For many business executives, digital transformation has lost its meaning.
Its definition seems to change depending on the situation. That doesn’t mean organizations can ignore it. Instead, businesses need to make sure that their definition includes the following key elements of a digital transformation:
Integration of digital technology throughout the enterprise
Deployment of technology to improve business operations
Use of digital tools to enhance the customer journey
Fully integrating digital technology also means changing the siloed mindset to one that engages employees, encourages innovation and promotes collaboration. Failure to adopt a digital mindset creates a company that fails to thrive.
How does an organization go beyond the basic automation of backend processes to become a digitally transformed business? What benefits will a digital transformation in insurance provide? Who will be responsible for the transformation?
Who Is Responsible for Digital Transformation?
Everyone is responsible; unfortunately, not everyone is an active participant. According to McKinsey, 70% of companiesfail in their attempt at digital transformation. And, the primary reason is a failure of executive leadership to become involved in the transformation. Often, executives remain focused on current operations and pass the responsibility to others within the organization. Sometimes, they aren’t 100% on board. Whatever the reason may be, executives are crucial to the success of any digital transformation.
Let’s look at how the deployment of digital technology can benefit three areas of an insurance organization.
Marketing sets the corporate strategy for growth. Its focus is on strengthening a brand and establishing a strong market position. Today, that means creating a positive customer experience. The experience begins the first time a potential customer interacts with your organization, whether it is in person, by phone or on a mobile app.
Companies that focus on the customer experience find that it:
Improves customer retention
Improves customer satisfaction
Increases cross- and up-selling
Without a digital transformation, businesses cannot react quickly to market demands. With the right technology, organizations can be the first to market with new applications that acquire more customer information. With access to data and real-time analytics, decisions that use to take months can take minutes.
Digitizing back-office processes is one of the first steps most organizations take. Moving all that paper-based information to electronic storage saves money with reduced physical storage, faster retrieval and improved processing times. But, technology can do more. It can lower operating expenses and enhance the customer experience.
As part of a digital transformation, companies are creating more mobile apps. They have customer service apps, scheduling apps, even loan apps. Why? Because there is projected to be 3.5 billion smartphones by the end of 2020. Who doesn’t have a smartphone?
No one plans on having a car accident or a roof collapse. But if something happens, having a mobile app can improve the customer experience. No waiting in a phone queue to get help. No waiting to logon to a website. Instead, a customer files a digital claim. What better way to build customer loyalty than providing a no-hassle solution during one of life’s stressful moments?
With customers providing the information directly into the claims system, they can receive faster responses and feel more in control of the claim process. As a company, you realize cost savings because you require fewer people processing claims.
When companies hear the word digital, they think IT. IT does have responsibilities for creating an infrastructure for digital transformation, but that doesn’t mean they are responsible for its success. As part of delivering digital insurance, IT deploys technology that facilitates information exchange across an enterprise.
With cloud-based technology, organizations can share knowledge across departments. For IT, that means removing multiple systems that perform similar functions and replacing them with an enterprise-wide system that everyone uses. With fewer pieces of software to maintain, IT can focus on vital issues such as cybersecurity.
Digital transformation is everyone’s responsibility because it benefits everyone. When performed correctly, digital transformation should touch everyone within an organization because it isn’t just about technology, it is about a change in mindset – a mindset that is focused on the customer’s journey and not only on internal processes.
Marketing collects more data on customers. Combining the data with analytics, fact-based decisions can be made quickly. Marketing no longer has to wait for customer surveys to be completed and analyzed. Operations has the opportunity to minimize end-user frustrations over claims processing while improving operational efficiencies that reduce costs.
With an enterprise-wide solution, IT has more time to pursue the latest digital technology. They aren’t burdened with maintaining stand-alone legacy systems or multiple copies of similar software. They can work to establish a single source of truth that ensures that all regulatory and compliance requirements are met.
Within the insurance industry, companies expect technology to improve employee retention and customer loyalty. They also envision technology transforming the customer-facing component to create a positive customer experience. Establishing and maintaining the customer relationship is crucial to business growth.
About the Author
Tal Daskal is the CEO and co-founder at EasySend, a SaaS company with a Digital Journey Builder that transforms paperwork into a digital experience for insurance and financial services. Tal is an expert on all things digital transformation in banking and insurance and is a passionate advocate for the paradigm shift towards no-code application development in the financial sector. Find out more at https://www.easysend.io/
Featured image: ©Tampatra