There is plenty of hype about digital transformation (DX). It’s going to save the business; it’s going to transform customer engagement; it’s set to redefine collaboration and communication. All this is true, but only as a part of a whole. DX is a journey, not a destination, and the route isn’t linear – it’s decided by the business, its strategy, the shifting sands of market and economy, and on building a culture that’s capable of leveraging digital to achieve results that are measurable. It’s not a tool. It’s not one single technology. It’s transforming the way the business thinks about business.
Demystifying DX asks for several steps in an entirely new direction, particularly in the financial sector where DX initiatives have often inhibited growth rather than enabling it. The challenge is that often decision makers in financial services and insurance companies see DX as a technology investment that will silver bullet its way through legacy problems. It won’t. Well, actually it will, if it’s part of a rethink around how the business is organised and how it redefines its processes and products to drive long-term success.
The biggest myth is that DX is technology that will simply deliver exactly what the business wants, when it wants it. The reality is that technology only forms one small part of the equation, and the rest is made up of culture, mindset and strategy. As the business embarks down the DX road, there are three key steps that it must take to ensure that DX is not a mythical beast that may or may not deliver value. The biggest myth is that DX is technology that will simply deliver exactly what the business wants, when it wants it.
Step 1: See DX as an Enabler
The first step is to see DX as an enabler. It can provide the business with the tools it needs to meet the demands of a rapidly evolving market. Customers want the same customer experiences from the financial industry as they get from buying a book or groceries online – they want speed, efficiency and reliability.
Step 2: Build a Culture that Embraces DX
Many DX projects are not successful because there was internal resistance. Leadership paid lip service to the idea and put some backing behind the technology, but they stuck to the status quo because it was what they knew and were comfortable with. DX is more than a project; it’s a culture shift. It is a fundamental redesign of internal thinking that allows for people to fully realise the potential of the technology that comes with DX, and to innovate within that potential.
The right culture and approach – created by ensuring that there is buy-in and awareness throughout the business – will result in an agile and flexible mindset that translates to fresh thinking, new products and intuitive service delivery. The second step? Build a culture that embraces the capabilities of DX with employees and leadership that are empowered to implement it effectively.
See DX as a Constantly Evolving Process
The third step is to see DX as a constantly evolving process. McKinsey captures this perfectly in its recent podcast, Digital transformations are a long game, where it points out that it’s become fashionable to talk about how often DX fails and how difficult it is to get value — that DX is elusive and murky as a quantity. However, “the point of digital transformation isn’t to become digital. It’s to generate value for the business” – and this value is found in expanding market share, lowering operational costs, driving intelligent growth and innovation, and evolving in line with markets and customers.
Step 4: Recognize that DX is Iterative
Businesses that have already embarked on a process of DX do not need to rip and replace when it fails to deliver the expected results. They can refine what they have by recognizing the problems that have inhibited its capabilities and making iterative improvements.
Finally, the business needs to maintain a clear vision about what it wants to achieve. To step away from the concept of digital transformation and to rather reframe this concept as modernisation, as a methodology that helps companies to optimise their people, processes and growth. The insurance industry may be an old industry, but it can benefit immensely from reorganising the way it does business, the way it thinks about business, and the way it uses technology to reimagine its potential.
Conclusion
The financial sector can benefit greatly from DX. Businesses need to maintain a clear vision of what they want to achieve and reframe the concept of DX as modernization, a methodology that optimizes people, processes, and growth. At Greenraven, we have extensive practical experience in the African insurance industry and can advise businesses on inclusive insurance, digital transformation, project management, alternative distribution strategies, cell captive arrangements, product design and pricing, simplified policy wording, change management, and mentoring. Contact us at hello@greenraven.co.za, or connect on LinkedIn.
