One of the most interesting reads of the day brings up a grand picture of business model development – ecosystems and platforms. While both with industry-specific opportunities and challenges, particular attention is paid to the ecosystem approach being the future of the insurance industry.
Pick #1. Insurance Beyond Digital: The Rise of Ecosystems & Platforms
A platform is a business model that allows multiple participants (producers and consumers) to connect to it, interact with one another, and create and exchange value. The most successful companies in the digital era, including Alibaba, Amazon, and Facebook, were all designed on platform business models.
An ecosystem, meanwhile, is an interconnected set of services that allows users to fulfill a variety of needs in one integrated experience. Consumer ecosystems currently emerging around the world tend to concentrate on needs such as travel, healthcare, or housing. Business-to-business (B2B) ecosystems generally revolve around a certain decision-maker – for example, marketing and sales, operations, procurement, or finance professionals.
Ecosystems typically provide three types of value:
They act as gateways, reducing friction as customers switch across related services.
They harness network effects.
They integrate data across a series of services.
For insurers, shifting from an industry to an ecosystem perspective requires a significant change in how they define their role in the economy. Currently, insurers act primarily as risk aggregators. They have a passive and limited relationship with customers, which increases their exposure to disintermediation, disaggregation, commoditization, and invisibility. If insurers were to lose their distribution and customer relationships, they would be left with few options to reinvent their business models. Adopting an ecosystem perspective – reevaluating the traditional business model and considering partnerships with players both within and outside the industry – could reinvigorate insurers’ digital strategies.
Pick #2. Beijing Court Starts Offering Legal Services on WeChat
Beijing No 4 Intermediate People’s Court began offering legal services on its WeChat platform on Wednesday, aiming to make lawsuits easier for litigants.
“Residents can file cases, provide judicial materials, follow lawsuits and receive verdicts on the WeChat platform instead of going to the court, which will save their time and also improve our work efficiency,” said Cheng Hu, the court’s vice-president as well as its spokesman.
Pick #3. Baidu Could Beat Google in Self-Driving Cars With a Totally Google Move
Baidu, China’s giant search company, is a relative newcomer to the fast-growing autonomous-vehicle market, having begun work on its self-driving cars only about five years ago. In an effort to catch up quickly, and raise China’s profile as an AI innovation center, Baidu is eschewing the secrecy that normally surrounds self-driving cars: as Google did with its Android smartphone operating system, it’s offering Apollo free to anyone who wants to use it.
Apollo 1.0 was released in July, and Baidu started testing Apollo-running cars on public roads in late 2017. Baidu hopes companies that use Apollo – it has 90 partners so far, including car makers like Lincoln-owner Ford, car-component makers like Continental, and chip makers like Nvidia – will then contribute data that it can use.
Over time, this will make the software powering rides like the one I took better, faster, and safer. In many ways, the approach is like the one Google used to help Android become the world’s most popular OS.