As insurers contemplate the transformations that lie ahead in 2023, they should consider three principles for successful change.
Very few insurers are currently embracing deep and broad transformation, but rather insurers find themselves somewhere along the change spectrum. At one end of the spectrum the focus is on robust, but complex and lengthier programs impacting multiple core legacy systems and touching people, processes, and technology. But at the other, insurers are focusing on a single core change alongside minor work on adjacent capabilities, focusing mostly on technology.
That pursuit of quick wins may seem attractive, but they often come with compromises that push the burden of real change into the future – for example, layering new functionality on top of antiquated systems, which only adds to complexity and risk, as well as complicates the transformative work that will still be needed later.
User research needs to be implemented as it allows companies to gather insights about their current systems, identify key pain points for both the end users and the internal employees, and enables them to target what processes need to be updated or replaced first.
The development of a transformation roadmap is part art and part science. To deliver meaningful and lasting change while also achieving benefits along the way, a transformation plan must have a clearly defined ‘journey’s end’ target state. The key to gaining benefits sooner rather than later is to develop transformation roadmaps and blueprints that define and create what can be described as ‘islands of stability’ along the journey.
These islands of stability are the points at which material changes made to people, process, and technology are at once stable, supportable, and provide tangible benefits. Generally, this will be a medium-term rather than a short-term benefit – but it will nonetheless materialize during the transformation programme, rather than some time after it is complete.
It must be recognized and accepted that there is an additional cost to creating these ‘islands’ within the roadmap, as they often require an upfront investment that would not be needed if the organization were simply to rush, all guns blazing, to the finish line. Accordingly, transformation plans should incorporate a logical build sequence that both prioritizes early benefits and minimizes unnecessary expenditures– while also ensuring a sense of urgency is maintained around solving pressing business imperatives.
Plans must also consider the business culture and its capacity to assimilate change. True transformation will always be disruptive but should not be a shock or cause distress. Embracing new ways of working as part of the change process can fundamentally reshape both the employee experience and productivity in a positive fashion.