- 1. The HR department who makes an announcement of significant organisational restructuring via a group email – and only via email. (When did it become OK to end personal or professional relationships via email or texts?)
- The Divisional head who lambasts his team via email for bad behaviour when it’s really only directed at one team member. (When did it become ok to use technology to be a lousy manager?)
- The family at the restaurant who don’t talk to each other over dinner as they are too busy typing into mobile phones, or watching TV on tablets. (When did it become ok not to talk to each other at dinner?)
Archives for April 2012
In our recent work in Latin America, it is clear that in the process of selecting core systems for countries such as Argentina, Brazil, Chile, Colombia, Mexico and Peru, Insurers have been more focused on delivery and support capabilities than in the product.
All vendors claim quick time to market, low TCO, quick ROI, strong product configuration capabilities and more. And when dealing with the top vendors, there is little material difference in features and functionality. Although functional requirements account for most of the items in a RFP the weight of non-functional requirements including delivery and support capabilities has matched and even surpassed the first. This is an approach that we have been advocating in other regions.
Functionality is now an arms race. Insurers, even in emerging regions like Latin America, must invest more in evaluating service and delivery capabilities.
With a plethora of new vendors in the region offering solid solutions proven elsewhere in the world, regional insurer have three important questions that vendors need to address:
1 . “Will the vendor have the capabilities to deliver and support the product in this region? “
2. “What will I need to change (people, process) in order to take advantage of these new highly configurable systems that promise to put everything, well almost everything, in hands of the business users?”
3. “How do I really validate that the product will support our lines of business, the products we sell and the channels and processes we want to have in place to better serve our distribution channels and customers?”
In response to these questions, there are several interesting points to make.
It is clear that vendors in the region bring a wide range of different business models. Insurers in most Latin American countries have been used for decades to have local/regional support from vendors which acts as a high entry barrier for new participants. While some of the new players have decided to work through system integrators or implementation partners, they still need to demonstrate how successful those relationships can be to deliver in the short term and to supersede in the long term. Insurers are looking for credible relationships (between vendors and partners) and processes in place in advance for knowledge transfer. Domain expertise, sufficient trained staff and delivery capabilities in similar projects are key aspects they will consider when evaluating the local/regional partner. Finally, how involved is the vendor going to be in the implementation process is also under consideration. Vendors who are amongst the first to prove some track record in the region will be the vendors who succeed in the future.
When it comes to validating the product against the insurer business model, Celent points insurers to the process of the RFP. There are smart ways of validating and engaging with vendors early in the review process to strike a balance between what the solution is capable of and the organizations willingness to change its business model. This new approach focuses more on system review in early stages of the process and making stakeholders and users engage in the quest of understanding what is possible and the transformation required within the organization since start.
This focus on service delivery and business transformation over functional requirements is the new reality in Latin America and one that Celent will continue to support.
This week, the Celent team have been developing the content for a workshop that we will take to our clients to explore what the world of insurance could like in 2022 once the disruptive effects of today’s technology evolutions take hold, such as cloud, ‘Big Data’, and SoMoLo (Social, Mobile and Local).
Although sometimes in this industry you can feel more like a museum curator than an innovator (especially if like me you focus on the Life, Annuities and Pensions market!), this is genuinely an exciting time to be in insurance technology. Some of these developments are simply explosive and have the potential to change the way the industry operates forever. Of course, with all innovation comes risk, and I suspect that we will see a few expensive failures littered along the way to adoption (and then quickly swept under the carpet) as insurers try to navigate their way through the hype.
For me, however, it’s not just the technology that’s going to force the change. Over the next 10 years, we are going to see a fundamental shift in demographics and with it consumer expectations that will see the coming of age of Generation Y. By 2022, the first wave of Generation Y consumers and workers will hit their 40s. They are likely to be at a key pivotal point in their careers and earning potential, making them a clear target for many marketeers. They are also likely to hold key positions within their organisations – including your own. This is a generation that has grown up with a high exposure to media (sometimes dubbed as the ‘MTV Generation’), convenience (especially when it comes to food), on demand services, and heavy use of technology. Simply put, they will expect more of everything, and they will not be willing to wait.
What could this mean for the industry? At a minimum, I suspect that Generation Y will expect insurers to have a coherent customer engagement model (that incorporates a great user experience with accessibility from anywhere, and a social dimension), propositions that target them specifically (through unique insight, mass customisation for delivery, and the ability to source their information directly so that they don’t have to find it), and service excellence (i.e. immediate resolution with the insurer doing most of the work). Many of the technologies described at the start of this blog will be at the heart of turning this expectation into a reality.
So, when you come back to work next week, why not start by asking yourself the question “What am I going to do to prepare my organisation now to take on the opportunities presented by Generation Y in readiness for 2022?”
Oh, and a word of caution, it doesn’t stop at Generation Y. Some commentators are also now talking about Generation Z. These are the babies, toddlers and young children running around our feet who know of no other world than one with high speed broadband, touch devices, and instant connectivity. If you would like to understand what their expectations will be, then it’s probably a bit too early to guess. However, this popular YouTube clip may give you some insight. So, are your applications up to it or will you be left holding the ‘magazine’?
Once again, Celent has teamed up with the Insurance Times for the 2012 Technology in Insurance Awards. These awards are the only dedicated insurance technology awards in the United Kingdom for general insurance. Last year’s awards were a huge success in recognising some terrific successes in our industry. We had 140 people attend a cocktail award’s ceremony in the iconic Gherkin building. LV=, Chartis, Ingenin, and HOV Global services were just a few of last year’s winners. Judges included Google, CEO of RSA, Editor of Insurance Times, and your own Celent analyst, myself.
This year, we have a two new categories which reflect the changing nature of technology:
– Best use in Social media
– Best use of analytics
So the important dates for your diary are:
- 11th May – Deadline for submissions (Go to Insurance times website for details on how to submit)
- Award ceremony 20th September in London
We look forward to this year’s interesting and exciting nominations, and recognising the superstars and stellar effort that is made every year in our industry. Good luck!