It all begins with understanding the behaviours, preferences, choices, likes, dislikes and needs of the digital customer. This is vital to the survival of the industry. Many want the attention of the customer, and many of them are digitally native start-ups, with almost no legacy and an agile approach to business development, and as a paradox virtually 100% of their software investments are in innovation. Allowing them to improv customer service every day.
Daniel Burrus says: "One hard trend to watch very carefully is the speed of change that new financial technology start-ups, often referred to as “fintech,” will bring to the finance industry". Daniel is considered one of the World's Leading Futurists on Global Trends and Innovation .
"Digital pulse 2015" Russell Reynolds Associates found that 53% of insurance executives anticipate "moderate or massive digital disruption in the next 12 months" and that 90% of the organisations that participated in the survey, profess to having a digital strategy in place, but that the change has created a skills gap, stopping many of them from moving more quickly.
In addition to the digital transformation itself, the industry need to adress the challenge of the "Internet of Things" IoT. Business Insider estimates that 74 % of insurance executives plan to invest in developing and implementing IoT strategies by 2016, just as many said they believe the IoT will disrupt insurance within the next five years. Giving a hint of the importance of adressing the challenge.
7 success factors for digital transformation as seen by A.T Kearney analysis:
- External client centricity - customer experience in focus
- External open innovation - open innovation eco system
- External fexibility - long-term vision and short-term execution
- Internal open innovation - inclusive digital teams
- Internal organizational flexibility - agile IT platform
- Internal client centricity - new roles for branches
- Inclusive digital culture
In "The Digital Advantage" ebook CapGemini says: Digital is revolutionizing the relationship between customers and retail banks, who have responded with strong capabilities in customer service, analytics and even social media. Banks have an opportunity to parlay these successes into new innovations in mobile or social customer engagement and internal knowledge sharing. In addition, opportunities exist to integrate initiatives and processes across corporate silos."
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Make the organizations internal and external information available in order to increase transparence, beneficence and speed of interaction internally, with customers and other organizations. This must happen within an ecosystem that is capable of delivering IT solutions in an ever increasing speed.
This survey covers the digitalisation in the Nordics. It shows the need for making businesses more efficient, and singles out that aspect as the most important driver for digitalisation, followed by the need to automate processes. More interesting findings in the report.
Disruptive forces are profoundly changing the insurance industry. A unique combination of challenging market conditions, shifting customer behaviors and new digital-first market entrants threatens long-established and profitable business models.