April 24, 2018 07:00
In a world that is complex and volatile, where the consumer is king, the insurance industry must above all put forward a collaborative approach on all fronts, says Réal Jacob.
Who is the Real Jacob ?
Professor in the department of entrepreneurship & innovation at HEC Montreal, Réal Jacob has also been the holder assistant of the Chair of Bombardier recreational Products.
Its work and its teachings are about the transformation of organisations and the management of change the management mode, cross-cutting and collaborative, and on the role of director. In this capacity, he has advised, accompanied, or closely followed several major international leaders of the economy, including Michelin, Samsung , and the Cirque du Soleil.
He has delivered more than 500 lectures with the business community here and abroad. Author or co-editor of thirteen books, of twenty-five chapters of volumes and hundred articles or communications at university, he has received a number of recognitions, including the prestigious Award of excellence canadian Leaders in Management Education.
At the opening of the Day of damage insurance 2018, he said that the industry needs to refocus on its fundamental raison d’être : to create value for its customers. It is as well that it seated its future on a sustainable basis. «Innovation is now a collaboration,» he said to the approximately 500 delegates attending the opening session.
To do this, there is an urgent need «to get out of its mental patterns» and » learn what is done elsewhere «. The business models used in the past will not be enough, he warns.
The success may make them blind ! It is by this warning that he began by giving the example of Blockbuster. Founded in 1985, this ex-jewel american made bankrupt in 2010. In 1997, at the height of its glory, its leaders have had the opportunity to acquire Netflix, newly founded, for $ 50 million (M$). They watched the train pass. The reason for this ? The niche Blockbuster, they argued, it is the rental of video cassettes or compact discs in a network of shops.
Today, while Blockbuster rest in peace, Netflix browses annual revenues of $ 12 billion (G$). DVD rentals by correspondence, the company has added over the years in a service stream on the Internet, the subscription from a tv connected, the production of its own films aligned on the tastes of its subscribers, a geographic expansion continues, a differentiated offering packages targeted, etc
«We live in a world that is horizontal and connected,» explains Réal Jacob. The consumer research platforms for integrated services. Ecosystems. Organizations should no longer be set vertically as a function of an industry, a segment, a expertise, or practice, but according to reason to be more broad, all-encompassing. Michelin is positioned more as a tyre manufacturer, but as a global leader in mobility. Blockbuster did not understand. Kodak no more. The list of the missing is long. «
To think otherwise
In the 1960s and 1970s, periods of change alternated with periods of stability. And then the change has become constant, but predictable.
The current era is characterized by the magnitude, the rapidity and unpredictability of changes. Under the combined effect of the digital revolution, the artificial intelligence, the explosion of mobility and new patterns of consumption. Not to mention the deterioration of the climate and the political upheavals on the scale of the planet.
Yet the modes of organization and management of enterprises still operate in a silo. The problem-solving and ideation-creation will continue to be between experts, in a vacuum.
«The reality has become too complex for this traditional model,» says Réal Jacob. Instead of pulling the head in its corner, it would be better to develop the ability to work with others. We are entering the era of open innovation. Now, innovation is synonymous with work. It is a whole other universe. Thinking collaborative is based on empathy, trust, openness, sharing and integration. It manages the interactions, connections, differences. The competition wall-to-wall, it is opposed by the co-operation and sharing. «
A mode, do you think ? The Harvard Business Review, whose mission is to inform key decision makers on the emerging challenges of the business world, has devoted a whole issue to the collaborative economy. as of 2011 : Collaborate. Build a culture of trust and innovation. The journal Management from HEC Montréal in 2015 under the title the imperative: «Work ! «
In 2014, the co-founder of LinkedIn, Reid Hoffman, said : «No company can succeed by itself. The only way to accomplish something significant, it is in working with other people. «
Collaborate with the enemy…
During the survey PwC conducted in 2015 with 1 322 CEO of 177 countries (A market without borders – In response to disturbances), more than 50 % of them responded that future alliances would be with competitors. Business leaders here believe the same thing.
The question of PwC, » Are you ready to work with a competitor ? «, 52 % replied » yes «. A heresy, it was not long ago, but a necessity today, they believe, to be successful and compete on the global level. We have created a new word for this phenomenon : the » co-opetition «.
Examples ? Financial institutions across the globe have paved the way with atms built in. In the mid-2000s, Samsung and Sony, two of the world leaders, have pooled their expertise to produce a prototype of the tv higher. Coca Cola and Pepsi have done the same to create a natural solution to the cooling of their drinks. Today there are 5.5 million of these units in the world. In Canada, the industry of the steel beam has formed a collection, Steel More, who is active in the area of training and sharing best practices. This does not prevent all of these players remain fierce competitors the rest of the time !
«The thinking collaborative also extends to institutions, recalls Réal Jacob. Do you know more enemies that theMcGill University and HEC Montreal ? Eight years ago, the two institutions have decided to offer an MBA program for business leaders. It has 13,000 management schools on the planet and hundreds of programs of this nature. It is the competition, it ! Each of our side, we had no chance to break through. By uniting our respective strengths, we have created a unique program which today ranks among the 30 best in the world. «
…and with the foreign
In the study of PwC, 60 % of business leaders surveyed say they are open to work with other sectors than their own. The proportion is the same in the international. Their message : for the best performer in my industry, I need to know and transpose what is done better in other industries. And conversely, our abilities and our strengths can represent solutions for customers in other industries ?
Mathieu Ferland, producer of games at Ubisoft, adds a logic of growth : «Every day, I am looking for how our universe of games, our know-how and our technology could benefit other industries and, by the same token, we open up new markets «, quoted Mr. Jacob.
Rolls Royce was not afraid to borrow the Perfumes of Grasse, its nose of leather to refine the smell of the recovery of its seats. You know Dig Rush ? It is a video game therapeutic used in the treatment of amblyopia, an eye disorder, which is the result of collaboration between McGill University and Ubisoft. For its part, the Society for arts and technology joined forces with the Sainte-Justine hospital to help children with autism to tame the doctor in the middle of an avatar, a computer representation. He also creates digital games for schools to develop a pedagogy which is more inspiring for young people.
«For the insurance industry, the collaboration must extend to the startups,» says Réal Jacob. It is necessary to see these young, innovative companies as partners and not as a threat. The investments in the Insurtechs increased from$ 140 Million in 2011 to$ 2.7 billion in 2015, and 75 % of their activities are dedicated to private customers. It is crucial to enrich the customer experience of insurers ! «
An antidote to the commoditisation
Internet shopping makes it easy and simple to obtain directly insurance products, which may be of the amenities. How to remove this danger ? Bain & Company, an international firm of management consultancy, has enquired of 172 000 consumers of insurance products in 20 countries. The title of his study carried out in 2017 is very clear : beyond insurance : cut the gordian knot of the commoditasation and build loyalty through ecosystems. An organization belongs to a community through its offering of services.
«Customers want two things from your hand, insists Réal Jacob : your guidance for all their financial needs, and that you’re serving with empathy and compassion. It is your fundamental raison d’être. They are therefore looking for value and not an intermediary transaction. The study of Bath also points out that consumers see the insurance industry as a natural integrator in the heart of the ecosystem of financial services. We trust you more than any other group. You are in good stead for the future. «
By way of conclusion : «The culture of collaboration must be valued, supported, recognized and developed. The leader of today is the explorer-in-chief and the provocateur-in-chief. Why not devote a portion of each committee of management to identify, analyze, and discuss a new trend to give then three months to integrate its activities ? «