Interview with Nuno Horta Innovation at Ageas Portugal

The insurance industry is evolving. Herbert Spencer coined the phrase "evolution is the survival of the fittest" after reading Darwin's book "Origin of the Species, 1864". Darwin pointed out that the species evolve by having the ability to change and adapt to external forces. The innovation teams, in the insurance companies, are acting as one of the forces that help the company to change and adapt in its lifetime. Here is another recap of an interview that I conducted with a force of "enterprise survival" and growth.

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Nuno Horta, innovation manager at  the Group Ageas Portugal, and Paulo Santos Alves a project manager in the Ageas's innovation team have a clear vision, and a plan, to catalyze innovation that will help Ageas to move with the times. And it all starts with pain.

Ageas (was named Fortis until 2010) is a multi-line insurance company that operates in fifteen countries. In Portugal, they are number three in Non-Life, number two in premiums and number one in Life by the numbers; 4 commercial brands compose the Group in Portugal (Ageas Seguros after buying in 2016 the Portuguese operations of AXA – Médis, Ocidental and Seguro Directo), today with more than 1,200 employees. A fascinating organization. As much as I would like to write about the past this interview is about the future.

Nuno started in corporate finance. At a certain point, he realized that "This is the death of me, I need to leave now," and he found a job with a mobile startup. After several years with the company, Nuno, built an innovation lab, the first lab in the Teleperformance the biggest call center service. During his time with Teleperformance, Nuno learned that the most innovating industry was the financial sector and its subset -- the insurance industry.
Things that today we take for granted, like mobile banking, bank transfer, are new and present a change and innovation in the field. The financial industry is much more kin on innovation than customer good and other spaces where the cool kids go. When Ageas invited Nuno for an interview, he jumped at the opportunity given the interest of the company and the industry in the change. It helped that Ageas has a culture of innovation in Portugal.

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The innovation team

The Ageas innovation team has four members and looking to hire two additional members. The innovation team started as two people two years ago. Then they appointed Paulo and another team member. They have been trying to hire their 5th element for a long time because "culture is our first priority and that person needs, not only to have the culture, he/she needs to help spread it in the company."

What is innovation for you?

Innovation is an answer to a problem - you have a problem, a pain, here is a remedy for it. There are incremental pains that you can manage. A classic example, let's remove the paper from a process that can take two days to fulfill. The process usually looks something like this - download documents, fill the documents, upload the documents and wait for answers. If you can remove the papers and save six hours of manual work it is a great improvement and a profitable innovation for the company. Let's look at another example; if you break an arm, you need to go to a specialist. In this case, you have a "breakthrough innovation." To handle both types of innovations Nuno and the team get the people from the LoB to meet with them, describe a problem that they need to break through. The key word here is that the innovation team co-creates with the business unit a solution. It can be a technical solution, and it can be a process solution. They are the specialists that take care of a problem.

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"innovation is pain management."  -- Nuno quotes Prof. Nadim Habib


"Many innovation people like to use the blockbuster example. We have to predict the change. We have to research to understand where the industry and the customer are going. We do the research ourselves, with consultants and with external startups. It is important to monitor changes and introductions of new products in other markets and think how it will affect the insurance market. We need to think a to adopt new technology and make it our own and relevant to insurance."

Paulo adds "it all about making money from the resources at hand. This is the guideline for me." Paulo's pragmatism and background in a large IT consulting company add an important dimension to the team as they deliver value by "remedy innovation" (solutionizing) and "specialist" (internal consultants).

"People mistake innovation with creativity. You can be very creative and have great ideas like building the next wheel, but, in my opinion, it is to be smart with what you have."

What is the mission?

There is a multi-year plan in place.

1. Unlock the startup culture in Ageas business units. The insurance industry is known to be conservative, but today they are more receptive to change than anyone else. It is part of the innovation team job to work with them and show them new ways to do things and develop their own projects. The company is open to hearing these changes.
2. Challenge the status quo. Bring up new value propositions and new opportunities.

"We need to bear in mind that the only way to make innovation is when the business is making money and the business is flowing."

Managers are busy. Their focus is on running the business and making sure that the current flow it there. It is very hard to think about new ways while you are responsible for the old way. Ageas innovation team has an internal business consultancy and it helps the business unit heads and leaders to look up and see new ways.

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What is the perception of a startup?

Startups don't have structure, rules and legacy systems. They don't have barriers that keep them from growing. They can come up with a great idea however it is hard to bring them in because the fit is very hard. It can take a year to develop a new product for a company. it is an expedited time. For a startup, it is a death sentence because they can't maintain a year, they need to eat and pay their bills.

The innovation team is advocating for the lean startup. The idea is to help the business units to move faster. The incumbent process is an impediment to velocity as it allows the stakeholders to keep dragging their feet under the facade of asking many questions and allocating resources to validate the value proposition. The startup-ish method drives fast and cheap execution with the goal of prove the value proposition and market fit. There is a good reason why the current process is in place. Don't forget that there is a different risk at stake between a $50M startup and a $14B insurance company.

The Portuguese startup scene?

Insurance companies are not lay back as many people think. There is a lot of work and energy that is being produced and consumed. It is up to the top management  of a large company to place the innovation managers and leaders if they would like to see innovation. From the top management it will trickle down. It is in their power to set the tone of the company and double down on innovation and the feeling of urgency. I see many insurance companies being innovative. I think that the stereotype of not wanting to change is wrong. In our conversation, Nuno and Paulo mentioned several times that they feel lucky to work in a company that is open to change, new ideas and that the board mandated the innovation.

Portugal has a booming tech scene. Portugal recently passed through an economical crisis that sprang many entrepreneurs and tech startups. Three, or four, years ago Portugal reach an economical rock bottom and that motivated many entrepreneurs at heart to hustle and come up with new ideas. Today, Portugal is named as one of the most promissing innovation centers in Europe.