turning digital disruption into innovation
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Turning Digital Disruption Into Innovation In Insurance
Pat Saporito, CPCUSr. Director, Global Center of Excellence for Analytics, SAP and Industry Analytics Expert
Digital: 4th Wave of Info Technology
1850
Industrial economy
2020
Digital economy
1990
Internet economy
IT economy
1970
$0.36T
$12.10T
All figures are in Trillions; 1990 international dollars; Source: Department of Economics, UC Berkeley, BAIN 8 MacroTrends Brief.
$27.50T
© 2016 SAP SE or an SAP affiliate company. All rights reserved.
$90.0TGrossworld
product
2
Living in a Digital Economy
Last 2 yrs. Last 2 yrs. End of 2020 End of 2020 In 2014
1 ScienceDaily, May 22, 2015 2 Technology Adoption Report on Business Networks, Ardent Partners3 Internet of Things (IoT) 2013 to 2020 Market Forecast: Billions of Things, Trillions of Dollars, IDC 4 Statista5 Cisco Global Cloud Index: Forecast and Methodology for 2013–2018, Cisco Systems Inc.
90%Of the world’sdata has been
generated1
40%Growth in
adoption of business
networks2
212 Billion
“Things” willbe connected3
9Billion
Mobile usersin the world4
51%Of workloadsprocessed in
the cloud5
© 2016 SAP SE or an SAP affiliate company. All rights reserved. 3
Insurance Industry Disrupters
Trends
Peer to Peer Insurance
Usage Based Insurance
Spot Insurance
Contract/or Management
Aggregators/Quote Engines
More InsurTech Sources:CB Insights InsureTech BlogTechCrunch Insurance
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The Analytics Native
• Began as an analytics company; morphed into an insurer• Acquired by Monsanto (seeds) for ~ $1 Bil.• Bayer (insectide) recently made a $62 Bil. Bid for Monsanto!
200+ data scientists analyzing 50 terabytes of weather data/day!
The Climate Corporation aims to help farmers around the world protect and improve their farming operations with uniquely powerful software and insurance products. …proprietary technology platform combines hyper-local weather monitoring, agronomic data modeling, and high-resolution weather simulations to deliver climate.com, a solution that helps farmers improve their profits by making better informed operating and financing decisions, and Total Weather Insurance, an insurance offering that pays farmers automatically for bad weather that may impact their profits.
Backed by Founders Fund, Khosla, Google Ventures, NEA, Index Ventures and Atomico.
© 2016 SAP SE or an SAP affiliate company. All rights reserved.5
The Innovator
!
Insurers are using their venture capital funds to invest in innovation!
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World Class Data & Analytics; Often Described, Rarely Achieved
Chasm between what we hear … and what we see!
© 2016 SAP SE or an SAP affiliate company. All rights reserved.
7
Individual Customer Journey
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Digital (R)EVOLUTION?
Extend the addressable market and ecosystem
New digitally enabled insurance products
Today Tomorrow
Core insurance business
New non-insurance offers
New digitally enabled premium services
Core insurance business
Property & casualty insurance
Life insurance
Health insurance
Banking
Property & casualty insurance
Life insurance
Health insurance
Banking
Telematics (e.g., Pay as you drive (PAYD); Pay as you live (PAYL)
Simple insurance
Context based offerings and next best offer
Smart pricing
Retargeting
Infotainment; gamification
More advanced digital sales support for brokers and agents
Vehicle road service; financial investment/coaching; health and wellness management; home protection; et al.
Ecosystem/partner offers; auto tires/batteries; gym/health club; home improvement; et al.
Use case examples
© 2016 SAP SE or an SAP affiliate company. All rights reserved.9
Smart ArchitectureNo Touch, Real Time, Agile
Hybrid – Cloud
CORE APPLICATIONS
ECOMMERCE APPLICATION(S)
PLATFORM
C O N N E C T
CONFIGURATION PORTAL
C O N N E C T
MARKETING PORTAL CRM
Sales/Service New Bus Acquisition, X-Sell/ Up-Sell, Renewals/Winbacks
Integration into existing(customer) portals
CLOUD
New analytics capabilities, build
natively in the Cloud
ON PREMISEExtend, leverage, scalable
on-premise capabilities
MARKETING SUBMIT/QUOTE POLICY BILLING CLAIMS REINSURANCE
Customer Data App/Quote Data Policy/Coverage Data Prem./Comm. Data Claims data Reinsurance Data
SALES
Agent/Sales Data
© 2016 SAP SE or an SAP affiliate company. All rights reserved.10
Enterprise Analytics: Strategy to Execution
Execution
Feedback to
Strategy
Strategy
Link & AlignStrategy to ExecutionBusiness Driven
Strategically Aligned
User Access & Usability
Improved Decisioning
Analytics
Strategy &
Roadmap
Corporate
Strategy
New Data /
Capabilities
Real Time
Analytics
Operational
Reporting
Exploration &
Visualization
Predictive
Analytics
Ad Hoc
Reporting
Corporate Data
Strategy &
Metrics
Performance
Management
Governance, Risk
& Compliance
Business Strategy
Analytics Strategy
Data Strategy
© 2016 SAP SE or an SAP affiliate company. All rights reserved. 11
SAP Data & Analytics Strategy Framework
Objectives Business Needs Business Benefit Technology Organization
Background and
Purpose
Current State and
History
Objectives and
Scope
Summary of
Needs
Envisioned To-Be
State
Priorities and
Alignment
Value Proposition of
Analytics
Expected Benefits –
Future State KPI
Business Case
Information
Categories
Architecture and
Standards
Tools &
Applications
Governance
Structure
Program
Management
Roadmap and
Milestones
Measurement
Education /
Training
Support
• Digital must be part of the overall business-driven data & analytics strategy
• Strategy is operationalized by an Analytics Competency Center
© 2016 SAP SE or an SAP affiliate company. All rights reserved. 12
Digital Transformation Roadmap
Define a Digital Strategy
• What does digital mean to your organization? Your customers? Your partners?
• How does digital relate to your strategic plans/initiatives?
• What are digital Opportunities? Risks?
Conduct a Pilot
• Conduct pilot with existing / new capabilities
• Test capabilities needed to support pilot.
• Conduct next pilot
Review your Digital Capabilities & Culture
• Data management
• Analytics
• Data bases/ platform
• Business Processes
• Skills & Behaviors
• Agility
© 2016 SAP SE or an SAP affiliate company. All rights reserved.13
Thank You!
Available on Amazon Pearson /FT Press & other channels in print and/or digitally
Download 1st chapter (industry overview) free
Patricia SaporitoSr. Director, BIGlobal COE for Analytics
SAP Labs, LLCNew York, NY
+1 (201) 681-9671pat.saporito@sap.comBlog: www.patsaporito.com
Digital/Innovation Resources:SAP Digitalist! Blog www.digitalistmag.com/SAP Analytics Strategy Self Assessment Tool https://sap-bi-strategy-assessment.com/(includes links to Strategy and BICC Best Practices ebooks)
Hasso Plattner Institute for Design Thinking at Stanford Univ. http://dschool.stanfor.edu/The Digital Insurer Forum www.the-digital-insurer.com/
© 2016 SAP SE or an SAP affiliate company. All rights reserved.14
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