Innovation is a top concern for CEOs. See how one leader, Rosaline Chow Koo, Founder and CEO of CXA Group, is driving innovation and how it is strengthening the employee benefits industry in Asia.
As part of KPMG international’s ongoing CEO Series – Set the pace or risk falling behind – KPMG’s Mary Trussell sat down with Rosaline Chow Koo, Founder and CEO of CXA Group, a benefits startup based in Singapore with a mission to transform the employee benefits industry in Asia, to talk about leadership and driving innovation.
Frustrated by the lack of investment in technology to meet unaddressed client pain points, Rosaline invested $5 million of her savings and borrowed another $5 million to build CXA. Within a year, her team built the platform, acquired Singapore's largest homegrown employee benefits broker, won 20 Fortune 500 clients away from the global incumbents and was voted one of the best vendors of the year. Now CXA has received $11 million in VC funding and are preparing to expand to 10 countries across Asia.
From the discussion with Rosaline, Mary wrote a short article – Becoming an innovation catalyst. In addition, the following are excerpts from their discussion.
Mary Trussell (MT): CXA has created quite a reputation for innovation in Asia’s insurance industry. Tell me about the company you started and the opportunity you saw in the market.
Rosaline Chow Koo (RK): I had been working with a large global HR consulting firm and recognized that – while we certainly helped them find the right insurance products to support their clients’ benefits programs – we weren’t really solving the pain points for HR.
What HR wanted was to reduce the cost of their premiums. They wanted to engage employees. They wanted to reduce waste from double coverage, where double income couples have overlapping benefits. And they wanted to improve the health of their employees – societal success in South East Asia means there has been a huge increase in the impact of chronic disease, diabetes and the like. Insurance was part of the solution, but they needed more.
MT: How does CXA solve that need in the market?
RK: At its most basic, CXA is a broker with an innovative technology platform. But our focus is on using data and technology to help companies improve their corporate wellness and, as a result, reduce their premium costs and improve employee health.
For example, we conduct online health screening for employees to not only help assess their insurance needs, but also to give them recommendations on ways to become healthier. We then aggregate all of that employee data to create an overall health score for the company that allows us to accurately predict their premiums over the next three years. And our reinsurance partners are then willing to guarantee a lower future premium for companies that are able to reduce their health scores.
We basically bring together all of the data, tools and providers needed to improve employee health and combine it with a personalized benefits wallet and a brokerage to create real value for our clients.
MT: How has the idea been received by companies in Asia?
RK: Our focus has always been on solving client pain points, so we’ve been able to work with companies to drive really tailored solutions that work for their business and market. When we launched in Singapore, we did so with Google, Facebook and American Express as some of our lead clients.
I think the key has been in really talking to our clients, being part of their community and knowing what is going on in their business. Just because you build a platform doesn’t mean anyone will come. You need to talk to clients to figure out what you are building, whether it matters to clients and whether they will pay for it.
MT: How is CXA partnering with traditional insurance players to drive the market?
RK: As a broker, we work with all of the insurers. But we’ve also started to partner with insurers and banks to deliver a ‘white labeled’ solution that allows them to better serve the needs of their existing customers.
The challenge isn’t in finding partners. The bigger problem is helping our insurance partners to build the APIs and electronic feeds that we need in order to digitize the claims process. We faced a similar challenge with the hospitals and benefits providers but they have slowly become digitized.
We’re basically trying to electronically aggregate and consolidate all of the vendors, all of the claims, all of the data and all of the payment flows into a single ecommerce marketplace. And it can be painful. But it is creating massive value for our clients.
MT: What advice would you give to insurance CEOs looking to take advantage of new models and new technologies?
RK: I think the most important thing insurers can do today is to digitize everything – from the front to the back. You can’t just leave innovation to a lab or an incubator somewhere. You need to be creating a truly digital enterprise right now.
I think they should also be thinking about open architecture. The reality is that you can’t build everything yourself and there is a lot of innovation in the marketplace that you can tap into and incubate if you have the right system architecture.
I also think that having the right talent is key. CEOs need to surround themselves with people who have a mindset of moving towards the future, not just doing things because that’s the way they have always been done. And you need people who can deal with a certain level of ambiguity and chaos.
MT: Do you have a special formula for driving innovation at CXA?
RK: I don’t think it’s a special formula. We just make sure we remain focused on solving our clients’ pain points.
Innovation starts at the executive level; it should be part of the core leadership’s basic duties to identify and drive opportunities for innovation. We also have a cross-functional product council that helps our product specialists and technology organization come up with new client solutions. And we spend a lot of time talking to the tech startup ecosystem and the innovation arms of large health care firms; we’re very much part of that ecosystem.
At the same time, we also have a long road-map of solutions we are trying to build. And we are continuously upgrading and transforming our core brokerage operation. So I think innovation is very much part of our organizational DNA.
MT: Thank you for sharing your insights with us, Rosaline. I’m sure we’ll hear more about CXA as you expand your footprint over the coming years.
This article series provides insights into the exceptions of insurance CEOs for business growth and the challenges they face.