Following on Greg’s last blog on digital strategy, he discusses the leadership behaviors and actions required to move the needle on innovation.
Any type of business transformation requires leadership, but to be truly effective you must have clarity, diplomacy, and openness.
If we look at clarity, if your digital strategy is vague, there will be confusion and uncertainty. With any strategy, you need to make sure that it is clear to those who oversee implementation. A strategy should clearly communicate - “This is what we are going to do...and why”.
Once you have created a clear strategy, diplomatic communication becomes the next step in the process. You should tactfully introduce the strategy as it likely will unsettle some members of the team. It’s a delicate balance. People want clear strategy, yet they often resist change. A good strategy will have both clarity and diplomacy in balance.
Beyond diplomacy, you need to be open with the team. Acknowledge to certain groups within the company that “this is going to feel uncomfortable,” and be open about how they participate in the end goal. Having an open dialogue within clear boundaries is very healthy exercise for the team and the enterprise as a whole.
Let me use an example to explain. INSTANDA was recently approached by a company with a large pool of underwriters. They “wanted to transform and needed a new system”. They mocked-up a wireframe for a new process, which was basically a re-creation of their current process – there wasn’t any real automation or transformation involved. I challenged them openly. “What you tell me you want to achieve and what you’re proposing are not matching up.” That’s not an easy thing to hear, but important to get across. What they needed to do was understand their current underwriting process, reflect on how it affects the customer, explore how data, automation and transformational thinking could create a new experience, and then search for solutions to achieve new results.
They also needed to be honest with themselves and answer fundamental questions such as “Why do we perform the underwriting steps in this way? Do we really need people to perform these tasks or can we use automation? How much risk are we willing to accept? How long should it take to underwrite a policy? What outcomes are we trying to achieve? These are just a few examples and we could generate many more. The point is that this type of thinking needs to happen prior to writing RPFs, technology selection, and project initiation.
In my experience, people step-up when an organization explains what it is trying to do and asks the brightest minds to help achieve it. They just need permission and a framework. You are asking those with the right transformative mindset to be part of the journey with you and that’s when real change happens.
If you are not ready to take these brave steps, you must question whether you are ready for real digital transformation.
That’s not to say you must do everything at once. Phase 1 could include a prioritized set of changes, re-evaluate, and then move onto Phase 2. Breaking up the changes into several phases or ‘sprints’ is often an effective way to achieve digital transformation.
The important thing is to keep your digital strategy and communications clear.
Generally, there are two business approaches you can take:
The first is the New Co Approach, where you peel off a new division or company and create a completely new customer experience under a different brand. This can be difficult to implement because it can create tension between new staff and those working for the parent company. Yet, when it works, it can be incredibly effective. You just need to make sure you take a customer-first approach.
The second model is very much an evolutionary one. It is where you transform over time and govern the journey with a group of people that are empowered to decide the priority of change. They decide which part of the process needs to be digitally transformed first, second, third and so on. I have seen this work when you have buy-in from people who share a transformative mindset.
Your leadership team must have the right mindset.
One of my favorite reference points is ‘The Technology of Fallacy’, a collaborative study between our friends at Deloitte and the MIT Sloan Management Review (SMR). It examines how and why people are too quick to jump into technology. They dive straight into technology solutions and hide behind it – they don’t deal with the real issue - ‘we have to think differently’ to transform.
If you lead with technology and IT, your digital strategy will likely end up being measured by cost and not by its impact on the customer experience. That sets the wrong tone for success and it is very limiting.
To quote the authors of ‘The Technology of Fallacy,’ “effective digital leadership requires leaders who have the core skills cultivated from the insights of the past, with the agile mindset and digital savvy to allow them to pivot when needed.”
At INSTANDA, we’re all about understanding your business on a granular level so that we can recommend the best way to transform. Whether you’re looking for a New Co approach or want to follow an evolutionary model, we’re a software partner you can lean on.
Experience insurance YOUR way.
Call us today at (989) 450-2351 or schedule a demo and we’ll happily discuss any aspect of digital transformation with you.