Other parts of this series:
- Poor data management threatens to hurt insurers in the digital economy
- As data soars in value, it’s time for insurance execs to step in and take the reins
- Data lakes and APIs provide insurers with the keys to unlock their data logjams
- Data governance is vital for insurers as they venture into the digital economy
- These five steps will help insurers get their data governance on track
Many insurers are struggling to properly manage their data. This is going to substantially undermine their performance in the digital economy.
I have a high regard for my insurance provider. But there’s one thing the company does that troubles me. Every few months it sends letters to my home addressed to two former tenants.
This is irritating. But it’s also worrying. It tells me the company is not managing its data properly. The tenants moved long ago and yet my insurer hasn’t updated its records.
Poor quality data often results in poor customer service. Insurers can’t meet the needs of their customers if they don’t know much about them. Or worse, if they have wrong information.
Without accurate and relevant customer information, insurance companies will also struggle to provide the highly-personalized digital services consumers are demanding. Google, Apple, Amazon and Facebook are setting the standard for customer service. And all companies, no matter what industry they’re in, are being measured against this standard.
My insurance provider is not alone in battling to manage its data properly. Companies throughout the insurance industry, and in many other sectors, are wrestling with the same problem.
Our research shows that around half the information middle managers retrieve has no value to them. Furthermore, some managers tell us they spend up to two hours a day searching for information.
Poor data management harms more than just customer service. It’s a drag on the whole business. Take a look at the illustration below.
Inefficient data management impairs the productivity and effectiveness of almost every aspect of the business. There’s no single bottleneck. Data collection, definition, integration, retrieval and application all need to be carefully and constantly managed. If they’re not, product development, customer acquisition, claims processing and business innovation all suffer.
Insurers have managed to carry the inefficiencies of poor data management for many years. But not for much longer. The digital transformation that’s sweeping the insurance industry will expose these shortcomings.
In my next blog post, I’ll discuss why business leaders need to take responsibility for data management.
Until then have a look at these links. I’m sure you’ll find them worthwhile.