Australia: Suncorp Life Insurance Unit
Deaths from Natural Disasters

Strategy and change

RGA Re has the results of a survey performed in conjunction with LIMRA and the Society of Actuaries. There is a lot of information, but it is well worth the read. The report resources are extensive, but have some limitations, as does all such syndicated research. But this being January, and while I am still on holiday, I feel free to comment on wider strategy issues, rather than the procedural aspects of improving the product development process. 

It is clear from the report that many product development managers (including heads of marketing, sales, and those responsible for innovation and change) feel trapped by the business in which they operate. They labour under many constraints: old systems, poor administration performance, and pre-existing problems such as channel conflict, legacy product ranges and so on. 

Most insurers do not actually set a product strategy. This is a refreshingly honest admission. Many insurers talk about a market strategy, with a significant product component. Yet what passes for 'innovation' in many companies would get laughed at by companies that exist in categories such as software, consumer products, and so on. That's not actually a bad thing. People come to insurance companies for certainty, not excitement. But it has an effect of making insurers slow to change.  Probably too slow. Yet dramatic change is probably required, if you are to avoid becoming some start-up's lunch. That's more change than the annual search for what is possible without breaking any constraints. "What can we do without any system change?" can only ever be a stop-gap measure - because if you don't have to do anything difficult to achieve a change, neither will your competitors, and so you will gain no sustainable competitive advantage. Here's a different take on a strategy challenging question: "what could we do that is both valuable and difficult, so no-one will dare follow us?"

But at this point it is best to stop criticising insurers for faults they know they have. It is so easy to point at others and judge them. Why don't they change? As one reinsurer put it in a recent meeting - 'before I came here, I thought I knew all the solutions'. Things are harder when you have more at stake. The reality is, change is hard. Not just for the industry, for you, for me.

At a time of reflection it is worthwhile pondering, not how others could change, but how I can change. What new skills an resources should I seek out this year? Which of my current assumptions about the market are faulty? What new things might arise and how would I find them? What will I do daily in order to realise my change? How will I keep track of my performance against these new goals and move to correct my course as I go through the year? What invisible fences are stopping me from creating new possibilities for me and for my clients? Whatever change I am trying to bring to an organisation, I must first be the change. 

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