1. How start-up principles can revolutionise
your organisation’s customer experience
Mar 24, 2016 Mark Kessler - Head of Digital Strategy and Product Development, IAG
Customer experience, Data, Engagement, Media
Organisations need to adopt a lean, start-up approach if they want to deliver great
customer experience.
The first step is moving away from business cases. I’ve worked in organisations where it
would take a team of 20 to 50 people spending two to three months developing a business
case for work that hasn’t been validated by customers or that has clear business
objectives and outcomes. This practice costs hundreds of thousands of dollars and
sometimes millions.
We need to get away from that model of wastage and inefficiency. Instead, we have
migrated towards the creation of a one-page lean canvas that lists the business value, the
customer value and the hypotheses we’ve identified. Once we have that, then we move
forward to rapid experimentation and prototyping.
We need to leverage agile and lean start-up approaches and principles in design and
development, as customer experience is critical for a product or service’s success. A lot of
companies get involved in long-tailed design processes where a great deal of research is
done up front, conflicts are generated, designs are implemented and then we see if it
sticks or not.
Instead, we need to think extreme innovation and rapid design. Fail quickly, identify failure
and pivot just as fast.
If we can get to that point, we’ve maximised the efficiency of an internal facing experience,
which in turn enables us to deliver better experiences externally. That is really the key.

2. Shifting the legacy business model
IAG has been providing insurance services in Australia for almost 160 years with IAG’s
Australia Direct heritage dating back to 1925 when the National Roads and Motorists’
Association (NRMA) started providing insurance to its members in NSW and the ACT
through our CGU business. We are one of the largest insurers in Australia and New
Zealand and have the luxury of a huge customer base with our remit covering NRMA
Insurance, CGU, SGIO, SGIC to name just a few. We have a customer base of more than
four million.
By realising we have been the traditional slow-moving extremely complex, multi-layered
hierarchical organisation, for us to survive moving forward, we have to change and we
have to change quickly.
I started at IAG in November 2015 and in the short time I’ve been there, what’s been most
interesting to watch is the creation of our Labs. The Labs began about nine months ago
and were brought about by our now CEO Peter Harmer who was the Chief Digital Officer
at the time.
There are two different labs: Digital Labs and Customer Labs. I work with a department
within Digital Labs where I’m responsible for defining IAG’s Digital Strategy. The first step
has been building knowledge of our existing digital strategies. At last count, there were
about 16.
Digital Labs is all about technology disruption, incubation, start-up-type ventures and
looking at products either adjacent to our offering or brand new products and services we
can deliver to our customer base. We’re looking at how we can leverage some of the
principles and approaches that have been defined recently around agile and lean start-ups
and how we can rapidly experiment.
Presently, we’re moving towards rapid hypothesis generation. This allows us to experiment
quickly and through validation of these experiments we either move forward with the
initiative or we don’t. It is a much more iterative and a leaner approach to testing in market.
Moving forward, the focus for companies should be on customer experience (CX). One of
the large initiatives under way at IAG is around how we lead with a customer. We are
looking at what customers’ needs are, their objectives and requirements and how we can
then move towards self-service via digital versus face-to-face or on the phone. How do we
digitise our operational functions so we’re able to respond quicker, automate, and meet
customers’ needs better?
Internal and external customers
The term ‘customers’ includes our internal colleagues and that can be anybody from an
operational standpoint. Somebody using web-chat, fulfilling phone calls, performing tech
support, non-customer facing roles like legal, compliance, and accounting. Our 15,000 plus
employees are a great resource for us to test.
They’re all people. We want to use human-centered design approaches so we’re
increasing efficiency, reducing the barriers to complexity and maximising the opportunities
to provide great experiences.

3. We’re able to test quickly then continuously improve. Continuous improvement is a large
part of what we do. You don’t just launch something then put it in the corner to run by itself.
You have to continually prove that product or service so it continues to meet users’ needs.
We’re working to find out how we provide the best experiences for customers externally,
and also how we drive them for our customers internally.
It’s a big job, but what’s great about it is having a CEO who was a Chief Digital Officer. He
recognises the importance of being lean, to change, to experiment, to validate. It makes
our goal that much more attainable.
It’s only a matter of time before more and more people in chief digital and technology-type
roles move into the CEO position. It makes sense for businesses looking to disrupt,
incubate and adopt start-up principles, in turn delivering first class customer experiences.
About Mark Kessler - Head of Digital Strategy and Product Development, IAG
Mark Kessler is a an executive-level digital professional with 20+ years of experience
specifically focused on customer experience (CX), digital innovation and transformation,
digital vision and strategy, customer centered and human centered design (CCD/HCD),
design thinking methodology, agile frameworks and lean principles. He is an expert-level
practitioner with product development, e-commerce, customer lifecycle management,
online acquisition, digital marketing, e-CRM, marketing automation, user experience (UX)
mobile design & development and social media.