“We have seen two years of digital transformation in two months. From teamwork and distance learning, to sales and customer service, to critical cloud infrastructure and security – we work with customers every day to help them adapt and stay open to business in a world from afar. "- Satya Nadella, CEO of Microsoft [i]
This statement was made on April 30 – just two months into COVID – and reflects the pace of change and acceleration of digital transformation in all industries, including insurance. And huge changes are still on the horizon for insurance. The pace continues to pick up speed and dominates C-level discussions and planning.
Today's changes require insurers to be clear about how to succeed in the future of insurance. Future market leadership and success will be defined by a new digital foundation and business model that includes customer, technology and market boundary changes with vision, energy and speed. This year's report on strategic priorities stated that forward-looking leaders are digitizing their current business while disrupting it by building their business model for the future. The gap between leaders and successors and laggards over the past year and the next three years is astonishing:
- Over the past year, Laggards had a 41
- Over the next three years, the gap widens as Laggards and Followers fall further behind Leaders, with 62% and 21% gaps respectively.
The era of success as a "quick follower" is long gone. Today's leaders are redistributing their investments to digital transformation that gives them a compelling, engaging customer-centric approach that sets them apart in a new era of insurance.
How do your strategies adapt to what leaders do? What specific plans can you take to improve your chances of success? How can you speed up your digital transformation? These issues and more are what the recently announced strategic alliance between Majesco and KPMG focuses on: providing a sustainable, risk-optimized path from strategy to implementation for insurance companies by leveraging Majesco Digital1 st® Insurance Platform and KPMG's Connected Enterprise framework to enable digital strategies and business models.
In Gartner's Emerging Risks Monitor Report earlier this year, they noted that “organizations are concerned about their ability to keep pace with a rapidly changing business landscape, driven in part by concerns about their own organizations' backward and misunderstood digitization strategies. [ii] This is a profound statement. Insurance still covers decades of older business assumptions and technologies that are blocking the path to digital maturity. Why is this important?
Because KPMG's research, compiled from various studies, found that digital mature organizations surpass less mature organizations. How? Digitally mature organizations had 25% higher revenue growth and 31% higher EBIDTA in the last three years, 11% higher net promoter points and higher market speed by 17 months! Digitally mature organizations not only function more efficiently, they are obsessed with their customers and with defining, unlocking and preserving value for both the customer and their business.
For too many insurance companies that lack digital maturity, this difference and the growing gap between leaders and followers and laggards should be a strong motivator to move on and get ahead of the curve … now.
The road to digital maturity
Visionary leaders see the market, customer and technology trends as a diverse opportunity for insurance – and prepare to use new data sources, reach new market segments, offer innovative new products needed by customers , create exceptional customer experiences, take advantage of new channels and more. KPMG's latest report, 2020 CEO Outlook found that the highest priorities were focused on: digitization of operations (74%); new digital business models (70%); the creation of a seamless experience (73%); and a new workforce model that empowers people with AI (66%).
Majesco's research reiterated a similar sentiment, indicating that leaders are advancing with a cloud-based / low-code cloud-based platform with microservices and open APIs (64%); imagines and experiments with new digital experiences (68%); and focuses on digital ecosystems and partnerships (45%) that enable them to stay out of trend and the market.
This is why leaders are accelerating their digital journey across three key areas depicted in Majesco's Digital Maturity Model (below):
- Digitizing – Creating portals for traditional products and channels for digitizing and automating existing processes
- Optimize – Expand customer engagement beyond transactional interactions to broader customer experiences
- Innovate – Launch new and innovative products and services to transform into digital operating and business models
Insurance companies can start at any time on this maturity curve – from focusing on today's business or by creating the business for the future. Having a single digital platform without code / low code with rich insurance content and a robust digital ecosystem of partners to enable this journey across a wide range of business scenarios is crucial to success.
But acceleration means that traditional methods must be adapted to meet the time pressure. This is where KPMG and the Majesco alliance are so powerful – with use cases prevented in Digital1 st ® using KPMG's methods of design thinking in a virtual world that can quickly show value in weeks or months, rather than years. Some of these use cases include:
- P&C multi-channel personalized quote
- Portfolio-level service
- P&C Intelligent claims intake
- P&C action-driven underwriting workbench
- L&A pipeline insights and next best action  L&A personalized products and insurance
And it's just a selection of opportunities to get started or speed up digital transformation!
Digital Maturity – From Good to Great
The book by Jim Collins, Good to Great, published almost 20 years ago, is still so relevant in today's digital age. While many different concepts were discussed in the book, the key to success was leadership. A key to that leadership is to have the right people in the right positions to create an environment for success. They have a vision and goals for success and constantly review and act on data or results to "make it better."
In today's digital world, it's about creating an environment that enables "testing and learning" and innovation. And the theme is speed to market. Although there is design work to benefit from better insights and interactions, it has access to a robust insurance ecosystem and pre-integrated and prevented insurance content within a no code / low code platform, allowing insurers to focus on their unique application and competitive differentiation in the experience .
Insurers need to make a future thought about real-time risk assessment and rethink customer journeys to go beyond a portal to a new customer experience, create new products, offer new services and renew their business models through a no code / low code platform like Majesco Digital1 st â Insurance that has rich insurance content and prevented plug and play ecosystem design that will accelerate their digital transformation and maturity.
Companies that delay increase the risk of irrelevance, because as the rate of change accelerates, their ability to adapt decreases. That is why it is crucial to act now. The time for plans and implementation is now – given that the gap is widening and that the time frame for responding is closing. Leaders are positioned to succeed.
Are you ready to accelerate your digital transformation? Together, Majesco and KPMG are ready to help you on your journey!
[ii] "Gartner Survey shows rate of change as the highest emerging risk for organizations in 2Q19," Gartner Press Release, July 24, 2019, https://www.gartner.com / en / newsroom / press-releases / 2019-07-24-gartner-survey-shows-pace-of-change-as-top-emerging -r