I and family were at our favorite mall the previous weekend.
Going down from the third floor elevator, I had to greet someone going up on the other side "pare!" Mutually.
In Filipino (Tagalog), the word "pare" is a colloquial term often used as a friendly or informal way of addressing a male friend. It's similar to using "buddy," "dude," or "mate" in English.
The guy was the CTO of the company who did the very first cooperative tech project that I was involved in. It was for the Cooperative Health Management Federation, also known as CHMF or 1CoopHealth.
He wasn't even a "pare" (friend) then. I met him only when I met his friend in the early days of Uber in Manila. To give you an idea how long ago this was, Uber stopped its operations in the Philippines in 2018, leaving Grab as the dominant ride-hailing app in the country. Grab acquired Uber's Southeast Asian businesses also in 2018.
But long story short, they did a good job.*
And so the road to digital transformation of 1 Cooperative Insurance System of the Philippines Life and General Insurance (1CISP), the leading cooperative insurer in the Philippines, began with CHMF, the first cooperative HMO in the country. At that time, both coops were headed by the same man, my first mentor in the cooperative sector.
Memories. Fast forward to—day.
As an insurance cooperative, 1CISP has been in the business of providing coverage and protection to its members for many years. However, in the last few years, 1CISP saw the need to embrace digital transformation to stay competitive in the market.
"Digital transformation is about using digital technologies to enable a fundamental change in how a business operates and delivers value to its customers." — George Westerman, Principal Research Scientist with the MIT Sloan Initiative on the Digital Economy.
Unfortunately, earlier attempts at digital transformation had been challenging, leaving 1CISP perhaps feeling a "little bit" frustrated.
Things are looking up, however, in 2023.
It is in this milieu that McKinsey & Company's 2022 article, "Every company is a software company: Six 'must dos' to succeed," is interesting to look at in relation to 1CISP's digital transformation goals.
Choose the right archetype
According to McKinsey, there are three archetypes for companies moving toward a software business model.
- The first archetype is to embed software into the core of the business.
- The second is to create new software-based businesses alongside existing ones.
- The third is to bring internal software 'gems' to market.
By choosing the right archetype, 1CISP can ensure that its digital transformation efforts are aligned with its business goals and objectives.
DBS Bank, a leading bank in Asia, has successfully transitioned into a digital-first bank. The company has invested heavily in digital technologies and has created a suite of digital products and services for its customers. DBS Bank has also launched several internal startups to develop new digital products and services.
Committing to a software culture
Building a software-centric business means building a software culture. This requires building a culture that deeply values the creativity and artisanship of great engineering, elevates product leadership and a customer-first focus, and empowers a leadership team with a strong understanding of software business models and tech.
By committing to a software culture, 1CISP can ensure that everyone in the organization is aligned and working towards the same objectives.
Focusing on the customer experience
The McKinsey article emphasizes the importance of focusing on the customer experience in digital transformation. This means providing a seamless and personalized experience when interacting with the company.
CX is commonly used as an abbreviation for "customer experience." It's often used in a business context to refer to the overall impression and perception that a customer has after interacting with a company, its products, services, and various touchpoints.
For 1CISP, this could mean leveraging technologies like AI and automation to streamline operations and improve the customer experience.
Embracing new technologies
McKinsey also highlights the importance of embracing new technologies in digital transformation. This means exploring technologies to streamline operations, reduce costs, and improve the customer experience.
DX stands for "digital transformation," which refers to the process of integrating digital technologies into various aspects of a business to fundamentally change how it operates and delivers value. DX involves reimagining processes, services, and business models to adapt to the digital era and leverage technological advancements for improved efficiency, innovation, and customer experiences.
By embracing new technologies, 1CISP can stay ahead of the curve and remain competitive in the market.
Fostering a culture of innovation
The article also stressed the importance of fostering a culture of innovation and experimentation in digital transformation. This means encouraging employees to try new things, take risks, and learn from failures.
By creating a culture of innovation, 1CISP can stay agile and adapt to changing market conditions.
John Deere, a leading manufacturer of agricultural equipment, has transformed itself into a software-driven company by leveraging data and analytics. The company has developed a software platform called MyJohnDeere, which is used to manage and analyze data from farming equipment. John Deere has also acquired several software companies to expand its capabilities in areas like precision agriculture and machine learning.
Digital transformation is a critical journey that every business must undertake to stay relevant and competitive in today's market.
1CISP's DX road is paved with dreamy CX aspirations.
For 1CISP, learning from the lessons from its own experiences and past efforts, and so with the lessons outlined by McKinsey can help the cooperative achieve its digital transformation goals and emerge as a leader in the insurance industry.
While "DX" emphasizes the transformation of a business through digital technologies, "CX" centers around creating exceptional customer interactions and perceptions. Both concepts are important in modern business strategies, as digital transformation often plays a critical role in enabling improved customer experiences.
*Postscript for the "pare"
Though our paths have somehow diverged, I was happy to see them acquire their EMI license in 2022 and continue to serve the cooperative sector.
Special Report
An Electronic Money Issuer (EMI) license in the Philippines is a permit issued by the Bangko Sentral ng Pilipinas (BSP) to a non-bank entity that allows it to issue electronic money (e-money). E-money is a digital or electronic store of value that is issued by an EMI and is accepted as a means of payment.
The license ensures that the entity is financially sound and has the necessary safeguards in place to protect consumers.