Transformation to the core at Southern Cross Travel Insurance

As the name suggests, Southern Cross Travel Insurance, part of the Southern Cross Group, is a travel insurer based in Australia and New Zealand. And as primarily a digital business with about half a million customers, virtually all its products are sold online. To get to that point, though, required an intensive transformation execution and mindset. Luckily, CTO Alex Smart is a self-professed problem solver. “You don’t go down a transformation path unless you have a really painful problem to solve, because it’s not an easy thing to do,” she says. “And transformation isn’t a technology project but a business project, so we needed to understand who to have involved from the start to get what we needed from them, and for them to get what they needed from us.”

There was also a lot of focus on IT from governance and the board. “The whole business was transforming,” she says. “We were ripping out its core foundations so the board was very interested in how it was going to go.”

With less than a year to totally transform the business, Smart had her hands full. “I still don’t know how we pulled it off, but it’s got to do with the culture and the team,” she says. “Technology transformation is more about the people than anything else, so I think we managed to pull it off in this time frame by owning every step of the way and solving every block they came across. If we had a different culture, we probably still would’ve achieved the same outcome, but it might not have been so fast, because that kind of speed requires everyone involved to have high accountability and ownership of what they’re doing.”

Structure was crucial as well. “At the executive level in our business, we share our KPIs, so I don’t have separate ones from a CFO or my COO or any of that,” Smart adds. “And the brilliance of that is, a transformation project isn’t my KPI to deliver. It’s for all of us to deliver. I just happen to be the sponsor of it. That structure makes a difference, so with any organization undergoing a transformation, make sure that at an executive or senior leadership level, the KPI for delivery is a shared one. If you’ve got competing KPIs, that’s where things start to fall apart.”

Smart also spoke about driving transformation of a central insurance platform, and why mentoring in technology matters more than ever. Watch the full video below for more insights.

On the scale of transformation: We cover the whole gamut of technology in our team. We do data, platforms, cyber, software development, and business analysis, among others. So heading into the transformation, that was quite useful because we obviously run most of the areas impacted from a technology perspective. But a transformation is more than a technology project. It involves the entire business. So the scale of it is huge. It’s probably the largest transformation our business has ever done in its 40 years, and it involved replacing our core insurance platform, which is essentially our business. Insurance is about data and risk, and so replacing our whole platform is replacing our business and everything that’s downstream of it. So all applications, customer experiences, and integrations all had to be rebuilt, and we only had 11 months to do it because we had a contractual obligation to our current vendor. So a transformation like that is mostly about speed, execution, and managing change.

On flexibility: When you’re doing a transformation, the hardest thing to do is get started. I think because the scale of it looks so enormous, it’s really difficult to know how and where to start. So our biggest challenge was actually breaking it down into bite sizes and figuring it out. Once we started, things began to flow. But another thing that transformations do is you can’t assume what you knew at the start is what you’re going to know at the end. And as we’ve gone down this transformation journey, we’ve learned a lot. For example, we constructed our teams one way at the start of the transformation, and during the process, we reorganized ourselves about four times as we moved through and learned things, and ran into different obstacles and broke through obstacles, refining our scope. As we’ve progressed, we’ve had to be open to change. I think that’s been a big challenge for the team. A technologist likes certainty and what they’re doing. They’re basically engineers at heart, so having to build in a flexible mindset has been challenging, but it’s been good for us. Diversity is essential as well, not just relevant. We have a really diverse team, and when you have that, you get a lot of debate, but debate with the right culture ends up with really amazing outcomes, which enables you to tackle big problems. It’s actually the only way you can do a truly successful transformation. So we have a lot of healthy conflict in our team because of the diversity, but what we don’t have is group think.

On staying the course: What often happens in a transformation process, because they tend to go on for a long time, is the business gets bored and they want to get on with doing other things. They want this transformation thing to be over so they can go back to doing the exciting things they want to do, and there’s a real temptation to be distracted to divert into something else. I think that keeping the main thing the main thing has been the other reason why we’ve been able to do this in such a short period of time. So remember the problem you’re trying to solve, be single-minded about it, and choose the simplest path to get there. Don’t try and add everything all at once. There’s plenty of time later to improve it. And once you do that, once you form that path, then you can understand what capabilities you’re going to need, and you can assemble a small group of people highly skilled in those capabilities to form a lead team. And that core team is essential for the success of delivering a transformation. I’d also say that team can’t be people from outside your business because nobody loves your business like people who work in it. That core team is essential, but you’re never going to get enough people for a transformation from your internal team. You need to scale up by bringing in resources you can scale down later. And that’s easy to do once you have that real core team that has ownership, is highly capable, and understands the simple path you’ve laid out.

On being digital first: Just about every business is digital first, even if they don’t think they are. Everything involved in every transaction you do in your business is underpinned by some kind of technology. So even if you don’t sell anything online, you’re still a digital business. But what’s changed is the expectation of the experience from both internal customers and those external ones you’re selling products to. They expect digital and in-person experiences to be equally good, and people want to have the option to choose which way to go. For businesses, that’s a big challenge transforming things that you’ve been doing over the phone or through a human into a digital environment. It’s not easy to scale, so that’s where I think the emergence of new technologies like AI is changing the game, and so we’re using it. For instance, we used to do sentiment analysis manually by reviewing call recordings. But now we have continuous AI monitoring of customer sentiment, and it can alert your contact center team leaders when something’s going off track. What that does is it helps us immediately provide a better experience for our customers. Now we know instantly how well we’re doing, and it can also help us pick up on where sentiment might be falling. It might be a particular product design or something they’re finding they can’t do on a website. So this is where AI is accelerating those experiences and helping businesses move faster. We’re very open to adopting that. And I think because we’re a small business and quite agile, it’s probably easier for us to adopt some of those changes and test them.