insurance trends
DESCRIPTION
A client preso for the insurance industry. High level with charts to prompt discussion on external access to insurance services.TRANSCRIPT
InsuranceTrends
• CEO Survey
• Changing the Game
• New Media
• Technology
• Customer reference
• Next steps
Agenda
CEO SurveyWhat is the Enterprise of the future?
We spoke to 1,130 CEOs and conducted in-depth analysis to determine the characteristics of the Enterprise of the Future
Core Traits of the Enterprise of the Future
1. Hungry for change2. Innovate beyond customer imagination3. Globally integrated4. Disruptive by nature5. Genuine, not just generous
Hungry for Change
Change Needed Past ChangeSuccess
Although CEOs are more confident about managing change, the gap between their capability and the challenge ahead is growing
The Change Gap* Triples
“We have seen more change in the last ten years than in the previous 90.”Ad J. Scheepbouwer, CEO, KPN Telecom
Change Needed Past ChangeSuccess
2006 2008
Change Needed
No/limited Change
Moderate Change
Substantial Change
No/limited Success
Moderate Success
Successful
Past Change Success
22 %CHANGE GAP*8 % CHANGE
GAP*
6%11%
83%
19%
20%
61%
13%
22%
65%
12%
31%
57%
Although CEOs are more confident about managing change, their capability and the challenge ahead is growing
2004 2006 2008
Market factors
People skills
Macroeconomic factors
Globalization
Regulatory concerns
Technological factors
Socioeconomic factors
Environmental factors
Geopolitical factors
84% 67%
42%
33%
44%
41%
48%
48%
35%
External Forces Impacting the Organization
Source: IBM Global CEO Study 2008; n (2004) = 403, n (2006) = 760, n (2008) = 1130
CEOs can no longer focus on a narrow set of challenges and intend to manage a broader agenda and greater uncertainty
Change Needed Past ChangeSuccess
* Dif ference or ‘gap’ betw een expected level of change needed and past success in managing change
Change Needed Past ChangeSuccess
Source: IBM Global CEO Study 2008; n (underperformers) = 173, n (outperformers) = 164** Performance based on industry comparisons w ithin
survey sample of revenue CAGR 2003 to 2006
Change NeededNo/limited Change
Moderate Change
Substantial Change
No/limited Success
Moderate Success
Successful
Past Change Success
Outperformers**Underperformers**
19%CHANGE GAP*29%
CHANGE GAP*
CEOs of organizations with outperforming revenue growth are more confident about their ability to implement change
5%10%
85%
17%
17%
66%
4%
13%
83%
24%
22%
54%
Companies that delivered higher revenue growth managed change more successfully
2. Thinking beyond customer imagination
Investment* past 3years
Investment* next 3years
Source: IBM Global CEO Study 2008, n = 609; * Total investments: all asset investments + all investments in R&D, marketing and sales
Rise of the informed and collaborative customer
“We must redefine our value proposition to customers. Information and advisory content are becoming even more valuable than traditional drivers.”H. Edward Hanway, Chairman & CEO, CIGNA Corp.
“The rise of the informed and knowing consumer will continue to have an impact regarding our go-to-market priorities. We must know how to leverage new media. We've been surprised by the impact that just a few consumers can have with their blog entries.”Rob Hurlbut, CEO, Attune Foods
22%INCREASE
16.7%
20.4%No
impact 14%
Positive impact 76%
Negative impact 10%
CEOs see even more potential with informed and collaborative customers and are rapidly increasing their investment there
Investment* past 3years
Investment* next 3years
Investment* past 3years
Investment* next 3years
21%24%
14%
19%
Investment in the rise of the informed and collaborative customer
14%INCREASE 36%
INCREASE
Outperformers**Underperformers**
“In the future, we will be talking more and more about the ‘prosumer’— a consumer/producer who is even more extensively integrated into the value chain. As a consequence, production processes will be customized more precisely and individually.”Hartmut Jenner, CEO, Alfred Kärcher GmbHSource: IBM Global CEO Study 2008; n = 167; * Total investments: all asset investments + all investments in R&D, marketing and sales
** Performance based on industry comparisons w ithin survey sample of net prof it margin CAGR 2003 to
2006
Outperformers plan to increase their investment in informed and collaborative customers by 36% over the next 3 years – the time is now
3. Globally Integrated
Source: IBM Global CEO Study 2008
Drive multiple cultures
Grow organically
Strive for one culture
Localize brands/products
Do everything in-house
Defend your core
Partner extensively
Globalize brands/products
Optimize operations globally
Deeply change mix of capabilities, knowledge and assets
Grow through mergers & acquisitions
Optimize operations locally
Maintain current mix of capabilities, knowledge and assets
Actively enter new markets
Extensive Globalizers (n=230)Globalizers (n=246)Blended Thinkers (n=131)Localizers (n=140)
UnderperformersOutperformers
Global integration approach
4. Disruptive by Nature
Business Model Innovation Focus
Source: IBM Global CEO Study 2008; n = 1106
29%
2%
69%
Limited/NoBMI Focus
Moderate BMIFocus
Strong BMIFocus
* See appendix for list of emerging economy countries
“When the business model is innovative, operations and the product will follow automatically.”Ronald de Jong, CEO Philips CL, Germany
29%
69%
1%
30%
69%
2%
Limited/NoBMI Focus
Moderate BMIFocus
Strong BMIFocus
Established Economy
Emerging Economy*
“All types of business model innovation are equally important; it's a matter of priorities.” Stephane Bancel, CEO of Biomerieux
Across the globe, a full two-third of all CEOs plan to be engaged in some form of business model innovation over the next three years
56%
91%
New Pricing/TaxationStructures and Models
ReconfigureProduct/Service/Value
Mix
n = 234 n = 203
Source: IBM Global CEO Study 2008
38%
57%
71%
Work WithinOrganization
Focus onDifferentiating
Activities
IntenseCollaborationwith External
Partners
Enterprise Model Innovation Focus
n = 369
Revenue Model Innovation Focus
36% 36%
73%
Create EntirelyNew Industries
Move Into NewIndustries
RedefineExisting Markets
Industry Model Innovation Focus
Collaboration is instrumental to drive Enterprise Model Innovation
Revenue Model innovators shift the value mix
Industry Model Innovation remains rare
Within the various business models, CEOs plan to implement distinct initiatives
5. Genuine, not Generous
“Our company is investing extensively in corporate social responsibility. We need to be a reference in this domain. As the leader of the luxury industry, we have to stay ahead.”Yves Carcelle, Chairman and CEO, Louis Vuitton
9%12%
42%
12%15%
44%
18% 17%
48%
EnvironmentalIssues
SocioeconomicFactors
People Skills
200420062008
Source: IBM Global CEO Study 2008; n (2004) = 403, n (2006) = 760, n (2008) = 1130
“Our strong commitment to corporate sustainability will be a clear differentiator for us with all stakeholders.”Tom Johnstone, CEO, SKF
“I see corporate responsibility going through three phases. People start to consider issues like the environment because they are compelled to do so. Then they realize that it actually makes business sense. Eventually they move beyond compulsionand selfish motives to become passionate because it is the right thing to do.”Vinod Mittal, Managing Director, ISPAT Industries
External Forces Impacting the Organization
The only three external forces consistently rising on CEOs agendas are all linked to Corporate Social Responsibility
Investment past 3years
Investment next 3years
Increasing customer expectations of corporate social responsibility
“The consumer’s concept of quality will no longer be measured by only the physical attributes of a product — it will extend to the process of how the product is made, including product safety, environmental compliance and social responsibility compliance.”Victor Fung, Chairman, Li & Fung
25%INCREASE
10.7%13.4%
No impact 20%
Positive impact 69%
Negative impact 11%
Source: IBM Global CEO Study 2008, n = 609; * Total investments: all asset investments + all investments in R&D, marketing and sales
Majority of CEOs see CSR as an opportunity, not a threat, and plan to significantly invest in CSR to integrate with society
CEOs can now assess how ready they are for becoming the Enterprise of the Future.
Hungry for change
1Innovative beyond customer imagination
2Globally integrated
3Disruptive by nature
4Genuine, not just generous
5
Core Traits of the Enterprise of the FutureCore Traits of the Enterprise of the Future
IBM Solutions
Changing the Game
Changing the Game: Goldcorp Inc
• Yr2000, Strikes, debt, high production costs, terminated mining operations
• CEO Rob McEwen “Goldcorp Challenge” $575,000 prize
• Exposed 400Mb 55,000 acre property of Geological data to the web
• 100 targets identified• 80%+ yielded substantial
gold• 8 million ounces = $3bn• $100 invested in 1993
work $3000 today
Changing the Game: Lego
• Assembled 4 enthusiasts• Ideas on new sensors,
redesigned input ports, and stabilized firmware
• Contributed for free
• Mindstorm v2 still sells 40,000 units a year at $199 a pop -- with no advertising -- and has become Lego's all-time best-selling product•http://www.wired.com/culture/lifestyle/news/2006/01/69946
Do you stand out?
“The purpose of the business is to create a customer” Peter F
Drucker
• What are the attributes of Generation X• How do you communicate with them?
• What are the attributes of Generation Y How do you communicate with them?
Questions
Who are we / will we be dealing
with?
http://www.pewinternet.org/pdfs/PIP_Teens_Social_Media_Final.pdf
35% of all teen girls blog54% of wired girls post photos online19% of boys have posted videos39% share their own artistic creations online26% of teens remix content 27% of teens maintain a personal webpage28% of teens have created their own blog33% of teens create or work on webpages or blogs for others
http://www.flickr.com/photos/14692968@N00/1351463530/
Lancaster, L.C. and Stillman, D. When Generations Collide: Who They Are. Why They Clash. How to Solv e the Generational Puzzle at Work. Wheaton, IL. Harper Business, 2003.
Collaborative & networkedIndependentFacilitatedClassroomLearning style
Gen Y1977 - 2000
Gen X1965 - 1976
Boomer1946 - 1964
Traditionalist1922 - 1945
Generation Born between…
Part of my daily routineNecessarySets me backUnwiseJob changing
Unfathomable if not provided
Unable to work without itUnsureUncomfortableTechnology use
On demandWeekly / DailyOnce per yearNo news is good newsFeedback
PartnerCoachGet out of the wayCommand & controlLeadership style
Team decidedTeam includedTeam informedSeeks ApprovalDecision-making
CollaborativeIndependentHorizontalHierarchicalProblem-solving
CollaborativeHub & SpokeGuardedTop downCommunication style
Continuous & expectedRequired to keep meToo much and I’ll leaveThe hard wayTraining
Some insights about generational diversity“Your customers”
Core Traits of the Enterprise of the Future
How do we find out about our customers?Core Traits of the Enterprise of the Future
We ask themHow do you ask them?
1. People post their ideas on a topic 2. Others can vote on their agreement
or disagreement with the idea by "promoting" or "demoting" it.
3. Comments can be provided to elaborate ones thoughts on the matter at hand.
4. Good ideas rise to the top,5. Bad ideas fall to the bottom. 6. The comments will tell the story why
an idea is good, bad or ugly.
Simple
• Zuzzid helps people help each other.
• Let everyone know about your insurance experiences by leaving a Rant or a Rave.
• Consumers can learn from each other’s experiences, leave advice or comments, agree or disagree, and get the discussion going.
• Ask questions about insurance and get a general consensus from other users.
• A price engine takes the cost of thousands of peoples’ insurance cover and uses this to figure out what other people like you pay.” Sources:
http://www.listio.com/web20/story.php?title=Zuzzid http://zuzzid.co.uk
Rant and Rave: Zuzzid“Why do you engage customers?”
This is poor example
Core Traits of the Enterprise of the Future
Innovation starts at Home
Innoation Jam 2006
Over two 72-hour periods, more than 150,000 people from 104 countries and 67 organizations came up with more than 46,000 new ideas. Out of all that collective intelligence, the best ideas were selected. IBM publicly committed up to $100M in seed money to their development.
3-D Internet Big Green innovations Banking for the Unbanked Digital MeReal-time Translation ServicesElectronic Health Record System & Healthcare Payment Intelligent Transportation System Real-Time Translation Services Simplified Business Engines
Innovating with our customersInnovation Jam 2006
Innovation with our friends…Innovating with our customersInnovation Jam 2008
Innovative beyond customer imagination
2
Core Traits of the Enterprise of the FutureCore Traits of the Enterprise of the Future
Hungry for change
1Globally integrated
3Disruptive by nature
4Genuine, not just generous
5
IBM Solutions
• Interview CEOs• Analyse information• Initiate Innovation Jam• Create blueprint for change• Gain competitive advantage for IBM, its
partners and it’s customers
• (Game changing process)
Enterprise of the Future processCore Traits of the Enterprise of the Future
innovation that
matters
Product Innovation
Services Innovation
Policy & Society
Innovation
Management& Culture of Innovation
Business Model
Innovation
Business Process
Innovation
Developing and bringing to market products that stand out in feature, function cost, availability… all in the right place at the right time
Product InnovationCustomizing services (instead of one-size-fits-all) and lowering prices (by beating competitors who are not capitalizing on new tools of innovation) in order to distinguish and deliver high value
Services Innovation
Re-conceptualizing the fundamental design of a business through the use of innovation tools and collaborative approaches
Business Model InnovationCreating and maintaining new behaviors and organizational structures to become the company that can constantly create game-changing products/services
Management & Culture of Innovation
Addressing the broader implications of innovation – for privacy, piracy, digital rights, intellectual property, global trade, etc. – and creating breakthrough innovations in these areas and shaping broad societal frameworks
Policy & Society Innovation
Conceiving, implementing, integrating and managing an organization’s business processes (supply chain, CRM, HR, product development, etc.) for competitive differentiation
Business Process Innovation
Innovation Jam - you can have one too
New Media
We understand demographicsWe understand our customers
We understand what they want?
Video: How many friends do you have?
“Web 2.0 is the business revolution in the computer industry caused by the move to the Internet as a platform, and an attempt to understand the rules for success on that new platform.” Tim O’Reilly
Technology
Solutions
Change
Interaction
Styles
“Socially Constructed Media and Communication”
GuruMe
Anyone
Participation
Web 2.0
http://www.ingblogs.com/mycupofcha/?p=82
Blog: ING in Asia PacificCore Traits of the Enterprise of the Future
Generational Website: Royal Bank of Canada
• Cuts out the middleman• Better response times• More user friendly• Supports our communities• Feels good to lend to people
rather than a savings account
• Delivered in a well known interface e.g. On-line auctions
• Fewer costs– No branch, – fewer staff– Less infrastructure (initially)
Peer-2-PeerLending
http://www.peertopeerinsurance.com/public/friends.php
Peer 2 Peer Insurance?
Finance in Facebook
Is it worth the investment?
Is it worth the investment?
Is it worth the investment?
Is it worth the investment?
Is it worth the investment?
Training and Games
“The Metaverse”
What does IBM do in this space?InternallyProduct
Externally – Blue 2.0
W3 - today
W3 – Next (today)
1 2
3
4
Bluepages
W4 - Research
Productisation of w3/w4Lotus Connections
Aggregate team data
Identify, develop and maintain a
professional network with
colleagues
Expanded customized profile data
fields and views for your
organization
Tag your colleagues and easily find them, search on them, and
keep in touch with them
61
Health of Social Network
New Media Solutions
Think about other industries and how they do things
Next?
Chris Sparshott(Sparkbouy)[email protected]
Portfoliohttp://www.slideshare.net/sparkbouy/slideshows
Bloghttp://chrissparshott.com
Can I help?