Justifying Web 2.0: Answers for the Boardroom

How should insurance executives answer board members questioning the value of Web 2.0?  One way is to address competitive advantage, according to analysts at Celent.

By highlighting specific benefits—usability, improved processes, and better online sales platforms—insurers can demonstrate TK, according to the consultancy’s latest “boardroom series” bulletin. “The perceived value of Web 2.0 is not obvious,” the bulletin, How to Capture the Value of Web 2.0, notes, “ but it seems that usability is at the center of insurers’ preoccupation.”

The analysts advise insurers to focus on key areas to make the most of Web 2.0. First, they suggest boosting comprehension: more important than adopting these technologies, “is understanding what the Web 2.0 attitude means and how it will affect insurers’ business and consumers’ behavior,” the bulletin states, urging insurers to assess the impact of any Web 2.0 initiatives, along with the risks and changes in the value chain.

Next, they advise companies to upgrade their online efforts, integrating Web 2.0 components into their sales processes, noting “insurers should launch initiatives aiming at new communication tools such as VoIP, chatting, and even blogging for their direct business, “ since “online sales portals will evolve quickly to satisfy a new kind of customer that has already embraced the Web 2.0 attitude.”

Companies should also carefully weigh any forays into social networking, whether external or internal, according to the analysts, who “recommend that insurers carefully analyse the pros and cons of such a strategy and consider a wide range of methodologies to capture the strategic impact of such initiatives.”

Finally, insurers should focus on underwriting value, with tools “that help them better
analyse risks with a leaner structure.”

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