- 17-05-2023
- BPS
- Business Process Solutions
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Introduction
Talent planning needs the same rigor and emphasis as business strategy, particularly as the financial services sector undergoes a rapid transformation. This is particularly true of the insurance industry, where recent technological changes are changing the dynamics.
New technologies are also gaining momentum. Digital and analytics technologies in particular, as well as the rise of artificial intelligence, have consequences for all key operations in insurance.
Among all these changes insurance executives identify human capital as the scarcest resource in the present economic climate, rather than financial or any other asset.
Role of Talent in the Insurance Industry
The traditional agent-led strategy used by insurers is failing to meet customer expectations. To flourish in the future, insurers must recruit "digital natives" and provide them with possibilities to make a difference.
Insurance firms have been rethinking how they find, hire, and keep personnel to remain competitive in the contemporary workforce. When it comes to replacing personnel, the sector is perceived as constrained and hindered by factors including geography, incentives, career trajectories, etc.
When there is fast change, business strategy, and personnel strategy must be equally focused, yet talent strategy takes a second seat. With the development of digital, analytical tools, and AI/ML, new technologies acquired acceptance with ramifications for basic tasks.
Individuals with technical and soft skills in customer connection and empathy are increasingly needed in the sector to manage risks and trends and maximize the value of new technologies. Furthermore, the sector needs a fresh approach to people management and workforce planning.
The talent shortage in the industry
The reduction of the insurance professionals, as has been talked about, has been happening over the recent years due to employees retiring and the impact of Covid where large sections of the labor force have not come back to fill in open positions. The reduced employee base and the direction the market is moving present a serious talent dilemma for the insurance sector. Up until recently, the go-to-market strategy of insurance firms focused on using agents and direct customer interactions where possible. However, today's consumers are attracted to the customer-centric strategies used by businesses like Netflix and Amazon – which offer online/ no-contact/ self-service options, supplemented by an ability to offer interactions by phone, by chat, messaging and other options as and when the customer demands.
Strategic staffing to manage the talent shortage in the insurance industry
Following the pandemic, there has historically been an increase in insurance awareness and sales. According to some observations of insurance CEOs, lower prices, accelerated use of digital technology, and the increase in skills are some of the advantages of the Covid-19 pandemic.
Insurance companies will need to rethink their talent strategies. They need to be focused on several talent and labor force-related areas including:
- Training and professional development - To be competitive, insurers must ensure that their present personnel are always learning and acquiring new abilities. Upskilling and reskilling are less expensive and time-consuming than hiring and training new employees, and they can help bridge the skills gap.
- Recruiting new talent - Insurers must take the time to integrate new hires into the corporate culture when they do hire fresh talent. This is especially true for relatively new or specialized skill sets like data science and analytics, digital marketing, and design thinking. However, there may be shortage of these skills in the local market – but that can be made up with the use of specialist outsourced service providers, who may not provide resources directly, but will take up these processes on behalf of the insurance entity, mostly at a lower cost.
- Talent Diversity - By changing the skill mix, talent strategy may also change the insurance sector. This is a chance to encourage the much-needed variety of gender and race. Additionally, it provides a chance to recruit individuals from other backgrounds and sectors, which may encourage creativity and innovation. In the current scenario where outsourcing and global teams are becoming common, the teams can also be extended beyond local boundaries.
- Dynamic Working environment – Personnel strategy may change the insurance sector by fostering a more dynamic workplace. Candidates are increasingly seeking this, and it is crucial for drawing in and keeping top talent. Although the insurance sector is renowned for being conservative, employers may create a desirable workplace nonetheless to attract new talent, and talent from other industry verticals.
- Performance management and recognition - Starting to monitor employee performance and recognize accomplishments would be seen as the most significant technique, eventually leading to an employee wanting to work more and better, therefore maintaining the working atmosphere motivating and healthy.
- Growth & well-being - Another significant development that insurance firms should be aware of is employee wellness. There are other methods to invest in employee well-being, including gym memberships, wellness initiatives, and on-site services such as daycare.
- Empowering the workforce with automation and digital platforms – As digitalization and new technologies are introduced, insurance organizations should adopt them to strengthen their service levels, and to empower their workforce with solutions that make them more effective, and their jobs less stressful. This may sound like a difficult task, and that it requires large investments – but with smart intervention, intelligent automation, a combination of technologies supported by human labor, this can be achieved quickly, and with near-zero upfront cost.
In fact, in cases that we have seen, it had led to overall cost-reduction, more efficiency and a better customer experience for internal as well as external customers. Take, for instance, an enterprise-wide platform called Copasys that was created by Coforge to automate compliance, risk management, and quality control. Such a platform reduces errors in processes and compliance while reducing costs and improving staff productivity.
In conclusion, there are several ways to enhance in-house staffing by adopting specific employee and hiring-friendly methods to fill the staffing gap. But insurance companies are not stopping there. They are partnering with service providers who can help with their operational processes, and with technology point solutions (a ‘digital-first’ strategy) so that the insurance company is more future-ready. This combination of in-house efforts and external partnerships delivers the best customer experience to their customers, and creates efficiencies and effective business outcomes.