Tag Archives: dinosaurs

Let’s Keep ‘Digital’ in Perspective

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.

The Revolution Is Coming! Be Ready

The world, the world of risk and risk in the world will be as different in 2020 as the original 13 colonies were from the U.S. as it is today.

The bad news is that Paul Revere won’t ride through your town alerting you.

So you'll have to settle for me — and I am, in fact, giving you enough warning to design your future, and not just manage toward it.

Understand: When one thing is different, it is change. When everything is different, it is chaos.

Change works for dinosaurs. Chaos doesn’t.

But chaos brings opportunity for those who are prepared, and, if you’ve survived in this industry for any length of time, you are able to adapt. Your only issue is one of willingness.

What follows are the 10 environmental factors that, in combination, are triggers of the coming Risk Revolution. These cultural changes are fissures in the foundation of the “good old days” and render vulnerable all traditional institutions and structures that have done so well for so long.

  1. Loss of innocence: When President Nixon said during the Watergate scandal, “I am not a crook,” he acknowledged the end of command and control. Raw power could no longer sustain the most powerful man in the world. As citizens, we confronted the “feet of clay” of our leaders. What Nixon did to weaken our trust in our political leaders, terrorists in airplanes on 9/11 did to our confidence. We won two world wars and are insulated and isolated from the “evil” out there by oceans on our coasts, but it is not enough. We have to accept we are vulnerable.
  2. Katrina was a “girl” but she was no lady: When Hurricane Katrina hit the Gulf Coast in 2005, it breached levees and created a Mad Max world that none were ready to face. Our institutions – federal, state and local government, the Red Cross, etc. – were supposedly built for catastrophes but failed us. Our confidence in our system of order was lost. We must rethink the world.
  3. “Hell no, we won’t go”:  war protests, burned bras, tie-dyed T-shirts, Elvis and the Beatles, hippies who protested everything except the right to protest. This was the marketplace speaking for the first time. Tomorrow, the market won't be quieted.
  4. ________ – Americans:  African-Americans, Asian-Americans, you-name-it-Americans. We're no longer a homogeneous nation. One size does not fit all. The change will accentuate the world of niches, affinity groups and “verticals” and so fragment the market that mass customization will be required, down to a niche of one. We want it “our way,” and not just in fast food.
  5. The front porch and the back fence are gone: Time and place now have little value, and “pace” is as fast as the buyer wants it to be. The question is: If Gen Y is known for a lack of empathy, how do you sell in a nonverbal world?
  6. Tennis balls and Patty Hearst: Sgt. Gill, an intelligence officer, told me in 1972 about satellites that could read the label on your tennis ball while you were playing. In 1973, Jim, another military intelligence guy discovered that, while his data mining model couldn’t help the FBI find Patty Hearst, he could find everyone in America who was just like her. In an era of satellites/drones/etc. and big data, what happens to privacy?
  7. Miss Hathaway: In the finance department of LSU, Joan always reminded me of Miss Hathaway from “The Beverly Hillbillies.” She told me decades ago, “Mike, this LexisNexis thing is going to be big.” She was talking about the Internet. She was right.
  8. From Ozzie and Harriet to Archie Bunker to the Huxtables to the Simpsons to the Modern Family and maybe to the Jetsons: The world keeps changing, and lots of people don't like that. They want to hold on to the past. Political correctness, shouts of racism and sexism, a bipolar political process, extremes, etc. all limit our willingness to hold hands and sing “Kumbaya.” We are changed forever, and so is our society and its most basic building block – the family. Deal with it.
  9. “If you have all your eggs in one basket, make sure it’s a strong basket.”: That line, from a Volvo ad, circa 1980, applies today because we are betting the economy and our world on technology . What happens if a natural disaster, a terrorist, an enemy or sun spots disables our technology for a week, a month, a year?
  10. Addictions: Addiction to the status quo is the worst. In this most serious form of dependency, we sacrifice everything to do nothing but protect our comfort zone. The insurance industry once owned the world of risk. Now we have done more than “let the camel’s nose under the tent.” We are now sleeping with the camel. When the market demanded innovation, we too often failed to provide it. Instead we gave up our responsibility and let government and others do what we didn’t want to do. Captives, alternative risk funding, HMOs, the ACA, self-insurance and the National Flood Insurance Program are all examples of decisions being made without us. That is the nature of markets. We were too slow, and something else filled the void. We still face two fundamental challenges: Our products are priced beyond the ability of many consumers to pay, and some embrace a “nanny state.”

The trends identified are not all right and they are not all wrong. They just are. What will 2020 bring your world? What will you do to prepare?

Remember the admonition from Peter Drucker, “Whom the gods wish to destroy, they send 40 years of prosperity.” The last decades have been good to us. The next decades can be, too, but only with the right amount of awareness, preparation, discipline and commitment.

George C. Scott, playing Gen. George Patton in the movie “Patton,” said: “In times of war, all other forms of human endeavor shrink to insignificance.” 

Are you ready, willing and able to fight and prevail in the coming Risk Revolution?