A while back, a life insurance company developed a great new policy-product, aimed at “high-net-worth individuals” – especially people with higher incomes, who wanted to protect their families in the event of their untimely demise!
Being more complex than life-insurance for mid-level earners, this new product was well suited to being sold through brokers, or “personal financial advisors”.
Potential buyers loved the extra protections in the product, which were much less costly to provide than the perceived value to those potential buyers. So brokers found they could sell the policies very easily, and jumped on the opportunity to make nice fat commissions.
Be careful what you wish for!
Sales took off – and how! Within just a few weeks, applications for the policies were coming in much faster than even the product manager had hoped.
Unfortunately, there were nothing like enough admin staff to actually process the applications. So those gathered dust for weeks until the brokers lost patience and cancelled their customers applications.
Then, of course, those brokers gave up selling the product.
An over-sell problem for a life-insurance product
AI to the rescue ?
Now generalise the issues in this case and bring in AI to help.
We are told that AI will not just help staff do things better and faster, but actually do it for them. As one source says, for example, “software becomes the worker itself, capable of understanding, executing, and improving upon traditionally human-delivered services”
So we won’t need staff to plan and implement marketing promotion campaigns – AI will do those for us. And of course, it will do so much more effectively, and so bring in more customers and sales faster than those measly humans could ever achieve.
Of course, AI will also do all the customer on-boarding faster too. But which AI solution will win? Here, there are irreducible delays in the process, like waiting for medical reports to come in from applicants’ doctors. So we could see more scenarios like this more often, and still bigger ones.
I did ask the guy who owned the problem above why they didn’t just pause the product’s promotion while they built up the on-boarding capacity. “What? .. and turn down a huge sales success? You must be joking!”
Some people (and organisations) you just can’t help!😒
It’s soooo easy to avoid these kinds of mistake by modeling how the future could play out before hitting ‘Go’. See how digital twin business models can help with a selection of important business challenges in our short courses here.