Thanksgiving stuffing and technological change

Thanksgiving stuffing and technological change

I like to cook, a lot. I spend a bit of time each week looking through magazines and my big binder of recipes to plan my menu of dinners for the week. It helps that my family is willing to try new and different things. They also like to offer suggestions for changes or to flat out request that certain recipes never make into the binder for future dinners. One recipe that comes out every year at this time is my grandmother’s turkey stuffing. Bam, as we called my dad’s mom, was of Canadian heritage and known for her traditional French Canadian tourtiere (meat pie). In a sense, her stuffing is a deconstructed meat pie, and my family loves it.

It’s also now a staple of Thanksgiving dinner with my husband’s family since I have been bringing it for the last 12 years. But it wasn’t always a welcome addition to the table. They already had a stuffing so why introduce another? And who ever heard of adding ground beef, pork sausage and potatoes to stuffing? But through a bit of cajoling, my tenacity in continuing to bring it, and introducing how good it is the next morning with a fried egg, I slowly won them over. It’s like that with any change isn’t it? You need to keep plodding forward and continually communicate the benefits even when others can’t see it or are willing to even try it.

There’s a parallel here to introducing technological change, or for that matter any change. Colleen Risk and I have been writing all year on front end technology for life insurers. We continually discussed how technology can help achieve STP and lower the cost of obtaining new business. Our research arc reviewed illustration, eApplication, and new business and underwriting systems. We wrote reports that analyzed how far life insurers have come in automating the new business and underwriting processes and found that there is ample room for further technology in many companies; automation is taking hold, albeit slowly.

A companion benchmarking report showed that since 2007 costs per application and costs per issued policies have dropped. The data shows that technology has been integral to the cost reductions even though making the changes affects how agents and underwriters do their work, for the better. Our last report in this theme will further analyze the benefits of automating the new business and underwriting process by comparing life insurers that have implemented technology into the process with those that have not. It is our hope that our research helps make the case for introducing more technology into the NBUW process and ease the change because the benefits are worth it.

Our 2017 research calendar includes a new research arc that begins with a paper published today, Separating Yourself from the Competition: North America Life Insurance Customer Service Strategy. Within the life insurance market, very few digital revolutions have happened in customer service. Implementing a digital strategy within the operating environment of a life insurer represents a complex set of challenges: organizational silos, multiple distribution channels, and legacy technology considerations make the work especially difficult. Life insurers recognize that customer service is critical to the success of their business. The criticality of customer service is underlined by the insurers’ recognition that the technology provided today is not sufficient, as well as the acknowledgement that significant spending is required to close the gap between what is available today and what should be provided. Yet, the challenge of digitally revolutionizing customer services presents opportunities. New tools exist that can increase the quality of customer interactions and deepen customer relationships. It is our hope that through a series of reports on customer service strategy, customer service operations, websites and portals, as well as mobile apps we can introduce the benefits of digitizing the back end processes related to customer service.

Let’s hope it doesn’t take 12 years to convince your organizations that new technology is beneficial. Celent wishes you all a Happy Thanksgiving. If you want a copy of my grandmother’s recipe, email me and I will send it to you!

Innovation is Magic….Or is It?

Innovation is Magic….Or is It?
What magic does an insurer need to keep up with all the change occurring in our industry? Every firm we talk with is aware of the many challenges currently faced….telematics, digital, social networking, predictive modeling, etc. And yet, more changes are on the way. Our short list includes the Internet of Things, peer-to-peer risk pooling, extended lifespans (maybe never-ending), and artificial/machine intelligence. What should an organization do now to respond and to prepare? What magic is necessary to make it all happen? Celent is pleased to announce our seminar designed to provide answers to how insurers move forward with innovation on practical terms. It will be in London, on 03 February, 2016. The venue, appropriately, will be The Magic Circle, Centre for the Magic Arts. Through a combination of presentation and hands-on workshops, the session will provide attendees with:
  • a practical understanding of how the very basic assumptions underlying traditional insurance products are changing and what impacts this will have
  • firsthand information of how insurers can respond, gained through a series of experiential, structured exercises
  • networking opportunities with peers which allow for comparisons with like organizations
Our view is that innovation, like magic, requires significant work. Successful “tricks” are the result of the investment of time and resources in various techniques, finding what works, what doesn’t and making appropriate adjustments along the way. After a solution is worked out, practice perfects the approach. Eventually, just like magicians during a performance, implementation must be agile, flexible, and respond to changing conditions. As the programme builds, we will post updates. For now, please save the date in your diary and register at this address: https://www.regonline.com/builder/site/default.aspx?EventID=1762713 …oh, and bring your wand!

A Prototype of the Successful Innovation Leader

A Prototype of the Successful Innovation Leader
Innovation is all about building prototypes, making them fail, adjusting them, and moving on quickly. So, what is the prototype for the successful senior innovation leader? How can this profile be used to make better selections when hiring for these critical positions? Continuing the Celent innovation research theme of how to make innovation work, we asked attendees at two innovation conferences to rank the critical success factors needed in senior innovation leadership positions. The purpose of this research effort was to assist with the “how” of choosing a successful innovation leader. There were four areas in the on-line survey: 1. Technical business skills 2. Leadership qualities 3. Personal attributes 4. Previous job experience. Ninety-one innovation professionals responded, 30% from financial services firms. Note that this is a very specialized respondent pool. These are the opinions of innovation practitioners about key success factors reflecting their experiences. Their outlook has been shaped by their own efforts which undoubtedly included both successes and failures. (The full report is available for download for Celent subscribers at http://celent.com/reports/leading-innovation-keys-success.) The top items in each area are displayed below. leader skills The innovation conference attendees made some important observations about these results. First, the top ranking in the Technical business skills area was assigned to strategic planning. Innovation practitioners clearly value the cerebral activities such as reading the external environment, identifying patterns, and matching this analysis with company capabilities to determine a plan of action. In two other areas, Leadership qualities and Personal attributes, however, the more extroverted activities of vision and inspiration rose to the top. It is often difficult to find one person with such a broad range of skills and attributes. However, the conclusion based on the opinions of these innovation veterans is that the process should include an evaluation of candidates’ capabilities in both of these “head and heart” areas. A second observation dealt with Previous job experience. Previous innovation leadership experience was ranked higher than start-up and operations management experience. Practitioners place high value on the practical wisdom about innovation which is learned “on the job”. Celent expects that the number of financial services companies implementing innovation programs will increase in the near term and, consequently, the value of professionals with successful, previous senior level innovation experience will also grow. Pay levels, work environment and other incentives must be calibrated accordingly. How can these results be used in innovation programs? For individual leaders, this can be used as an input into their personal development plan. As an example, if they are strong in strategic planning, but weak in inspirational leadership, coaching activities may be worthwhile. In organizations with established core innovation teams, this can be used to evaluate the strengths and weaknesses of the entire group. For example, in situations where a leader lacks a critical attribute, the team may be able to compensate with increased contribution from other members. Finally, these results can be shared with a H.R. department to develop a data-driven selection process for senior innovation leaders. **************** FYI — Topics such as innovation leadership development are discussed at our Innovation Roundtables. The next session is scheduled for November 20 in New York City. Senior innovation leaders from Banks, Insurers, and Security Firms are invited to join us. The registration details can be found here: https://www.regonline.com/builder/site/Default.aspx?EventID=1623753  

Making Innovation Happen – Practioners Speak at Celent Rountable

Making Innovation Happen – Practioners Speak at Celent Rountable
Celent facilitated a roundtable discussion between innovation practitioners this past week in San Francisco.  The three hour meeting was so dynamic and the time went by so fast that the group worked straight through their planned mid-afternoon break! Numerous threads were explored around the practical implementation of innovation in financial services companies. The agenda was organized around the themes of scanning the external environment for opportunities and threats, implementing innovation processes and technology, and successfully engaging the organization around innovation. Fifteen companies participated across the verticals of banking, capital markets and insurance. A few were just beginning their innovation journey but most were experienced practitioners with three to seven years of experience. I won’t try and summarize the entire session in this blog — you really had to be there to get the full depth of experiences shared around the table.  I will highlight several of the key adjustments to “business as usual” that the group agreed were necessary for success.
  • Traditional roadmaps that detail process and technology future states have not worked. As one participant said they “don’t survive the first contact with reality”.  Successful innovations have much shorter cycle times than roadmaps and must be executed much more rapidly. Incubation and prototyping are critical. One company has committed to prototyping new innovations every four weeks.
  • In some organizations, the standard annual planning process has been adjusted to support innovation.  One participant reported that an innovation “lens” is now part of their business planning routine and that front line business leaders are contacting the innovation group to assist with budget planning to ensure that innovation is considered along side their day-to-day operational investments. Another person admitted that they were still striving to find the right balance between investments in routine improvement, incremental innovation and disruptive innovation.
  • Ideation approaches varied across companies.  My sense was that ideation techniques evolve as a company moves through its innovation journey.  Many reported continuing success with internal crowdsourcing of innovation opportunities.  Others discussed that they have moved to a more focused approach using tailored processes and specialized skill sets.
  • External crowdsourcing of innovative ideas was also explored at length. One participant cited their success in identifying innovations by engaging employees in their technology providers’ organization. They have found that front line developers understand their business and also are less encumbered by traditional approaches.
  • Fit-for-purpose innovation software packages provide a “force multiplication tool” that enables one company to engage all of its employees in innovation.  Surprising results were discovered  when they used the tool to develop network maps of information flows within their organization. Unexpected sources and “hubs” of innovation were found in surprising places.
A recurring theme was that continuous innovation is not an objective in and of itself.  Much like other business improvements in the past such as total quality management, e-learning, and Six Sigma, successful  innovation  is achieved when it is integrated into on-going business processes. One participant stated that a goal of Chief Innovation Officers should be to “work themselves out of their jobs!” For disruptive innovation, the group discussed that there are specific processes, incentives and organizational structures that are required for changes that, by their very definition, threaten the core business.  These efforts must be protected, nurtured and implemented differently than incremental innovation.  The group shared some of the approaches they use to meeting this challenge. The meeting ended with frank observations about the cultural changes necessary to bring about sustained innovation.  Financial services firms face special challenges related to its risk adverse nature and traditional incentive and organization structures.  Several interventions were shared related to successful communication and leadership interventions.  It was recognized that the companies making progress with innovation in financial services recognize that the cultural changes required are long-term in nature and that success will come through a continuous commitment to reduce fear and increase engagement between employees, partners, and customers. As one person put it “this is a five to seven year transition we are in and we are learning and adjusting as we go”.  

Bending the Supply Chain Into a Supply Network

Bending the Supply Chain Into a Supply Network
The image of a supply chain is linear, stretching from one point to another, link-by-link, in an orderly procession. If each part does its part, success is realized. But, we all know that business does not really work like that.  Rather, activities are more random, concurrent and fluid. The case studies at the Celent innovation event, What’s Next: The Search for Disruptive Innovation, https://www.regonline.com/builder/site/Default.aspx?EventID=1237201 will explore how companies are making the transition from the step-by-step chain to the dynamic network that we increasingly experience. Over the next few weeks we will give you a preview of the program. This week we will preview cases of financial services firms that are using social networks to create new collaboration patterns with their customers, distributors, and employees. We have some fantastic examples of companies that are extending social technology in order to bend their supply chains into supply networks. The companies presenting on October 3 in San Francisco have applied social collaboration well beyond the Marketing function to use them to change traditional relationships between customers, distributors and employees. I’m not going to steal their thunder and give away all the valuable details in their cases but here’s a thumbnail sketch of what you’ll learn in the sessions:
  • How does an insurer reduce fraud, manage risk, decrease losses, minimize customer acquisition expense, and lower processing costs all at the same time? Join Sebastian Herfurth, founder and co-CEO of Friendsurance as he explains how his company is using social collaboration to turn the traditional insurance model on its ear and accomplish all these goals simultaneously.  His presentation details the mechanisms that allow their customers use social networks to agree to “cover” each other if there is a loss.
  • Don Montanaro, CEO of TradeKing Group, will describe how their focus on social networking immediately differentiated their firm from the 600-pound gorillas in the online brokerage industry by providing a safe, collaborative environment for investors to interact with peers and with the company itself. He will share examples of how TradeKing operationalizes social. Working closely with securities industry regulators to leverage social’s power beyond marketing, they have built industry leadership in key business functions like customer service.
  • With the increasing need to innovate and change the way business is being done, companies continue to struggle with tapping the skill and knowledge of their employees to identify ways to transform the business. Everyone recognizes what a valuable resource associates can be, but it is very difficult to collect and refine the “next great thing”. Chubb & Son uses social technology to build innovation as a part of the day-to-day, natural activity stream of all of their employees. Jon Bidwell, SVP and Chief Innovation Officer, will describe the social platform that reaches directly to front line support staff and interacts directly with agents and customers to engage them in the product development and feedback process. Their lessons learned are surprising and insightful.
The conference is a unique offering that will allow you to take a deep dive into what innovative leaders in financial services are doing to exceed market expectations.  If you haven’t already, join us in San Francisco on October 3 by registering today https://www.regonline.com/Register/Checkin.aspx?EventId=1237201 and stay tuned for more updates!