data, voice and video network provides the same expense advantages to a contact center as it does to any other part of insurance operations. However, the largest payoff is in operations. Putting several contact centers on the same converged network creates a flexible staff pool to handle "peaks" and "valleys" of call volume.

Setting up conference calls in real time leads to "once and done" calls. Call center representatives can easily access information about a caller and the caller's issue--whether that information resides in voice mail, e-mail, images, applications or databases. As more consumers and agents have their own VoIP capabilities, they can switch easily from a Web-based to a telephone interaction (what is called click-to-call).

Before an insurance company can implement a converged network, however, business and technology managers need to address several important issues:

o How will a converged network provide the same or better level of reliability and security as the networks it replaces?

o Will the rollout to different organizational units be all at once (a "big bang") or phased (a necessity in larger organizations)?

o Most important, what is the target mix of business and technology benefits desired--expense reduction, operating efficiency, better service or increased agility?

Answering these questions provides the foundation for a successful converged network implementation.