EP 110 – Romil Turakhia, Reid Bailey and Rohit Nambiar – CIO vs Chief of Digital, Practical Advice On Digital Transformation and the Cloud

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Michael Waitze has been podcasting with some of the best investors and business builders globally and discussing all things startup with them from an Asian perspective. Michael worked in Global Finance for more than 20 years, employed by firms like Citigroup, Morgan Stanley, and Goldman Sachs, primarily in Tokyo. Michael always maintained a particular focus on how technology could be used successfully to make businesses more efficient and to drive P/L growth. Michael is quite skilled at connecting people and capital to innovative ideas and is a trusted advisor to both investors and founders. Michael is a leader in the digital media space, having pioneered the concept of a podcast network in Asia while building the biggest and fastest-growing listener base in the region. His flagship website, AsiaTechPodcast.com, has listeners in over 130 countries and is available on virtually every podcast player that supports RSS feeds.

Romil Turakhia has over 25 years of experience in the technology industry where he has helped create high-impact change in the insurance industry. At Candela Labs, Romil drives innovation and IP creation, as well as business development, giving him a unique "outside-in" perspective, helping Candela Labs focus on creating products and solutions that solve real business issues and bring quantifiable business benefits. Outside of work, Romil mentors young entrepreneurs and start-ups. He also loves traveling, learning new languages, history, anthropology, philosophy, and remixing music.

Rohit Chandrasekharan Nambiar (“Rohit”) joined Tune Protect on 14 October 2020. In his role as the Group CEO, Rohit will be responsible for steering Tune Protect on its journey of digital transformation aimed at positioning the group as a preferred lifestyle insurer within South East Asia and Middle East.

Guest
Reid Bailey

Reid runs the Transformation function for Bupa in Hong Kong, delivering large scale change initiatives within the insurance business. A growing function, with an ever increasing focus on digitalisation to provide the best customer experience. Reid has worked for Bupa for almost 9 years spanning across the UK, USA, Australia and Hong Kong. The majority of which has been focused on establishing and embedding Risk and Compliance functions in highly regulated environments, before moving into Transformation to set and deliver the future vision. With a passion for sport and fitness, health is something that inspires Reid in and out of work. During the weekend, you're most likely to find Reid on the football pitch.

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The Asia IsnurTech Podcast had a roundtable discussion with Romil Turakhia, an Executive Director of Innovation at Candela Labs, Rohit Nambiar, the Group Chief Executive Officer at Tune Protect, and Reid Bailey, the Transformation Director at Bupa. We had a dynamic conversation about how insurers can connect the dots between legacy enterprise systems and emerging digital solutions. 

Below the transcript of our conversation:

Michael Waitze  

Hi, this is Michael Waitze, and welcome back to the Asia InsurTech Podcast. This is the only podcast in Asia focused on insurance that gives entrepreneurs, thought leaders and investors a platform to discuss how technology is reshaping the insurance industry in Asia, and frankly, globally. Today, we’re going to do things a little bit differently than we normally do. We’re going to have a roundtable discussion with three pretty impressive guests. We are going to be joined by we are joined by Romil Turakhia, an Executive Director of Innovation at Candela Labs, Rohit Nambiar, the Group Chief Executive Officer at Tune Protect, and Reid Bailey, the Transformation Director at Bupa. Romil, I want to start with you, if that’s okay. In the current environment, is there really, or should there be a difference between how incumbent insurance companies perceive existing enterprise technologies versus their growing digital side of that business? 

Romil Turakhia  

Thanks , Michael. So just, you know, it’s kind of quite amusing for us to watch us as practitioners who provide technology to insurance companies. It’s quite amusing sometimes to watch how insurance companies put in a divide between digital and enterprise technology, they say, you know, there’s a chief of bit, little Chief Digital Officer, and then they say, there’s a Chief Information Officer, or Chief Technology Officer or whatever you have. And now, we find that quite amusing because we we believe that digital and enterprise are two sides of the same coin. It’s how people experience an insurance company that matters. Which actually brings us to the to one point before what you asked, which is, what is the definition of digital? And everyone’s saying, we should have digital insurance and so on. And we always sort of subtly and gently advise our customers that it’s not about becoming digital, becoming a digital insurer. It’s about insurance in a digital world. Now, when you look at it in that context, where there’s a digital world around you, people are ordering food from, you know, from the local food apps as Uber, taxis, all of that, in that digital world, the consumers expectations have changed. And if that’s what digital means, which is insurance in a digital world, then how could that experience be different for digital side, which is a frontend side of portal or app, quite a few people think that standing up a portal or an app is digital, and then nothing else behind? Whereas I think the end-to-end experience matters. So we find that kind of quite amusing. And we’ve been able to speak to our customers to sort of not look at it as two different sides.

Michael Waitze  

Got it. Rohit, do you want to jump in and give your opinion? I think I know where you’re going with this. But go ahead, please.

Rohit Nambiar  

I think my view on this topic is, you know, for me digital is like electricity. You don’t have a Chief Electricity Officer, do you? I don’t know why companies have this title called Chief Digital Officer, I’ve argued it for quite some time. For me digital permeates to the whole organization. My HR head is as much responsible for digital transformation as she is to hire people develop them, and so on and so forth. My operations head or my sales head, is as much responsible for the efforts as anyone else in the company. So for me, digital is across the organization. It’s a facilitator, it is the way we want to do business, the way we want to interact with the customer the way we want to drive our business going forward. And technology enables this, but led by what the business wants to do. Now, the conversation on whether you want a particular technology, or you want a particular way of doing things, is a byproduct of where you want to get to as an organization. So for me that’s where the important discussion, and a lot of time I think these conversations happen, because in a quick summary, if you look at the evolution of InsurTech and the technology element of insurance industry, which has been a laggard. Initially, a lot of companies jumped on this innovation center bandwagon. Several million down the drain, they realize that that doesn’t work. Then they put you know, the youngest, the most bravest, the smartest chap in the room and said you are the Chief Digital Officer now help me transform 

Michael Waitze  

Or  they are making him the Chief Innovation Officer I think, right?

Rohit Nambiar  

Two years later, that also doesn’t work. Because I was that a few years back, and I can tell you, it’s one of the most impossible roles to do in an organization. Because to go and tell a sales head who’s been doing sales for the last 20 years exceptionally successful, saying, I will tell you how to transform your sales channel. You know what he’s got to be quite kind to me on a good day, and probably worse on another day. So coming back to this conversation for me, it comes down to the same point, have we changed the culture, don’t over glorify tech, and give less importance to the most important topic in the room, which is cultural change, and people required to drive the change. There’s enough tech available everywhere, no offense to any of the providers. And anyways, the last point on tech for me is any technology that I launched today in the market is anyway outdated. Because there’s something that’s already come because most of our implementations take a few months. And it’s already outdated. So that’s why for me, tech is only an enabler, not the main part of my compensation.

Michael Waitze  

Got it. Reid, why don’t you give us your opinion on this as well. And just let me jump in, from my experience working in the financial services industry, for 25 years and essentially technologizing myself out of a job on purpose, like knowingly doing this. We didn’t have a Chief Digital Officer, we didn’t have a Digital Transformation Officer at Goldman Sachs, nor at Morgan Stanley. But we did find a way to use technology to transform our business. And I agree that at some level, there has to be a cultural change. And the people that couldn’t keep up with it, or the didn’t want to change culturally, just got left behind. And now Reid, go ahead. What do you think from your perspective?

Reid Bailey  

Yeah, I echo everything that Romil and Rohit had said. So, for me that one the same, right? However, I think it’s probably born out the fact that historically, certainly, you know, insurance companies, it’s been about just maintaining your IP technology, right? It’s, let’s just maintain that let’s make sure that’s taking over. And I think what’s disruptive this is customer expectations. So customer have such a need for instant gratification, such a need for real time results that to potentially some of these legacy systems of the past can’t provide that. So what’s happening is people are looking at new solutions, and bucketing under digital. And so what’s kind of happened is you, you almost got to environments, which have developed this digital real time application type environment and the backend legacy system. So I think that’s probably where it’s born out. But for me that one in the same, and when I look at it from my transformation lens, I look at it from an end-to-end process perspective. So when I look at it, through that lens, it’s all about, okay, the front end for our customer and the backend systems  for our employees and making sure they’re integrated. So if they’re not integrated, I don’t feel you’re able to get the right benefits out of the changes you’re looking to try and implement.

Michael Waitze  

I don’t disagree with you there. But I want to get back to this difference between sort of the frontend systems and the backend systems. But before I do that, Romil, I want to go back to something that you said, kind of in passing, but I want you to maybe dig a little bit deeper, and then I’ll get everybody else’s opinion on this as well. You said it’s a lot about the experience that people are having. Do you think and I asked a lot of people in the insurance business and in the InsurTech business, you know, combined, obviously, do you feel like the best technology implementations, particularly on the frontend, from a UI and UX perspective, are now no longer competing just with other insurance companies but are competing with the best of class for, you know, whether it’s Stripe, or Amazon or any other sort of customer facing company? What’s your view on that?

Romil Turakhia  

Absolutely. Absolutely. Insurance is certainly competing with them at two levels. One is just the user experience, of course, because people are used to that user experience. Insurance in a digital world as we talked about, but there is another deeper level of competition, quite honestly, which is that the GAFA firms as they’re known as Google, Amazon, Facebook, Alibaba, Apple, they just call GAFA. So the GAFA firms are getting into insurance. Whether you like it or not, Amazon has an insurance company or investments in insurance companies, same way. You know, in our lifetimes, we’ll probably see the Bank of Facebook so that there is going to be something there, which is, so there’s competition even at that level. So what to traditional insurers, or even slightly, you know, those who are not GAFA, they do need to look at two or three aspects. The first is that, that the GAFA firms they already know what great customer experience looks like that’s at the frontend. But then there’s the second element, which we always talk about, which is, you know, there are people in the GAFA firms there are people who specifically tasked to look at their processes internally to align, realign their processes, make them so friendly to customers. I mean, I remember earlier, when we used to have to return something on Amazon, we had to take a printout of a return receipt and so on, right. And that was just one extra step for us. But it was so much easier on the Amazon whole cycle for them to just accept that, but they just changed the whole process so that I don’t have to take the printout just one small step cut out from my journey as a customer, but they had to reorient all their warehouses, how they return stuff, that whole process behind, just to make that one small thing possible. And they’re able to do it. So we as insurers, are we able to do stuff like that? And that’s where the real competition is, which is, are we able to align our backend processes to meet the expectations of the frontend. And therefore, that’s why the whole bit that both of them are actually, to us the same thing. And that’s why we call it connecting the dots between enterprise and digital. That’s really what we believe is the game changer. And it’s not just the front end. Therefore, I mean, we are familiar with what Rohit is doing a Tune Protect. He’s not moving just the front end piece. They actually shipping whole whole API’s to new customers and partners who sort of sell Tune insurance without anyone knowing they’re buying Tune insurance, right, they are consuming another brand. And so isn’t that digital, that’s digital, too. And in fact, it has no frontend whatsoever. And yet, you know, so that’s digital is right from the front of the back.

Michael Waitze  

Yeah, I mean, I would actually make the case. And Rohit you can jump in on this in a second. But I would actually make the case that the frontend is in some cases is so disambiguated from the user experience that it is there but they don’t know it’s there. It’s like everything. It’s like breathing air, you know that there’s h2o, I mean, you know that there’s oxygen out there, but you don’t feel breathing it you’re just breathing. Anyway, Rohit, please go ahead.

Rohit Nambiar  

So let me give you an example of one of the examples of my past job where we launched Malaysia’s first online health insurance product. And when we are launching it, we drew out the whole customer value proposition, we always start with the customer. And he claims everything he basically. And I had two issues with the technical folks. And most people will tell you, in an insurance company you put an underwriter, a claims, a compliance and a risk person, nothing has seen the light of the day after that, right. So I had this four or five people in the room. And there were two issues, they raised. One, they told me when it’s a digital health product the claims will be higher, I don’t know where they got that form. And they said, if it’s digital, it’s easier to do fraud. Okay, again, I don’t know where they got that from. So they had some examples. They said, Oh, somebody could duplicate a bill and upload it, you know, different examples. Three years after the launch, and it did very well in the market, we were number one in less than three years. We found neither was the claims worse off, in fact, it was significantly better than our traditional channels. The second thing, the fraud rate was significantly better than our traditional channels. Because here there is nobody acting on somebody else’s behalf. And you know, you don’t have all those funky things that happens in traditional business. But we found a new issue, which none of us thought would be there, which was the renewal rates were lower, because the millennials and Z-lennials need to be pushed over the line with goodies and freebies to actually, you know, do a renewal. Now, that was a learning. So the point, why am I giving this example is yes, we took a lot of effort in simplifying the experience the customer experience, through digital and other means. So you know, if customer wants to talk to a chatbot, they do a chatbot, the customer wants to talk to someone over the phone, they can do it. If the customer wants to do it on an app, they can do it. So we gave that functionality. But we had our own strong views on how this channel would work. And the channel behaved very differently. So what I’m trying to say is this has been the big. That’s why, you know, sometimes, and there was a lot of cool tech behind this. There was chatbot. There was API, you know, there was open API RESTful API, there was a native mobile app. I’m not talking about all this tech, because I think that sounds very nice. But frankly, that’s not the point. The point here I’m trying to say is there were two important changes we need. One was a cultural change for an insurance company to say, I’m going to launch a product despite not having enough data about the product. It’s a massive, don’t underestimate how difficult that elephant is to move out of the room, right? Because you can’t get the actuaries, and underwriters and compliance people to get over the line, the second one was for us to know that we are getting into the unknown. So when we went live, I think we actually had this calendar of, we will put something live every six weeks to 12 weeks, we’ll put it live. And people are amazed at how many things we did. And I can tell you 70% of what we didn’t work. But we got to number one, because that 10% worked very well. 20% I would say in between, and 70% didn’t work, but the 10% was the game changer for us. So it requires that repeatability the ability to and that’s where I like concepts, I started, I don’t like concepts, but I like thinking, so what I mean is, we had a philosophy of launching everything in six weeks. But the minute someone said, I’m going to put a scrum together, I’m gonna have a product owner, I’m going to have a, you know, SME, I’m going to have that I’m going to agile coach, I said, I don’t care about what framework you use, what I care about is, are we able to get this out in six weeks? What measurements can I have to measure with whether the six week funnel is flowing through and so on and so forth? So I think that was my learning from this debate we’re having on the topic. 

Michael Waitze  

And Reid, do you want to give me your opinion on this? Romil obviously touched on this too. But this idea of connecting the frontend experiences with even small tweaks in the backend processes. Again, I saw this a lot when I was at Goldman. If somebody wanted some new functionality, we had to make sure that it fit into this massive process in the backend. And while it seemed like something tiny to the client, the impact that it had on the backend was massive. So what’s what’s your take on this?

Reid Bailey  

Yeah, it’s a great question. So I think it comes back to that kind of the legacy systems and platforms are not necessarily having the right development capability. So the small you need, you want, you want to make a number of small tweaks on that frontend. But any end from a user perspective, you’re like, oh, that should be super simple. We deliver it in a day at minimal cost, but the downstream effects of how that needs to integrate into your backend legacy systems can be quite, quite big and onerous. Something that we we definitely a challenge we’re trying to overcome here in Bupa, I think, you know, we’re a long standing insurance company. We’ve we’ve legacy systems. So some certainly something we’re trying to, to overcome. And I think it’s all about the architecture and how you design that architecture for the future. And then, over time making those right decisions, and investing in the right tech to be able to streamline and upgrade that. So that’s my view, a couple of things just touching upon, I think what Romil and Rohit was saying, quite a interesting example around fraud is going to be through the roof. It’s quite interesting, I think  that whole view is now changing across the industry, because we are able to use that data to better inform our decisions, and then also better inform our the likes of our risk control. So I think we’ve certainly seen a shift in that nature and those, I guess, anecdotal experiences and wives tale old wives tales. So we’re definitely seeing that change. And we’ve got a massive focus towards data analytics driving the right decision. So um, so it’s super interesting discussion. And I think, like Romil said, all starts with the customer. And everything we need to do these days is all focused on the customer, right? And so InsurTech, and otherwise, rommels, although his views are insurance is now all about how do you build the ongoing trust? And how do you build a proposition which isn’t just about the insurance plan? It’s all about what additional services and added value can you add with that? So here at Bupa we’re looking at how can we look at preventative care? How can we use data to inform our customers around how they can get healthier, how they can prove their wealth, how they can get preventative care before it gets to a point of needing to claim and I think that’s where InsurTech and digital is playing an even bigger role in in driving those great customer outcomes.

Michael Waitze  

I want to go back to something and again, Romil, just because you brought it up, right? You mentioned the GAFA companies. Let’s just go through the list again, Google, Amazon, Apple, Facebook and Alibaba just super globally dominant companies. Is there a concern and I know that Amazon has invested in some insurance companies and InsurTech companies, in India we know that Amazon, I mean that Facebook is coming into the insurance business. Google wants to dominate everything as well. Apple already has Apple Care, which is fundamentally an insurance business. And Alibaba is similar things, is there a concern in the insurance industry at scale that because 80, 90 pick a number, percent of the advertising digitally goes through Facebook and Google, that they’re going to subsume a large part of the insurance industry.

Romil Turakhia  

Not  directly. I mean, if I speak to the CEOs and Reid and Rohit will come in on this, they are from the industry, but when I speak to insurers across the industry,  there is a fear of GAFA, like firms coming in, if not exactly the GAFA firms. There are newer age insurance companies that don’t have the legacy at all, they don’t have to deal with any of that. They can do product selection at a micro level, they can, they can ensure I mean, we know what Lemonade ensures, right. So there is always a Lemonade that comes up. And it doesn’t have to be a GAFA, it can be a Lemonade, which becomes with joins actually another GAFA. So I do see a definite definite concern from all insurance that I’m talking about. Most of them are not fortunate enough to have been New Age. So they do have a lot of legacy. And, and if I ask them, what’s your concern, number one, this is we’re always looking over, you know, over our shoulder, and looking at if there’s a competitor out there who’s just coming in, and taking away bits of our business, but those are the bits that we’d like to keep so and then it’ll become mainstream soon. So that’s what I hear at least, but Rohit, Reid.

Reid Bailey  

Yeah, I’ll happy to jump in here. So I think it’s all about owning the customer. And if you can, if you can own the customer, then you can, you can make value out of that. And I think that’s where the likes of the GAFAs have have bad competitive advantages that they said, here, they’re 89% of, of the marketing space, you know, that is, it’s an incredible advantage when you own that customer touchpoint and that first customer touch point. I guess from being an industry, you know, we obviously do a SWOT analysis, and we capture our our risks on a regular basis. And, you know, we’ve always captured the risk of, you know, these players entering the market and providing potentially a better proposition based of a wider range of data. And we probably had on there for the last three to five years and and we haven’t seen them materialize yet. So definitely, I think it’s something which we are constantly monitoring and looking at. And I think it’s definitely an ongoing threat. Nothing’s as of yet materialized. And I don’t quite know why potentially, it’s the regulatory environment in which insurance plays in, it’s quite tight and regulated. And the requirements would come along that especially around around data and such. But I think that’s that’s going to be an ever evolving landscape. 

Michael Waitze  

Rohit, what’s your opinion?

Rohit Nambiar  

Yeah, so I think three parts to this conversation first one. Let’s look at the top 10 insurers of the world. 20 years back and now or 30 years back now, in the last 10, three decades, only two insurers have been a constant in the top 10. The other eight have fallen off and new have come in.

Michael Waitze  

Who are the top two?

Rohit Nambiar  

AXA and Alianza, the only two. The others have fallen off. Yeah. And there’s new players come in, they go right to the top, you know, all that stuff. The second point is 10 years back, I heard some of the names Romil mentioned, of getting into insurance, and basically going to make us all non existent. And there was one of them who actually entered France and got out of the business. Said we are no more in this business. We also heard about the famous three way joint venture, which was supposed to shatter all of us, it didn’t. So I’m not being arrogant or anything, right. I’m a small player. But I think what I’m trying to say is, it’s very easy to take views, A will work B will work. Lemonade is not a classic insurance company. Lemonade is a very different insurance company. But Lemonade is not depending on profits as yet. They’re paying on valuations. Same with Oscar.

Michael Waitze  

I would say depending on profits, I don’t even think they’re thinking about profits. But I’ll leave that to you. Yeah,

Rohit Nambiar  

So you’re still looking at the valuation game. So that’s a different, you know, competition that you do between a traditional insurer and a new age insurance. So my point is very simple. What we’ve seen in this industry 10 years back, large companies looked at InsurTechs as a threat. And InsurTech’s looked at large companies as I’m going to take your job away. None of it worked, because InsurTechs realized we can’t survive because we don’t have the balance sheet. The large players realized, Oh, I’m gonna you know, these guys can do nothing to me. So they did two things, right. As I said before, this set up innovation centers or they set up a company from within to disrupt their own business. What they forgot is the company from within also is subject to the same complexity that insurers have. So the company from within the unit from within never succeeded. In the last few years, we’ve seen far more maturity. I think InsurTech’s realize they need the larger balance sheet. The larger balance sheets realize that they need these InsurTech’s because they’re faster, more nimble, more quicker, etc. They’ve been some examples of people who got out of the spec. But by and large, I think we are now complementing each other not competing with each other. And that’s why to Ronil’s point for me API friendliness is my strategy. Because if there’s an InsurTech out there who has an access to a customer base to what Reid mentioned, I’m happy to partner with them. I’m not looking at them as competitor because they get my underwriting, my technical standard, if they bring the technology, what is my problem, I’m happy, I’m getting customer, they are getting customer, we are happy in this value chain. Right? So it’s all about customer have we made it simpler. So if tomorrow, Amazon finds an amazing way of distributing insurance, what I will do is I’ll go and partner with them be it Google be it Facebook, be it anyone? Because it’s not easy for Amazon. There’s no global license that you get for insurance. Every country, I’ll give you a very simple example. There’s one country in Asia that I’m trying to enter. People told me the average time to enter is two years, average time to get a license is two years. So imagine doing that over you know, for an Amazon or Google or Facebook doing it over 40, 50, 60 countries? Yeah, it’s a long time that you’re talking about. So that’s why the method we have used is, for example, we are able to work in multiple countries because we have a reinsurer we have a tech platform, we tie up with whichever insurer that comes in the market who has like minded thinking, we bring in that and we do it. So coming back to this point, I think, I don’t think there’s one method, I think every company has a different framework, Lemonade and Oscar Health, Root has shown us one way of disrupting the market, the AXAs, Allianz, PingAns of the world have showed us another way of disrupting the market. And then there are smaller players like Tune, who are saying there’s another way of disrupting the market by picking specific areas where we believe there’s bigger bang for buck. And within that the profitability could be higher. And that’s the whole idea here. 

Michael Waitze  

I just want to make a point that I did not want to contend that I want to be clear about this, right, I did not contend that Google was going to come in and dominate the insurance market. And frankly, I’ve watched Google over time. We’ve all watched them, right? Come in build products, everything’s in beta. And then when they’d fails, they just give up. I mean, frankly, if you look at their business model, look at their revenues. Unlike actually, Amazon, Google really doesn’t succeed at much except AdWords, and ads. And sure they have a ton of data. But I don’t think they figured out actually how to use that data for anything else except serving ads to people. So I was asking, because I’m curious what you’re reflecting from insurance companies and technology providers. But they don’t scare me. You know, it almost sounds like they don’t scare you either. Like I want to switch gears a little bit. And Romil let’s start with you. Again, I want to talk about the cloud. What’s your view on the adoption of cloud and cloud services from the insurance industry as a whole. And, you know, I was just looking up some data, Amazon’s AWS business is about a $40 billion a year business. So it’s about 10% of their revenue. So there’s a lot of activity there. What’s your view from the insurance industry on this, though?

Romil Turakhia  

Oh, absolutely. Cloud is almost, you know, linking it to the previous question. It’s, it’s almost a prerequisite to sort of newer digital initiatives, so to speak, and whether they are related to the frontend of the backend, I put all of them in one bucket called Digital initiatives, or being able to survive in a digital world, so to speak. What most insurers that we are talking to not most actually, all of them, whichever tier they come under, whether it’s tier one or tier three, or four, wherever they are. It’s just a question of when we move everything to the cloud, not whether we move everything to the cloud, and that everything of course is all staged, I mean, there are legacy systems that do not ever will not be able to be hosted on the cloud. But there are other systems that that move in there. And the whole reason for that is, you know, Rohit alluded to experimental, you know, there were 100 projects and 70 failed and 20 were not okay and 10 were, you know, super successful. I remember one conversation with Rohit over lunch where he said, we launched a particular online sort of property. And there was no way that anyone could have understood the kind of volumes that would have hit them, Rohit than I hope you remember that over lunch the other day. And it was within a week that the property came reeling came down on his knees, I mean, in another company, and  that was to no fault of anyone, it was just that no one planned for that level of elasticity, no one planned for, it just wouldn’t happen. So to allow for this kind of experimentation, where you scale up, scale down, you can’t have a constant hardware infrastructure, etc costs, it just suits. All these digital models they can only be aided assisted. Very little, if you add on premise, if it is cloud, then that’s when the real magic begins. So we’re seeing all of that happens, some insurers are taking an option of let’s get just SaaS, so let’s get only SaaS applications, software as a service. So we buy applications, we consume them on a monthly basis, we get to try and buy as an example. So we know  what we’re going to get before. You know, there’s this whole thing, you know, like, like Rohit said, whether use agile, or waterfall, but we just don’t know what’s coming at the end of six weeks, or whether it’s 60 weeks? Don’t know. So those are the types of models that some of the insurers are, most of them are are taking on, some are moving just like testing environments, some are moving quite a few of the frontend systems first to the cloud. So depending on various, you know, maturity curves that everyone’s on, it’s a question of like I said, when and not whether we move to the cloud.

Michael Waitze  

Rohit, do you want to share? Obviously, you you have had this conversation before, do you want to share some of your thoughts on this as well?

Rohit Nambiar  

I think cloud is something super important. For me, it’s not about cloud. You know, it’s really about the agility that it gives my business. It’s really about the scalability that it gives my business that I’m quite keen at Tune, we are actually putting a lot of our assets on the cloud. And I think the challenge for cloud is two pronged. One is regulatory. There’s always challenges in every jurisdiction on what can be put on the cloud, what can’t be put on the cloud. So sometimes, you know, whether all entities, especially when you have multiple presence, can follow the same framework of cloud, it just becomes very complex, because each jurisdiction seems to have a different view on what can be put on the cloud, what cannot be put on the cloud. And that’s when we have all these discussions on public and private. And now there’s a hybrid one, which I keep telling people is basically glorified on-premise, it’s not cloud. But anyway, you know, it is what it is. The second part of cloud for me is, I think, also this conversation on what does it do to the business? Because sometimes the business people don’t get it right. You know, what, so what, what, what do I get for the cloud. And that’s why I think I look at lead KPIs over lag KPIs, because too often initially, we looked at Google or Amazon, or, or whatever is the cloud that you use, to say, it’s gonna bring me cost saving, actually, it’s going to bring you a lot more than just cost saving. It’s going to bring you faster time to market, scalability, ability to handle more customers, if your campaign is, you know, successful, and so on and so forth. So I think that’s where, you know, I’m fundamentally a big supporter of the process.

Michael Waitze  

Reid I want you to jump in. And I also want you to talk a little bit about, you know, Bupa is a global company. I’m really curious what that conversation is, like, when you’re trying to come up with a global, you know, strategy for, you know, for cloud implementations or, frankly, for any technology implementation, because both Romil and Rohit said this, like in different jurisdictions, and for with different regulators, the things you can and cannot put in the cloud are very different. What are those meetings like internally? And what’s the strategy really as well?

Reid Bailey  

It’s a great question, and that the bruxy iced answer is we haven’t cracked it yet. You know, where we were, we carried through that as we speak. So I think Bupa as an organization is, has run quite a federated model, historically. So each of our business across the globe has its own IP architecture, network infrastructure. So it’s, it’s very different. So historically, trying to align that has been a very, very difficult exercise. However, that is one of our key strategies and key objectives for the next couple of years, is aligning on what is our cloud strategy across all organization. So we’re definitely moving to a cloud first approach. And at the moment, there’s a Center of Excellence is, as we call them, which are gathering the brightest minds  across Bupa, to understand how to actually crack this problem, and that goes across cloud strategy that goes across our digital development strategy. So yeah, we haven’t quite cracked it yet. And some of those regulatory components is playing a big part. But also, it’s also more about actually being able to centralize all of this data in in the first place. But it’s not something we’ve actually been able to tackle successfully, historically. So it is a big question for us at this moment in time.

Michael Waitze  

I understand. Romil, you want to say something?

Romil Turakhia  

You know, when you say this, the brutally honest Bupa hasn’t cracked it, you’re not alone, right? We’re seeing this across insurers. So you know, to that question that you talked about Michael, just, you know, has, as anyone cracked it, we’ve seen different models. So we know, one large insurer says, in some countries will do Amazon, in some countries will do Azure. And that’s mainly up one is, of course, to be safe, and, you know, have failover and backup, but don’t know how that will work. But more importantly, it’s got to do with what Rohit said, In some countries, you need data sovereignty, for example, all the all the data should reside in that country. And some providers are able to provide it for all the countries that we work with, and some aren’t, and so on. So there are choices made on split, split cloud kind of thing, based on countries. There are others that say, even within the same countries, some types of applications go into insurance, and some will go into Amazon and some maybe GCP, which is Google Cloud Platform, or whichever local cloud provider if they have one. So dividing within the country, between clouds, we’ve seen that lesser off, but a little more. But to overcome all of this, just like the point I made earlier. All of them, so unanimously say that if you are hosting as a provider, if you’re hosting your SaaS provider, then I don’t care where you are, you just tell me that you comply to the noms of my regulator. And then whether you’re an Azure or Amazon doesn’t matter to me, whatever my global policy. So that’s one thing that I’ve seen which people have have come together on, but on the on all the other things. Reid, you’re probably not alone. Nobody else has cracked it. Everyone’s trying different models. 

Michael Waitze  

I mean, I can definitely corroborate that just based on the conversations that I have. So gentlemen, before I let you all go, I want to touch on one more thing. We talked about this a little bit offline and Romil, let’s start with you, again. When it comes to digital transformation, when it comes to moving things to the cloud, when it comes to all these things that we’ve talked about, all these initiatives are great. But how do you measure success? How do you know if you’re actually being successful in these developments, in these endeavors?

Romil Turakhia  

Absolutely, that I think that’s the key. Why why we do what we do is important, isn’t it? It’s not that we want to become digital. And there are tick marks, we’ve got an app there, we’ve got a portal, we’ve got a chatbot. And then hey, guess what API is now considered part of it. So we’ve got all of that. So now we are live. Obviously, we all talked about this, all of us right from the beginning. One is the customer experience itself, the agent experience, everything else can of course be replicated, you come out with a great product, maybe someone else will come out with a similar one in some time. You know, if there is it’s all available for the market to see. So obviously, there’s much more than just product differentiation. Of course, product differentiation helps.  Lemonade doesn’t really ensure that standard traditional product, in some senses, it could be probably an insurer, right? In that sense. So it the product types, of course, vary and so on, but experience is one. So like experience, how many other measurements are there? What are the KPIs? What, how do you look at this? So at least from our perspective, I can tell you wherever we implement, we we put in what is known as a benefits led program management thing. So it’s not that we’ve delivered this app, but it’s about how many agents have actually come on board, and what is your adoption rate, and how many people are submitting applications per day versus, you know, this month versus last month versus next month. So it’s extremely important. What we do is we set up a workshop, right? Somewhere, either in the beginning, middle, or end doesn’t matter. But certainly before go live, where we all agree on the KPIs. Hopefully, it should start in the beginning of the project. And we actually say what do you think makes this look like it’s successful? And we had so for example, someone said, Okay, we have a large, two large objectives. One is growth at constant costs. And the other is step change and customer experience. So we said Okay, then let’s have workshops separately, apart from requirements and all of that and giving you the tech, let’s have workshops, and on dealing with those so we chose seven measures four in customer experience and three in, in growth at constant costs. And and that was the workshopping So, for anyone who’s going through a digital transformation of any transition of any sort, obviously, the results matter, the end vision, the KPIs matter, and then we drive towards it. That’s, that’s just how we do it. And that’s how we’ve seen other insurances. 

Michael Waitze  

Understood. Reid, lets go with you first and then we’re gonna finish with Rohit.

Reid Bailey  

Yeah, perfect. So, in terms of what, yeah, how do you measure success? So I think, as Romil says, you want to start with the why. So why are we doing this? Why are we embarking on this change or this journey? And then really figuring out what are the benefits and for me, there’s kind of two buckets, the tangible benefits, and the intangible. So the tangible are always the easy ones, to be able to define and track you know, the increasing revenue, decreasing costs and cost savings. The intangible ones are quite often the difficult ones to track and measure, you know, your NPS, your customer experience. But they’re also just as important, just as valuable, right. So it’s being able to frame the conversation around not only the financials, but also the really important intangibles. And then exactly what exactly Romil, all about having that clear, view what those benefits are, and alignment across across your leisure team in your board. And then those underlying KPIs which drive that? So, yeah, I mean, it always starts with the why the benefits the underlying KPIs, and then making sure we will hold each other to account.

Michael Waitze  

Got it. Okay, Rohit, you’re up.

Rohit Nambiar  

So, let me try to break it down into four parts. First one, a little bit of timeline, a decade back, I was heading maybe 10, or 11 years back, I was heading out strategy at AXA, one of the things I very early learned in my job is a business case is as good as the CFO, and the strategy head want it to be. And many projects were launched on, you know, those business plans. So if you plan, because you always want to show the board or the management team, APE, NBV, you know, profit, you know, those kind of stuff, without even figuring out you know, how this flows through because these values go through, as a result of many other actions as well. So it’s almost almost impossible to separate one implementation, and say this cost that to improve. And the problem with those exercises, very soon we realized was, it was almost impossible to actually, you know, show this cost improvement and and I call them lag indicators. Five years later, what happened was, most CEOs don’t want to sign up to such such numbers, right? Because after one or two years, the board is going to ask you better than numbers, and you are possible for you to show the numbers. So then the industry went through a shock phase of being shy. And every project you did was either compliance, or catching up to the mark, cost saving. cost avoidance never cost savings. Because you know, that’s how you drove it. And then again, you had another debate among all the large insurers saying what the heck, you know, you can just keep implementing projects and then you know, there’s nothing flowing through to the bottom line or the top line. Then we went through a third phase where I think we really got into reality check. Which is to say, you know, what, life doesn’t work where if I do one customer portal, my retention level is going to improve? That’s a bit of a hogwash, right? It’s not going to work that way. There’s so much more that has to come to, you know, make that happen. So that’s when I think as an industry, we went towards what we’re still in the process, we went towards what I call an Amazon way of doing things. I really like that in particular, I’m a big fan of Jeff Bezos first letter and the second letter, of course, 10 years later, I think looking at things by saying very simple, right? Why are we here? My ex-manager told me this. Why are we innovating, we are innovating because the customers asking for it. So we look at four simple KPIs at Tune Protect. The first one is, how many customers have I added? How long is he staying with me? How much more is he buying for me? And how much cheaper is it for me to service him? And the rest on how it flows through, I think the industry is still figuring that out. Because it’s it’s like, you know, I’ve been thrown models by by consultants, no offense to them, saying 1% saving in customers 1% improvement in customer satisfaction scores means X percent improvement in bottom line. I would like them to come and join my company and show me that next year. 

Michael Waitze  

No insult intended to the consultants either, but yeah.

Rohit Nambiar  

you know, I’ve also had these debates. This is the same debate in life insurance without my last point I people always said NBV flows through to the underlying earnings. And you know, it never happened right? Because NBV was NBV, because they were actuarial mumbo jumbo, and there was a lot of complexity involved there. So coming back, and that’s why it’s really important to make these KPIs simple. So the last point I leave you with is I did something, I do something which is very different. I give everybody a KPI, which is what they have to deliver. So my head of e-commerce KPI is not sales, my head of e-commerce KPI is, none of your purchases should take more than five minutes, simple. So he gets the message, his job is to keep the process as simple as possible. With that I’ve sent a message of simplicity, you know, all of the things that I want to do, it’s all about how do I get get what I want out of that person in that given year, versus looking at 3, 4, 5 years, because 3, 4, 5 years, at the end of the day, who saw COVID, who saw 2008, who saw many of these things happen? Right? So I think those are definitely a financial forecasting exercise. But it’s it’s impossible almost to, you know, connect every single initiative we do in an organization, especially from a digital transformation perspective, to these like KPIs.

Michael Waitze  

Look, I think this has been a really incredible discussion. I want to thank all of you for coming in and doing this Romil Turakhia, Executive Director of Innovation at Candela Labs, Rohit Nambiar, the Group Chief Executive Officer to Tune Protect and Reid Bailey Transformation Director of Bupa. You guys were awesome. Thank you very much.

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