"One key to surviving in a world of disruption, where theexternal environment is changing at lightning speed, is to changethe game internally." — John Kotter

The extraordinary adoption of digital capabilities is changingthe world at lightning speed, and the insurance industry is notimmune. In a recent survey of insurance consumers,PricewaterhouseCoopers found that 70 percent conducted someform of digital research before purchasing their policies, 26percent used a digital medium to purchase those policies, 67percent would be willing to attach a sensor to their home or car toreduce premiums, and 68 percent would be willing to download anduse an app provided by their insurance provider. Even moreindicative of digital's rapid expansion, industry CEOs told Forrester Research that theyexpect 56 percent of insurance revenues to be digitally generatedby 2020.

Unfortunately, the industry is not keeping pace with the changeswrought by this disruption. EY found that almost 80 percent of insurers donot see themselves as digital leaders and Forrester found that only9 percent feel they have mastered digital enough to use it as acompetitive differentiator.

Biggest challenges to digital success

What's holding insurers back? In a cross-industry survey by McKinsey &Company, structural and cultural issues pose the biggestchallenges to digital success:

• Difficulty finding talent (functional and technical).
• Organization structure not designed appropriately fordigital.
• Business processes too inflexible for new opportunities.
• Quality data and analytics to inform business decisionslacking.

The good news? Because these difficulties are largely internal,focusing on these three areas and rigorously measuring results go along way toward shoring up your digital strategy.

Related: Insurance 2017: Priorities for innovation,automation and transformation

(Photo: Getty Images)

1. Establish a digital game plan

According to the EY survey,a startling 47 percent of insurersindicated that they don't have an up-to-date digital strategy orbusiness case. The complexities associated with digitaltransformation can be significant: changing processes, unifyingorganization silos and modifying success measures, acquiring newskillsets, and changing cultural identities. Success requires a CEOmandate, a cross-functional executive team, and a roadmap thatintegrates prioritized initiatives (tied to corporate objectives)with detailed budgets.

What to measure:

• Is ownership delineated (chief marketing officer, chiefinformation officer, or digital officer)?
• Does the team incorporate all required players?
• Participation depends on the objectives of the transformationbut should include representation from all impacted business areas:finance, risk, HR, and IT; as well as the marketing and salesgroups.
• Are team roles and decision rights clearly spelled out?
• Does the strategy include initiatives (with detailed budgetsand identified success measures) that tie directly to corporateobjectives?
• Are the overall measures that help to set initiative prioritiesidentified (for example, improved customer satisfaction, increasedprofitability and decreased service costs, or quickertime-to-market)?
• Is the digital strategy a regular part of board-leveldiscussions?
• Does the strategy include a skills assessment and concreteplans to fill gaps?
• Are process and performance objective changes identified?
• Are required data and technology enhancements incorporated intothe prioritized initiatives?

Related: How to strategically monitor your book ofbusiness

(Photo: Shutterstock)

2. Put customer experience first

Just because the industry lags behind in customer satisfactiondoesn't mean customer expectations are lower for insurers. Savvyconsumers expect a digitally enhanced customer experience that goesbeyond simple ecommerce. This means timely, relevant communicationsthat conform to personal preferences and highlight realcustomer knowledge. For example, rather than a generic annualpolicy review letter, an insurer might send a text messagetriggering a policy review only when circumstances change (whenhome values in the area have increased enough to warrant increasingcoverage, for instance). The message might contain a click-throughto a web page with the relevant comparable value versus coverageinformation, an appointment set-up function, and a click-to-calloption for the agent in question.

Seamless and consistent experiences with minimal friction pointsare also critical. Streamlining claims reporting with mobile appsthat dynamically adjust questions to the type of claim, speed upthe damage assessment with in-app functionality, and providelocation-based connections to approved repair companies are a goodexample of where the industry is headed.

What to measure:

• Are you tracking customer-oriented measures such as net promoterscore, customer lifetime value, and customer satisfaction?
• Do you have cross-channel journey maps that highlight personas,journey objectives, handoff points, and pain points?
• Are these journey maps dynamic and revisited?
• Are measures established for the journeys based on the mappingresults (for example, one-call resolution, ease and speed of claimsprocess, a single contact point for the claim, andtime-to-notification for agent changes)?
• Are the digital channels measured (for example, time in themobile app, frequency of use, drop-off points, content accessed,and navigation)?
• Do you employ voice-of-the-customer techniques for feedback orweb app measures?
• Are the agents and brokers who are included in the strategyprovided with digital capabilities?

Related: Insurance consumers: We'll give up our data forpersonalized service

(Photo: Shutterstock)

3. Use advanced analytics

Insurers are at the forefront of using analytics to predict riskand price policies, and it's imperative that these skills arebalanced across the organization, particularly in the customerexperience area. A Forbes Insights study found that leaders inusing data-driven experience management experienced benefitsincluding faster time to decisions (67 percent), a morecomprehensive common enterprise view of customers (51 percent),more confidence in their decisions by managers and employees (49percent), better collaboration between departments (36 percent) andgreater repeat business (44 percent). This means that analytics isfostering much more than a share of wallet and profits. It's alsoplaying a role in changing the internal game; in breaking downorganization silos and changing cultures.

What to measure:

• Do you have a comprehensive 360-degree view of customers andall their interactions across all channels?
• Are you developing insights around customer value; includinglifetime value, influence value and the extent of their socialnetworks?
• Are you developing insights around customer behavior; includingpast channel and product usage patterns, engagement, andinteractions across all channels?
• Are you using sentiment and social media analysis to developinsight around attitudes, preferences, and opinions?
• Are you using predictive analytics to optimize customercommunications? Across all channels?

Digital transformation is changing the world and insurers mustchange with it. Establishing a digital game plan, putting customerexperience first, and operationalizing analytics will get youthere.   

Related: 10 new digital marketing tips for agents, advisors[infographic]

Lisa Loftis is a Thought Leader on the SAS Best Practicesteam where she focuses on customer intelligence, and digitalmarketing. She is co-author of "Building the Customer Centric Enterprise"(Wiley). She can be reached at [email protected].