Given the constantly evolving nature of technology, digital transformation cannot be a large, one-time investment and initiative. Rather, to digitally transform means to put the organizational, operational and technological foundations in place that foster evolution and cross-functional collaboration.
In our recent study, it was clear that although most businesses are actively working to develop their digital capabilities, they are far from achieving digital mastery. We found that:
- Carriers are focused on assessing the digital experience and putting digital governance in place. In the coming year, many insurers plan to do one or more of the following: establish new digital governance and transformation management, assess the impact of digital as it relates to the customer experience, transform their IT systems to make them more agile and create digital-oriented collaboration or joint ventures with business partners.
- Confusion over who should own digital impedes insurers’ ability to execute their digital strategies. There is no clear consensus on who should own and drive the digital vision and strategy. Currently, ownership is divided among the CEO, the CIO, the chief digital officer and other senior leaders—and when asked who should own digital, the responses are just as muddled.
- Insurers feel that they are meeting expectations for the digital experience but not exceeding them. There was a sentiment among respondents that their digital strategies are good enough for now. Insurers reported that they are actively executing a number of digital strategies—including implementing key technologies, fostering a culture of innovation and reorganizing to better deliver digital.
- Measurement is lacking. Our study reinforced the observed trend that metrics are a low priority for insurers, as “implementing the right digital metrics and measurement” came up as the least critical consideration to enabling a digital business among both personal- and commercial-line carriers.
- Insurers do not have a complete understanding of digital. Just 38 percent believe they have the technology, 30 percent believe they have the organization and 25 percent believe they have the operational processes in place to execute their digital strategies effectively.
One key question insurers must answer for themselves: Does the business have the cross-enterprise digital capabilities it needs to enhance the customer experience sufficiently and quickly enough to both meet customer expectations and remain competitive in the market?
Many insurers will need to consider bundling their offerings with a network of service providers who can complement their offerings (with such ancillary services as appraisal services, restoration services, private fire fighters, etc.) and who are better positioned to help achieve the customer-centricity, credibility and next-generation business model that are priorities for future success. Others will need to advocate for digital transformation at the executive level, be willing to take risks and learn from their mistakes, and execute change within the context of a clear end vision.
To learn more, register to download the Digital Transformation in the Age of the Customer: A Spotlight on Insurance report.