Graham Harvey, CEO of Cardinal Group
In recent years, discussions around digital transformation have been dominated by buzzwords like Insurtech, artificial intelligence (AI), machine learning, and robotics.
While these terms capture the imagination, they often mask the deeper challenges and opportunities faced by industries like insurance.
During a recent conversation with Tony Van Niekerk from COVER, I shared my thoughts on what digital transformation truly means and how businesses can approach it strategically.
Buzzwords vs. Reality – The last two years have seen AI emerge as the central theme in technology conversations. It’s easy to get caught up in the excitement of AI-powered tools, whether they involve voice sentiment analysis, visual recognition, or process automation. These tools, deployed in cloud environments with sleek front-end interfaces, certainly represent powerful innovations. However, much of the current activity in AI feels like “tinkering” rather than transformative progress.
In many cases, companies are experimenting with AI to solve specific problems, such as extracting data from hard-copy documents using optical character recognition (OCR). While this is a step forward, these solutions often falter when confronted with variability—like a change in document format. This underlines the fragmented nature of many digital transformation initiatives. They’re often narrowly focused and lack the comprehensive strategy needed to drive meaningful change.
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The Leadership challenge – One of the key points I raised in my conversation with Tony is that digital transformation cannot simply be outsourced to external consultants. While consultants can provide valuable insights, they are unlikely to fully understand the unique challenges and opportunities within an insurance organisation. Each company’s environment is distinct, and successful digital transformation requires leadership and expertise from within the organisation itself.
Reskilling employees and fostering a culture of innovation are critical. Leaders must prioritise building internal capacity to drive transformation. This involves not just adopting new technologies but also redefining processes, rethinking customer interactions, and aligning the organisation’s goals with its digital ambitions.
Moving beyond AI – When discussing digital transformation, it’s important to emphasise that it’s not just about AI. True transformation is about reimagining how a business operates at its core. This includes everything from workflows and customer engagement to data management and compliance. For example, many insurance companies still rely on outdated processes, such as paper forms and manual data entry. Digitising these processes is just the first step. The ultimate goal should be to create a seamless, customer-centric experience.
Digital transformation is also about addressing fundamental challenges like data privacy and workforce readiness. As technology evolves, so do regulatory requirements and consumer expectations around data security. Companies must be proactive in addressing these issues, ensuring that their digital strategies are not only innovative but also compliant and trustworthy.
A Holistic approach to transformation – One of the key takeaways from my discussion with Tony is that digital transformation cannot be approached as a one-size-fits-all solution. Instead of trying to implement a sweeping strategy, companies should focus on addressing specific problems or opportunities, one step at a time. This targeted approach allows organisations to build momentum and learn from each phase of their transformation journey.
For example, an insurance company might start by automating claims processing to improve efficiency and reduce costs. Once this process is optimised, the company can turn its attention to other areas, such as customer onboarding or policy management. By breaking the transformation process into manageable phases, organisations can achieve sustainable progress without becoming overwhelmed by the complexity of change.
Looking ahead – As we move into 2025, the insurance industry faces a pivotal moment. The potential of digital transformation is immense but realising that potential requires more than just adopting the latest buzzword-driven technologies. It demands a strategic, customer-centric approach that prioritises innovation, internal leadership, and a willingness to tackle complex challenges.
Ultimately, the companies that will thrive in this new era are those that view digital transformation not as a technology project but as a business-wide initiative. By focusing on building internal expertise, addressing specific challenges, and fostering a culture of continuous improvement, insurers can position themselves for long-term success.
As Tony aptly summarised during our conversation, “You’re not just transforming a system or a platform; you’re transforming a business.” This mindset is essential for any organisation seeking to navigate the complexities of digital transformation and emerge stronger, more innovative, and more customer-focused than ever before.
I believe the magic of digital transformation lies in its ability to bring people, processes, and technology together in a way that creates real value for customers and businesses alike.
By staying focused on the bigger picture and investing in the right areas, the insurance industry can unlock its full potential and set a new standard for innovation and agility.