Innovation is about creating somethingthat adds value to the customer. (Photo: Shutterstock)

Our business environments are changing rapidly, at a faster pacethan most of us can keep up with.

In insurance, we've got nimble competitors entering our space,challenging the status quo, and disrupting our existing supplychains and networks.

Our customers are more sophisticated, demanding that we engagewith them on their terms.

New technologies are coming at us faster thanwe can evaluate and consume.

The new reality within the insurance industry: Innovate, evolve,adapt, or wither.

We're all tasked with the same objective: Be more innovative, bemore creative, find the next breakthrough idea, do things fasterand cheaper

But how do we get there?

Why pair design thinking with insurance innovation?

Innovation is about creating something that adds value to thecustomer, whether internal or external. Innovation helps us find new ways of doingthings. Innovation is not simply a new product, service, ortechnology. Real innovation engages people, and when you engageyour employees, you create a positive environment for generatingbreakthrough ideas.

Getting people into an innovative mindset doesn't happen bytaking a course or seminar, although those can be helpful. Ithappens by solving for real human-centric problems.

A great way to engage employees in innovative problem solving isto use design thinking. While this method has gotten a lot of buzzrecently, the techniques have been used for quite some time increative endeavors, such as user experience design, productdevelopment, and even lean continuous improvement.

Related: Innovation can overcome growth obstacles forinsurers

Consider these words from Tim Brown, CEO of IDEO, a leadingdesign firm: "Design thinking can be described as a disciplinethat uses the designer's sensibilities and methods to matchpeople's needs with what is technologically feasible and what aviable business strategy can convert into customer value and marketopportunity."

Basically, it's a fun way to generate constraint-free ideas andshape them into tangible solutions.

In our design practice at XL Catlin, I advocate a six-stepapproach that's based off of StanfordUniversity's D School framework. (The D School offers lots ofreally good, free resources to kick off your own internal designthinking sessions).

Here's what applying design thinking to insurance innovation canlook like:

Step 1: Educate your (design) team.

What is design thinking and why are we here? There are a numberof ways to organize your team. There may be a specific challengeyou want to solve, or it could be more unstructured ideageneration. Cross-functional teams are the most effective.

As you get started with a design thinking session, spend timediscussing the process, setting expectations, and providing theright space for the teams.

Step 2: Put yourself in the customers'shoes.

In thinking about and defining our customers as people withindividual needs, we uncover opportunities to provide a betterexperience for them. Through qualitative and quantitative research,we shape those needs into personas, a hypothetical person thatrepresents a set of specific customer behaviors.

Step 3: Map the customer journey

We trace that customer through their experience journey,identifying all of the context and events surrounding our area ofinfluence. Through this process, we identify new product or servicecapabilities that add value to the customer.

Step 4: Define the solution space

With a list of innovation ideas to start with on our ideabacklog, we narrow down our focus to those ideas that support ourbusiness objectives.

Step 5: Visual and prototyping thesolution

Seeing is believing. The team visualizes their idea in the formof a wireframe or mockup of what the solution could look like. Ifit's a technical challenge, the team could even code aquick solution.

Step 6: Present your concept.

Most teams will need to sell their concept internally. Usestorytelling techniques to guide your audience through the user experienceand your solution design options.

You can leverage design thinking even within an active project.One internal development team in our organization was struggling toprioritize features for their new product offering. We sat down andcrafted a series of personas (which gave us some great insights inwho we should develop for today and in the future).

We took the personas and created journeys for them, thinkingabout what was happening before and after they interacted with ourproduct. By doing this, we came up for a number of new solutionideas (and challenges!) that went on our idea backlog that could beevaluated and prioritized by our steering committee.

We created visual artifacts for the persona and their journey.These documents helped the team communicate the intent of thedesign and illustrated how our personas would interact with theproduct. Application mock-up screens and working prototypesfacilitated the feedback process before development began, savingus time and money.

If you're looking to infuse a little energy into your innovationefforts, get your teams engaged using a design thinking approachand let the ideas flow!

Rachel Alt-Simmons is vice president of Program Enablementwithin the Strategic Analytics team at XL Catlin. She can bereached by sending email to [email protected]. These opinions are herown.

See also:

• From start-up to scale-up: Deploying insuranceinnovation at scale
• In claims, all roads lead toinnovation
• 4 innovation gateways for the insuranceindustry
• 10 lessons in customer journey mapping for theinsurance industry
• Insurance 2017: Priorities for innovation,automation and transformation