Students' zone - A selection of Box Cases

<< back to list

Box case 4.1

Allianz-Versicherungs-AG – innovation networking

Increasingly companies need to bring in a fresh, outside perspective into the
way they define their innovation strategy. Too often organizations view their
field too narrowly and this prevents them generating breakthrough ideas.
Creativity is often the result of a market being viewed from different standpoints
and this approach has been very successful at Allianz-Versicherungs-
AG.

Allianz is the largest insurance provider in Germany. Dr Karl-Walter
Gutberlet, an Allianz board member with responsibility for private customers,
also serves on the board of Mondial Assistance Deutschland GmbH. This
company is a business-to-business service provider focused on consumers’
service needs related to travel, car transportation and living. Gutberlet’s idea
was to add this service philosophy to the insurance viewpoint. The result is
an innovative new product that has taken the German market by storm and
won an innovation prize from Capital magazine.

The new product is officially called ‘Allianz Haus- und Wohnungsschutzbrief’ (House and home emergency cover) but is better understood as the equivalent of a car breakdown service – a ‘household emergency service’. Normal house insurance may cover the costs of solving a problem (for example, a blocked water pipe) but the consumer is still left with the hassle of finding someone to do the repair. Taking the analogy of the breakdown services available for cars, the new product covers the costs and also provides a hotline at Mondial, which organizes a quick repair by a qualified
tradesman and the payment; and this is for about 5 euro per month.
Klaus Stemig, a member of the board of Mondial Germany, was appointed
to be the project manager for the 24-hour household emergency service. A
cross-functional team was assembled for the project comprising personnel
from Allianz, Mondial and Agemis, a facility management company which
provides part of the service provider network for the product. The kick-off was
in July 2003 and the product was introduced (with the full supporting
networks of service providers) in April 2004. Despite a time-to-market of only
eight months, extensive market research was used to test and improve the
initial ideas generated in brainstorming sessions involving the two companies.
Over 400 inputs from interviews and focus groups for example defined
the key product features. The completed product includes cover for being
locked out, heating failures, plumbing problems, removal of wasps’ nests,
storage of copies of crucial documents such as passports, emergency babysitting,
and emergency looking after of animals.

The cross-functional team had to solve many unexpected problems during
the development, but having all functions represented and both companies’
networks meant that these could be quickly addressed. ‘For example, information
technology is typically the bottleneck in the development of insurance
and service products but our representatives from IT were on board from
the beginning’. Overall, Stemig says, ‘we are proud that we not only developed
a new concept but that we developed it on-time, matching a very challenging
schedule. For example, it wasn’t easy to create a new network of
tradesmen set up to respond 24 hours a day across all of Germany but we did
it’.

The product has sold more than double the first year’s goal of 25,000 policies
and has established a reputation for Allianz as an innovative player in a
conservative market. Spotting strategic opportunities is often about bringing
in a different perspective and it is management’s role to ensure that an organization’s
paradigms are challenged. Allianz are continuing to try and do this
and are now rolling out further new products, such as ‘Accident 60 Active’ for
senior citizens who need not only health insurance but also help in finding
and organizing the services they require.