Ben Telfer:

Hello, everyone. Welcome to today ICMIF webinar, the seventh episode in our Digital Mutual series. Today we’ll feature the case study San Cristobal Seguros in Argentina, who will share a little bit about their digital transformation journey and overall digital strategy.

It’s my pleasure to introduce today’s presenter, Ignacio del Castillo. Ignacio is a business analyst in digital transformation at San Cristobal. Ignacio, thanks for joining us today and over to you.

Ignacio del Castillo:

Hi, and thanks a lot for the introduction. First of all I would like to talk about what’s in San Cristobal so you can have an idea what the company is. San Cristobal is an 18 years old company. It’s one of the top five company’s in Argentina, insurance company. It’s constituted by nine business units.

We not only do insurance. Now that we have nine business units we not only sales insurance we also have a company with financial services, a mutual. So I was telling you this because it’s important for me for you to know.

Argentina, San Cristobal, as I was telling you before, was founded in 1939 as a mutual insurance organization. We are in the top five insurance company in Argentina and we have nine business units. We not only sell insurances, we also have pensions, financial services, travel agencies, all the stuff.

The agenda for today, first we are going to talk about… It’s not working. Why digital transformation. Sorry, but it’s going really slow. Why digital transformation, first of all. Then we are talking about why digital transformation in San Cristobal Group. Then I would like to talk about three innovation cases we are dealing now that are really, really interesting.

We start in 2017 making a deep analysis of what was going on in the digital in Argentina and in the world.

First of all to go along with the agenda. We were talking why digital transformation, what was going on in the market, what was going on in the industry interest? We find out that the perfect storm was coming to the industry in Argentina. This analysis I mentioned before, we can sum up all in four important topics.

First of all the change and behaviors, the needs and behaviors of our customers. Clients now days are more demanding, they have more information, they have cell phones, they have have more information about what they want, what they need and they are more demanding. They compare every experience. They want the best experience in every process journey they have.

For example, I like to do an example about this because I think it’s better to understand it. Ten years ago when you had to buy dinner or TV you went to the shop and you tell the guy there and they tell you all the TV’s they have, you buy the TV. If you have a bad experience on that journey, go to another shop. It was like too tedious. You had to walk, go to the car to the next shopping and try to buy another TV. Nowadays with only two clicks you can go from one shop to another and to find the best TV you want with the best experience to buy it.

So customers behaviors are changing a lot. They are more demanding. They will have more information to make decisions. This is really important thing we have to take care about.

Also, we have new technologies because all today, this generation data is increasing a lot. We are using cell phones. We are using our TV’s. We are using our computers and we are generating information in every journey we do. If we enter into our phone we are generating data. Also the new technologies are capable to process all the data really, really fast. So we have a new opportunity to process all this data and to make decisions with all of it. Later in the presentation I will talk a little bit about a business case that we use all this stuff.

Also competitive pressure, it was in 2017 we were expecting the company maybe a big company in the world, was coming to Argentina and it will be really hard for us to compete with it. Also, we think maybe two guys in a garage were able to make their own company, own insurance company that will compete with us and will be really hard to compete with.

At last, but not least we are talking about regulatory and macroeconomic environments. Maybe in Argentina all insurance a regulatory is quite regulated so it’s not a big deal. But maybe the macroeconomic environment was really hard in Argentina because we have a lot of inflation, it’s really hard to analysis. Even though I think in this point the regulation in Argentina is quite strick so it’s not a big deal so I think we have a really good opportunity working in insurance company to make a change.

After all this analysis we find that we have opportunities outside and inside the core business of San Cristobal.

Opportunities outside the core, we found a new company called Iunigo. It’s a new company, 100% digital and direct with no intermittence. So they buy direct. Inside the company we decide to launch digital transformation.

Digital transformation creates a tipping point to capture new opportunities. We have new talent attraction because when we start this digital transformation we have this new type of profiles that we not need to hire that we have no idea where to find them. That we don’t have at the company. And we are all the time having new challenges that are really interesting for the new talent. So I think digital information is a talent attraction because you are working for new, interesting project that people like to work with.

Also, regional expansion because all this digital information is breaks of areas of geographic barriers. It’s easier to go to another country, it’s easier to go to another city and it’s easier to expand.

Last but not least, you have new opportunities because with digital information maybe you can change really quick. You can make it look at new opportunities, make a new business with everything.

Now we are talking, after all this analysis we did in 2017 we decided to, as I tell you before, we decided to make a digital transformation in San Cristobal. What does digital transformation means?

We define digital transformation as a cultural and strategic change that affect the entire organization. As you can see we don’t use digital in the definition of digital transformation. When we talk about digital transformation we are talking about transformation, not about digital because we are not talking about doing digital as a webpage, as an app, as a big data. We are talking about being digital because being digital means to be a [shell 00:10:55], to have the capacity of adapting to changes, to be open mind of new products to think about all the time about the customer. When we talk about digital transformation we are talking more about transformation and to be digital not to make digital products.

After all this definition we had to know what was more important for us. After a lot of meetings we decided to make first the customer experience, was the most important for us. This is not easy. Maybe a little you can hear a lot of companies that are talking about it, customer experience, that is really important for them, but to be the top of your priorities is not easy. It’s a big change about the company because nowadays teams are watching all the time the client satisfaction to see how the products evolve, how we are working, and this is the main KPI we are watching all the time.

Also, customer experience, when you say companies are working on their customer experience it’s not because they are nice, it’s not only because they are like to make happy, their customers, it’s also because we need that. As I said before customers are changing, with only two clicks they can go to another company to buy insurance in other company. Also, they compare our experience buying insurance with experience in Amazon, in Google, in the bank. So I think it’s really importance to know the importance of customer experience in our journey.

Also, the second point is then we prioritized growth and last profitability. When we try to order this, first customer experience then growth then profitability, we are not saying that it is not important to grow, it’s not important to have big profits, but what we are saying is customer experience is the most important thing we are having to watch. This is really important for us because I think it is what defines the strategy in the next five, ten years.

How do we organize ourselves in San Cristobal? Nowadays we organize in tribes that all have their common objectives. For example, acquisition, are teams that are working all the time thinking about sales. Then we have after sale tribes that are all the time thinking about how to offer a better service and the tribe of analytics. This is a really important slide, I think, because it’s a new way of organize ourselves because we are talking about when you see a collum we are showing you a team. We have a product owner, with the leader of the team. You have the designer. They have a trial code, the technology team, and the business. We are all sitting at one table, different parts of the team. We’ll let them make decisions by themselves because every profile of the company is sitting in the same table in this team, so they can all make a decision and be faster working.

This is important to understand that maybe two years ago when you make a new product you have to… When you need a business call, you need help with a business, okay I’ll help with technology. You would have to go to the second floor to ask someone to help you with that. But now we’re doing like everyone is sitting at the same table. It’s easier to work, you work faster, you work all together, it’s more collaborative work. It’s important to know how the teams are working.

Also, if you see in the rows, you have what we call chapters. Because you have design team, for example, we take this chapter. We have designers that work in different teams, but they also have this chapter of design and they talk about the best practice and they talk all together how they work, so we are sure every team is working the same way. It’s making the same standards of the products, makes standards of quality, and that’s also really, really important.

Also, what is something really important about that also that it give us more flexibility. For example, if you have to get more important for one team you have to nowadays cross selling is something really important for us, really strategic. You can change teams, you can give a designer to that team to make it faster because you need, because everyone in the company, in the chapters know how the other guy in the other chapters works.

We work in sprints. We work on value delivery every two weeks. That mean that every two weeks we are sending new products. We are giving new release with new value added. We have teams collaboratives, autonomous and flexible teams. As I have said before, we have autonomous team because in every team you have people present in every part of the company so the product has an autonomous of making their own decisions. Collaborative and flexible teams because everyone know how the other one work, everyone know what the other one is doing, so we can help them. We can help them, we can reprioritize, give more villosity to one team just changing the guys giving helping each other.

Also, make design think in methodology, and continuous improvement and pilot testing. What does it mean? We say continuous improvement and pilot testing, it’s all about failing fast. It’s all about going to test all the time in the field. It’s easier to get results when you go to the field and test the product. You release pilots to get information all the time about how the client use the product, and all the insider feedback you get. You continuously improve your pilot all the time.

How do we work, also? We work with objectives. We began to adopt OKR methodology, establishing vision and key indicators for the fulfill of the strategic objectives. Every objective, every KPI we define, they are all attached with a strategic objective. That means that every time we do something we are thinking about what we are doing, fulfill all the strategic objectives.

Also, we explore customer needs all the time, and plan and prioritize based on them. That mean that we are asking all the time, the customer, what they feel about the product, or what they are thinking, what they need, and we try all the time to create with them. When we sell this, all the customers, all the agents we work with, they came to San Cristobal to sit with us and we create the product with them. We don’t tell them what they need, they tell us all the time what they need, and we try all the time to understand what they are asking for.

Then the planification. The planification, we make roadmaps every six month. We measure and share results every month so we can challenge us every time. We are trying all the time to learn. We feel that making mistakes is a way to learn so we are trying all the time to try new stuff, to try new things, to measure everything so if we make a mistakes they are cheap and also, we can learn a lot about them so we don’t make them again in the future.

Also, this is a slide I tried, I bring with because it’s a nice example of how the journey of evolution works, for me how a journey evolution works. First of all we have ideas, we have the business case, we have the roadmap, we have the team. We decided what to do and we start the research and design what we are going to do until we release the MVP. MVP is a minimum value product that is the smallest product we can sell, we can put in the market so we can see how it works, we can validate a hypothesis.

So we set with it, we deploy the MVP into the market and we see how it works. We start measure everything. We have to see all the KPI, how it works and we have to listen all the time to customer to see how it works. As I show you before in the slide before, we are continuously making improvements, making new release, so the MVP is even more bigger, and bigger every time we release something new.

First the PO, the product owner of the team, the leader of the team is working with that, the product until the product is so big they start to work with the business, with all the company working with that until the product is so big, it’s so ready that it’s part of the business. So you can start again with a new product and start working with this again.

The digital transformation of San Cristobal’s core business presents six key dimensions. Three impact driven initiatives, opportunity generated in the data, that is what we call advanced analytics. Journey digitalization, that is all about making digital products for the customers, and digital marketing. Next one I will show you some innovation cases about San Cristobal, I will try to give you one example of each of these driven initiatives.

Also, we find three enablers. Agile principles, as I said before we are using objectives that help us to try our products really fast, to make sprints, to be collaborative, to know how to prioritize. Also, organization and talent, as I told you before talent is really important because you are like, we need all these new digital profiles that are really important for this information, and next generation technology.

As I told you before, what we are doing at San Cristobal I think is really important for me to tell you a little bit how was our journey on the path of digital transformation when we started in 2011, and how we are not in 2020. First, as I told you before in 2011 we start with this diagnostic of the situation and new strategy we are trying to develop. We started our digital transformation in 2011 with two teams, one analytics team and one digital team. This is really important because we released the MVP four weeks after that and we start to see good results of them.

So after that we start working and we develop new teams. We build three new teams, two new digital teams, and one analytics team, and we start to go off in that way. We start to learn about what we are doing, try to improve every time. We try to measure everything we can so we can learn a lot about this process. We start making new products, new teams and nowadays…

I think this is really important because a little about the journey, we learn about a lot. For example when we develop the first wave of results we had to change, we see that customers were happy what we were doing but they wanted better. So we had to, all the time had to reconfigure our products so we can get better results. All the time we are getting insight from our customers so we can find what we need. Also, in 2019 we decided to try a new reconstruction of our teams. We make more smaller teams, for agile teams so we can have more flexibility and more better results with more compact teams.

Today we create a digital factory that is changing the way things are doing in San Cristobal. We have more then 120 peoples, we have more than 25 products, 15 teams and all of our agents and clients are with mutual. You can see here we have the three tribes, like I told you before the tribes are analytics, acquisition and the tribe of post-sales. But also, all this is also important with human resources performance team that helps to merger all the KPI’s, the objectives, all the roadmaps, and also the support of IT so you are sure everything is working and works in the best way.

Now I would like to talk a little bit about the innovation cases and as I told you before I will talk about three type of innovation cases of the three driven initiatives I told you before. One of analytics, one of Journey digitalization, and one of digital marketing.

First of all, I will talk about opportunity, innovation case of opportunity generating data.

What is advanced analytics for us? Advanced analytics is not about modeling. It’s to run end-to-end business solution. Before digital information we always do really good modeling that with really good result that predict reality as really good, but we always have this problem in adaption. We go with the model to the business, we say hey we have this model it’s predicting really good reality but they say no guy I’ve been doing this for a long time I know how to work. I don’t need the model.

So what we try to change in advanced analytics nowadays is to work in adoption, to work in the formation, to know that the data is the main… Have to use data to make our decision. We cant make the decision without data analysis before.

We launched fraud. Fraud is one of our advanced analytic process that is giving us really good results. We combine advanced analytics with anti-fraud culture, so with this combination we could create a new fraud management where we increase our annual saving on fraud detecting and about 110 million pesos. Also, we increase 1200% cases fraud detected and we multiple our fraud saving plus nine combining. Also, advanced analytic and anti-fraud culture we could create great impact what is fraud detecting.

How do we use advanced analytics or artificial intelligence in fraud? We recently, last year we create a model that help us to fraud detection with image detections. We find the vehicles with a photo of an accident, we can find which of the photos of our partners and what photos of the other vehicle and with the model we know when there are damages to the vehicle, what type of damage we have, if they are serious damages or not. We make automatically report for our fraud analysis so we can know if the accident is logic with the image we are seeing.

With this fraud detection is something really important. As I told you, this is something I want to remark because fraud detection was recognized by the Worldwide leader with Celent Model Insurance Award, with a use in analytics and… Sorry, this fraud detection case was recognized by the Celent Model Insurance Award in 2020. Something really important to know is that we not only work analytics in fraud detection, we also make a new process of fraud detection.

Nowadays with the new models and the new technology we can know with a fraud in 24 hours. We can see if an accident was fraud or not, so our clients will not know if we were investigating or not about this. This is really important because two years ago when you have a fraud we take about a month to know if it was a fraud or not, but nowadays we can do it in only 24 hours. So I think that’s really important because when we talk about customer experience it’s really important to our customers to know we will not take a lot of time doing this investigation.

What about other insurance innovation, journey digitalization.

When we talk about digital, journey digitalization, we talk about, as I told you before, customer-centric design. We try to deep understand what the customer wants, what the customer needs, and we try to create with them our products. Also, we are zero-based business transformation. As I told you before we try to find what are essential needs of the customer and design around the. Also with the quick delivery of technology, we have to deploy continuously and get quick feedback of them. So if we make mistake we can fail fast, fail cheap, but we had to learn every time we do it. That’s really important.

Next. As I told you before, I will give you an example about one innovation case we have here and what where our customer needs. They want to have information of the progress of the claims to achieve a better experience. This is some of the things they always say, our customers. I want to know the repair… Oh, sorry the translation was really bad. But they were all the time asking us, they want more information about how the repair of their vehicles was.

So we develop a tracking initiative, a claim tracking initiative, so people can know what is the status of the vehicle. Making an example of this is like when you buy something on Amazon you know the status of your package, if it was delivered, if the mail has it, or if it’s going to… You know every part of the tracking of your purchase. This is the same concept. You will know every track of what is happening with the repair of your vehicle.

What help us with that, we increase a lot of satisfaction of our clients, and also we improve time of repair of vehicles. Instead of taking 49 days or repair, we take now 23 days without spare parts and 33 days with spare parts. Also, it gives us a lot of information about all the information we need of the process. This product give it to us because now we know how much time the vehicle was repairing, how much time we were waiting for spare parts, how much time the shop was working with the vehicles. We know everything is happening now because we have tracking of all the claim process. We will know where to work with if we know what we want to improve.

The last case of innovation I was going to talk about is digital marketing. When we start this process, our agents that were our principals, partners, they also were watching the perfect storm we were watching. They were also scared about all this change of customer clients and they have no idea how to go with additional information. Every company was thinking about how we work with digital information with our agents. All the company in Argentina were doing the same. They are making their own code wrote in their webpage and every sale they make they assign to one of the agents.

We sanctioned something different, because our agents were all saying they want to create to get digital and they don’t know how to do it. They want to be online, they want to reach more people, and they didn’t know how to do it.

What we were seeing also, there were a huge opportunity in digital business in Argentina. We have a lot of annual searches. If you search in Google seguro, that is insurance in Spanish. There were a lot of people looking for that on the internet. Also, auto insurance was increasing a lot in 50% in the last years, so there was a big opportunity to be online to sell insurance.

What is our challenge in digital for our agents? First of all they want to gain online visibility, they want to be online. Say someone is searching Google their name, they want to be there. Then the next part is attract new talent. Our agents, they are used to sell insurance in one way. They are used to have a coffee with their clients to sell insurance. They don’t know how to work with the new digital customers. Last but not least we have generate business opportunities. This is really important because, as I told you in the slide before, there a lot of people that are searching in Google about insurance and if you are not online, if you are not working with this, if you don’t see this opportunity you will not be able to get it.

In last year, one year ago we launch what we call Sitio Seguro, in English it’s basically a webpage for our agents where we create a webpage create for our agents where they can make their own webpage in our platform to San Cristobal where they can do all their online businesses.

What is Sitios Seguros? They are personalized webs that you can see on the internet, you can see on a webpage also. They are adapted to phones, you can see that they are really nice to open it in your phone. Also, they are co-branded with San Cristobal. They are enabled for all devices, design to turn opportunities into customers. We created them thinking about how they can sell better. They have quote integrated, and also they have a central lead monitoring from the portal. The portal is our home banking for our agents where they can do all their transactions there.

Sitios Seguros is one of our things, one really cool, new innovation idea we did because no one in Argentina did it before. I think it’s the best way to show our agents what we call digital transformation because now they can be online. Also more than 1,000 of our agents have their own web where they can do their new business. Also, they have, our average monthly sales of every agents is also with new sales that they wouldn’t have before because they were not online. Also, the conversion is at 20%. So I think this is a really good opportunity for our agents to make new businesses.

As I told you before, this is not only a making products. We had to work with our agents, so we can help them to work properly in this online businesses. We help them to create their professional brand, we share the site everywhere. Also, we integrate the website with the social media. We create the quote so the website is better.

We work all the time with our agents so they can learn, we’re learning with them how to do it and they can use better this new tool. For example, we are making webinar tutorials and tips all the time about how this work. We are online training with blogs so they have all the information they need to sell through internet. We are sharing with them all the articles about tips and digital marketing on online sales. We help them to create their websites every time, with a digital tool article. We also have a WhatsApp group with the latest digital news. Also, we share with them a lot of images so they can use it for brand their new products. Also, we send them mail with digital tips. I think this is more important thing we are doing with this Sitios Seguros because we are not only giving them the product, we are also helping them to get through this new type of making business.

At the beginning of this year we partner with Leadaki, that is a Google partner, so we can improve the results of our Sitios Seguros. Leadaki help us and our agents to work on their digital strategy so they can get better results, better leads, and better conversions.

For conclude, I don’t know if everyone knows him, this is Juan Martin del Potro, he’s our main character. This is a photo when Argentina won the Davis Cup. This is important because I think what technology do with sports is the same with this company here. I think if number one, and number two player of tennis play against each other, and one has the latest tennis racket and the other one has the wood racket they play with 30 years ago, probably the one with the better racket will win. But if you want to buy a racket it’s easy.

If you want to buy a racquet it’s easy. You can get to Amazon and buy the best tennis racquet in the world, but if you don’t practice, if you don’t eat, if you don’t train, if you don’t have the best training, the best attitude to play, it will be impossible to you to get the best results. So I think that the best example of how technology help us to get results. The technology for itself would not do nothing, digitalizing every process would do nothing by itself, but what will work if we change ourself, if we challenge ourself to get better, and better, and better all the time.

Ben Telfer:

Thank you very much, Ignacio. Great ending with the analogy with the tennis racquets. I think that’s something everybody can agree with. Apologies for the slight technical issue there, but it certainly didn’t distract from the quality and the content in your excellent presentation. If you’re still okay, Ignacio, we’ll have a couple of questions, a few have come in.

Ignacio, one question that did come in. Really like the way how you organize with your tribes and your chapters. There’s actually four parts to this question. The first part I think you already answered. How many people in total in your digital delivery team? I think you said 120. The question is how many of these were new hires? How many of these were people from outside of the insurance industry? Do you have an issues attracting the right talent into San Cristobal?

Ignacio del Castillo:

Yeah, I think we have 80% of the teams are new hiring. Maybe 20% are people from San Cristobal. That’s one of the questions I think they ask me, we have almost 150 persons in this new digital transformation. One of the harder things, I think for us, is to hire new talent because we don’t know how we say it in England, but in Argentina we don’t have too much. We are competing with all this new companies as Mercado Libre, or big companies with really known name, international name. It’s not easy.

That’s why I think it’s really important for us to make a good challenge, be a good opportunity for this new talent so they want to work with us. It’s not easy because as I told you before, we are competing with a lot of companies for the same talent. Even though what we are doing also, we are trying to work with Universities, with making all the time computations inside the company for this talent so that they know that we are working with this. That is really challenge what we are doing. For them could be really interesting to work with us.

Also, I think at the beginning of the journey when we didn’t have too much talent of this type of talent we had two options. One was to hire new talent, also. Another one was to work with the talent we have inside the company and to transform it to digital talent. That also was not easy, but a lot of people like it and make their capability building so they can work with this new type of work.

Ben Telfer:

Thank you, Ignacio. That actually relates quite nicely to a second question that we have. Did San Cristobal experience any resistance from their employees or from the agents in terms of developing this digital transformation project? And what did the company do to solve this?

Ignacio del Castillo:

Yeah, all the time I think we have this resistance. When you want to change something you will have resistance. I think the most important thing is, as I told you before, when you release a small product and you see you are having results that’s easier for you to show that’s the way. When you work with numbers you work with results and you have the capability of changing, or adapting yourself, you will find a way to have the company, the business collaboration. That is really important.

The other thing that is really important, when we started this digital transformation the main sponsor of it was the CEO. Sometimes when we need help getting the collaboration of the rest of the company he helps a lot. Not all the time, although sometimes he helps, sometimes it was not necessary. But I think if you have the leader of the company is the main sponsor of the initiative it helps a lot to work with it. I don’t know if it was clear.

Ben Telfer:

Yes, that was very clear. I think you make the excellent point that this transformation comes from the leaders within our organization. I think that’s an important learning for the people to know.

I think we’ve got time for one more quick question, Ignacio. Obviously San Cristobal quite advanced with things already like AI, and machine learning. What do you think the other emerging technologies will be that will have a big impact on your business?

Ignacio del Castillo:

I think we are all the time watching all the new technologies. This is my personal opinion, it’s not only about the technology we are using, it’s about how we use it. As I told you the example of the portal. We have a lot of opportunity with all the things we have, for example deep learning all the stuff, but we have re-create it or how you use it so you can get the best result of each technology you use.

Ben Telfer:

Thank you, Ignacio. Thank you again for an excellent and very comprehensive presentation detailing the journey that San Cristobal’s been on, and sharing some of your award winning innovations. I think that award you won for leading digital insurer was well deserved.

Again, just a final thanks to Ignacio for his excellent contribution today. And thank you everybody for joining us. Enjoy the rest of your day. Goodbye.

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