With less than 2 weeks before we kickoff WinterHack 2020, it’s time to talk about this year’s theme: Digital Ecosystems. Today, we discuss the concept behind digital ecosystems, why they matter, and how they can benefit insurers who are looking to thrive in the digital era.
What is a digital ecosystem?
Simply put, a digital ecosystem is a network of companies, their customers, and third-party service providers that share digital platforms. These stakeholders combine their offerings to provide services more efficiently, thereby creating greater value for all their customers. Digital ecosystems integrate several industries, allowing participating companies to create targeted products that are better tailored to changing customer needs and preferences.
Why are digital ecosystems important?
Customer expectations are rapidly changing — and providers must evolve in order to keep up with these changes.
Modern customers want customized insurance products, and they want these offerings to be available immediately. They want transactions with their provider to be smooth, quick, and simple. They want the best possible value for the price they pay. And they want to be able to trust their provider to protect their personal data.
In a digital ecosystem, insurers partner with digital service providers to create cross-industry product and service offerings that capitalize on technological capabilities to serve these customer expectations. These ecosystems enable insurers to quickly modify products and services based on changing customer preferences. By collaborating with experts in other fields, the insurer can create true customer value in an efficient, cost-effective, and mutually beneficial way — which is the first step towards building a long-term relationship directly with the customer.
How can you benefit from digital ecosystems?
According to a report published by Accenture in 2019, insurers who do not quickly respond to these changes will miss out on growth opportunities worth USD $177 billion over the next five years.
Collaborations through digital ecosystems allow companies to scale faster than if they stood alone. For example, access to partners’ technological resources makes it easier to roll out new offerings quickly. These cross-industry partnerships provide opportunities for insurers in local and global markets and expand into new sectors by offering complementary products and services with already-trusted partner brands.
Data aggregated from these combined products can be used to generate new leads and lower operational costs, McKinsey says, as well as create targeted products with increased value. It further suggests that insurers can use this data to offer risk assessment, predictive modelling, and other analytics capabilities as a service to partners in the ecosystem.
Insurers must move quickly to adopt a more active role in their customers’ daily lives. By shifting to a digital ecosystem strategy, these insurers can improve product offerings, distribution, and customer relationships while capitalizing on collaboration opportunities that can take them well beyond borders and into a whole new era of globally focused growth.
Wondering how you can adopt digital ecosystems in your insurance organization?
At WinterHack 2020, our Certified Innovation Experts will guide your team through the Design Thinking methodology to help you create an innovative solution around our “Digital Ecosystems” challenges. At the end of the Ideathon, pitch your solution to our esteemed panel of judges and global audience for a chance to win our big prize!
Limited spots remain — sign your team up here!