Using strategy to navigate to a fixed point in the future is an outdated and inflexible approach for today’s dynamic insurance market. With so much change, an approach of strategic intent is more appropriate as it allows an organisation to adjust and adapt their strategy as the market continues to change whilst remaining true to their core strategic aims. In an insurance market that is experiencing technical, societal, structural and environmental change, a good strategy is now more important than ever before.
Rajeev Aggarwal, who joined Consumer Intelligence’s Advisory business as Managing Director after a career in strategy building, says: “The challenge for Strategy Directors and Chief Strategy Officers is how to understand a market and keep abreast of new developments where so much change is occurring.
“Blockchain, artificial intelligence, internet of things, autonomous vehicles, a growth in insurtech start ups, an ageing population and a multi-generational workforce are just some of the drivers of change that have the potential to create a tectonic shift in the insurance industry.”
The centuries old proverb, ‘being forewarned is forearmed’ is still appropriate today. While nobody can accurately predict the exact future of the insurance industry, it is possible to be prepared for multiple futures and to adopt a flexible strategy that adapts to the future as it comes true.
Following a robust and systematic approach to looking forwards allows insurance brands to identify, understand and prepare for important trends that are likely to create both risk and opportunity for their business. At Consumer Intelligence we call this process horizon scanning and we have a proven and detailed approach to helping insurance brands prepare for the future.
Horizon Scanning in action
The initial part of horizon scanning is to identify trends that could affect insurance. These trends might be insurance specific, general consumer behaviour led or macroeconomic.
“The key is not to evaluate their potential impact at the first stage, but just to capture and understand them. Once the identification stage is complete, impact and analysis can be undertaken,” says Rajeev Aggarwal.
Consumer Intelligence’s fundamental belief is that no trend occurs in isolation, therefore the process of basing a strategy on one trend alone can create unnecessary risk. To overcome this, Consumer Intelligence examines how trends interact and impact each other to create insightful themes and it is from these themes that strategic plans can be built. For example, the internet of things, artificial intelligence and consumer data privacy are all trends that will combine to drive the personalisation of services in the future, rather than by a single trend on its own. This approach also minimises the risk of building a strategy based upon a single trend or technology that doesn’t live up to its hype, a good example being Google glass that quickly went from being the future of wearables to an unwanted gadget.
Aggarwal continues: “The art of a good strategy is to turn it in to practical actions and through the creation of multiple possible future scenarios, a link can be constructed between a strategic directional intent through to a set of operational actions.”
Preparing for multiple futures
Horizon scanning enables insurance brands to bring together functions including strategy, risk, marketing, innovation and pricing for a single perspective on how the insurance market may develop and the options to maximise the opportunities for success. As the future reveals itself, horizon scanning adapts and adjusts to new trends and external drivers of change to ensure the strategy of an organisation always remains relevant, in touch with the market and consumers and aligned to commercial objectives.
Aggarwal concludes: “Insurance brands that are looking forward are able to adapt to a changing market with greater agility than one that just reacts to an event. Within Consumer Intelligence we see a greater number of insurers looking to adopt the concept of strategic intent and finding that horizon scanning is an invaluable tool as part of this process.”
Consumer Intelligence is already helping some of the UK’s leading insurance brands with horizon scanning with its unique approach and insight. In these times of extraordinary change being forewarned is forearmed has never been more relevant. Isn’t it time you looked to the future with Consumer Intelligence?
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