More than insurance - Transformation dilemmas

Piac és Profit 04.2018.

Insurance companies have to break with their current hierarchical structure and classic business architecture if they want to remain competitive. As for the inclusion of young talent the most important threat is nothing else, but the absence of messages.

There’s a magic expression, which is indeed typical of great enterprises and a highly efficient tool for strangling innovation: “That’s the way we do it.” This might be the deadliest poison for a company of a several-decade-long history and a labour force of a few hundred people. Of course, well-tried practices are often useful, especially in a trust-based industry, such as insurance. Nevertheless, the time has come to admit and say out loud: the current hierarchical structure and classic business architecture insurance companies operate with simply won’t be competitive in a couple of years.

It’s enough to think about how daily business is dealt with nowadays, or how one searches for information: we’ve got used to the fact that should we have any kind of demand, it’s enough to grab our mobile phones and after a little bit of surfing some convenient solution comes to hand. Unless a company is transformed in a way to follow this direction and fondle its clients, it can say farewell to competitiveness.

Of course, the question arises how to implement this transformation. How can the representative of an industry based on hundreds-year-long traditions rival in the field of innovation with start-ups, which blast several segments of the economy with their rummaging solutions, keeping in mind their completely different operational and development models? Well, in this above-mentioned change one of the most imperative factor is the commitment of the senior management. They have to realize that there is only a single path to follow and that only flexible reactions are feasible on the changes of the market; otherwise they won’t have any chance at all. I do believe that it’s worth trying to achieve some innovation also outside the organization, thus creating contention, and perhaps establishing our own competition, because this might have a positive effect on our company.

This model of course can only prove to be successful if we not only rethink our operations, but also implement the changes decided upon. I believe that the era of vast strategies covering hundreds of pages, reflecting on every aspect of the business and lasting for years is definitely over. It’s much more instrumental if the focus is always on the renewal of certain processes with rather short deadlines.

Of course, such an approach requires a completely different mindset from the employees, and managers have to deal with a really tough challenge in order achieve this: they simply must eradicate the myth of “we’re there”. Everybody need to understand that there won’t be a single moment when it can be stated that the end of the road is reached, that we’ve arrived at the final destination, because development is continuous and to top it all it’s constantly accelerating. Of course, success needs to be celebrated on the road, but the following day we need to keep going and continue our journey.

This transformation brings about something else; namely that nowadays totally different types of colleagues are needed than let’s say ten years ago. One shouldn’t get frightened of attracting non-professional people to the company; just the other way around: it’s a good idea to utilize their drive, their new mindset and the way they evaluate processes before they become “infected” by professionalism.

Nowadays there’s a myth in the labour market, which is perfectly suitable for hiding away deeper issues at companies: the lack of skilled professionals. In my opinion the lack of real messages is much more worrying. If we are able to communicate clearly, tell what we are planning to achieve and how, and what we would like to do differently, then it will become a reality to find the best people even from among the younger generation. On the other hand, it’s also true that their inclusion into the organization also requires serious adaptation: for example, the classic insurance industry related internal communication is based on e-mail and intranet; however younger people prefer instant messaging solutions and this is what they expect from the management team as well.

You shouldn’t have any illusions. At an organization of hundreds or thousands of employees the acceleration of innovations skills, the spreading of a new mindset or the involvement of young talents is not easy at all, and what’s more, it’s not a fast process; might last for years. At the same time the fact is that these steps are imminent if we want to break the “that’s the way we do it” kind of spell.

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