Should an Insurer Try to be More Like Google?
Insurance Experts' Forum, May 20, 2014
There's no shortage of admiration and emulation going on for the business models of the big web companies. Go all-digital, automate decision-making with big data, engage mass markets online, support mobile and keep on innovating. Google and Facebook are held up as models of success, the corporation of the future.
Insurers need to keep blazing digital trails as well. But should they look and operate like Google?
There are important differences between Google and an insurance company. For one, Google's level of customer investment is wide, but relatively shallow. Many users take advantage of its many free services, but don't have strong financial bonds to the company. Insurance carriers, on the other hand, do have deep bonds with their customers.
There are many aspects of digital companies that do provide roadmaps for insurers, however. The web companies, for example, have learned to master the customer experience. As spelled out in a Harvard Business Review article from Jeanne Harris, Allan Alter, and Kelly Dempski, the Googles of the world provide important lessons in adapting the new digital realities.
Plus, many executives are starting to look at the disruptive qualities of these web properties, generating new innovations on a weekly or daily basis. IT departments, mired in legacy maintenance, need to be freed up to pursue this innovation.
They provide some guidelines for corporate and IT leaders to follow:
Iterate, iterate, iterate: Employees at the digital companies deliver innovations at a fast and furious pace. “They quickly test new services and features with actual customers and data,” Harris, Alter and Dempski report. They also look to outside ideas for innovation.
Employ analytics: It's now possible to gather data from every iteration in every corner of the organization. This is a key piece of the success of digital companies, the authors state. “When companies capture and analyze their customers’ interests, and integrate them with data from other sources, marketers and developers can better predict and influence consumer behaviors and deliver more personalized experiences.”
Reinvent the IT department: It's key that the IT department take the lead in the digital evolution, and move away from legacy systems that are slowing down innovation. “The bottom line for CIOs,” the authors state, is to “serve the accelerating demands of digital customers, IT organizations will have to behave more like Amazon or Google, and less like their traditional competitors.”
Joe McKendrick is an author, consultant, blogger and frequent INN contributor specializing in information technology.
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