Overcoming change management fear to achieve differentiation
Fear of differentiation and how to best manage change is a key obstacle for insurance CIOs.
Editor’s Note: This column is the latest installment in a series from INSTANDA’s Greg Murphy about fears that can prohibit digital transformation in insurance.
Much of the financial activity in insurance companies today is spent on doing the basics. Ensuring legal compliance, maintaining base products and keeping the engine running, takes up most of the money and energy a firm spends, leaving differentiation as an afterthought.
Differentiation can fall into the weeds of everyday decisions, but its planning and implementation can be essential to a company’s change-management success. Fear of differentiation and how to best manage change is a key obstacle that insurance CIOs need to overcome.
Differentiation requires big-picture thinking
What may seem like small systemic changes such as adapting a product’s appearance or addressing questions asked by a potential customer, should form part of a larger strategy. CIOs must ask themselves what makes their company unique and how they stand out compared to competitors, to determine how best to differentiate. There must come a point where someone in the company can speak up and clarify how the differentiation process can be carried out. The ‘idea people’ may be executives, but their relationship to other departments who will actually carry out the changes are paramount to a smooth differentiation process.
Inter-departmental relationships
CIOs need to maintain a productive relationship with their IT departments to make innovative changes and distance themselves from competitors. IT specialists can put CIO’s high-level ideas into practice as well as educate executives on the nuts and bolts of the changes. Consulting between departments, and building the necessary camaraderie of creative problem solving, will keep changes quick, agile and under budget.
Every CIO wants to be remembered for helping their business to differentiate and progress. A relationship with IT that fosters creativity to achieve this can lead to great things for companies.
But even when it comes down to making the changes and shifting systems, companies can face new difficulties.
Change management: the most challenging fear yet?
It’s possible that the most challenging fear for companies is the reluctance or inability to adapt. As it moves from one system to another, the change management of a company can tip the scales from efficient to failing, and many organizations do not dedicate enough energy and resources to manage change effectively. An inefficient attitude toward change can hinder the delivery of any core system transformation. Companies often tend not to provide for its occurrence in budgets, training and communication between departments.
Communication facilitates seamless changes
It is also vital to remember the people at the other end of the decisions; the employees who use these systems to do their jobs. By changing these systems, the way these people work changes. So might their positions and pay. Therefore, communicating empathetically and honestly about change is significant to maintaining a healthy ecosystem. Jamming systems in and demanding that people “get used to it” simply will not work. IT departments currently have to ensure that they spend a lot of time on change management as certain systems may have been in operation for decades, and longstanding employees may find the immersion of new world technology too much to handle.
Not only do these legacy systems mean that there is an imbalance in ability with old and new employees, but they also hinder the change process. Changes within these systems, if requested to an IT department by their users, fall in a long list of tasks already put-upon IT experts within a company. These departments now need to line up the change, taking months to a year to implement the transformation.
How to prioritize change management
The valuable time and skills within any IT departments are best spent on innovation and planning rather than dealing with the minutiae of a legacy system change. Platforms such as the one deployed by my company, INSTANDA, can implement system changes within minutes including distribution appearance and client communications. This approach can facilitate a seamless working relationship between IT experts and other business units, providing the speed and agility to allow IT to expend important resources elsewhere.
Differentiation that makes any company stand out is achievable without the extensive timeframe, costs and training of traditional change management practices. There is no need to waste time and resources when the right technology vendor can facilitate digital transformation in real-time.
Greg Murphy (Greg.murphy@instanda.com) is executive vice president for North America at INSTANDA. These opinions are his own.
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