In the recent past, working for innovative projects in insurance, I discover how simple it is to have plenty of ideas to bring more comfort to the clients and to lower the risk. If you put in a room few experts in insurance, you will finally be able to gather many interesting thoughts. However, to transform them into project will encounter many barriers. Among them, I see 2 important ones that need to be solved in priority:

• Competition that will limit collaborative project
• Opposite interests from the different stakeholders that require important negotiation and tremendous effort for mobilizing the right sponsors.
  For example, sharing data with my insurer is not obvious that it will bring me lower premium, or sharing data between insurers will benefit to the one that is in advance.

Those both factors slowdown the process of innovation, threatening efficiency and profitability of the project, demanding more funds than it should.

Therefore, in an innovative project in the insurance industry, lobbying and committing powerful sponsors are keys and should be address beforehand!

The French cluster Finance Innovation is launching a RFP for projects in Insurance that address one of the prior topics listed in the white paper published on July 2010.

More than 26 topics in Insurance have been listed and are looking for solutions that would bring tremendous value to the customers and the insurance industry.

Therefore, if you have a project or already a solution, don’t hesitate to apply at http://www.finance-innovation.org/news0000219.htm

Good luck!

Any Department of Innovation of a corporation has 2 main responsibilities:

1. Leading internal innovation
2. Sponsoring external and independent innovation

1. Leading internal innovation may include:

• Animation of the Ideation process (ideas box, ideas transformation to projects)
• Innovative projects Management and Execution
• Preparation of the commercialisation of the solution
• Follow-up of the ROI of selected projects

 2. Sponsoring external and independent innovation

• Sourcing innovative projects bringing added value for the company directly or not
• Building the alliances
• Supporting the executions and the commercialisations
• Follow up the projects and their life cycles.

And you? 
Which missions have your Department of Innovation in your company in the Financial sector?
Are you proud of their achievements?

See also “Craft a precise definition of innovation’s role in the overall corporate strategy based on the company’s industry, market,and competitive environment”  (http://blogs.techrepublic.com.com/10things/?p=1417)

In France, mass consumer access different families of products for investment and saving. Apart from real estate, individual savings are generally roughly split between securities accounts (especially PEA –  a securities savings plan driven by tax incentives) and life insurance contracts (Euro, UC – unit-linked contract…).

In this environment, one can wonder what the value proposition of the unit-linked contracts is. If you compare this product with the PEA, clients are taking the same risks whereas they pay significant fixed administrative fees.

If you are looking quickly on google for finding articles on advantages of unit-linked contracts, you will have a poor result, which means that a large place for innovation exists in the futur, combining marketing and design areas.

Therefore, I am very interested to discuss with you about the value proposition of such product in France or similar one abroad. Why mass consumer should buy them?

Patricia Egard
Founder of Ever Up, Consulting in Strategy and Entrepreneur
For continuous profitability in Financial Services

Is Entrepreneurship in innovation in France more difficult than in USA?

According to Daniel Zumino and Jacques Birol in the article “Let the entrepreneurs innovate in peace», HEC magazine, France has several success stories in innovation. However, investors are usually more reluctant to take risks and more demanding on fast returns than those in USA, making the Silicon Valley apparently the heaven of start-ups.

In fact, the comparison is not so obvious: USA is attractive and therefore a huge competition among project exists, France has few government incentives and a large capital in research capabilities, enabling the launch of projects and ideas, but encountering difficulties to raise large amount of funds.

One solution to boost the capacity of developing innovative projects in France is to diminish the risk adverse culture by educating investors and financial institutions. The effects will be in long term. At the same time, the government has a major role in regulating the Private Equity, promoting them or not in the funding of innovative projects.

See also an article on French business angels with Daniel Zumino

Patricia Egard
Founder of Ever Up, Consulting in Strategy and Entrepreneur
For continuous profitability in Financial Services

Therefore the McKinsey Global Survey results on what successful transformations share should be considered with attention by Solvency 2 leaders. Key lessons can be sum up in 7 main issues to be addressed.

1. Create clear, stretching targets and define a clear structure
2. Focus on your employees’ mind sets and behaviour
3. Put a priority on finding efficient and scalable ways to engage employees
4. Do not focus only on problems, but also on your strengths and opportunities
5. Broke down the process of the transformation into specific small initiatives
6. Build leadership capabilities to maintain long term organizational health
7. Emphasize collaboration and co-creation

Patricia Egard
Founder of Ever Up, Consulting in Strategy and Entrepreneur
For continuous profitability in Financial Services

Solvency 2 presents a great opportunity for the evolution of the Insurance business.

In Insurance, many professionals criticize the regulation of Solvency 2 as an additional constraint, which limit their freedom to run the business. Because of more capital requirement trends, insurers will focus on reducing the guarantees or increasing the prices in order to maintain their margin.

However, if you make a pause and go to the balcony, you might also see an opportunity to re-think the insurance business model, to work differently for saving capital needs. This means to understand your various risks accurately and their impacts on the capital requirement to adopt your strategy. Concurrently, any solution that brings better productivity should be considered with attention. Therefore, focusing on the 3 following dimensions will be decisive in the next 2 years:

• risk policy and insurance products,
• process and services provided,
• investment tactics.

Patricia Egard
Founder of Ever Up, Consulting in Strategy and Entrepreneur
For continuous profitability in Financial Services

Where governments in the developed countries tend to limit their commitment in the health care system, the decision of the US congress to offer a better protection to the majority of their citizen symbolises a step toward a global social responsibility model, by giving access to the inhabitants of a wealthy country to a correct level of health care.

Is it an important event for French people?

Should it be considered in the re-design of the French health care system?

Visit the congress site to have more insight.

Patricia Egard
Founder of Ever Up, Consulting in Strategy and Entrepreneur
For continuous profitability in Financial Services

Joyce Wycoff, in an issue of the InnovationNetwork’s Heads Up! e-newsletter, provides some important insights. The objectives at the beginning tend to be loosely defined. Team is more diverse and should be strongly supported even if a failure occurs. A wise risk management will help to learn fast, and change the direction to more attractive options, having a decision process that limit hazard and conflict. Funding is very important. Innovation projects should be sold to sponsors committees. Then, the commercial launch is not always efficient, which leaves space for more profitability.

Naturally, you will say it is a “tarte a la crème” for consultants, with great opportunities to assist their clients. In reality, executives see the value of the consultants more as a cost / a resource than a leverage for getting more value from the innovation project.

In the last 2 months, I had the opportunity to study innovation processes in few large insurers. Risk management dimension is generally neglected, results obtained could have been definitely better. Gathering clever and creative people is mandatory but not sufficient.

Any comment or experience on this issue?

Patricia Egard
Founder of Ever Up, Consulting in Strategy and Entrepreneur
For continuous profitability in Financial Services

Innovation is a top priority for companies seeking to grow in the wake of the economic downturn, but flaws in managing innovation may hinder their progress, according to three studies released by Accenture (NYSE:ACN) by the end of 2009.

Almost half (48 percent) of the 630 U.S. and U.K. executives surveyed said their companies had increased funding for innovation in the preceding six months, while one-third (33 percent) said their innovation funding remained the same.
Additionally, nearly nine out of 10 respondents said that innovation is as important, if not more important, than cost reduction to their company’s ability to achieve future growth.

However, the studies found several flaws in the corporate management of innovation, including:
Experience curve ineffective,
High Risk aversion,
Lack of collaboration,
Too much focus on making incremental improvements.

Does this testimony apply in Europe, especially in France? Are the executive awared of their capability to innovate in financial services? And how do they emphasize their resources to achieve successfully their initiatives?

Thanks to Accenture Study for pointing out the necessity for companies to think about their innovation process. This will be very interesting to expand it to the main European FS markets and to share experiences.