August 11, 2014 | Written by: Christian Bieck
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Our latest IBM Institute for Business Value study “Winning strategies for insurers” is now roughly four weeks old – time to check out a few details. Our graphics team has done a tremendous job creating some nice graphics to help me do just that, so I’ll be showing a few off today.
Insurance leaders – profit and growth leaders alike – are focused, proactive and analytical. The are also social:
“Show me the business case” is a request I often hear when I talk about customer interaction in general and social media as an important future interaction point in particular. Business cases are always a guessing game when it come to the revenue side, but for social it is harder than ever. How much more can you sell? Like advertising, it is hard to pinpoint, but unlike advertising, there has been no consensus that it is necessary for future business. Leaders seem to have turned the question around: What happens if we don’t do social media? Can we – our intermediaries, our brand – stay a trusted adviser without this form of contact that the customer of the future is coming to expect? A large majority of leaders think not.
As I mention earlier, leaders are focused. That means that their answer to this question is yes. For a long period of time, insurance was so much of a highly regulated sellers’ market that insurers didn’t need a strategy all. (According to one of my favorite strategy research, not having a strategy is pretty common across other industries as well.) As Andrea and myself argue in the paper, that doesn’t really work anymore; many insurers have replaced ‘no strategy’ with ‘we want to be everything to everybody’. Even as a Quality competitor that cannot really work; the behaviors and needs of the various customer (psychographic) segments is too diverse to serve all of them equally well; commoditization of classical Level 1 insurance products is too far along for there to me much differentiation possible there etc.
An interesting side discussion here is whether even leaders consciously and intentionally chose their archetype, or rather stumble upon it like in the linked post. I would argue that it doesn’t matter – what matters is that when it is there and it works, then the strategic choices have to be aligned to the archetype. And leaders do that.