Transforming a 300-year-old business
The ability to execute a successful digital transformation is becoming an ever more existential threat for large corporates. There are several examples of companies who are doing this well, and one of those is Aviva. With that in mind, The Up Group’s Sarah Noyce sat down with the insurance giant’s Global Innovation Director, Serge Taborin, to discuss transformation and corporate innovation.
SN: What does digital innovation mean for you at Aviva?
ST: Typically, corporates haven’t been good at disruptive innovation — this is the reason disruption happens. There is no universally correct way to do things, and so we have to work out our own way to innovate. Culture, market position, and customers all impact how a company will innovate. Those companies that have been most successful so far have not picked simply one stream through which to innovate, but executed on a number of different streams: venture arms, incubators, internal product launches. This multi-stream approach is the one we take at Aviva; as there is no one universally correct approach, there is no one stream that will win out over the others.
There is no universally correct way to do things, and so we have to work out our own way to innovate
SN: And how does innovation and transformation work specifically within the insurance industry?
ST: Insurance is different to most other industries, in that it has not been disrupted — yet. We are still hugely behind what the customer might expect from a modern digital business, and there is an enormous amount of work to be done. This will take place through incremental innovation to improve the customer experience, coupled with more serious leaps forward.
SN: What are you doing specifically at Aviva to achieve this?
ST: Our strategy revolves around three core pillars: build, partner, invest. For example, we have set up our own investment vehicle, Aviva Ventures, and we have opened our own digital garage. This hosts a number of our most critical digital initiatives, as well as working on existing features and product development. Our Chief Digital Officer, Andrew Brem has put in place a culture that mixes innovation with real, tangible improvements in the present. On the partnerships front, we take a two-pronged approach, either directly investing in startups or just incubating them and working with them operationally. In addition to working with startups, we also have partnerships with accelerators — Founders Factory in London and Plug and Play in Silicon Valley. I led these initiatives, and in doing so it was vital to consider exactly what we wanted to get out of these partnerships. So far, we are very happy with the two accelerators we have partnered with.
SN: What was it that made you move from a startup back to a more corporate environment?
ST: In reality it was a couple of things. When you’re at a startup, you can move quickly, whilst at a corporate you have resources, an existing brand and all sorts of other things — so to some extent, it was a case of the grass always being greener on the other side. Having been in a startup, I was fascinated by the opportunity to try to recreate that same approach, leveraging all the advantages and resources offered by a corporate. This culture shift can often be a difficult one for a corporate, but Aviva is really committed to this transformation.We are still hugely behind what the customer might expect from a modern digital business, and there is an enormous amount of work to be done.
SN: What was it that attracted you to this opportunity in particular?
ST: Insurance as an industry has a few fairly unique elements to it that have made it difficult for startups to crack, such as the regulatory environment and the assets required to start. The strength of the current incumbents gives them a real opportunity to innovate. Moreover, this leads to a fantastic opportunity for collaboration across the value chain, as corporates can access the best talent and startups can access a suite of corporate assets.
SN: What are the biggest challenges that companies face when going through a digital transformation?
ST: My role at Aviva is actually innovation, rather than transformation. Whilst often used interchangeably, the two are in fact very different things — one is turning a tanker around, whilst the other is building a new boat entirely. The challenges are similar though. In a 300 year-old company with 30,000 people, getting people to get to grips with digital is diffi cult, and you have to work hard to convince them to take the first leap of faith required to generate future profits.
SN: What does the future hold for disruption in the insurance industry?
ST: Insurance will still exist as it does today — that is to say, people will still insure the same things, such as cars, but there will be new challenges. With the oncoming rise of autonomous vehicles, new and difficult questions will arise for both insurers and regulators — who is to blame when an accident occurs? The owner? The software? The manufacturer? In addition to this, we are living in a world in which more and more data is becoming available, from more and more different sources. This represents a threat to our own proprietary data sets, whilst the surge in artificial intelligence potentially creates new ways of underwriting.
Insurance will still exist as it does today, but there will be new challenges
SN: So those are the challenges — what opportunities do you see coming about in the industry?
ST: Digital represents a huge opportunity to right the historic wrongs in our industry. Insurance is typically unloved and poorly understood amongst consumers. We now have a real chance to mend this relationship with customers and turn it into something far more positive, meaningful, and transparent. In terms of the business itself, we have an opportunity to expand into new areas with customers — taking more preventative measures, for example. As things stand, insurance exists for when things go wrong, but what if we could use artificial intelligence to predict a boiler breaking a month before it does, and advise the customer accordingly. Those sorts of services could be hugely valuable.
SN: When building teams, what qualities do you most prize in a potential hire?
ST: The balance is a very tough one to strike. When we first started, we looked to attract a lot of entrepreneurs who have created and grown products themselves. When we were doing this, the digital garage was a huge asset, as it showed we were really serious about our commitment to transformation. However, we found that the ability to do this in a startup was different to the ability to do so in a corporate environment, and the assets that we could offer were not being leveraged properly. We now operate in a more bilingual environment, with both entrepreneurs and those who can understand and navigate the corporate environment working together. This mix of talent has been absolutely crucial to our successes.
We now operate in a more bilingual environment with both entrepreneurs and those familiar with the corporate scene
SN: What would you be doing if not this?
ST: Having worked in this space, at the intersection of the startup and corporate worlds, I think I’d be hesitant to move back into another role in a purely startup environment. Where I am at the moment is such a fascinating space, as these two worlds move closer together.
