Given the number and pace of mergers and acquisitions (M&As) in the market over the last few months, the challenges and opportunities ahead for our industry has reached an all-time high.
Be it to expand into new markets, access new audiences or to take cost out, the coming together of organisations big and small adds significant additional pressure to an already busy and often full change agenda.
End-customers will want to see and expect almost immediate benefits from the M&A, picking the best of the previous organisations to ensure that the bar is set correctly for the newly combined organisation. If it was only that straightforward.
In my experience, companies look to manage this in two ways. An ‘outside in’ or an ‘inside out’ approach. The former ensures that the way in which they engage with their customers is quickly and efficiently integrated to a common message. There are many analogies for this that you will have heard in the past, but this at least establishes a clear brand and agenda while buying time to focus on what is often the harder part.
The latter approach, while not always first because of the complexity, ensures that the foundation the new organisation collectively agrees on is fit for the new world and its future desired operating model. This usually starts at the very core and brings together multiple core processing systems and works upwards to the intersection of employees, brokers and customers. ‘The coming together of M&A and insurtech creates a whole new opportunity for disruption to come from within’
Regardless of the intitial approach, ultimately both need to be taken. Failure to do so means creating a whole new legacy with an increased cost base, increased complexity and little capacity or funding to move quickly – something the insurance industry has been labelled with for far too long.
This also gives rise to an interesting segue, the world of fintech, specifically InsurTech. Just like M&A, this has also grown, rapidly following other financial services examples that are already being disrupted. Investment in this space has reached new highs, with many organisations either investing (AXA, for example) or acquiring (Generali, for example).
No one expected many traditional industries to be disrupted so quickly and fatally in some cases. The coming together of M&A and InsurTech creates a whole new opportunity for disruption to come from within and lead, as opposed to those that didn’t see it coming. Let’s learn from others and embrace the changes and opportunity ahead. However you approach the new world, one thing’s for sure, it’s fast becoming a race to
join the dots.