KPMG Principal Scott Shapiro isn’t bragadocious but he knows a thing or two about pop-culture icons. Shapiro kicked off this week’s Digital Master interview with some witty banter about Roland Deschain of Gilead, the iconic protagonist in a Stephen King sci-fi book series called The Dark Tower which was also made into a movie.
“Remember the movie Dark Tower and the character Roland Deschain?”
“Hmm, I remember the movie but not Deschain."
“But you and Deschain have the same first name.”
I attempted to respond. And I say attempted because I vaguely remembered the movie but not Deschain. The name just didn’t ring a bell.
“C’mon Roland, how could you not know about Deschain? He’s a pop culture icon. And you both have the same first name. But I won’t hold that against you.”
Incidentally, I queried the Google machine and learned Deschain comes from a long line of futuristic warriors with superhuman abilities. But what the heck’s the connection between a post-apocalyptic pop icon and the future of technology and risk management? Superficially, not much.
But this is the connection economy. And there’s a deep connection between pop culture and tech trends. Likewise, there’s a parallel in Deschain’s hero journey and the calamity confronting CIOs in the post-COVID-19 world.
The worst of the pandemic may be over, but the crisis was lethal to businesses unable to keep up with the acceleration of risks.
Future crises are unavoidable. And experts worry the next one could be worse than the one we’re experiencing now. The question is whether pandemic-weary businesses will automate critical business processes.
Which brings us back to Shapiro. In addition to having some serious pop-culture chops, Shapiro is an experienced Principal and National Leader for KPMG US Insurance Advisory which means he’s also an expert in managing risk.
“If the COVID-19 crisis reminds us of nothing else,” says Shapiro, “it's the importance of managing risk in our lives. Insurance is one mechanism for doing that. The way I see it, COVID created an opportunity for insurers to take advantage of all of the technology trends we're talking about today. And that’s okay.”
“But at the end of the day, people buy insurance to protect against risk.”
Now, it’s time to tune in to the latest episode of Digital Masters, a pragmatic conversation with insurance industry and risk management expert Scott Shapiro:
Appian: So, before we get into the challenges of managing risks in the post-COVID world, talk about your role at KPMG.
Shapiro: As the advisory industry leader, my responsibility is to look after our US practice when it comes to all of our advisory services for the insurance sector. And my background is in insurance, operations, analytics, and performance improvement. I have about 30 years of industry experience.
Appian: So, you have a strong background in risk management. These days it's hard to talk about risk or anything else without talking about COVID, right. So, talk about how COVID has impacted the insurance industry.
Shapiro: There is this business truism that COVID accelerated the pace of change that many companies were already experiencing. And that's absolutely true in terms of customer expectations and digital transformation and modernization, which are among many of the services we'll be talking about today. But I think insurance is a special use-case because in times of crisis, which is what COVID is, stability matters a lot. And, so, insurance companies must be responsive and agile and customer centric and digital and innovative. But not at the expense of why we have insurance in the first place—for protection and stability which has a different kind of value system.
Appian: There's a lot of commentary out there about how organizations are using automation to drive efficiency and cost savings on the back end of the business. But what about the rest of the story, the customer experience piece. Can you have both? Is automation about driving efficiency or great customer experience? Is it a choice of doing one or the other or can you do both?
Shapiro: I think you have to do both. But we have to modernize our systems. Actually, the insurance industry was a very early adopter of technology. I mean, if you go back to the sixties and seventies and mainframe computers, some of the first use cases were insurance related because insurance is a knowledge product. There's no physical product involved. So, it really is about data and information. That's been the case for a hundred years. And, certainly, we will take advantage of initial technology waves. But unfortunately, some of those technologies are still with us. And that is the challenge, modernizing the infrastructure in a way that is both economical and timely.
Appian: So, based on your experience and insight, what's the solution?
Shapiro: We have to be honest about that. We're still a thriving industry that has tremendous value to our customers, but we have to adapt our legacy capabilities to a modern interface for customers. Customer expectations are being set, not within our industry, but by digital experiences they have on a daily basis. We also can't ignore e-commerce or digital banking as models for us to aspire to in insurance, because that's what customers are expecting every single day. And I think this is where competitive advantage lies.
Appian: Beyond COVID, what do you make of companies prioritizing operational agility as a competitive strategy, and how do you connect that to claims management in the insurance industry?
Shapiro: Yes. The fast pace of change, particularly in technology, really requires that business operations be flexible, adaptable, and agile enough to react to sudden changes in the environment. And that means investing significant capital dollars in modernizing the infrastructure of your company which is what we call legacy systems. But a modernization effort can take multiple years. It can be very expensive and very time-consuming, but in our view, it’s essential.
You also need the capability for end-to-end system integration and the ability to integrate your legacy systems with other technologies that are evolving at a much more rapid pace. So, yes, having a modern system is essential. But that’s really just the beginning. The integration of microservices is much more cutting edge. In other words, you have a stable technology backbone with an efficient interface that allows you to take advantage of a technology ecosystem that is constantly changing.
Appian: Tell me about the solution you were working on that involved low-code automation. Related to that, talk about the concept, the idea of connected claims and how that fits into claims modernization as it relates to KPMG.
Shapiro: Yes, we used low-code automation to build a solution that allows you to integrate various parts of the value chain to bring an optimal experience to the user. And so, for example, a lot of times in insurance, carriers tend to build up their businesses in silos which creates a lot of complexity. For example, claims management may have been built up in a silo. Or Underwriting or actuarial, right? But a connected claim platform allows you to take advantage of all that information, knowledge, and processes to quickly integrate microservices for a better customer experience. It’s really taking a design thinking approach where you build systems from the user’s perspective and look at the world from the outside in as opposed to inside out.
PS: In the next episode of this two-part post, Shapiro breaks down why low-code automation is essential to keeping up with the acceleration of risk. Read it now.