Iconic Prudential Center, Boston

Iconic Prudential Center, Boston

I read a recent article that spoke about the critically important role Social Technologies will play in the survival of business. The focus was the current lack of participation in Social Tech at the executive level. While the article wasn’t specifically pointed at the insurance industry, based on my experiences within the insurance vertical, especially the Life, Health, and Accident sector, my experience affirms the following truths.

  1. The insurance industry has always been slow to adopt new technologies.
  2. In an era of Big Data, insurance companies that are still relying on legacy technologies are falling further and further behind consumer expectations with regard to data flow and integration.
  3. These consumer expectations are being established by consumer experiences in a variety of settings with products and services of all kinds.
  4. Only a handful of insurance companies, most often those that focused on Direct-to-Consumer sales and service models, are adapting to these new expectations.
  5. Those insurance companies that use distribution channels such as agency, association, and worksite marketing, continue to struggle with technologies of all kinds that are advancing faster than their capacity to adapt and integrate.
  6. As always in business, these issues can only be solved by leadership driving change. And that leadership must be savvyabout technology in order to effectively direct that change.

    Compelling Stat, Hubspot

    Compelling Stat, Hubspot

  7. However, for the last 20 years or so, the standard response of insurance executives relative to technology is, “I have people that are doing that…” or “I’ll leave that to the techies…” or something along those lines.
  8. More specifically, relative to Social Tech, many executives are still saying things like, “When someone can show me the ROI of Social Media, I’ll be more than happy to use it.”
  9. So in other words, they are willing to be 2nd, not 1st. Yet, these same executives will proclaim that they are “thought leaders.
  10. And so their organizations are stuck. Line managers know that existing business models are struggling but they don’t want to rock the boat. Instead, they engage in protectionism and internal competition, rather than creativity, innovation, and change.

So do you see how incredibly damaging it is for insurance company executives to abdicate technological strategy? I heard it said this way recently,

“Many executives are committing corporate treason by abdicating technology leadership.”

I doubt that there’s actually deception going on – a necessary component of treason, but you get the point: If an executive is tasked with strategic leadership, and yet they don’t understand technology, much less set the direction for its use, aren’t they putting the enterprise at risk?

The top insurance companies today are actually “technology companies in the business of insurance” rather than “insurance companies leveraging technology.” The most effective executives in insurance tomorrow will be the ones who understand technology, who use it with their own hands, who write about technology and teach it to their staff and business partners, and who create dashboards that will continuously put new information in view about how to leverage technology.

To that end, I’ve got a handful of public Social Tech Boot Camps for Insurance Executives scheduled over the next few months, plus a few private ones. After that, I’ll be moving on.

What’s next? A LOT. But if executives don’t understand Social Tech and Web analytics, they won’t be able to understand and apply what’s coming after.

Do you agree? Or is there still more time to wait and see on Social Tech? Is the Blockbuster video demise instructive? They fell off a cliff. Is the current overhaul of the health insurance business model a direct result, among other reasons, of an industry not leveraging technology to the point of exasperation of the constituent base? (Remember, Obamacare passed by ONE VOTE.)

Am I out in left field on this? Please drop a Comment. Perhaps then Share the post on Linkedin and ask your network to Comment as well.

What’s at stake? What’s the solution?