What Does It Mean to Be an Agile Insurer?
On every continent we work on we see the same demands from the C-suite of LP&I providers. Pressure to reduce operating costs, the urgent need to digitise product journeys and automate administration processes, and the desire to be able to launch new, targeted products rapidly and without having to incur disproportionate upfront costs. Many companies are adopting an Agile insurance strategy to embrace these challenges. Ai-London’s PlatformONE Rapid Launch Platform is our contribution to executing these agile strategies. But what exactly does it mean to be an Agile Insurer? And how can you recognise one?
Similar traits often come in the form of:
- An attacking mindset
- Genuine commitment to omnichannel
- Launching new products at speed
- Empowered, multi-disciplinary teams
An Attacking Mindset
For decades, incumbents in the LP&I sector have been able to succeed without adopting attacking tactics, as the industry had seemed so stable. However, structural uncertainties and disruption, such as we are now seeing through universal digital adoption and the combination of more demanding compliance and near-zero-returns, can land even long-established businesses in trouble. In times of structural change, as Ram Charan identified in his seminal work, The Attacker’s Advantage: Turning Uncertainty into Breakthrough Opportunities, “Going on the offense is no longer optional, for one simple reason: defence alone means a shrinking business.”. Agility is essentially the mindset of the attacker.
Genuine Commitment to Omnichannel
A striking finding from Capgemini and Efma’s World Insurance Report 2020, is that between a half and three-quarters of LP&I customers (varies by segment) researching insurance, prefer to use three or more channels. When it comes to purchasing, between a quarter and three-quarters prefer three or more channels. While attackers will focus on mobile and digital strategies, incumbents don’t have the luxury of giving up on traditional channels – and neither can insurgents who succeed beyond narrow niches.
Launching New Products at Speed
In their 2018 paper, A Vision for European Life Insurance, McKinsey and Company identified that the combination of people living longer, declining State pension provision and flagging State healthcare spending, is driving a sea change by encouraging Europeans to look for additional or alternative sources for their retirement income. We believe that an important element of addressing this opportunity is for LP&I providers to be able to design and launch innovative, highly targeted and fully digitised products, without the burden of inappropriate cost structures and legacy administrative systems. We’ve developed PlatformONE, Ai-London’s Rapid Product Launch Platform precisely to support what McKinsey describe as, ‘A focus on speeding up the company’s metabolism (for example, faster, bolder innovation in product and servicing)’.
Empowered, Multi-disciplinary Teams
What is it that converts talk about “agile” into real operational agility?
Probably the single most important – and radical – change is that Agile teams must be self-managing, and to be that they must have all the members necessary to empower them. Outside management must refrain from intervening operationally to redirect or reprioritise from week to week. Management should set up the context and constraints, and by all means contribute to the backlog, but the teams must be allowed to manage their own work.
A second tell-tale sign that Agile has taken hold, is when we see teams selecting work from the backlog and being accountable for completing it within a time-bound period. Scrum Boards make the whole process transparent; overruns, drift and delay are visible to all and quickly corrected. Finally, teams must be mission-based. They must recognise they have a specific purpose and are accountable for the success of that mission.
What’s at Stake?
McKinsey and Company have found that companies who have embraced and operationalised Agile methods have got products to market 5-to-7 times faster, with a 20% to 30% improvement in productivity and similar increases in customer satisfaction and employee engagement. Ai-London’s PlatformONE Rapid Product Launch platform is our contribution to support our clients in achieving precisely those objectives. In their important study Scaling Agility: A New Operating Model For Insurers, McKinsey concluded, ‘As they organize for the next normal, it will be critical for insurers to get faster, leaner, and more effective. Agility helps on all three counts.’
Are you looking to adopt an Agile insurance strategy? Kickstart your free trial period for PlatformONE today.