Majesco Is Moving Fast

Majesco (formerly MajescoMastek) is bulking up fast. On December 12 it acquired Agile Technology’s business; and on December 14 it announced a merger with Cover-All. The resulting entity will have revenue greater than $100 million; and more than 150 insurance customers globally.

Scale has always been a plus in the insurance software business. It speaks to a demonstrated ability to create and maintain insurer relationships. Technology firms with more customers have broader and deeper IP; and more resources to invest in getting better.

That said, size alone is no guarantee of success. Smarts and agility and foresight are not correlated with size.

Majesco has moved quickly to create a big player with impressive resources. Now comes the harder, but necessary, work of integration, vision, and creating value for current and future customers.

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Board Member to Insurers: “Don’t get Uberized”

At the National Underwriter Executive Conference last week, a member of the Board of Directors at one of the largest life insurers in the world warned insurers: “Don’t let what happened to the taxi industry happen to us. Taxis thought regulation would protect them and you see where that got them. We can’t allow ourselves to be Uberized.”

Beyond the fact that this was the first time I have heard the verb form of Uber (remember when Google was just a noun?), the statement represents a valuable summary of the disruptive threat for our industry. The public expression of this possibility by such a highly visible leader is another in a number of recent signals that insurance innovation is gaining real traction.

A recent Celent survey provides the datapoint that innovation practitioners expect the probability of disruption to rise in 2015:

Note that no one responded that the threat would decrease.

However, recent events demonstrate that the Uber effect is also an opportunity for insurers — the high level of trust that the industry has earned over the past 150 years. An Uber driver in India has been charged with assaulting a female passenger, reminding us of the dark side of the sharing economy.

I am not suggesting that this is a reason for insurers to become complacent, or think that the need to invest in experimentation and to reward risk taking has lessened. Rather, I trust that our industry will heed the threat expressed by one of its most prominent leaders and leverage the positive relationships it has established with its consumers to deliver new solutions which increase its value proposition.

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The Lion and the Mouse: Start-ups Pitch to Top Insurer

One of the common behaviors of successful innovative companies is establishing creative partnership arrangements. These relationships are not traditional supplier/buyer arrangements (zero sum games) but are mutual agreements that combine deep subject matter expertise and new technical capabilities to produce unique and valuable solutions.

I witnessed an event this past week that demonstrated partnership-building in full force. Eight start-up companies pitched their solutions to one of the largest insurers in the world. It was inspiring to see the interplay between the very different perspectives, and encouraging to watch the participants struggle, and most times overcome, hugely different communication styles. It reminded me of the Aesop fable about the lion and the mouse, the moral of which is that size is not an indication of value.

Each presentation followed the same general structure. The founder / CEO / CTO of the start up reviewed the key functions and value propositions of their solutions. In most cases, about half way through, the audience members from the insurer would begin to ask what I call use case questions. “Does this mean we could use your solution to do ABC?” and “We have a problem with doing XYZ. How would your system approach this?” I was struck by how natural it was for the subject matter experts to quickly apply the technical information to their current challenges and how easily they could imagine future capabilities.

I think that there were several reasons for the success of the session. First, this insurer’s innovation team has been in place for multiple years. Over this time, I know they have worked hard to engage with the “innovation evangelists” in the organization. This meeting included the right “curious minds” and was a manifestation of their advance work.

Another reason is that the facilitating company which selected the start-ups chose carefully and coached the participants regarding presentation messaging and delivery. There was just enough tech talk and a good amount of insurance-specific application examples.

Finally, I think the immediate translation into use cases signalled pent-up demand from the insurer. Their attendees obviously have already been thinking in specific terms about how technology can help them better run their businesses. This forum provided them an outlet for expression of those thoughts.

The session was a well-planned and well-executed example of innovation execution – the type of activity that Celent calls Deliberate Innovation. Kudos to all involved for demonstrating how to operate in a market of exciting possibilities!

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