Pacing ahead to conquer the next-gen technology & drive business growth
Digital Transformation has been a key strategic agenda for most CEOs/CIOs across the BFSI spectrum globally. But what exactly in digital transformation is driving the traction and yielding maximum business benefit? Why do digital transformations get stuck in the conceptualization phase and don’t proceed ahead?
Generally, a term like “Digital Transformation” is an umbrella term and therefore, organizations are unable to conceptualize the working, thus prompting failure and disappointment.
Intelligent Automation was born as a term related to Digital Transformation with the advantage of being better defined. It is a combination of multiple automation technologies such as RPA, BPM, machine learning and cognitive analytics used together to tackle complex business issues and drive growth.
Intelligent Automation systems analyze & detect patterns from the vast information in hand and can automate entire processes or workflows, learning and adapting on the go.
Volatile customer demand is causing a massive transformation across the insurance sector, globally. Insurers today are grappling with the issues of customer satisfaction, commoditization, product personalization as well as threat of new entrants who are enabling lower operating costs.
Intelligent Automation can bring about a radical shift to the insurance value chain transforming the business model, operating model and ecosystem.
Intelligent Automation as a strategy will help the incumbents tackle the disruption threat which challenger players like Big Techs can pose.
Amazon, for example, has invested in insurers, including the India-based digital start-up Acko General Insurance. Additionally, it is speculated that the e-commerce giant is looking to enter the home insurance market to leverage the capabilities of data collected by its devices like Echo Dot. Asian Giants — Alibaba & Tencent already offer insurance across its platforms and have invested in a wide range of insurance companies in the past few years.
Intelligent Automation should no longer be seen as optional but as a ‘must-have’ technology strategy for insurers to cater to the new demands of the digital era & remain relevant in the evolving market
Let’s delve a bit deeper into the three broad classes of automation across which intelligent automation spans:
1. Robotic Process Automation (RPA): It is the simplest form of automation that is used to automate repetitive rule-based tasks & processes by applying a consistent set of rules to structured data. Scope in insurance would involve improving repetitive tasks across structured data in billing, reconciliation, policy updates. For instance, a large insurance provider utilized RPA to enter transaction data into policy administrative system to initiate cash disbursements
2. Enhanced Process Automation: This technology suite has the ability to work with unstructured data, recognize patterns, predict the desired action path and learn from existing interactions to enhance performance over time. For example, we can use text analytics on comments posted on social media to detect trends in the sector & identify brand perception. This can help in boosting customer experience & making more customer-centric products.
3. Cognitive Automation: These systems are empowered with the ability to answer complex queries and perform tasks which were previously possible by humans only. This technology suite has the capability to learn, self-optimize and process huge data sets leading to pattern discovery and predictive analytics. For example, AI engines can be used to recommend treatment & return-to-work plans for employees under worker’s compensation policy.
Let’s assess some key components of the insurance value chain to get a glimpse of the intelligent automation fit.
· Claims Management: Major scope is seen in automating the process of extracting relevant unstructured data from a claim submission, spot potential fraud and analyze trends in fraudulent activity
· Commercial Underwriting: Critical benefit is identified in automating the process of data extraction from a thousand pages of documentation — reducing the customer response time and thus improving customer satisfaction. It can further automate identification of product trends focusing on demand & profitability
· Product & Pricing: Intelligent data analysis can price risk more accurately by involving a wider range of risk factors
· Sales: AI can send an automated alert to agents indicating the readiness level of prospects to buy a particular product — thus leading to higher conversion rate
· Regulatory Compliance: Insurance providers can develop Natural Language Processing (NLP) queries to automate processes such as retrieval of a provision or a term definition. Intelligent Automation can also be used to automate similar query responses based on historical responses.
· Customer data protection: In today’s era, where customers seek confidence on digital trust, Intelligent Automation can help insurers in differentiating their service by ensuring avoidance of data leakage from manual data handling.
· Customer Experience: As per a global study, 45% of consumers have explicitly said they give more importance to the experience of purchase cycle than the insurance product itself while picking an insurer. Intelligent Automation promises to unlock whole new levels of personalization & convenience in customer service. For instance, an insurance provider in UK can give its customers an automated insurance estimate after answering just 4 questions from a chatbot on Facebook messenger.
As per estimates, a software bot is approximately 1/3rd the price of an off-shore FTE and 1/5th the price of an onshore FTE and ensures an overall saving of upto 10 times the cost of original implementation. In addition to cost savings, Intelligent Automation is poised to deliver some additional industry agnostic benefits like:
· Productivity & Performance Improvement: On an average, insurers utilizing RPA can reduce operational cycle time by 40%
· Employee Satisfaction: Instead of manual repetitive tasks, employees can now focus on strategic work ensuring that more value is delivered towards the organization goals.
·Scalability: Bots can reliably scale up/down to respond to current demand. Challenges with fluctuating workload is no longer a concern
· Reliability & Quality Excellence: No scope for human error, ensuring consistent delivery and quality of work at all times.
Insurers of today must lead the race in embracing intelligent automation as a part of the next-generation operating model to drive product innovation, boost customer engagement at a dramatically lower cost and emerge as tomorrow’s winners!
NSEIT is a leading partner of Antworks which provides a single integrated intelligent automation platform providing codeless/low-code environment, the capability to digitize and curate all types of data (structured, unstructured) and fractal science empowered faster data ingestion solution.
Visit https://nseit.com/digital-transformation to understand how NSEIT & Antworks can help you unlock the true potential of automation & grow your business.
Asst. Manager - Strategy
Kamalika is a part of the strategy team at NSEIT - working with senior leadership on identifying and growing the technology practices disrupting the Banking, Financial services and Insurance space. Armed with an MBA from the prestigious Indian School of Business (ISB), she's skilled at analyzing competitive behavior & market trends in the BFSI segment.
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