MIP Holdings, the local software solutions provider for the healthcare and financial services administration industries, has doubled its profit and increased revenues by 22% in the past financial year.
This growth is due to its broader product suite, expansion into the Western Cape financial services industry, its billing model that parallels the success of its clients and its two new offices, one in Cape Town and the other in Pretoria.
"We've made strong inroads into the financial services sector," says Don Elliott, sales director at MIP. "We've continued our growth in the medical aid, pension and life arenas, entrenched ourselves in financial services supporting wealth products, living annuities, wrap funds and unit trusts, for example. We've signed some new clients and grown alongside others – such as Coris Capital, Prescient and Genesis."
In 2006 MIP broadened its financial services offerings when it launched its new lending system, Integrated Lending Solutions, after acquiring it from a local bank and significantly updating it.
The lending system broadens MIP's existing software suite of medical, pension fund, life, unit trust, asset finance and motor warranty administration applications.
Richard Firth, CEO of MIP, says: "The ILS enhances the MIP financial services offering, rounding off our strategy to be the leading ERP supplier of financial service systems in the South African market, with global reach."
MIP's expertise in medical aid, employee benefits and life assurance administration has led to several notable successes for clients, including:
* Allcare Medical Aid Administrators being awarded the PMR Diamond Arrow Award as "Medical Aid Administrator of the Year" for three consecutive years;
* Genesis Medical Aid Administrators, and Medical Services Organisation (MSO), which provides case management to its extensive list of clients, both receiving unconditional accreditation by the Registrar of Medical Aids in the first round;
* Channel Life Limited, one of the fastest growing life insurance companies in the industry, showing year-on-year growth in market share; and
( Alfinanz, the South African financial services outsourcing specialist, being named the world's best outsourcer for financial services for 2006 and 2007. The award was made in the US by OutsourcingCenter's Outsourcing Excellence Awards, sponsored by Forbes magazine and Everest Group. A critical part of Alfinanz's outsourcing operations are made possible by Progress Software-based applications from MIP.
"We're giving our customers a product that's fit for purpose and because it's locally developed they also get all the support and maintenance they need – quickly," says Elliott. "Our pricing is competitive and we haven't shoehorned an offshore product to meet local specifications. A well run administration business should spend between 11 and 13% of its revenues on its total IT infrastructure and half that on the administration system."
MIP's billing is calculated on a monthly per-member or per-policy fee and based on volumes. It uses a sliding scale to reduce marginal costs that include all upgrades and any new value-added systems.
The monthly fee also covers all costs relating to the system, such as application software, database licences, implementation, training, data conversion, as well as ongoing support and product enhancement. Contracts typically run between three to five years.
"Risk-based billing provides a guarantee that the service provider understands the customer's business and technology needs," says Elliott. "Our model has been designed to provide a win-win outsourcing partnership in that the customer no longer has to constantly look after its technical infrastructure and can focus on improving revenues and profits with the support of the technology service provided. It means that they can accurately forecast their IT expenditure for the duration of the contract, the only variable being the growth in the client's membership and/or policies and there are no unexpected additional costs."