Five Strategic Insurance Business Imperatives for 2016
“One of these days the ground will drop out from beneath your feet
One of these days your heart will stop and play its final beat
One of these days the clocks will stop and time won’t mean a thing”
“These Days”, Dave Grohl, Foo Fighters
As we kick-off 2016, the time is now for industry decision-makers to make a profound difference in the way Insurance business is transacted. Not just for competitive position, but for future generations, shareholders and most importantly, for the customer. Peer group competitors are formulating action plans now to address the most pressing tactical and strategic business imperatives across the enterprise for 2016 and beyond. Are you? Here are five top focus areas for 2016 that I am hearing from insurance executives across both Life and P&C:
- Digital Strategy
- Talent Acquisition and Retention
- Business Outcome Approach
As in 2015, “Drive to Digital” remains a top-of-mind insurance business imperative into 2016. Mobile underwriting and policy sales, claims distribution and servicing, and multimedia communications are vital areas for digital transformation that is needed to compete now and in the future. Based on conversations with insurance business executives and CxOs, I continue to hear that an important first step in digital transformation is modernizing the core insurance IT system.
It is vital to secure the enterprise with tested and validated security solutions that help advance the business and mitigate risk. Here are the major areas of consideration I am hearing from chief security and risk officers:
- Chief Information Security Officer (CISO) Considerations:
- Want early inclusion in projects to help determine security needs
- Want faster recognition when a breach occurs
- Want not just an effective defensive posture, but ability to quickly move to resolution
- Risk and Compliance Considerations:
- Want line of business initiatives to be fully compliant and risk aligned
- Want proof of value on their terms to reduce risk
- Want priority for controls to be followed consistently across the enterprise
- Line of Business Considerations:
- Speed to capitalize on market opportunities
- Secure and Compliant Business Enablement: Wants to turn to GRC group early in process to mitigate risk
The global insurance industry has many moving parts. Without effective enterprise collaboration, opportunities can be lost.
A unified collaboration strategy will enhance business results with improved customer service, business growth, operational efficiencies and cost reduction. Further, alignment with technology will encourage employee innovation ongoing.
Strategic collaboration challenges:
- Efficient external communication
- First contact resolution
- Meet external partner expectations
- Faster access to resources and information
- Limited or unintegrated channels for communication engagement
The successful use of collaboration technology and processes can have a strategic impact on the business by:
- Delivering a differentiated experience to customers, partners and employees
- Lowering the cost of transactions
- Minimizing need and cost associated with callbacks and follow-up
- Increasing loyalty
- Achieving broader reach and connecting in new ways
Talent Acquisition and Retention
One of the more provocative statements I have recently heard was during the 2015 Life Insurance Conference in Arlington, Virginia:
The insurance industry remains dominated by Caucasians who are “pale, stale and male,” said Mark Hug, executive VP of product and marketing for individual life insurance at Prudential Financial as he pointed to the need for more diversity.
Succession Planning with a customer-driven, thoughtful approach will foster diversity and help level the playing field.
Considerations for building a more diversified workforce include:
- Are diverse interest groups represented? If not, what is action plan to engage all points of view?
- Who are the insurance leader(s) of tomorrow? Is she/he in-house or elsewhere?
- How do we attract and retain top talent?
- How do we harness the technical knowledge and lessons learned of senior executives here now?
- Do we have the technology capabilities and vision to capture the interest of tech-savvy millennials, not just as a stepping stone to a better job elsewhere, but for a long-term career?
Business Outcome Approach
It is no longer acceptable for business management and information technology (IT) to exist in independent silos. When managers of cross-functional teams do not share tactical and overall strategic goals, data, priorities, processes and tools with other departments, there is increased risk for lost business, decreased operational excellence and productivity, increased exposure to regulatory and compliance requirements, and increased operating and capital expenses. Aligning IT with business and driving toward a shared business outcome(s) help to alleviate this. The following 1 shows the elements of a Business Outcome Approach.
Business Outcome Approach advantages include:
- Helps to ensure collaborative enterprise strategy across IT and business by breaking down silos or an us-versus-them mentality
- Promotes smooth flow of data and information across the organization as you move from shared discovery to outcomes
- Improves competitive position with enhanced customer experience
- Begins with a common objective and vision as you move from pilot to scale and vision – so you realize business value
Do these priorities align with your enterprise conversations? As senior leaders of insurance firms, I urge you to keep these five imperatives top of mind as you ramp up your plans for 2016 and beyond. Cisco is helping insurance firms address each of these imperatives across Life, P&C and Health Insurance firms.