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EMBRACING ACCELERATED DIGITALISATION IS CRUCIAL FOR INSURANCE: HERE’S WHY

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By James Hall, Commercial Director at Doxim

 

The events of the past year or so have seen an unprecedented acceleration of digital transformation within organisations. In fact, research from cloud communication platform Twilio, shows COVID-19 accelerated companies’ digital communications strategy by a global average of 6 years, with 5.3 years the UK average. Additionally, 96% of UK enterprise decision-makers believe the pandemic sped up their company’s digital transformation, and of these 66% said it did so ‘a great deal’. This change has impacted the way companies operate internally, especially as staff were forced to rapidly adapt to remote work, and change the way they communicate with customers.

The insurance space is no exception. Even as insurers were paying out billions of pounds in claims as a result of COVID-19, they were having to grapple with a drastically altered working environment and find new ways of engaging with customers. As vaccines continue to roll out and life becomes increasingly normal, however, they need to be aware that there’s no going back. According to a recently released report from Accenture, digital insurance and distribution in the UK will put a £8.3-billion dent in the revenues of insurers that cannot keep up with the pace of technological change by 2025.

It’s therefore critical that insurers embrace digital transformation. And while it is an ongoing and evolving process which impacts the entire organisation, the best place to start is with customer communication.

 

CX and digital transformation 

That’s because customer communication is critical to creating a great customer experience (CX) which, ultimately, should be at the heart of any digital transformation initiative. So much of CX is about the relationship between a company and its customers and it’s impossible to build a relationship in silence. That’s especially true in a world where 73% of customers expect companies to understand their needs and expectations. It should hardly be surprising then that 95% of customers are looking for some degree of proactive communication from the companies with which they do business.

And yet, most insurers traditionally fail to speak to their customers in any meaningful way.

Stats show that more than 90% of insurers worldwide do not communicate with their customers even once a year and that 20 to 40% of their customer base will not receive a single communication all year. There’s no reason this should be the case.

 

The power of CCM 

Insurers have much larger amounts of data on their customers than most other industries.

Combined with a powerful customer communication management (CCM) platform, insurers can use this data to create a massively improved experience for their customers. Using a CCM platform, insurers can send messages that are tailored according to customers’ needs and preferred platforms (web, email, SMS, print) and devices (mobile, laptop, tablet, PC).

CCM platforms also mean that messages received by a customer provide not only the needed information but take into account the entire context of the interaction which includes customer profile (e.g. lifestyle and life-stage needs), history of online activity, and personal preferences. That’s particularly important for insurers, where keeping up with a customer’s changing needs is critical to giving them the best product and experience possible. CCM platforms also allow insurers to more efficiently deal with customer queries, as well as reduce the cost of sending, storing, and managing customer documents.

A CCM platform is pivotal for managing the transition from print to digital in customer communication. Whether a result of legacy decisions or chasing the lowest price, many insurers expend unnecessary time and energy managing multiple vendors for print and digital communication. Consolidating all customer communication onto a single platform from one vendor can save significant time and money and allow valuable resources to focus on growing the core business. While print communications won’t go away completely, it’s important to acknowledge that consumers are choosing digital, so organisations can only benefit from providing digital and doing it well.

Perhaps most importantly, however, a CCM solution can help insurers achieve a great digital experience by creating, sending, and storing customised messages and providing consistency across all the channels that customers interact through. In addition, it enables the organisation to leverage the data on hand to generate highly personalised offers that are relevant to each customer’s needs and lifecycle stage. A good one will also cater to each of the insurance customers’ accessibility needs. All of these factors have been brought to bear in the Doxim CCM solution, which is currently being launched in the UK.

 

Forget fear, embrace opportunity 

While some insurers might find digital transformation scary (“this is the way we’ve always done things” is an easy mindset to get stuck in), it’s clear that they need to move beyond that fear if they’re to remain competitive going forward. But they also need to be clear about the fact that digital transformation isn’t just about adopting new technologies. Rather, it’s about using digital tools to create the best possible experience for customers. Starting with customer communication is the best way to do so and a CCM platform is one of the most powerful enablers of this customer-centric approach to digital transformation.

 

Finance

WHY PEOPLE ANALYTICS WILL PLAY A PIVOTAL ROLE IN SOLVING THE FINANCIAL SERVICES INDUSTRY’S SKILLS CRISIS

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Daniel Mason, Vice President EMEA, Visier

 

Successfully guiding teams of employees through the post-pandemic landscape will not be easy for any business, but nowhere is this more apparent than in the financial services sector. Here, leaders face the formidable challenge of rebuilding working environments against the backdrop of huge industry uncertainty, caused by the most turbulent 18 months in living memory, as well as an increasingly concerning global skills gap.

In order to succeed, not only do they need to create highly compelling environments that entice new and existing employees alike, they must also work to proactively identify areas where additional improvements need to be made. Doing so will enable swift and decisive action to be taken before seemingly small issues start to have a major impact on overall business performance or staff retention.

 

Storm clouds are gathering on the horizon

It’s safe to say the financial services industry garners more media attention than most when it comes to working conditions. With well over a million people employed in the UK alone, scrutiny into key areas such as work-life balance, job pressures and pay is near constant.

In order to gain better insight into current job satisfaction within the sector, Visier recently conducted a new study focussing on how both UK employees and HR leaders feel their businesses are managing during this difficult time, and how it is affecting both current performance and future prospects. The research revealed some worrying statistics that point towards a potential avalanche of resignations in the near future, unless something is done to prevent it.

Why is this? Put simply, too many financial services organisations don’t appear to know their employees are unhappy and of those that do, most don’t fully understand the reasons behind it, meaning they can’t effectively tackle them. This article will discuss these findings and their implications in more detail, before exploring how people analytics can be used to spot key trends – both positive and negative – early, and boost employee experience/morale at this crucial time.

 

Learning new skills is increasingly important to both employees and businesses

According to Visier’s study, over half (52%) of employees in the financial services industry expect to actively look for a new job outside of their current company in the next 12 months, with almost a quarter (24%) already doing so. In light of these alarming figures, you’d be forgiven for assuming financial services organisations have failed to adapt to Covid-enforced ways of working. However, this isn’t the case at all, with the vast majority of those surveyed reporting that their companies have reacted impressively to the pandemic.

There are, of course, multiple reasons why workers may feel compelled to move on, even if they have a positive overall connection with their current employer. While each case is unique, the three most common reasons cited in the study were, perhaps unsurprisingly, ‘poor work-life balance’ (43%), ‘salary’ (33%) and ‘feeling undervalued’ (25%).

Following closely behind in fourth place was ‘not being encouraged to learn new skills’ (19%). However, there’s a growing school of thought that this has a much bigger influence on employee satisfaction than the raw data might suggest. Work-life balance and salary have always been major drivers of change, and learning new skills can go a long way towards helping workers address these by improving the value they bring, as well as boosting their overall day-to-day efficiency. The findings backed this up, with over half (55%) of employees admitting they are worried that failure to develop new skills will lead to their careers stalling.

The study also uncovered a strong feeling amongst both financial services employees and HR leaders that learning new skills is a crucial factor in the future competitiveness of their organisations.  Just 59% of employees felt confident their employer was bringing in the right people to keep pace with clients’ expectations for digital services. Meanwhile, over two-thirds of HR leaders believe that the sector’s lack of available candidates is holding back their company’s digital transformation strategy. As such, not only do employees see a lack of skills training and opportunities as a blocker to their own progression, it also presents an existential threat to the organisations they work for.

 

People analytics is playing an increasingly pivotal role

As financial services organisations continue to work through the disruption caused over the past 18 months, they need to be conscious of key factors impacting employee retention, as well as address any skills gaps acting as barriers to effective digital transformation. Investing in the right new learning opportunities and upskilling current employees will be crucial in reducing unwanted churn and ultimately boosting long-term competitiveness.

People analytics tools give businesses – in financial services and beyond – the real-time intelligence they need to achieve this, enabling them to grow and thrive regardless of what’s put in their path. Not only can people analytics help identify worrying employee trends such as disenchantment about skills training early, it also provides the insights needed to fix issues before they can significantly impact operational effectiveness.

As the data shows, employee satisfaction isn’t the only factor at play. Job happiness is also tied to whether employees believe the business is making the right decisions for their future. However, without the right tools in place leaders must operating on gut feel alone, which is rarely a good formula for success.

Every day, a growing number of decision-makers are using people analytics to uncover the key insights needed to make informed decisions regarding who to hire, who to reskill and who to promote. This is no coincidence. The move towards people analytics at scale is not a passing craze, but the acceleration of a powerful trend that’s been gathering momentum for almost twenty years. Maybe it’s time your business sees what all the fuss is about?

 

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Business

BECOMING THE CEO: THIS IS HOW CFOS CAN SECURE THE TOP JOB

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Mark Freebairn, Partner and Head of the Board and CFO Practices at Odgers Berndtson, explains what CFOs need to do if they want to become CEOs 

 

For some time now, there’s been a very clear trend in CFOs progressing onto CEOs. It’s a trend that should come as no surprise to executive leaders. With more CEOs under increasing pressure, many CFOs have become the nominal second in command, often taking non-finance related responsibilities off their CEO’s plate.

As result, CFOs have begun playing a more strategic and commercial role which has inevitably broadened their remits beyond the finance function. With many CFOs breaking out of the traditional financial management confines, executive teams and boards have begun to realise that finance and general management are more closely aligned than they previously thought. This has given CFOs more opportunities to gain experience relevant for the CEO position. From owning P&L business units to engaging with external investors, the CFO’s evolving remit is making them likely candidates for the top job.

That’s not to say it’s a done deal for anyone who is currently a CFO. The CEO jobs market is comparatively small, CEO turnover is typically slow, and competition is intense. So below, I’ve outlined the key areas CFOs should gain experience in and the opportunities they should capitalise on if they want to compete for the CEO positions out there.

 

Mark Freebairn

Take responsibility for P&L business units 

Overseeing specific business units is a natural extension of the CFO’s responsibilities. It provides experience of managing products, costs, and revenue generation – all of which are staple requirements for the CEO role. But it also provides operational credibility internally, which will prove advantageous for any CFOs lining themselves up as a succession candidate to their own CEOs.

If possible, CFOs should take on responsibility for turning around a failing business unit. This is the fastest way of gaining commercial experience relevant for a CEO role. Particularly as economies emerge from the pandemic, boards will be looking for leaders who can demonstrate an ability to drive growth and new business despite significant internal and external challenges.

Likewise, CFOs should involve themselves in other business functions. Whether it’s procurement and the supply chain, or facilities and security, CFOs should play a role outside of the finance function in order to gain broader business experience.

 

Build a highly-autonomous finance team 

The CFO’s role within organisations and their ability to easily expose themselves to other P&L units makes them suitable candidates for CEOs. However, CFOs are only as good as the team around them. Building a high-performing finance team that can drive the day-to-day operations of the function will have several outcomes. Firstly, it will free up a CFO to take on more responsibility around the business and gain more time with their CEO. Secondly, it’s a valuable proof point that CFOs can use in any interview to demonstrate their ability to build strong teams – as a CEO, building a strong cadre of trusted executives is crucial for success.

This should be a team that can be trusted to perform autonomously, with a strong second in command that the CFO can rely upon.

 

Take on a non-executive director (NED) role 

While financial management is central to any successful organisation, CFOs still need to develop expertise outside of the function if they are to step up as CEOs. Taking responsibility for P&L business units will provide this, however it won’t provide a CFO with the same board-level perspective that a NED role will.

Taking on a NED role will not only help CFOs to understand what boards expect of CEOs but it will also provide experience of a different kind of leadership; one that is less hands on and more about guidance and mentorship.  Within the commercial sector, there are board roles among smaller quoted companies, those backed by private equity, or family owned businesses. Advisory boards and subsidiary boards are also a good option.

On the public sector side, board roles exist within organisations owned by or reporting to government. These include major infrastructure operators, the NHS, regulators, museums and other arts institutions. Likewise, a charity trustee role (while unpaid) is similar and will help to develop both a CFOs network and board skills.

Auditing, budgetary reviewing and balance sheet responsibilities are often sought after skills in non-executive directors, making CFOs ideal for these positions.

 

Take on internal leadership positions 

These types of leadership positions should be separate to the finance function and can include things like internal workstreams, strategic initiatives such as I&D and sustainability, or CSR projects. The benefit of taking on this responsibility is two-fold. It helps build necessary leadership skills and provides leadership experience. But it also showcases a CFO within the business in a leadership capacity outside of finance. The later will be beneficial for any CFOs looking at internal progression onto the CEO position.

Mentoring achieves similar outcomes. This helps build leadership skills and can lead to greater exposure around the business. What’s more, any mentee may later become a useful contact in a CFOs network.

 

Network outside of the organisation 

CFOs often underestimate the power of a personal network. Building relationships with other senior leaders will enable a CFO to generate career opportunities that can lead onto CEO appointments. While professional networks within the CFO community are valuable, networking outside of these types of environments is likely to be the most profitable for career advancement.

Any CFO looking to make the jump to CEO should build relationships with a variety of third parties. These include shareholders and brokers, investors, M&A specialists, bankers, and even lawyers. A CFOs experience and perspective can be incredibly valuable to these types of professionals so getting on their radar shouldn’t be difficult. Making the effort to build a relationship with them will pay dividends in the long run, and may lead to hearing about, or if you’re good enough, even being recommended for a CEO position.

 

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