How time flies. It just seems like the other day the insurers taking the lead were those leveraging the “SMAC” constellation of technologies – social, mobile, analytics and cloud. Now, those approaches seem so… well, 2015.

The new way to accelerate ahead of the competition these days is by going all-digital, all the time – with healthy doses of artificial intelligence (AI), machine learning, and virtual or augmented reality (VR/AR) thrown in.

Technology may be advancing at blinding speed, but everyone is still struggling to keep up. In a new report, PwC, which first began measuring what it calls “digital IQ” in 2007, finds little or no progress. The consultancy’s latest global survey of more than 2,200 executives shows that digital IQ scores — “a measure of an organization’s capability to get strategic value from technology investments” — have stagnated since it started tracking them 10 years ago.

“They have even dropped in recent years,” comments Chris Curran, principal and chief technologist for PwC and co-author of the study. “Companies are smarter about technology than they used to be, but the challenges of integrating new tech into the enterprise have gotten more difficult.”

In the current survey, 52% of executives self-rated their organizations’ digital efforts as “strong.” This is down from 67% a year ago, and 66% the year before that.

So, outside of rapidly shifting technology, what’s changed in just one years’ time? For starters, Curran and his co-authors suggest, is the expansive expectations now associated with digital enterprise. Digital has evolved from a “synonym for IT to a more expansive approach to technology that is making its mark on customers and culture.”

With this expanded scope comes an even more intense need for the human element. It may seem counter-intuitive that greater technology reach requires a greater human touch. Even in the earliest days of the PC revolution, futurist and writer John Naisbitt observed that no technology initiative will succeed without it, calling it “high tech/high touch.” Witness the rise of the most successful and powerful computing platforms to emerge in tech history – Facebook, Twitter and Apple. All were designed to improve peoples’ lives and to help them in a social sense.

As the PwC report’s authors state, “people have been the missing variable in the digital transformation equation. What we’ve learned, in our own work with clients and by analyzing a decade’s worth of data, is that focusing on the human experience can raise an organization’s Digital IQ.”
The need for human engagement in digital initiatives will only become more important as enterprises embrace emerging technologies such as artificial intelligence (AI) and the internet of things (IoT), the report’s authors state. Lack of skills, uncertainty about data, inflexible or slow processes, and an inability to collaborate are holding back the digital revolution for many organizations.

Curran and his PwC co-authors make the following recommendations for building a more human-centered digital reality:

Create an environment conducive to learning and collaboration. “Enable a cross-section of specialists to be in close virtual or physical proximity to one another. When they speak a common working language, deep specialists across the organization -- lawyers, marketers, designers, programmers -- can harness the power of perspective to get a firmer grasp on what their colleagues are saying and on what the business is asking for.”

Commit to education. Start at the top, the PwC team recommends. “Company leaders must understand and engage with digital technology to see how it could help or hurt the business, including how it affects the employee and customer experiences.” For the rest of the workforce, “now, more than ever, upskilling is needed.”

Get support from the top. “The c-suite needs to fully embrace emerging tech as a core competency of the organization if it is to contribute to the enterprise. If emerging technology is considered a side project, it is unlikely to have any lasting impact on the organization as a whole.”

Select a digital evangelist. “Determine who in the organization is passionate about which technologies, and recruit them into the scouting effort. Then assign leadership roles based on interests and expertise.”

Develop a scouting plan. “Listen to trusted sources to determine which cutting-edge technologies are most relevant to your business.” The PwC team recommends the insurtech-as-partner strategy: “double down on emerging tech by truly becoming part of the tech community. This includes establishing an outpost in Silicon Valley and other tech hot zones, participating in incubators (perhaps in conjunction with other companies), or sponsoring a university research lab.”

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