When the COVID-19 crisis hit, guidelines for responding to a global pandemic probably weren't in your company’s disaster recovery playbook. But that probably changed after the pandemic fired up a remote-work revolution that has also accelerated business process automation across industries.
Yes, we’re almost on the other side of the pandemic. But future crises are unavoidable. And the next one could be worse than the one we’re experiencing now. So, how will your organization prepare for the unavoidable, the unpredictable? And if you can do that, how can you also minimize risk?
Which brings us to the conclusion of our two-part conversation with insurance and risk management expert Scott Shapiro, Principal and National Leader for KPMG US Insurance Advisory. (Read part one here). Last week (after flexing his pop-culture chops on the redemption story of Roland Deschain, the protagonist in Stephen King’s Dark Tower book series), Shapiro dropped some serious knowledge on how COVID-19 accelerated the digital transformation that many companies were already experiencing.
He said that this was especially true in terms of customer expectations, digital transformation, and modernization in the insurance industry. Insurance is a special use-case, he said, because in times of crises such as COVID-19, stability matters a lot. In other words, insurance companies must find new ways to be responsive and agile and customer-centric, but not at the expense of why we have insurance in the first place—for protection and stability.
If the COVID-19 crisis reminds us of nothing else, said Shapiro, it should remind us of the importance of managing risk. Enough said. Cue the final episode of Low-Code Automation, Pop-Culture Icons, and Keeping up with Post-COVID Risk:
Appian: Before we get into the topic of managing risk in the post-pandemic world, I want to briefly touch on another topic I’ve been hearing about lately—accelerating time to value? Break that down for me from an insurance industry standpoint?
Shapiro: It’s about delivering value to the business at fractions of costs and time. The challenge with large organizations with significant infrastructure and regulatory requirements is that modernization initiatives can take years and cost tens if not hundreds of millions of dollars to deploy. Time to value to me is about working with a toolkit that allows you to deliver results along the way at fractions of costs, hundreds of thousands not millions of dollars and fractions of time, days, and weeks, not months and years.
This really matters because the longer things take to build and deploy, the more you’re exposed to the risk of obsolescence and underperformance because the economic conditions have shifted. That’s why I love the low-code way of working because it directly addresses this critical success factor.
Appian: And that brings me to the topic of hyperautomation. Gartner calls this the age of hyperautomation, a term that is really trending right now. But from your standpoint, and from your insights and your experience, what do you see as the biggest trends driving insurers to modernize their claim systems. You just mentioned low-code. Talk about the role low-code automation plays in system modernization?
Shapiro: Yeah, we’re big believers in hyperautomation. It’s certainly relevant in a function like claims management. At the end of the day, an insurance claim is a human experience. We can't forget that damage has been done. Losses have occurred, and pain has ensued. And what hyperautomation capabilities allow you to do is to enable the appropriate human response to what is a human condition. So, we are big believers in hyperautomation.
Appian: But also you don’t expect human interaction to be totally replaced by automation.
Shapiro: Not when things get more difficult, when losses are more severe and more complex, and the need is there for the skill set of a claims adjuster—which includes things like empathy and dealing with feelings and emotions and ambiguity.
We believe hyperautomation will complement claims adjusters and make them more effective at their job.
Which means they're not doing paperwork, swivel-chair work, or wasting time tracking down information. This will enable companies to create true differentiation by delivering a more human experience in dealing with loss.
Appian: Before we wrap up, I want you to look over the horizon and into the future. What are the two or three big trends on your radar in the new decade? And which of these trends do you think will have the biggest impact on the insurance industry?
Shapiro: So, the big picture for me is, I see a lot of merger and acquisition activity in the insurance industry, because there are thousands of companies delivering multiple experiences. There'll be a lot of consolidation which also speaks to growing demand for low-code.
When you think about a low-code platform, you think about how it helps simplify the challenge of integrating massive amounts of legacy infrastructure.
When big entities merge it usually involves integrating dozens and hundreds of systems. So, I do see mergers and acquisitions and low-code trending.
Secondly, I see renewed focus on digital transformation. I also see a sharper focus on customer experience from the user point of view, which is all about digital enablement and getting the right information to the right people at the right time. And the third trend I see is an acceleration in the evolution of risk.
I firmly believe that risk changes shape but it never goes away. In a global economy, there will always be risk. We saw that with COVID. We’ll also see it with the rise of cybercrime.
We'll see new risks with the evolution of sensors and the internet of things and blockchain and artificial intelligence. While all of these tech trends are wonderful enablers, they also create new forms of risk. And as long as there is risk, there will be a need for insurance to mitigate it.
