Other parts of this series:
- Perfect storm threatens to sink insurers’ earnings by nearly 40%
- Smart digital strategies enable insurers to double their earnings
- Insurtech firms show big insurers how to thrive in the digital economy
- Defensive digital strategies help insurers strengthen earnings
- Insurers should prepare themselves for constant digital transformation
The insurtech start-ups that will make the biggest, longest-lasting impact on the insurance industry will be those that master the practice of constant transformation. Traditional insurers will also need to prepare themselves for ceaseless change.
The most successful technology start-ups don’t just capitalize on a single innovation. They constantly innovate and never stop transforming themselves to seize opportunities presented by new technology and shifting markets. Just think of how Google, Amazon and Facebook continue to stretch their businesses. They recognize that digital transformation is relentless.
The insurtech start-ups that will make the biggest, longest-lasting, impact on the insurance industry will be those that master the practice of constant transformation. Many of today’s high-profile insurtech firms are likely to fall by the wayside in the next few years because they couldn’t re-invent themselves.
Some far-sighted insurers have already recognized the importance of constant digital transformation. Ping An in China, for example, is currently realigning its business to capitalize on the anticipated surge in consumer traffic across digital ecosystems. It’s working with key allies to build a digital platform for financial services that will be accessible to a huge number of potential customers as well as many additional partners.
The ability to constantly change to grab new opportunities and side-step potential threats is becoming increasing important to insurers. As I mentioned in my previous blog posts, insurance providers need to combine offensive digital strategies, which will expand their businesses and strengthen their ties with customers, with defensive initiatives that improve the efficiency and effectiveness of their operations.
It’s essential that insurers identify the best combination of offensive and defensive strategies for their own particular requirements. They will then have to build the technology skills and capabilities they’ll need to implement and support these strategies.
We’ve identified five key steps that will enable insurers to ramp up the skills and capabilities they’ll require for continuous digital transformation.
- Commit to a strategic plan and ensure long-term funding: Clear milestones, on-going tracking of progress, and iron-clad expenditure commitments are vital.
- Develop flexible and multi-speed IT: Cloud-based infrastructure and embedded multi-speed IT capabilities provide scalable and flexible technology resources.
- Shift to data-centric and advanced analytics solutions: Standardized internal and external data resources coupled with sophisticated analytics systems can deliver critical business insights in close to real time.
- Transition to the new workforce: Extend the talent pool beyond employees, contractors and consultants by pulling in specialists, especially experts in key technologies, from crowdsourcing and on-demand sources.
- Build an agile organization: Foster innovation and entrepreneurial skills to find new ways to engage with customers and employ DevOps approaches to roll-out IT systems that enhance business flexibility.
For further information about transforming your organization into a digital insurer have a look at these links. I think you’ll find them worthwhile.