Jon Bidwell: The Innovation Interview

Jon Bidwell, Chief Innovation Officer of Chubb Group of Insurance Companies shares his thoughts and insights on innovation, technology and the insurance business.

He is currently responsible for managing Chubb’s global innovation platform, internal venture fund for new ideas as well as Chubb internal and external social media and collaboration tools.

In 1983 Jon joined Chubb as an underwriting trainee in Chubb’s Department of Financial Institutions (DFI) in the Chicago, Illinois office. Subsequently he was promoted to manager DFI operations in Detroit, MI. He held that position until assuming manager roles in Philadelphia, PA in 1987 and New York, NY in 1991. In 1996 Jon was promoted to Chief Underwriting Officer for the New York Brokerage Zone. In 1998 he became the manager of Chubb’s Strategic Development and New Product Development group in Warren, NJ. From 2001 to 2008 he oversaw Chubb’s Strategic Marketing Group and in June 2008 was named to his current Innovation position.

Jon graduated from Northwestern University in 1983 with a Bachelors Degree in History.

Jon resides in Pelham, NY with his wife and four children. He is a qualified structural fire fighter and currently serves with the Pelham Fire Department, holding the rank of Captain.

How do you define innovation and what does it mean to you?

It tends to be a grossly overused term. I think, perhaps a bit more narrowly, innovation really means finding a way to commercialize something that is new or is a new combination of existing technologies, services or products.

I think we treat innovation as though it’s something that everyone just discovered in the last five years. If you look at any business that’s been successful over years, however, if they weren’t innovative, they were not successful. It’s just one of those fundamental pillars, and if you stop innovating, you will eventually go out of business.

What industry needs to embrace innovation and take more risks?

Any industry that doesn’t want to end up in what I call “The Graveyard of Irrelevance” has to make innovation a fundamental part of what they do.

Otherwise, customers will not hire or buy your product or service. I think risk is inherent in being innovative and is ultimately less risky than being static and unchanging.

Businesses that perceive greater risk in innovation than in inaction, generally follow that Hemingway description of bankruptcy. “How do you go bankrupt? Two ways, gradually, then suddenly. How do you go out of business? Gradually, then suddenly. And I think the world is full of examples of companies that were once cutting edge that failed to innovate their way out of their niche in the face of changing market demands and went suddenly extinct.

What is the best piece of advice that you have been given and received?

I had a boss many years ago who told me that most people can contribute and at a high level, but you’ve got to be able to spot those who have value and identify the right way to use them in the organization. That’s the best piece of advice I ever got.

It’s frankly allowed me to spot a lot of talent that other people might have missed and helped those people have very good careers. Being able to see the value other folks have has a big bearing on innovation. It’s quite often that good innovations are the sum of many of these people making their own unique contributions.

What is your greatest achievement and why?

There are a number of individuals who have gone on to very significant careers within our firm and externally whom no one could figure out what the to do with at some point in their careers. Many of them passed through departments that I ran. Quite often I received a call from a colleague about some of these people. The message often was that “this person was smart, but we have no idea what to do with him or her. Can you figure something out?” And I did. Helping people who may not have had a direction in their career but who were bright, ambitious and driven to succeed is frankly more gratifying than anything else.

Newspapers and Books: Digital or Physical?

I consume almost everything except The New York Post digitally. But somehow, The Post, with that “Shock , Horror, Death, Probe!” vibe, still does better in paper format.

In 2008 when you were tapped to run innovation unit of Chubb, what were your first thoughts?

I can’t do this. Or more accurately, I have no idea how to do this. But I’m an optimist and figured it out.

How has innovation impacted Chubb’s product service offerings?

Even though Chubb is a large firm in the aggregate, it’s really constructed around many smaller industry segments and product specialties. Some of our segments insure rapidly-evolving companies in industries such as life sciences, clean technology and information technology. A key underlying factor in our success in serving these customers is Chubb’s ability to provide cutting edge products and services, which dates back practically to the founding of the company.

If we are not able to constantly evolve our business models, products and offerings to remain relevant to these and our other customers, then they would not continue to pay us a premium over Brand X or Y. If we couldn’t get that type premium over Brand X or Y, then we couldn’t remain profitable and could go out of business. So I think that innovation is a basic requirement in our business. And during the last four years, we’ve been using different sets of digital tools and processes to speed the pace of innovation, so we can keep up with or get a little bit ahead of our customers.

As a global company, we are speeding up the process and making sure that information flows quickly from the point of transaction to management and then to senior underwriting and claims folks, so we can figure out what’s changed and how we might need to change our product and service offerings.

What are some of the most interesting ideas that evolved from a Motivate + Drive + Deliver event that became a reality?

The first product that we created, which was tied to the emerging needs of our customers and has been very successful, was a clinical trial insurance certificate issuance system. Sounds sort of boring and insurance geeky, but the fact is we have a very large life sciences practice, with mainly biotech, medical device and clinical trial research organizations.

And once upon a time, clinical trials were done in a limited number of locations and countries, mostly the U.S., Canada and Europe. And now these global businesses may have to conduct trials in dozens of different countries to test different populations before their drugs or devices can be approved. The problem is that a variety of strict liability insurance requirements exist in each country and jurisdiction. And the liability insurance industry, frankly, hadn’t caught up with being able to provide customers with proof of insurance coverage before a trial is permitted to go forward. And remember, too, when you’re testing drugs in a clinical setting, it’s on patent protection. A delay of three or four or five months means the loss of precious patent time on that particular compound or device.

Our solution involved re-engineering the certificate issuance process so that proof could be generated almost instantaneously. It also was built to generate certificates in dozens of different languages. We basically built a system that could run parallel with the whole packaging process the clinical trial manager runs to get the trial approved with the local review board. So that’s a really interesting one because we got out completely ahead of our competition, and frankly, we were able to increase our relevancy to keep pace with the needs of our clients.

Most of our early mobile development, frankly, came out of this process, as well. Also some of the tools we provide to agents today came out from high potential employees who were tasked with solving business problems during internal training programs.

What segments of Chubb’s business are new technologies having the largest impact upon and why?

I would say that it’s what we call social business–the ability to network in a conversation with vast numbers of people. It’s impacting our business. It’s impacting how we communicate internally. I think it’s starting to impact how we communicate with our brokers and customers. It’s very much going to drive the pace even more of product and service innovation, but we just see information moving around a much, much higher pace than it did even four or five years ago. We’ve been involved in installing and using Jive as our platform, but the entire social business ecosystem within Chubb will always see how much faster we can keep our fingers on what’s going on in the marketplace and coalesce people around solving problems. So I would say it’s something actually that’s across the board.

The interesting problem, if you’re familiar with Metcalfe’s Law that governs the number of unique connections within a network, the volume of information that’s being created and the number of possible connections is also overwhelming. And I think the biggest challenge that we and our customers have is how do we cut through that volume of information to find what actually drives decision making or analytics and business intelligence. Some of this fits into the big data issue that everybody loves to talk about these days, but I think it’s across the board. Five to ten years from now, it’s going to completely change the way we do business. But it’s hard to say it’s only impacting one part of our business, I think it is universal.

With Chubb’s reputation of being one of the most well respected insurance companies in the world, how do you balance new innovations and technologies to ensure Chubb’s attention to detail and high-level of customer service?

One thing that our people do very well is to serve the customer, both end policyholder and our agent or broker. Let’s improve the service that we give to them. Will this improve their experiences? Is this a better product? Does this meet a need? That’s a mindset you can’t buy off a shelf. The firm has always had this very intense customer focus.

Interesting sidebar – when Sandy hit, and obviously Chubb has many customers and employees who were in the affected area. Even employees who had nothing to do with the claims process, you would see email chatter going back and forth, asking “what can I do to help?” I was in my firefighter role for a good part of the storm. I ran into people who were Chubb clients. It’s like, “Okay, I work for Chubb. Here’s the number you need to call. Make sure if there’s a problem, call me. Here’s my cell phone number.” And then you’re off to the next call. But I think our entire firm has that mindset completely woven into it. So that’s a good first screen. People don’t get off on wacky things that are good for them, but not for the customer.

Second is that we do a lot of proof of concepting, where you experiment very small with a trusted group of producers or customers and you iterate very rapidly before you go big. I think a big problem in the insurance industry in the past has been heavy up front R &D investment in IT technologies and then springing something on the market that doesn’t work.

And that’s very much how we do internally and externally and stayed very close to the customer through the whole process. Always making sure this is something that’s going to help them. But again, it’s a mindset and among most of our employees; you can cut it in half and I can see it, it’s almost an unconscious action and our employees are not even aware that they’re doing it. Psychologically, it’s really interesting, how we get people – it’s almost like a cult.

We’re one of the largest underwriters of fine art in the world. And, again, we have people with unbelievable expertise in that and they spend the time developing the relationships. But it’s ultimately all about providing the very best knowledge and service to the customer. But that’s how, again, this is a relevance business. We’re a balance sheet, but there are a lot of balance sheets out there. We’ve got a very good balance sheet, but if we’re not providing products that are really meaningful and relevant to our customer at that moment of truth, then we have no reason to exist.