Digital Insurance Agenda

Open Ecosystem Approach Accelerates Digital Transformation and Innovation

Written by Roger Peverelli and Reggy de Feniks - Founders The DIA Community on Feb 3, 2021

Some time ago, DIA academic partners Alexander Braun and Florian Schreiber (University of St. Gallen) argued that real innovations require more than just new technological improvements to unlock new economic value. It is about combinations of innovative new models. Think of combining the work of different insurtechs working closely together, combining their ideas to come up with something that is even more innovative. Innovation multiplied.
Sameer Datye, Head of Business Development Insurance and Wealth Management at TietoEVRY, has taken that to a next level. That;s why we were very pleased to speak to Sameer to learn more about the open ecosystems work ethic, and this innovative way of working.

Sameer, an open ecosystem approach to accelerate innovations … How would you define ‘open ecosystems’?

Sameer: “Open ecosystems is when different companies come together to co-innovate and try to address a common need. Where there is freedom for ideation, innovation, new business models, based on collaboration. With a shared single-minded purpose to produce an outstanding solution. Then we can safely say it’s about an open ecosystem.
Thinking and working this way works best when expectations are to produce results in minimum time and with minimum costs, but with maximum traction. It takes place in organizations that are a humble, believing that innovations not only happen in-house, but also outside the organizations. They understand that it makes sense to plug-in to the ecosystems that exist outside their own organization. It works best for organizations who want to use speed and agility; and are looking to have a first mover advantage, a differentiator to win in the market. And for organizations that are focused to deliver a best-in-class costumer experience for a wide audience; not for a very small or niche audience.”

I think you once mentioned that you were actually inspired by your visit to the very first edition of DIA, in Barcelona 4 years ago …

Sameer: “Yes, that is correct! Once upon a time, 4 years ago, two colleagues and myself were in a bar, late in the evening in Barcelona. Well, it was actually early in the morning in Barcelona – it was a long night. We had seen so many very interesting presentations from insurtech companies, but we also felt there was an even bigger opportunity. The opportunity was that independently these were already excellent ideas, but what if we would be able to create a glue to bind them together? Of course, there are all sorts of accelerators but they tend to look at insurtechs at their own merit. We believed it would make more sense to place the best insurtechs in the context of an entire insurtech and insurance landscape. And that is where we came up with the idea of trying to attract these kind of insurtechs to collaborate with us and create a completely immersive experience, away from the traditional thinking.”

What we also like is your consumer perspective …

Sameer: “Yes, we started with addressing the needs of the end consumer. We did our own research by talking to end consumers. We looked into end consumers needs in the different insurance spaces, their identities or how they want to come across with the insurance companies and their preferences on how insurance companies behave towards them.
Once we had this insight from the end consumer, and we mapped the skills, solutions of ourselves and our partners. Then we actually started collaborating and trying to figure out how this can all be tied up nicely. All the way from what we had been doing to what the market or the consumer might end up needing.”

So, how does that look like in practice?

Sameer: “To make all this work nicely, we needed to create an architecture in which all the layers have their distinct roles and that all the components of the solution are capable to interact with each other via API’s. We created the so-called ‘Insurance in a Box’. It is based on an open ecosystem. The architects in the ecosystem need to work together, adapt to the changing world and find solutions which serves our customers the best possible way. The key to success is to carefully choose the components and the companies you want to work with. Base your architecture on a loosely couple of integrations, open standards and glue everything together with modern, agile ways of working.”

Your approach may sound simple, but it is quite disruptive. What kind of hurdles did you encounter along the way?

Sameer: “We had a fantastic beginning. We worked across borders, addressing the whole value chain, but very easily and very fast you end up realising that your biggest enemy is the acceptance of mediocrity on any level, both individual, organizational or partner. You realize that this mediocrity has the ability to set all of us back and this was something that had to be addressed brutally. We as an ecosystem had to be very alert. If it’s not best of best, we have to get rid of it.
Another thing we encountered is a lot of process overhead. It’s very difficult for people to cope with the idea that now were trying to reinvent ourselves. This means that the processes that you’re used to, don’t apply. With agility, you need to be able to be flexible enough to actually allow common sense to proceed processes and start believing that you only need processes when common sense stops.”

How did you make sure that everyone in the ecosystem lives up to the high standards?

Sameer: “We use the ‘fail-fast’ approach. I like to look at a partnership as if it were a marriage. In the beginning, everyone is enjoying themselves. But, at some point, it is possible you realise that this isn’t flying as you had hoped for. As soon as that became evident, we disengage asap. I know it sounds a bit brutal, but it’s better to have that pain upfront and as fast as possible, so that the remaining relationships stay, survive and thrive. This is a continuous process. It’s a self-regulatory mechanism in an open ecosystem. Everybody has to prove that they are useful and relevant for the ecosystem and the ecosystem has to acknowledge this. If not, that specific node has no role to play and has to probably move out.
The fail-fast approach was to ensure that a least amount of time is spent in creating a drag on the momentum. Don’t have an emotional connection with an idea, but with the solution.  We also implemented it in real life towards the customers. This is the way the platform and ecosystem have been built. If a customer wants to try new ideas, they can quickly try. If it doesn’t work, let it go and move on. Really focus on what they can achieve in the future.”

One of Tieto’s ‘Insurance in a Box’ clients is Baloise. Joris Smeulders, managing director and member of the board of directors Baloise Belgium: “Insurance has always been a quite closed industry and is quite risk averse. Baloise is known for being very open to innovation and working together with interesting insurance and non-insurance partners. Specifically for digital, this becomes very important. We believe in strong partnerships and ecosystems to bring together skills and capabilities to deliver this in a coherent and fast way. We see an evolution in clients insurance needs, driven by new trends and the covid crisis will only accelerate this development. To improve our time to market and to test new solutions in a fast, agile and coefficient way we launched the eBaloise initiative, enabled by TieToEVRY platform and ecosystem partners. It is in our common interest that brokers succeed in finding the place in this digital environment. The eBaloise initiative supports the hybrid vision with the hassle-free experience that digital creates, but also the human aspect and the personal touch that brokers offer. We were also looking for a new environment that in which we can experiment with the online business. The ecosystem gives us the possibility not only to implement new products very fast, but also we are able to connect fast to new services.

Can you share some learnings while working in the open ecosystem?

Sameer: “Yes, of course. The first is what I just mentioned: being the need to maintain absolute and brutal honesty. The second is to maintain super simplicity. There are too many stakeholders and the message can be easily lost. And lastly, and not least is, it is a continuous unlearning process. Which means that, we have to keep unlearning whatever we just learned all the time in order to cope with the direction of the ecosystem.”

A large number of insurtechs, many of which have joined us on the DIA stage, play a role in the ecosystem that you created in ‘Insurance in a Box’. Can you give a few examples?

Sameer: “Take Signicat for instance. To do trusted digital business, you need to know who you’re dealing with. Signicat’s provides this with a complete identity life cycle.
We also integrated DriveKit, the telematics solution offered by DriveQuant, in the platform. It allows motor insurers to create usage-based programs by launching a mobile telematics app.”

It is really amazing to see how you implemented the open ecosystem vision, how you have taken the efforts of individual insurtechs to next level with more added value for insurers, and how your journey has been so far. With all that in mind, where do you think the future of the insurance industry is going?

Sameer: “I am not sure where exactly the insurance industry is heading looking at all the societal and technological influences. Business models will keep changing and evolving, but in my humble opinion ecosystem thinking and open innovation are crucial to navigate ever changing conditions. So, I’m pretty sure that our approach, our ‘Insurance in a Box’ ecosystem and our partners are going to come out as winners. I think where going to have some serious fun in the future.”


Sameer Datye

https://www.tietoevry.com/iiB

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