Midwest Family Mutual Goes Green
Subject : Infromation Technology import and strategic Planning.
CASE STUDY 13-2 Midwest Family Mutual Goes Green
Midwest Family Mutual Insurance Co., an insurance company with $120 million worth of written premiums in 2014, considers itself to be “environmentally green.” Through a variety of initiatives, it has reduced its annual energy, natural gas, and paper consumption by 63%. 76%, and 65%, respectively. Ron Boyd, the carrier’s CEO, attributes most of the improvements in energy usage to creating a virtual work-from-home environment as a result of implementing a series of electronic processes and applications. These include imaging and workflow technology. networking technology, and a Voice over IP (VoIP) network. In 2006, the year these savings were reported, all but two of Midwest Family Mutual’s 65 employees worked from home. In addition to the energy savings that the company has directly experienced, Boyd estimated that in 2008, the company’s telecommuting policy resulted in fuel savings of at least 25,000 gallons. Although green computing was a commendable goal in itself, Midwest Family Mutual’s bottom line also has benefited from the company’s socially responsible approach. Over a five-year period, Midwest Family Mutual’s was able to shave its expense ratio to 25.9% from 33.5%. Its Web site states, “Being green environmentally and operationally CAN [emphasis in original] equate to being green financially.” Green computing grew out of Midwest Family Mutual ‘s IT successes, according to Boyd. As the company started realizing savings from the electronic processes it implemented, management started thinking about telecommuting arrangements
mJ Privacy and Ethical Considerations in Information Management
that allowed its employees to work from home. Boyd adds, “It became obvious that many of our jobs could be done wherever a high-speed connection existed …. VoIP completed the technology requirements for all [employees] to work from home.” Boyd summarizes that the company “became green as a side benefit of saving resources and cost.” The company continued its green policy with its decision to sell its 24,000-square-foot office building in Minnetonka, Minnesota. However, to provide more centralized regional service to agents in the new states in which it was recently licensed (i.e., Arizona, Nevada, Utah, Colorado, Idaho, Washington, and Oregon), the company built a new home domicile in Chariton, Iowa, in 2012.
1. Do you think that the economic benefits that Midwest Family Mutual realized as a result of green computing are unusual? Do you think that most companies could see similar types of economic gains? Explain.
2. What are some possible disadvantages that the employees of Midwest Family Mutual might be experiencing as a result of its virtual work-from-home office environment?
3. Apply the normative theories of business ethics to this situation.
Sources: Adapted from Anthony O’Donnell, “Plymouth, Minnesota-Based Midwest Family Mutual’s Move to a Paperless, Workat-Home Operational Paradigm Has Yielded Both Environmental and Bottom-Line Benefits,” Insurance & Technology (February 24, 2008), http:/ /www.insurancetech.com/resources/fss/showArticle.jhtml;jsessionid=A YMVWDKZBGIFIQSNDLOSKHSCJUNN2JVN?article 1D=206801556 (accessed April 23, 2008); Midwest Family Mutual News Archive, “MFM Announces 2011 Results and Plans for 2012,” https:// midwestfamily.com/news.php?detail=589 (accessed on April 14, 2012); “Midwest Family Goes Green,” https://midwestfamily.com