The forces of digital disruption continue to impact organizations of every size and in every industry, as consumers, employees, and partners expect everything to be on demand and fully connected. At a business level, there is now growing impatience to make digital transformation a reality.
85% of the insurance CEOs have “digital” on top of their agenda. Insurance providers around the world are embarking on extensive programs, but for many organizations, there are still huge barriers to digital transformation.
Yes, digital transformation is an overused buzzword and it can mean different things to different companies. The insurance industry has never been much of a leader when it comes to technology. However, companies should work on their digitization and plan activities to improve their processes.
The driver for this modernization is the evolution of the market. Insurers has to deliver products and services quickly and they need to reinvent itself with major revisions in operating models, document processes, value propositions and customer relationships.
So, digitization is a huge task and insurers are facing the following challenges.
1. NOT CLEAR SCOPE OF WORK
Organizations are overwhelmed by consultant firms, industry analysts, experts and their overflow of information about Digital Transformation. Intelligent content management, Internet of Things (IoT), omni channel, big data, telematics, blockchain, biometrics and analysis. The problem is NOT with technology. Most of them are mature enough to support and drive the transformation. The challenge for CEOs and executives is understanding how to change and transform their businesses.
Insurance is looking for more than just modernization of core systems. They expect a successful digital, analytics, and organizational transformation that can enable them to unlock the full potential of a core transformation has provided to them.
Digital transformation is used to package and sell technology because it sounds progressive and modern. But the real scope of digital transformation is much harder to accomplish because it means changing the culture and the behaviors of people and potentially, even the core business and operating models.
2. MISALIGNMENT BETWEEN IT AND BUSINESS
While most executives believe the company is clear on the definition of digital transformation, an obstacle to success is the lack of alignment on what exactly digital transformation means. This pressure to transform comes at a time when IT budgets have remained relatively static, but IT is simultaneously being asked to deliver more projects to the business than ever before. Many insurance companies are suffering the negative effect of a disconnection between the IT role and the business strategy, which, in return, increases data fragmentation, security and compliance risks and decreases transparency and clarity across the whole organization.
Aligning IT with business functions helps to support your enterprise strategy by breaking down the silo mentality. It promotes a smooth flow of data and information across the organization. And, such an integrated environment far more strongly supports the omni-channel experience, improving your competitive position with an enhanced customer experience (Cisco).
3. STILL CONTENT CHAOS
Videos, email, documents, billing, claims, risk assessments…the growth of unstructured data in the insurance industry, including brokers and agents, is unstoppable and unavoidable. All data come from several sources, different in volume, size, formats and type. On top of that, content is duplicated across shared drive, network folders, CRM, ERP and other business applications. This is what we call content chaos.
The proliferation of customer touch-points, applications and digital interactions makes it more challenging than ever to deliver the right information to the right people, whenever and wherever they need it. For insurers information is vital: from regular enquirers about insurance policies through the insurer’s contact center, website or agent to requests for a change of beneficiary and claims management, the ability of insurers to support these interactions depends on how well they manage, locate, and deliver various types of digital information.
A good starting point is via a unified digital strategy, built around a robust Content and process Service platform.
4. LACK OF INTEGRATIONS
The forth major obstacle to digital transformation is integration. And organizations have a lot to integrate. Driven by trends such as cloud, the number of applications used by companies today is huge. On average large organizations are using more than 1000 individual application across their business, therefore agility in application integration is essential to growing in a changing market.