© 2012 celent, a division of oliver wyman confidential mike fitzgerald senior analyst creative...
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© 2012 CELENT, a Division of OLIVER WYMAN CONFIDENTIAL
Mike Fitzgerald
Senior Analyst
Creative Disruption Symposium
September 13, 2012
New York, New York USA
CREATIVE DISRUPTIONMANAGING INSURANCE INNOVATION
2© 2012 CELENT, a Division of OLIVER WYMAN CONFIDENTIAL April 21, 2023
Tradeoffs in performance of activities that define a business model (Porter)
Continuum leading to disruption (big “D”)
STRATEGY
INNOVATION
DISRUPTION
Breaking those tradeoffs (Raynor, Christensen)
A theory of innovation, where:
• Technology changes the “productivity frontier”
• Success in fringe markets sets the stage for “up-market march”
• Managing innovations as a portfolio will increase the probability of success
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Compared with other industries, insurance companies successfully innovate....
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4© 2012 CELENT, a Division of OLIVER WYMAN CONFIDENTIAL
Compared with other insurance companies, my insurance company successfully innovates....
April 21, 2023
5© 2012 CELENT, a Division of OLIVER WYMAN CONFIDENTIAL
Innovation in insurance looks like
1 Inconsistent
2 Initiatives rebound
3 Lack of disciplined approach
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Model
STATUS QUO
Risk and Compliance
Business model enablement
and partnerships
Market and product agility
Efficiency and expenses
Pre and post sale customer engagement
Liability Management
Growth and retention Profitability and Control
Improvement
Innovation
Disruption
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Example initiative
Enable the direct sales capability for life product sales. Quote and bind applications on the company website for term products.
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Identify strategic lever
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Risk and Compliance
Business model enablement and partnerships
Market and product agility
Efficiency and expenses
Pre and post sale customer engagement
Liability Management
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Identify type of project
April 21, 2023
STATUS QUO
Improvement
Innovation
Disruption
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Where should initiative be placed?
STATUS QUO
Risk and Compliance
Business model enablement
and partnerships
Market and product agility
Efficiency and expenses
Pre and post sale customer engagement
Liability Management
Growth and retention Profitability and Control
Improvement
Innovation
Disruption
11© 2012 CELENT, a Division of OLIVER WYMAN CONFIDENTIAL April 21, 2023
Innovation framework
STATUS QUO
Risk and Compliance
Business model enablement
and partnerships
Market and product agility
Efficiency and expenses
Pre and post sale customer engagement
Liability Management
Product configurator
Real-time Capital Adequacy
Fraud Analytics
Business ProcessManagementSocial-media enabled
real-time servicing
Growth and retention Profitability and Control
Telematics
Improvement
Innovation
Disruption
12© 2012 CELENT, a Division of OLIVER WYMAN CONFIDENTIAL April 21, 2023
Innovation framework – 2012 Model Insurer results
STATUS QUO
Risk and Compliance
Business model enablement
and partnerships
Market and product agility
Efficiency and expenses
Pre and post sale customer engagement
Liability Management
Improvement
Innovation
Disruption
Growth and retention Profitability and Control
13© 2012 CELENT, a Division of OLIVER WYMAN CONFIDENTIAL
Growth and retention
STATUS QUO
Risk and Compliance
Business model enablement
and partnerships
Market and product agility
Efficiency and expenses
Pre and post sale customer
engagement
Liability Management
Insurer pilot – priority 1 initiatives
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Profitability and Control
Improvement
Innovation
Disruption
14© 2012 CELENT, a Division of OLIVER WYMAN CONFIDENTIAL
Challenge phase
• Are we being bold enough?
• Are our strategic bets the right ones?
• Are we leveraging disruptive technology?
• Where are we at risk of losing ground against our competitors?
• Are our resources aligned against the right initiatives?
• Have we got our best people on leading the most disruptive initiatives?
• Do we have the capacity / skills to implement the technologies required?
• What trade-offs in the portfolio need to be made?
• Is the organization ready for the changes required?
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Agree actions to realign the portfolio in order to match the strategic intent
15© 2012 CELENT, a Division of OLIVER WYMAN CONFIDENTIAL
Case studies
• What is truly new?
• Why was it a success?
• What else can be done?
April 21, 2023
16© 2012 CELENT, a Division of OLIVER WYMAN CONFIDENTIAL April 21, 2023