Connected enterprise framework: the role of customer data collection

Even though traditional insurance companies still have strong market performance, their business models are under pressure to meet the demands of a new generation of customers - customers whose needs are evolving as quickly as new technology becomes available. However, the current legacy systems simply don’t have the infrastructure required for this type of agility. This resulting lag has become a clear signal to the entire sector that it’s time for a radical transformation.

The external factors impacting the insurance landscape

Transformation, especially of established businesses, is never easy and doesn’t come overnight. The insurance industry is no exception. Here are just some of the factors insurance companies are now expected to take into account when they start thinking about becoming a connected enterprise:

• Today clients and employees alike expect to get a cutting-edge experience that’s both sophisticated and tailored to their needs, addressing all previous pain points.
• Factoring in economic uncertainty is a must. The world is still recovering from Covid-19, meanwhile, there’s the impact of the war in Ukraine and the resulting inflation. All of these uncertainties will have a wide business impact and will require insurers to adjust their approaches on the go.
• There’s a noticeable shift towards regulatory and legal deglobalization, with some markets already pushing aggressively for national regulation, making the regulatory landscape even more fractured and complex to navigate.
• Evolution of technology means that new technologies are providing insurers with new opportunities to meet expectations, increase efficiency, and innovate through the use of automation and AI in streamlining processes, collecting and analyzing data.
• There is a growing expectation from customers, but more importantly, stakeholders and regulators, that insurers should employ a business model that emphasizes social responsibility, namely ESG Activism (environmental, social, and governance).

For insurance companies to survive, let alone thrive, all of these factors should be taken into account in order to create new strategies that will allow you to adapt and remain open to constant, fast-changing customer needs. 

The 8 Capabilities Framework

Tackling these changes means adapting to a connected enterprise operating model. KPMG has defined 8 Connected Enterprise capabilities that will help companies become twice as likely to succeed by defining a customer-centric approach to digital transformation, spanning front, middle and back office:

1. Integrated partner and alliance ecosystem
2. Insight-driven strategies and actions
3. Innovative products and services
4. Experience-centricity by design
5. Digitally-enabled technology architecture
6. Aligned and empowered workforce
7. Responsive operations and supply chain
8. Seamless interactions and commerce

They advise enhancing all 8 connected capabilities across the organization to provide the greatest value to the consumer. 

Insurance companies will specifically benefit from mapping the below capabilities to their operating model, to be able to better prioritize and execute their digital transformation.

Experience-centricity by design

The importance of customer experience has reached a new level. “We're in an experience economy, consumers are very fickle,” said Tony Bates, chair and CEO of contact center software provider Genesys. In the age when a lot of businesses, including insurance, sell their products and services online, customer expectations on the level of experience are on the rise and insurance companies must rise to the challenge and provide them with a personalized as well as simple digital experience. Using digital data collection tools is the first step insurance companies can take to improve their services.

Digitally-enabled technology architecture

It’s been predicted that the insurance industry in the US and UK will increase their spending on technology by more than 25% by year 2026. This shouldn’t come as a surprise -  the insurance sector is still battling with lots of technological legacy issues, but has already started down the path of digital transformation that will be crucial for their success. Without the modernization and updates of technology, insurers won’t be able to build and then scale digital processes that will transform the industry.

Seamless interactions and commerce

We’ve already mentioned the customer’s expectations of tailored and smooth experience. This seamless, personalized interaction is the prerequisite in building trust and encouraging customer loyalty. For this seamless interaction to happen, every stage of the process and every interaction need to be fully integrated, customizable, secure and efficiently designed, starting from the customer data collection all the way till the end of the customer’s journey.

Aligned and empowered workforce

According to Venture Beat, 76% of employees are frustrated by inefficient workflows, and 86% prefer digital processes over manual paperwork. By now it should be clear to every employer that manual paperwork remains one of the most frustrating and repetitive jobs and that frustrated employees are not productive and are at high risk of churn. Fostering a work environment that will fully engage their workforce will result in satisfied employees and their satisfaction will certainly reflect on customer satisfaction. Employees that can focus on higher-impact tasks will be more likely to be proactive in their jobs and exceed customer expectations.

Transforming data collection

In order to implement the 8 connected enterprise capabilities to maximum effect, it’s important to address the need for digital data collection in insurance companies. Besides the obvious advantages listed below, this first digital interaction with your company sets the tone for your relationship with the customer. 

Since data collection is such a critical part of the insurance customer workflow, automating customer data intake in the insurance industry is the first step towards seeing that ROI impact. Digitizing the data collection has many other advantages, besides the revenue growth:

• Makes the customer data intake faster and more efficient
• Improves data accuracy
• Improves customer experience
• Enables companies to implement end-to-end automation in all processes

All of these benefits combined will result in providing both your employees and customers with a better user experience, thus positively impacting your ROI.

If all of that isn’t enough to convince you to transform the way you collect your customer data, McKinsey are positing that by 2025, enterprises will be entirely data-driven. This means they predict a seamless interaction between humans and machines as a standard. As a result, companies that make the best and fastest progress in this direction are the ones who’ll see the biggest improvement to their bottom line, both in the long and short term.