Other parts of this series:
For many traditional insurance companies, updating products is very complex. Inflexible legacy technology, inefficient processes and compliance requirements slow things down. But this is changing. As companies transform into Agile Enterprises, getting new products and updates to market will speed up.
Forward-thinking insurers are reorganizing and updating their business models to center around their customers. They are committing to continuous improvement, which demands iterative product development. This means delivering products to market that are essentially unfinished. Updates will come out as market conditions and regulations change. This is a big shift to the traditional one-and-done approach.
In software, iterative development is the norm. Consider how often Apple updates its iPhone operating system: 15 times in 2018 alone. Apple is continually improving its products based on user feedback and data, and security requirements. Contrast that with the average incumbent’s life insurance policies.
At first thought, continuously updating products can seem like an exhausting feat. It’s nice to be able to cross something off a to-do list. However, iterative product development can be liberating when supported by the right technology stack. It means companies can stay relevant as markets change, and they can benefit to moving products to market faster.
The Agile Enterprise has three key capabilities
Iterative product development is a cornerstone capability of an Agile Enterprise. To get to this point, insurers need three underlying capabilities that enable speed and agility.
Organization Adaptability and Leadership Effectiveness: further to my last blog, insurers must foster a culture of innovation that adapts to changing organization structures and processes, such as DevOps. They should reduce bureaucracy and grow Agile leaders that will champion the company’s vision and foster a culture of continuous learning.
Product Innovation: insurers must continuously optimize their products, services and business models based on customer feedback and data insights. They should also be ready to pursue emerging market opportunities such as electric scooter rentals, pay-per-mile auto insurance, and offerings specifically tailored for the growing gig economy.
Delivery Agility: insurers must respond quickly to customer and market needs with high-quality offerings. Automation, artificial intelligence, microservices and blockchain technology can support speed and efficiency at scale.
Without these capabilities, insurers run the risk of falling back into ‘business as usual’. In my next blog I’ll uncover more potential missteps along the journey to becoming an Agile Enterprise.
ENTERPRISE AGILITY IN FINANCIAL SERVICES
The New Strategic Imperative