“Digital transformation means providing all our clients the possibility to interact with us via the channel they want, when they want. As a client experience leader, we will follow the client journey across all interaction channels”

You think you are ready for the digital transformation, but do you have the right foundation in place? Having a clear performance framework is the starting point for a successful digital transformation journey. Ahead of the PEX Network’s 3rd Annual Operational Excellence in Insurance event, key speaker Benoit Gowigati VP, Performance and Operational Excellence at Desjardins General Insurance, shares his insights on creating the right environment for digital transformation at the third-largest property and casualty insurance company in Canada.

What are some of the internal challenges Desjardins has faced on it’s digital transformation journey?

One major challenge is evolving the mindset of our employees interacting with clients as our environment is still very phone-centric. So it's a journey from a phone-centric environment to an omni-channel environment, while we become a client experience leader. Among other things, this requires new competencies to adapt to new channels. It also brings significant changes to our internal processes, so our support groups, such as underwriters and workforce planners are an essential part of it as well. It is also a culture change as it's a different way to develop our client approaches and to design and develop our products and services. More fundamentally, you need a solid performance foundation on which you can build the transformation just as building a solid foundation for a house.

So you recently implemented a service and performance framework across your contact centers to get ready for these challenges. Why?

This is what we call our operational excellence performance model. We first concentrated on our performance framework. This is an essential foundation on which we will build the transformation. Before you transform, it is essential to have alignment at all levels on your market discipline and the associated expectations at all levels. Only an organization that is effective and well aligned can absorb such a transformation with velocity. In a client-focused organization, it starts from a strong connection between front-line employees and support teams as well as senior executives.

The operational excellence framework has allowed us to clarify in tangible terms what our operational excellence market discipline means on a day-to-day basis for the 2000 employees in our Client care and Underwriting division. It can be summarized as a balancing act of profitable growth, where client experience is at the heart of everything we do, supported by a strong employee experience foundation. Among other things, it translates into how we measure performance at all levels, how we prioritize projects and continuous improvement efforts, as well as employee performance appraisals, including both quantitative and qualitative expectations on front-line employees. It is a vehicle to animate operational excellence on the ground in a positive and engaging way. When we deployed it in 2015, it was a key leverage to reduce our variable operating costs by over 5%, while improving our net promoter score by four points, enabling a portfolio growth over 5% while increasing our employee engagement score.

What would you say are the key areas to consider when rolling out new interaction channels?

One important learning for us is around the benefits associated with a test and learn approach, because we are a pretty large organization. As soon as we talk about deploying a new channel or a new approach it's a large and complex initiative. In order to be more agile, we have started to deploy new channels with smaller teams, for example click-to-chat for online services with a small team of tech-savvy front-line employees. This way, we learn quickly and we get a lot of traction. This enables us to move at a faster pace than the traditional large “cookie cutter” approach. The second learning is don't underestimate the importance of the creation of meaning for employees so that they can get comfortable with changes and explain them to clients. They need to test and learn themselves.

What are the benefits of growing innovation in a large corporation?

The advantage when you are a large organisation is that you have the benefit of scale, so you can invest in larger initiatives. We are the first insurance company in Canada to provide a fully mobile telematic solution to our auto policy holders. That is a competitive advantage we have because of our scale. The challenge that arises is business integration - we need to mobilize around 1200 insurance agents to promote that product with our new and existing clients and to explain it properly – which is an important effort. We are learning from this. We are now involving frontline employees earlier in the process, as we define and develop solutions, so that they can provide their insights and point of view. And we promote the “Gemba” approach with the support teams – in a nutshell “walk the process” as you define it.

What would be your top tip for getting buy-in from the key stakeholders in the digital transformation journey?

In my view, our number one key stakeholders are our clients. So my first advice is never lose sight that you do this for your clients. At the end of the day. innovation is not a purpose in itself – rather a new value proposition. We get very excited by innovation, but we innovate because we want to provide something valuable to our clients. So from the start, think about it, define it and articulate it from the client’s point of view. A simple example is the use of online services. For obvious efficiency purposes, we want to drive some of our service traffic online. However, the client does not care about our call volumes. The value to the client is the ability to perform simple transactions 24 hours a day, 7 days a week – and get personalised advice for more complex requests.

Do you think that insurance firms are traditionally slow to adapt to digital disruption?

Five years ago, I probably would have answered yes with no hesitation. However, I sense there is an important momentum now and all the big players want to move aggressively in this direction. It will be an exciting yet complex journey as it could impact the fundamentals of the insurance business model, including our traditional mental models on how we manage core insurance risk.

What does the future of operational excellence look like?

That's a very good question because there are many angles to this. Taking advantage of the analytics and the big data to improve performance is a major one. Beyond the potential on insurance risk segmentation, data analytics will allow us to have much better insights on the performance of our contact centres. For example, speech analytics will help us better understand how effective is our client interaction time. Analytics will also help us better understand client expectations up front, driving more proactivity, resulting in increased loyalty and retention.

Why do you feel it is important to share your story at OPEX in Insurance in October?

What we have achieved is the creation of an operational excellence model that's simple for people to understand. I consider this important because operational excellence can be a very conceptual thing or it can create anxiety because many people associate it with cost reduction. I think we have found a way to develop a model that creates meaning for our people, and the key success factor is you need to integrate it at all levels of the organization. You need for everyone to understand it, because at the end of the day operational excellence is not owned by the operational excellence team, it is owned by all employees, so we need them to believe in it. I think we found a way to create that momentum and engagement around operational excellence.

Why is it important? I come back to the first part of the story, if you want to move towards digital transformation you have to build a solid base. Your current performance framework has to be very robust and you must have people aligned to it, so then you can transform on that foundation. If your base is not solid, if you are not clear on your market discipline and it is not shared across all the employees with the proper meaning and alignment or performance, I don't think you have an optimal context to maximize the value of such a large transformation.