Thriving in the new digital age: culture is king

Since the impact of the COVID-19 pandemic began to be felt, in the US and across the world, insurance companies have had to re-invent their ways of working—much due to social distancing and the increase in remote working, and the uptake of e-commerce. Subsequently, insurers have had to expedite their digital transformation programmes and their digital processes to remain relevant.

A blog by anti-insurance fraud software company FRISS, “7 Key Industry Perspectives In The Fight Against Insurance Fraud”, cites a Gartner study of chief information officers. It predicted that artificial intelligence (AI) (36 percent), data analytics (21 percent) and customer experience (20 percent) will be the game-changers during 2021. Deloitte also argues that AI and advanced data analytics are currently core priorities for insurers for the automation of processes in underwriting and claims.

Maintaining customer satisfaction remains a key driver too—achieved by placing the customer at the centre of everything an insurer does, while improving operations efficiency and by working to make AI more effective. To this extent, there has also been a need to build a department mindset and culture to foster change and to drive the success of digital transformation.

Andrew Vogeney, general manager, North America, FRISS, will be speaking about how insurers can thrive in the new digital age by transitioning from being digitally enabled to adopting a digital-first strategy on Day 3 of Claims Innovation USA 2021.

In an interview with Intelligent Insurer ahead of the event, Vogeney says he hopes delegates will learn that culture is king.

“It’s important across any major business topic to understand the type of culture you want to create within your organisation because you can write as many policies and procedures as you want, but ultimately the culture of the organisation will dictate how your employees perform and contribute,” he says.

This lesson applies to innovation, diversity and inclusion, regulation to other topical areas of the business.

How can insurers understand why diverse teams deliver greater returns?

Diversity brings with it an increased variety of ideas. When everyone in the room has the same ideas, they will arrive at the same results.

“Diverse teams come with different life experiences and a variety of perspectives,” Vogeney says, underlining that “a lack of diversity is not good for business, and it’s not good for the communities we serve.”

Diversifying an organisation’s workforce can therefore help to promote innovation through equality, inclusion and social justice. Speaking as a member of the LGBT community, he says respect is the most important and simple concept. By starting with respect, teams and individuals can become highly motivated and efficient.

He explains: “I like to focus on the mission of my organisation and how I can contribute to it. I believe I have done a great job of earning my team’s respect based on that alone, regardless of their views on my (or anyone else’s) diversity characteristics.

“I in turn have great respect for everyone on my team, regardless of their differences or personal opinions that might not align with mine.”

Respect and trust can inspire innovation and to lead to significant accomplishments.

“Having a reputation for respect promotes further diversity, resulting in diversity of thinking and true innovation,” Vogeney suggests. Respect can also form part of an organisation’s culture, which is a crucial aspect to change management. Without respect, nobody will be motivated to embrace and fully participate in any kind of transformation initiative, he adds.

What are some of the challenges?

Culture will inevitably differ across different organisations and even individual departments. This can make developing a cross-department mindset to foster change quite challenging.

“Over the past two years I’ve seen the reluctance towards digital transformation move towards embracing it as carriers realise they need to treat their customers more like the big-name companies that are renowned for their speed, accuracy, and customer-centricity,” Vogeney says.

“Where carriers struggle is often detangling from a web of legacy systems and processes. Embracing a modern core system is often the first actionable step in moving toward digital transformation goals—plugging in the ancillary technologies that solve specific business needs is the second.”

There is also a need to define and implement the right talent strategy to hunt for brilliant digital talent, and to cultivate new digital skills in-house. Vogeney says he hears companies across all industries beginning to describe themselves as “technology companies”, or they say they are the “intersection of food (for example) and technology”.

The allure of working for a buzzworthy company attracts top talent to some extent, but the challenge in the insurance industry is that it’s not had the best reputation as an exciting place to work, he adds.

“Much effort within the industry needs to be put into changing that perception—particularly if it wants to attract fresh talent. Once you have the talent in house, they need the room and resources to grow, learn, experiment and make mistakes.

“If you can’t foster that type of culture, innovation will impossible”, he emphasises.

How does this relate to the delivery of improved customer service?

To address the challenges, through the lens of the solutions offered at FRISS, Vogeney says there is a need to enable safe digital transformation by recognising the risks your organisation runs when you set off on customer-focused innovations.

“In the world of insurance, paying claims efficiently is now table stakes. Yet, many carriers still don’t perform the checks needed to verify whether all of these claims should be processed so efficiently.

“Inevitably, the results of this blind spot will become obvious in loss ratios. Solutions like ours are an important safety measure to ensure the information you see is accurate and legitimate.

“It’s easy to lie when you’re looking at a computer instead of a human and, unfortunately, committing insurance fraud is a lucrative career. So, while it’s important to enable efficiencies and superior customer service with tech, it’s also important to have the back-up to make sure you’re doing so safely.”

To maximise the impact of a team’s digital capabilities and implement important learnings across other core processes to improve operational efficiency, there is often a need to break down departmental silos. Organisations can then start to innovate across departments, whether that involves sharing business data for an enterprise or whether it’s to tackle problems from different perspectives by working well together.

Vogeney says this always yields better results—even during the COVID-19 pandemic, which has led to the widespread use of videoconferencing tools such as Microsoft Teams and Zoom.

He explains: “These meetings often level the playing field, and they allow you to collaborate with people you might not have met before. In my case, I can very easily call a colleague from across the globe, and even a five-minute catch-up can be very inspiring.

“No matter the initiative, taking time to learn, reflect and debrief are important aspects to closing out any efficiency project. Sharing these learnings is equally important to future innovation.”

Why do we need to transition from being digitally enabled to digital-first?

Innovation requires change, but sometimes it’s an incremental process. Being digitally enabled is therefore just a stopgap. It permits an insurer to accomplish some innovation, but it’s not at the forefront because the organisation’s systems weren’t built to be digital.

“While your old computer could do some things, your iPhone or Android can do almost anything these days,” Vogeney explains, adding that smart devices have been built to be digital-first.

With them the possibilities are endless, and in this regard insurance processes follow the same theory. Legacy systems can usually do some things, but they are not able to perform every task or process.

Solution providers can innovate faster in a digital-first environment, providing updates in real time to fight real challenges, and continue to do so long into the future. This requires them to work within a digital-first ecosystem.

“The most important step in any transformation relies on getting the conversation started. The trouble is that digital transformation is fast becoming a throwaway word within the insurance industry,” Vogeney concludes.

“I’m excited to be part of the conversation as there are organisations that are still struggling with the most basic transformation projects. In contrast, there are others that are far along the journey, providing their customers with the service they deserve.

“But, regardless of where a carrier is on its own journey, my team can help them. And sometimes the best advice is a reminder that culture is king when enabling change and customer satisfaction.”

Andrew Vogeney, general manager, North America, FRISS, is speaking at Intelligent Insurer’s Claims Innovation USA Virtual Event (July 13–15). The event brings together 60+ expert speakers on claims transformation and is free to attend for insurers and brokers/agents.  Register now to access 15+ hours of content live and on demand.