Wednesday, March 6, 2019
Despite growing emphasis on digital transformation, researchers found, only 31 percent of banks and 27 percent of insurance companies had mastered digitalization, and only 33 percent of executives are confident in their companies' digital competencies. Researchers suggested that lack of a digital transformation road map has been a major obstacle for firms that struggle with digital service adoption and implementation.
Anirban Bose, CEO of Capgemini's Financial Services and member of the Group Executive Board, called the research findings an industrywide wake-up call for a modern, collaborative, innovative and agile operating model.
"In an environment of growing competition and consumer expectation, the view is very different from a few years ago, and it's unsurprising that large organizations have become more realistic about their capabilities," Bose said. "The digital masters we looked at are working with an ecosystem of third-party partners, developing and testing ideas more quickly under an MVP model, and nurturing a culture of bottom-up innovation and experimentation. The majority of financial services firms need to learn from the small pool of genuine innovators in their field."
Capgemini researchers noted that financial institutions are at a critical juncture as they attempt to meet the increasingly digital needs of their customers while managing costs and competing with emerging technology players. However, research found that banks are ahead of insurance companies in customer experience, workforce enablement and technology, and business alignment.
"Fifty-six percent of the banking firms said they use analytics for more effective target marketing (in comparison to 34 percent insurance and 44 percent non-financial services sector)," researchers wrote. "More than half (53 percent) of banking organizations also said that upskilling and reskilling on digital skills is a top priority for them (32 percent for insurance and 44 percent for non-financial services sector)."
Insurers had a slim lead over banks in operational digitalization, according to the study, with 42 percent of insurance companies having implemented robotic process automation, versus 41 percent of bankers. An additional 34 percent of insurers are using artificial intelligence to improve operational efficiencies, compared to 31 percent of financial institutions.
Upskilling and reskilling of labor remains a top priority for 53 percent of bank respondents, 32 percent of insurers and 44 percent of non-financial service sector respondents. Additionally, 56 percent of banking sector respondents saw a need for advanced digital marketing methods, compared with 34 percent insurance and 44 percent in the non-financial service sector.
Researchers concluded that digital transformation has been a struggle, but near-term adoption of advanced technologies will accelerate in the financial service sector. A full copy of the report is available at www.capgemini.com/research/where-are-banks-and-insurers-on-their-digital-mastery-journey/?utm_source=pr&utm_medium=referral&utm_content=fs_none_link_pressrelease_none&utm_campaign=other_cri_digitalmastery_fs .
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