Ahead of our 2024 Insurance CX Awards at Proud Embankment, London, Modern Insurance Magazine caught up with Spencer Brooks, Chief Growth Officer at The Knowledge Group, to discuss industry challenges, the diversification of suppliers within the industry supply chain, and the benefits of bespoke solutions.
Q, Hi Spencer, thanks so much for your time! It’s great to have tkg on board with the 2024 Insurance CX Awards, represented on our judging panel and sponsoring our ‘Best Customer Team’ Award.
Why don’t we start by talking about tkg and the services you offer. How have you been supporting organisations within the insurance sector?
A. To give you a bit of background about The Knowledge Group, or tkg, we are a disruptive sourcing and procurement firm specialising in delivering outsourcing services for clients. Operating across the UK, Europe, USA and South Africa, we are experts at connecting buyers to suppliers within the contact centre and outsourcing sector. We have been operating for over three years now and we’re proud to have supported a variety of clients, including well-known organisations across the private and public sectors.
The key thing that differentiates us is that we are not a broker. To explain, there are individuals and companies in our industry that present themselves as independent when matching suppliers to buyers. However, behind the scenes they have contracts with suppliers where they are paid a fee for placing the buyer’s services with certain suppliers. These fees range from 5% to 20% of the total contract value.
There are several challenges with this model:
- The broker’s commission is incorporated into the supplier’s price, inflating the cost of the service.
- Not all suppliers will sign-up to these terms, so the buyer is not engaging the whole market.
- The incentivisation model is not transparent to the buyer and some suppliers will pay more than others, removing the independence from decision-making.
We believe in challenging this model to ensure that everything we do is transparent and independent. We don’t charge suppliers anything to be on our platform or when they win work.
In 2023, we were involved in outsourcing projects across the financial services sector, including some, more specifically, supporting organisations in the insurance sector. We were mainly engaged to help our clients address the balancing act they were facing between optimising customer experience, protecting against regulatory risk and harnessing new technologies, including automation.
Across all sectors in the market, organisations are looking to adopt new channels where customers can self-serve or are engaged via lower cost delivery models, whether that is accessed from offshore resources or utilising AI and automation. However, for our clients in the insurance sector, we have seen that this strategy does pose a number of potentially significant pitfalls which can cause business and economic risk in a heavily regulated and audited environment. And that is where we have been able to support, with accessing on-demand, flexible and cost-effective outsourcing solutions.
Q. How do these services benefit the insurance industry?
A. We believe in the importance of really driving value for our clients, focusing on how we can create bespoke solutions that work for them. We help buyers engage the market by delivering immersive procurement events, backed up by industry thought-leading solutions to help alleviate risk. At tkg, we don’t just manage a process on behalf of a buyer; our network of industry practitioners provides unbiased and independent advice on finding the right blend of in-house and outsourced resources. We support our customers through the design of target operating models that help them to achieve their business objectives, whilst prioritising customer experience and protecting against the risks they face in their specific sector.
Q. What advice do you have for organisations that would like to diversify their suppliers within their supply chain? How can tkg help with this, and what benefits can this bring?
A. Don’t be afraid!!! The concept that “big is beautiful” and sourcing everything through one supplier to gain economies of scale in pricing is no longer true for the outsourcing sector. Insurers are accustomed to having diverse supply chains in the repair, recovery and claims part of their business, and their contact centre operations should be no different.
Given the complexity of insurers’ products and services these days, it is highly unlikely that organisations will be able source relevant skills and expertise alongside servicing all the appropriate channels and chosen markets, from one supplier. In fact, building ‘ecosystems’ of multiple suppliers servicing particular channels or geographies is becoming far more commonplace in today’s markets.
Segmenting the processes and/or functions that you want to outsource into logical areas – without impacting the customer experience – is relatively simple to do when you have the knowledge of what the capability is in the market. That’s where we fit in. We have over 90% of the market within our sourcing platform, with 350+ data points on each, allowing us to visualise to buyers what capability best suits their business. It’s important to remember that the data is only one part of the picture when selecting a provider. Making the best use of the data can help you to build a clear picture of potential suppliers that are able to meet your requirements and can inform the end decision-making process. But cultural alignment is really important too, as well as ensuring that you will be able to build a successful partnership. This forms part of the journey we take buyers on when we support them with sourcing events.
Q. From a customer experience perspective, what are the three main challenges facing the insurance sector right now?
A. The sector is shifting, and the number of products offered and the range of cover within those products is growing. This leads to three primary customer experience challenges for organisations.
Complexity of products and policies. Insurance products are often complex, and the language used in policies can be difficult for customers to understand. Simplifying communication and providing clear, transparent information can improve the overall customer experience. The key decision for organisations, if they choose a partner to support these channels, is who owns the communication strategy. We always believe this should be in the hands of the buyer.
Customer expectations / Lengthy and complicated claim processes. Claim processes in the insurance industry can be time-consuming and complicated. Customers may face challenges when filing claims, or they may experience delays in claim settlements. Streamlining and automating claims processes can enhance customer satisfaction. There are a multitude of software solutions in the market that can support this, and while navigating this market can be a minefield, the right solution can be a game changer.
Fair and prompt settlements. Customers expect fair and prompt settlements. They want to be compensated appropriately for their losses, and a smooth settlement process contributes significantly to overall satisfaction. The cost of living crisis has increased this expectation and insurance companies are having to manage claims tightly, given the increase in unexpected events, such as storms and floods. This is leading to greater friction in customer interactions.
Q. Which aspect of the Awards night are you most looking forward to?
A. We’re looking forward to celebrating the successes and talent across customer service in the insurance sector. We’re proud to be part of such an exciting time in customer experience industry, championing solutions that celebrate and focus on customer centricity, innovation and high standards. We wish all shortlisted companies the very best of luck!
Q. If you could offer one piece of advice to the award winners, what would that be and why?
A. Enjoy it and recognise the accomplishment of not only winning, but being involved in these Awards across your business. We know there is a significant amount of effort that goes into building an awards submission, but amongst all that, people often forget the effort it took to actually take the business to the point where you can write about it in the first place. It is the effort from across the organisation – from the agents servicing the customers, all the way through to the policy makers – that contributes to making a difference when it comes to how customers are engaged and how people are protected. Everyone’s contribution to the overall end delivery deserves to be celebrated.