Apr 15, 2019
In a recent blog post, Joe Annotti, president of the American Fraternal Alliance, explored the need for fraternals to begin thinking about their technology transformation. As he wrote, “Those organizations that can’t or won’t invest in and adapt to those changes will face a future with a very predictable outcome: a slow and steady fade into obsolescence.”
While we couldn’t agree more, we also understand that for many, undertaking such a technology transformation is much easier said than done. This leaves many organizations in a catch-22—updating their technology capabilities can be a complex process, but failing to do so means they risk losing market share over the long-run.
This is a particularly challenging question for fraternal societies that are facing increasing pressure across their organizations from larger carriers. As fraternals look to compete and remain relevant to their members, there is no room for error. Fortunately, with the proper guidance and direction, a fraternal’s technology transformation can be a relatively straight forward process. For those looking to begin the evolution, here are a few ways to get started.
Remember your mission
From their founding in the 1800s, fraternal societies have been about more than just offering insurance protections. Rather, they’ve long been committed to working alongside members to collectively better their communities.
But in order to execute against their complete mission, fraternals must be able to engage with and capture member information in a seamless manner. Yet, many aren’t able to do this as member information is stored in siloed back-end systems that can’t “talk” to one another. For customer service representatives looking to engage with members—be it about a benefit or charitable activity—this inability to see the complete picture can create a customer-facing, and potentially costly, friction point. This is the ideal place to start your technology transformation.
Begin by leveraging your legacy IT system as a starting point. Too many executives incorrectly assume that a system created decades ago—many have a lifespan of up to twenty years—is incompatible with today’s technology capabilities. Yet much of today’s technology can be layered on to existing systems.
But this is only possible if fraternal society executives reevaluate how their IT budgets are spent. Most currently prioritize system maintenance over system development. As a result, societies have created new back-end efficiencies, but largely remain stuck in the status quo when it comes to customer-facing innovation. By emphasizing program development moving forward, societies can offer superior member services and better collaborate with members to achieve their mission (not to mention the fact that they avoid wasting previous IT investments).
In today’s digital environment, members can order a taxi, purchase a retail item or book a vacation rental at the click of a button. Even more impressive is that members have the same omnichannel experience regardless of whether they are interacting with companies like Uber, Amazon or AirBnB from their desktops, tablets or smartphones.
With the notable exception of Lemonade, most carriers across the Pamp;C and life and health space still struggle to deliver an omnichannel digital experience. For fraternal societies, this presents an opportunity to differentiate themselves from the crowd and is a logical next step in their technology transformation.
Overhauling your entire digital presence at once isn’t realistic, so start by breaking this process down into manageable pieces. Again, begin by prioritizing high-friction member-facing pain points, particularly the way in which you communicate with members. Upgrading your digital capabilities to include text alerts so that members don’t have to go through a clunky sign-in process when trying to access their accounts from their phones, for example, should be a high-priority and will solve a pressing member need.
Regardless of where you start, you will need the right leadership team in place to guide your omnichannel—and larger technology—evolution. For many fraternals, this might mean looking outside of your current c-suite or executive team, many of whom might be unfamiliar with newer technologies or unknowingly hamstrung by legacy thinking. Consider leveraging your chief digital officer or hiring new talent with deep digital experience to spearhead your transformation.
Most importantly, no matter who you select, this can’t be someone’s second job. Fraternals who empower their technology transformation team to focus solely on the project at hand will not only see the best results, they’ll realize the benefits sooner.
The status quo comes at a cost
As Joe wrote in a follow-up blog post, while transformation might not happen overnight, “I am acknowledging the likelihood that the life insurance industry will not be exempt from the sweeping changes affecting other businesses around the world.” As you look to continue serving your members, what will you do to safeguard your society’s future?