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Start-up culture: taking a Wrisk to innovate in automotive, guest opinion

Steve Cann, general manager, Insurance Solutions at BMW Financial Services (GB) Ltd

If businesses fail to innovate, they cease to be able to compete. But achieving innovation is tricky.

Automotive retail is a great example of an industry requiring constant innovation.

Purchasing a car is a major decision. We respond by adding innovative features to show how our vehicle is different from the others.

But when it comes to innovation outside of the car, there is a gap.

The industry has not given the right focus to customer services and internal processes.

This means we are not responding to customer needs – and could be losing out to competitors as a result.

These places are ripe for innovation. Take car insurance – an area that has not kept pace with today’s customers, who are used to running their lives on smartphones and via apps.

While car insurance isn’t the main consideration in purchasing a vehicle, consumers are not as engaged with insurance as they should be – and are therefore at risk of choosing an unsatisfactory plan. But it is an essential part of owning a car.

We need to innovate our approach to car insurance. The solution might not always be one we realise ourselves.

Collaborate to innovate

Our answer was to seek out the disruptive players that are already looking to innovate products and services.

This thinking led, in part, to the creation of the BMW Innovation Lab in 2016 – our own technology incubator. It sees early start-ups partner with our commercial divisions to bring into development business models and new technologies that benefit our customers.

One example of a success story from the Lab is our partnership with start-up, Wrisk.

Wrisk is our answer to how we are transforming car insurance in the UK.

It is a consumer-facing, insurance app business. When they came to the Lab, it’s fair to say neither side knew what to expect. But by looking at the problem together, we designed and developed a solution – a new digital platform for BMW and MINI Car Insurance.

The digital platform is just the first phase. Together, we have launched seven-day drive-away and annual car insurance via the online portal. We plan to evolve this with Wrisk into an app that will future-proof insurance services for years to come.

Launched in September, the platform places Wrisk as the sole provider of new business UK BMW and MINI Car Insurance services and products, which are now on-demand and digital first.

This is an example of what can be achieved through collaboration. On our own, we might never have devised this platform – and it certainly would have taken longer.

Speeding up innovation

Large firms often struggle with innovation. They are too siloed and technologically-shy. Start-ups on the other hand are born innovative – but don’t have the market share or scale.

Collaboration creates a win-win-win scenario. We get access to innovation, the latest technology and can meet the needs of our customers.

For start-ups, they get to learn the ins and outs of their customers, access to mentors and – potentially – a major customer.

For the consumer, it is about getting better services and products that are intuitive and on-demand.

The car industry is set to change more in the next 20 years than it has in the past century. Will the next generation of consumers even own a car – will they even drive? What impact will AI and blockchain have on how we interact with customers?

These questions will truly disrupt our industry. We need to answer them now to adapt and survive.

Working with startups allows us to meet the needs of customers today and learn how we can future-proof for the customer of tomorrow.

Industry-wide impact

The collaboration between big automotive and start-ups will of course have an impact on the rest of the industry. But it’s not about disruption. It is evolution.

No one really wants true disruption – we want evolution. That is why Uber has been so successful. The model of ordering, paying and taking a taxi remains the same – but it is more convenient and tailored to the individual.

Other businesses in the industry – such as franchised dealerships – will still operate mostly the same.

But they need to explore how they can enhance the showroom and customer service. Can they integrate augmented reality into the sales process to show a custom car? How can big data be used to predict customer needs?

By working with our retailers and start-ups, we can find the right answers and implement them.

Our work with Wrisk is an example of this – giving the customer more options and power over the process, while encouraging greater loyalty by meeting their needs.

There will always be a place for dealerships. They need to learn about their car, test drive it and find out what finance options are available. But this doesn’t mean it can stand still.

Innovation rarely happens in isolation. To effect change, we need to collaborate with the innovators and adopt them quickly. The result? Future-proofed products and services and real value for customers.

Author: Steve Cann, general manager, Insurance Solutions at BMW Financial Services (GB) Ltd

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