Most insurance players recognize that employees represent their greatest potential source of new ideas. Many have tried to transform their culture to encourage greater innovation. But our experience and our interviews suggest that culture remains a key sticking point for the insurance industry to overcome.
With half of our respondents saying that the greatest number of new ideas are currently being generated by diverse working groups of cross-functional teams, it seems clear that insurers can drive enhanced innovation by creating a more
collaborative culture.
“If we can find a way to get all 70,000 employees across Metlife Inc.’s 50 geographical markets to collaborate together and start solving common problems, we can seize the competitive advantage for another 150 years,” MetLife’s John Geyer noted.
Insurers certainly seem focused on transforming their culture away from risk-averse, conservative and siloed ways of working toward a culture where experimentation is encouraged and new ideas and skills are thoughtfully deployed. Sixty-one percent claim they actively encourage employees to experiment. “One of MAPFRE’s core values is ‘Innovation for leadership,’ recognizing that our innovation must have a purpose and—for us—it is to be different and better than our competitors,” MAPFRE’s Antonio Huertas said.
While some are focused on creating a more innovative culture, others are creating a more “customer-centric” culture that, indirectly, will drive innovation. “I would argue that the biggest culture change isn’t around innovation in itself, but rather around the customer experience, and I’m not convinced that property and casualty insurers—or any insurers, for that matter—are all that good at focusing on the customer compared to other industries,” noted Henri Dolino, VP of Marketing and Corporate Strategy at Desjardins General Insurance Group, part of Desjardins, the largest integrated cooperative financial group in Canada. “It’s all about listening to the voice of the customer, understanding the changes and shifts in
expectations, and then using
innovative approaches to answer those demands.
Innovation isn’t a strategy on its own, it’s a means to an end.”
Yet, half of our respondents also tell us that their inability to break down internal silos is creating significant challenges to innovation. Not surprisingly, smaller organizations seem to face fewer challenges relating to internal silos, likely reflecting their less complex structures and greater opportunities for
collaboration.
KPMG Insights:
Incentivizing employees and creating structures that prioritize the success of customers—not products—will help drive cultural change and new ways of thinking.
Systems, tools and technologies can be harnessed to help monitor the value of each customer interaction to the overall customer experience and help define the objectives of
cultural change.
Breaking down internal silos is a key success factor to create a more agile, collaborative and flexible organization.
Actions:
Identify pockets of innovation and effective models already working within your organization to replicate.
Review your broader talent strategy and culture. Focus on developing a diverse group of talented people in-house, identifying individuals with reputations for shaping new ideas, simplifying processes, helping drive change and looking to
the future.
Consider employee reward and performance management, and consider whether metrics and targets encourage innovation and experimentation.
The article was taken from KPMG’s special publication, entitled A New World of Opportunity.
R.G. Manabat & Co., a Philippine partnership and a member-firm of the KPMG network of independent firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved.
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