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December 14, 2016

Let’s Keep ‘Digital’ in Perspective

Summary:

We've lost track of the fact that "digital" is a "how," not a "what. We can't innovate just by falling in love with technology.

Photo Courtesy of Pexels

Call me old-fashioned, but I believe we have forgotten that technology is not a “what,” it’s a “how.” Technology is intoxicating, because it comes complete with millennial attraction, new vernacular, hip-looking office space and sometimes a lot of money. However, keep in mind that the cool new app, acronym or buzz phrase is only as valuable as your vision.

Innovation has so rapidly become the most urgent skill set to develop that many new innovation leaders are skipping over the basics and are thrust straight into the “tech” side of their industry. They are left thirsting for and examining every new technology and looking for a place to apply it. In fintech and insurtech, particularly, this list of technologies is long, as many startups jump on the bandwagon of opportunity. For the untrained eye, this can result in a lot of time and money spent on the wrong things.

Let’s get back to the how versus the what. “What” means the offering and experience you want to deliver. “How” enables that experience. When you are crystal clear about the what, it is much easier to find the technologies you need, and, more importantly, deploy them effectively.

See also: Do You Really Have a Digital Strategy?  

Becoming crystal clear on the “what” takes careful examination of the current offering, consumer feedback and trends shaping the future. These insights can be quantified so that you know which ones are the most important to focus on.

In insurance, for example, some might be focused on price comparison as the consumer need. While this was a strong need years ago, the market is now flooded with comparison sites. This is the reason why even the great and mighty Google couldn’t scale its first attempt.

Less obvious — but emerging — in our industry are the ways to make insurance more transparent. This can include everything from the decision process to approve an insurance application, all the way to rate-making and even company profitability. Insurance startup Lemonade has interesting approaches to satisfy this need, and the area of transparency is rich with opportunity. After all, it is the flip side of trust, and we know that the insurance industry is not trusted.

However, just because others are going in a specific direction does not mean it’s right for your company. It’s important to spend time thinking about your own true core competencies and then match them to unmet needs and emerging trends.

After six years working in innovation, I have seen that more companies need to spend time choosing the strongest insights that are a match for their power. Then they should hunt for startups and partners based on those insights. While on the surface this approach may appear to narrow the field of choice, it actually widens it because it will help to uncover the non-obvious companies that don’t list themselves as serving a particular industry, and are more clearly just about the “how” that you are looking for.

So, back to digital as a “how.” Yes, digital experience, digital interface, digital platform, digital communication, but no, not just plain digital.

If you need to kick that habit, imagine yourself managing dinosaurs in Fred Flintstone’s town of Bedrock. What would you do? You wouldn’t just focus on how cool dinosaurs are; you would  find the right dinosaurs that could work very hard behind the scenes to create the “what” that the customer expects.

See also: 5 Accelerating Trends in Digital Marketing  

Watching that show as a kid, I remember some small dinosaurs fit nicely under Wilma’s sink, eating scraps like a garbage disposal. Others were large, and used their mouths to haul rocks like a crane. Some flew with chairs tied to their backs to get people from place to place.

We just need to replace those dinosaurs with the modern digital technology, or whatever is next after that, keeping in mind what the consumer demands now and, more importantly, what they will be demanding in the future.

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About the Author

Maria Ferrante-Schepis is the managing principal of insurance and financial services innovation at Maddock Douglas.

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