The COVID-19 pandemic has forced everyone – financial services companies included – to rethink their priorities very quickly, accelerating the digital transformation and reacting to extraordinary circumstances in order to continue operating. Now, it is time for the “new normal”, a second phase of the pandemic that is going to be crucial to keep transforming and evolving businesses.
According to Forrester, the drivers across all industries will be creativity; resilience; agility fuelled by strong customer understanding; and smart technological investments. Forrester’s prediction 2022 states that as COVID-19 pressures reduce, the key to success – as well as the one thing that “will separate leaders from laggards in 2022” – will be the ongoing differentiation due to creative processes, organisations, products, and business models. Customers will still be the main focus based on their demands: “commitment to ESG values; seamless cross-channel experiences; convenience; and reassurance”.
This is especially true for financial services and the insurance industry, where the year 2022 will be characterized by Customer Engagement, a central theme that permeates all the areas of transformation.
For what concerns these specific sectors, the year we have just entered will be characterised by customer-centric design, intelligent and algorithmic organisations, an agile and phygital model.
This is indeed the outline identified by Celent, another well-known player in advisory and market research for financial institutions, which published the Technology Trends Previsory 2022.
When it comes to the insurance industry, it is imperative to continue to evolve rapidly in order to respond to new technologies, changing business models, the explosion of data, and the need to digitize and innovate across every aspect of the value chain. Celent identified five trends, which are discussed extensively in the report and are the following:
• Customer and distributor experience
• Data analytics and AI
• Digital innovation and insurtech ecosystem
• Legacy transformation
From the role of IT and data analysis, which can offer competitive advantages in terms of risk management and service improvement, to digitalisation, which is now the foundation of efficient and effective business, up to the goal of creating sustainable growth, these are key trends that different sectors of Financial Services industry should be focusing on in 2022.
And what are the trends we envision at RGI? I would say 3:
• Speed becomes a differentiator (see also my previous post): from speed of product development to instant insurance, the ability to be first on the market will the a strong differentiator
• Platform play, whether very wide (from Amazon or Alibaba) to very focused (eg Marine-related), based on an experience (wellbeing, travel) or on a transaction (eg retail insurance at the point of purchase). Adoption and the business model will be the key drivers (see also my interview at the 23rd Insurance Summit)
• Finally, the width and depth of Partner relationships, along the full value chain (from Insurtechs like us, to start-ups, to hyperscalers but also System Integration players) should be ever more impactful in 2022
It is now up to the various companies and players in the market – and their top management – to put the trends they select at the centre of their actions and make them drivers for growth.