In nearly every industry, business leaders are searching fortheir organization's place in the digital landscape. A digitalbusiness is more than using social media or offering mobileapplications. A digital business succeeds by staying ahead of thecurve and reinventing itself to differentiate it fromcompetitors.

The insurance industry is not exempt from this transformation,and it lags behind other industries. Agencies andcarriers who fail to recognize the digital disruption will be leftbehind, as customers will turn to those companies that supporttheir business priorities, and improve customer experience andoperational efficiency.

Taking the steps to become a digital business will have itschallenges. “The degree of pain will be dependent on how wellcompanies create new strategies; embrace innovation; fundtransformation initiatives; and create a business that will beflexible, adaptable and valuable in the new digital future,” saysDenise Garth, partner at Stategy Meets Action (SMA).

SMA, an insurance research and advisory firm, identifies eight essentials for preparing for thedigital revolution.

1. Digitalization is everywhere.

And it is necessary for winning and retaining customers. We livein a world that is digitally charged and connected, and it isgrowing exponentially more so as everything becomes even moreconnected.This is driven by new technologies and the customerexperiences that have been reshaped by the use of thesetechnologies, creating an increased preference for digital in theprocess. In response, modern technology and digitalization must nowchange how companies view themselves–no longer as value chains, butrather as enterprise ecosystems that must be connected.

2. Digitalization is dramaticallydestructive.

A disruptive, foundational change is taking place in the way allbusinesses are approaching value creation. The ubiquitousconnectivity of people via the Internet and emerging technologies(such as social media, the Internet of Things, crowdsourcing, mobile, andcloud) are disrupting traditional and historic businessassumptions–from how to engage customers, to the products andservices offered, and ultimately, to business and revenue models.The barrier to new entries into all industries is falling or isalready gone, creating more risk to existing business and revenuemodels. New entrants are finding it easier to build, launch, andsell much more rapidly.

3. Data and information are the new currency in thedigital world.

And it is critical to the acquisition of insights aboutcustomers, the offerings of products and services, the creation ofnew products and services, and more. Increasingly, data is beingconnected to the cloud, allowing data to be available anytime,anywhere and in any way.

4. A massive paradigm shift in how we view andunderstand the world has occurred.

The necessity to view businesses in a bigger frame of the worldmust follow suit, otherwise the view will be too small anddetrimental. Align around a vision, projecting possibilities andoutcomes. Spend to achieve an opportunity or possibility, not tocomplete a project, otherwise you will find yourself trailing thecompetition. Just think big.

5. Operational excellence is table stakes and innovationis the price for future success.

The absence of action and innovation creates significantbusiness risk and a potential for lack of relevance. Innovation isthe price for strategy enablement and the creation ofpossibilities. Life-long learning, creativity, an entrepreneurialspirit, and the understanding of computer science, math and dataare critical characteristics for future success.

6. Innovation and collaboration are mandatory for futuresuccess.

These are critical components for digital companies today, butthe success with which they are employed will separate out themarket leaders of tomorrow. The flow of information to engagecollaboration through a network of resources and communities isvital to developing new products and services. The collectiveintelligence of ecosystems promotes entrepreneurship, provides agreater understanding of new technologies, and stimulates thelearning and creativity that together are key characteristics forfuture success.

7. Customer empowerment defines new engagementmodels.

We used to shape customer experience; now it is shaped for us bythe rest of the world. As customers gain market power, become morecomfortable with technology, have a stronger voice and demandcollaboration, companies must reinvent themselves and have aunified digital strategy that enables customer experienceconsistency and connectivity.

8. All technology must be viewed ascustomer-touching.

Social, mobile, analytics, cloud, wearable devices, robotics,the Internet of Things, telematics, driverless vehicles,biotechnology and much much more all influence and define customerrelationships. Technology is super connected. It creates newoutcomes, new experiences, and new products and services. And thefuture will be the cloud of things, with a world of distributeddata, devices, technology, intelligence, computing and more thatare highly connected.