Digital Indigestion - time to act!

Late in 2020, I published my annual predictions (check them out here). One of them peaked the attention of many - Digital Indigestion, what is it, what do I mean and what are the implications for Insurance, and to be fair many other industries through 2021.

I was delighted to be asked by Poppy Green at Modern Insurance Magazine for further thoughts on this and I was more than happy to jump in. To read the full magazine online, check it out here. Delighted to feature alongside James York and Rob Galbraith in The Big Tech Edition.

The full article is included below for you!. Enjoy, would love to know what you think! Are we all going to suffer with indigestion or do we have a clear way to deal with it?

As many of us opened our laptops, phones, and iPads at the  beginning of the year, after a well-earned, and let’s face it, well needed break, we also looked up for the first time to see what  state 2020 left us in. Not the pandemic or ongoing global health  emergency, but all the work around new tools, systems, regulation,  governance, hardware, and other technology deployed for the first  time at breakneck speed in an industry rarely associated with pace  of change. 

This time it was different, everyone just ran, as fast as we could,  laptops and hardware ordered and almost all teams moved to  WFH almost overnight. If you had asked any of the industry leaders or professionals dealing with business change, it was  never an event that we deemed possible or imaginable in such  a short period of time. But we did it! 

As time passed, and we hunkered down to business as  unusual, starting the year (in the UK at least) to a third  national lockdown, with tight rules, home schooling and much  more, one thing was clear — there is an element of ‘Digital  Indigestion’ to deal with following the aftermath of 2020 and  getting ourselves ready for the long road ahead — whatever  that may look like.

We must look at what we simply digitised in our moment of need and start to look  back at what we now need to re-evaluate, digitalise entirely, or reimagine

Pre-pandemic, the talk of the town was how technology could  change the insurance dynamics, from AI, to machine learning,  to Robotics and so much more. It has been for many years to  be fair. I can’t see the world ever having less technology than  we did yesterday, whether it’s in home or work. The key really is  how it evolves, adapts, and most importantly, is adopted over  time. Technology such as telematics has been around for over  25 years but is really only meeting broader adoption now as the  mass adoption of smartphone, mobile internet, and much more, is  widely available so that it truly becomes possible.  

Our Tech Trends report has tracked many of these over the  last 12 years, in what can only be described as a ‘Star Wars’ like  chart! See here for the  full report and infographic as above. As an aside, there  is also a good summary from across all industries through our  Deloitte 2021 predictions which can be found here.  It’s truly fascinating to see how every industry is under a constant  technology-led evolution, from athletes to media and everything  in-between. 

What is evident here is that many of these technologies we see  being deployed in the market today are 4-7 years old before they  get adopted at some level of scale. Others seem to be a ‘forever  burden’. I remember my first job where I was working in the Data  Processing Department on a DEC VAX6420 and was told it was  nearing the end of its life. 

That was 20 years ago, and I don’t know if it’s still going, but you  can see core-revival has been a constant over the last decade and  is likely to continue from my client conversations over the last  10 years — perhaps in a different form. Other technologies come  and go — blockchain seems to have reached a peak and then  gone quiet for the last few years. What we normally do is take  this broad spectrum and then apply it directly to insurance, from  direct carriers to brokers and re-insurers, to see what creates the  greatest opportunity.  

What’s evident to me here, is that through the pandemic we  doubled down on things that made an immediate impact, mostly  enabling technology — we started the evolution. In many cases,  the workplace of the future or the desire/need to work from home,  was nothing more than a mere experiment or potential pilot,  afforded to a few but not all. The pandemic translated this to —  lets execute our current plans at pace and digitise what we need  to so we can continue to function and trade as normal, just with a  dispersed remote workforce. Fast forward a year, this indigestion I  referred to earlier is now starting to emerge.  

What’s critical now will be how we make best use of the things we  accelerated, the investments made, and continue to leap forward.  We must look at what we simply digitised in our moment of  need and start to look back at what we now need to re-evaluate,  digitalise entirely, or reimagine the process entirely. All too often we are guilty of taking a broken paper process and making  it a broken digital process. To drive efficiency, scale up  and cost ultimately out, we need to take a long hard look  at these and quickly adjust, or fear looking back in 5 to 10  years with simply more technical debt. 

The real winners for me are those that  use this as a leapfrog to the revolution,  that will continue to drive the insurance  industry forward

Is this pace sustainable, both for technology and  infrastructure as well as the human element of the change?  It’s been quite some year for us all. If 2020 was the year  that we accelerated everything, 2021 and beyond will be  the year in which we fix the indigestion, replan our 3–5- year roadmap, but with a spring in our step, know that it is  without doubt now possible. We have all seen the memes and infographics flying around LinkedIn that said — ‘Who  led the digital transformation at your company? CEO, CIO,  CTO, COVID-19'. 

Whilst I didn’t like the trigger that started this, on the positive side, it has been a brilliant accelerant for so many, that we have, in many cases, to level the playing field for digital engagement. What was once seen as competitive differentiator to a few, touted as unique differentiator by many of the InsurTech community, is now table stakes for all to function normally. As I said in my 2021 predictions, some may spring back, or slow down, and deal with the evolution; the real winners for me are those that use this as a leapfrog to the revolution, that will continue to drive the insurance industry forward, creating new competitive battlegrounds for the future.

Nigel Walsh | @nigelwalsh