SilverBridge Press Office

Thought Leadership

Embracing a digitally driven culture of innovation in insurance

by Nelson Camara, Go-to-market Executive at SilverBridge

Insurers have focused on ways to reinvent themselves for a digitally driven market where the customer experience has become even more of a priority than in the past. End users are clamouring for self-service and personalised solutions. For example, they want a more intuitive way of taking up a policy and be able to get speedy claim pay-outs. Customers are willing to provide insurers with more personal information, but they expect more relevant and personalised solutions in exchange.

Customers require efficient and user-friendly solutions while having the ability to engage with the insurer using their channel of choice. From its side, insurers are focusing on embracing a digital culture and adopting the new technologies essential to deliver on rapidly evolving customer expectations and injecting the level of innovation essential to do so.

As much as this requires modern technology to accomplish, the best way to improve the success of any digital transformation initiative is by putting the focus on the people inside the organisation. For insurers to successfully transform from within, it must start creating a culture of innovation in its people regardless of their position in the business. Part of this entails defining what the end goal will be when it comes to digitalisation and customer experience. The ‘why’ is critical in this regard as that will help position the ‘why’ for the insurer on the path to change. Furthermore, a culture of innovation is something that is iterative. It does not happen overnight.

Leadership support

Critical to the success of any culture shift within an insurer is having the necessary support from leadership. Some experts suggest appointing a director with a digital background that can support and challenge the executive team. This person will act as the critical link between the executives and the board when it comes to all things digital.

Even though many insurers might be concerned about the perceived costs associated with making a transition in becoming more digitally-forward, the reality is that not investing in these initiatives will result in higher penalties in the long term that will translate to increased customer churn, loss of relevance, and an inability to become agile to deliver to future customer requirements.

According to McKinsey, ‘insurers are experimenting with many different approaches to digital, but all are grappling with the same challenge: deciding where and how to focus in order to establish or maintain a competitive edge.’

It recommends adopting a structured approach focusing on several levels. One of these encompass the culture of the insurer. In this regard, McKinsey advises the business to develop ‘agile test-and-learn capabilities at the front line to encourage experimentation and shift to a digital-first mind-set; recruit and develop new types of talent such as data scientists and design thinkers; and revise formal organisation structures to encourage collaboration between functions and reflect the importance of digital.’

Prioritising culture shift

Spencer Stuart recommends putting an integrated framework in place that assesses the company culture and the personal styles of individuals as the means of identifying how to effectively apply insights about leadership and talent decisions in the transition to a digital business.

He believes that the best kind of cultural patterns can encourage innovation, growth, market leadership, ethical behaviour, and customer satisfaction. Insurers should understand the gap that exists between the current culture and the one that they desire to drive throughout the organisation.

As part of this, the article highlights a set of distinct sociocultural styles or ‘basic assumptions’, which apply to both cultures and leaders. Together, these styles can be used to describe and diagnose highly complex and diverse behavioural patterns in a culture, which helps to understand how an individual executive is likely to align with and shape that culture.

By harnessing and understanding the changes needed from a cultural perspective, the insurer will be well on its way to reinvent itself for a digital world.

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