Accelerating an Insurer’s Digital Transformation – Lessons from the Pandemic

As many of us have noted, the Covid-19 pandemic has accelerated digital transformation in multiple industries, insurance included. My own articles on this platform have pointed out the Business Model Implications and the potential Impact on Insurance Products and Services.

Insurers have done an excellent job implementing digitally-enabled work-from-home models. They’ve also made progress using digital tools to reduce unwanted face-to-face interaction with their customers.

But now the dust is settling, what next?

Insurers have proved to themselves that they can achieve digital change far faster than they ever imagined, but in what direction should they point those new-found energies now?

Clearly some sort of strategy, or perhaps even a plan, is required. And insurers are good at preparing and updating rolling three-year plans. So perhaps, in the next update cycle, the digital elements of these should be made more ambitious?

But wait.

When Covid-19 struck, there weren’t any relevant plans in place. Just an imperative to act, and to act quickly. And that’s what insurers did, for the most part effectively.

Most of the insurers that I work with decided that the only ‘spare capacity’ they had to figure out how to design and deliver remote working etc were their ‘innovation’ and ‘strategy’ teams. So it was the people who are normally paid to gaze into the future and think longer-term who were suddenly tasked with making something happen right now.

These pioneers succeeded not by creating detailed plans, but instead by using far more agile approaches to designing and delivering change.

So does that mean insurers should ditch the planning, and switch completely to agile techniques?

Not quite. Because insurers’ successful response to the Covid-19 challenge wasn’t achieved by agile delivery alone.

It was achieved by agile delivery which was directed towards a clearly defined:

• Vision (focused on keeping the business running and on maintaining customer satisfaction); and
• Operating Model (focused on keeping, as far as possible, out of offices and remote from customers).

And that’s important for insurers as they consider where to take their digital transformation next – because agile-alone will lead to gaps and overlaps in the transformation, and hence to sub-optimal results.

For me, therefore, the digital transformation lessons from the pandemic are:

1. Start by agreeing, and socializing, a Vision for the insurer’s future (you might glean some ideas from my Insurer of the Future microsite) ;
2. Once that’s done, design your future state Operating Model, and accompanying one-page Transformation Roadmap, to provide the ‘guard rails’ for every transformational activity you undertake (you can find more on this in my articles on Insurance Operating Model – Steps to Take and Insurance Operating Model – Example Design Principles); and
3. Then, and only then, start on your agile delivery.

Taking the time to agree your Vision, Operating Model and Transformation Roadmap should take insurers no more than a few weeks. But the pay-off, in terms of directing your post-pandemic digital transformation energies effectively, is priceless.

Please feel free to comment below, or to contact me direct.