OPERATING PERFORMANCE

IAG Labs

All our businesses are supported by IAG Labs which focuses on the customer experience and technology. Customer Labs and Digital Labs were formed as part of the new organisational structure which took effect from December 2015, and Digital Labs continues the work of IAG Labs which was created at the end of July 2015.

CUSTOMER LABS

Customer Labs’ focus is deeply understanding customers and their needs to help create new and improved experiences for them. This division is responsible for IAG’s customer experience strategy and for driving product, pricing and marketing innovation. It does this by using data and insights, brand architecture, human centred design and new business incubation and venturing.

In the 2016 financial year, Customer Labs further harnessed the power of IAG’s data by:

• bringing all IAG’s data warehouses together to create one central source of truth for our information. This database lets us immediately understand what actions customers are taking across all channels;
• using our better understanding of how customers buy insurance to tailor their experience through personalised offers, targeted marketing approaches and pricing options. Because we analyse and understand each customer action, we can improve the next experience or product offering;
• building a culture of experimentation and continuous in-market testing. Rather than telling customers what they want, IAG is enabling customers to explain what they need. This process is aided by in-market trials, where offers can be automatically adjusted depending on customer take-up, as well as improved through cognitive computing techniques including machine learning;
• developing and deploying a fraud analytics model that identifies fraudulent behaviour and helps IAG improve its response and, therefore, claims effectiveness;
• identifying opportunities to work more collaboratively with other corporations in the areas of customer experience and use of data and information; and
• developing and testing the software capabilities of wholly-owned subsidiary Ambiata as a service product offering for the broader market.

In the 2017 financial year, Customer Labs’ key priorities and initiatives will include:

• defining a world-leading customer experience and building customer journeys and experience strategies to reflect that;
• developing IAG’s customer segments and aligning them to brand and product propositions;
• taking to market an analytical tool developed by Ambiata to provide the intelligent analytical layer that connects an organisation’s data asset to its customers;
• further building a customer-led, data-driven culture across IAG, by aligning customer measurement; introducing customer training and education programs for all staff; and making data open and accessible throughout the organisation;
• using a marketing automation system to optimise IAG’s marketing spend and allow direct interaction with customers; and
• continuing to build on IAG’s world-class pricing capability by further improving pricing approaches and models and leveraging advanced analytics techniques to automate them where possible.

DIGITAL LABS

Digital Labs provides digital and design innovation across the Group, and identifies and harnesses disruptive technology. It is also accountable for building digital apps and eco-systems, and simplifying existing core platforms.

During the 2016 financial year, Digital Labs focused on embedding rapid innovation and lean practices; exploring disruptive technologies and delivering new eco-systems; and preparing the way for the simplification and stabilisation of core technology platforms and the delivery of new customer-led, data-driven products. This involved:

• introducing a truly ‘digital’ way of working across IAG, embracing Lean Manufacturing principles, Design Thinking Concepts and Agile and Continuous Delivery methods, achieving significant efficiency gains and shortening the timeframes for realising value from initiatives;
• establishing and aligning dedicated digital delivery teams for each IAG division across Australia, New Zealand and Asia;
• putting in place the capability to generate and evaluate ideas from across the organisation, resulting in pilot digital services to unlock further value from IAG’s supply chain, including increased touchpoints with existing customers and the introduction of new customers; and
• completing planning for the simplification of core policy and claims platforms.

In the 2017 financial year, Digital Labs’ key priorities and initiatives will include:

• commencing the simplification of core policy and claims products, processes and platforms, to drive efficiency across Australia and New Zealand;
• accelerating the creation of digital capability aligned to the goals of all IAG divisions;
• launching new digital services to use existing IAG capability in an innovative way, while harnessing emerging technologies including the ‘Internet of Things’ and drones;
• developing IAG’s marketing automation, social and loyalty platform;
• introducing application program interface and mobile-first architecture, combined with implementing social coding to co-innovate and reuse technology within IAG;
• leveraging research institutions and partners to co-innovate and develop new revenue-generating products and services; and
• enhancing contact centre, work-from-home, branch and kiosk technology across IAG’s operations.