Innovation strategies adopted by insurance companies in Kenya

Abstract

Globally, the insurance industry has enjoyed strong business conditions over the last few years but worsening economic outlook will likely pose considerable challenges in the years ahead. These challenges will be especially pronounced in the property and casualty segment, where growing pricing pressure as the market softens will drive a need for cost-cutting and greater efficiency (Deloitte, 2008). Due to the afore-mentioned, although insurance is a mature industry, driving profitable top-line growth will be difficult owing to increased competition from global players and companies from other industries that produce either same or substitute products and services. While profitable growth is the key to success in a mature industry like insurance, it can be prohibitively difficult to achieve through conventional strategies simply because the industry is mature (Deloitte, 2008). It is vital that insurance executives take a fresh look at the industry and seek fundamental change at all levels of the organization, from its people strategy to its client and product strategy to its processes and infrastructure achieving these will be difficult is appropriate innovation strategy is not put in place (Carrie, 2008). The study sought to establish the innovation strategies adopted by insurance companies in Kenya.The research design employed in this study was a survey method the entire population was undertaken covering 43 insurance companies. The study relied heavily on primary data obtained through the use of semi-structure questionnaires and the analysis was done in terms of descriptive statistics.From the findings the study concluded that companies with strong technology-enabled innovation strategies are more likely to secure competitive advantage and create superior shareholder value. The study also concludes that a good technology-enabled innovation strategy should clearly deconstruct the reasons why a company is (or will be) successful. The study recommends that insurance companies need to develop robust technology-enabled innovation strategies that define how a company source’s and develops technology to help deliver compelling new products, services, customer experiences and business models while simultaneously creating barriers to entry