Best practices in insurance and beyond: It's time to stop looking backward

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'Best' practices are problematic, largely because 'best' is difficult to prove. The use of the term begs for evidence to support the assertion. Accordingly, because 'best' usually is subjective, we view its connotation as “directionally better,” according to whatever dimension insurance and other companies have chosen to evaluate. 

In this report, analysis shows that the very idea of 'best' practices is problematic. It presumes that the problems insurers are trying to solve are static enough and similar enough to our peers’ and competitors’ problems that their solutions will work for us. This premise no longer holds true.

The obsession with 'best' practices continues unabated

With new tools, technologies and behaviors coming on fast, 'best' ideas about what works 'best' are failing fast and need updating. Companies are on the lookout for ways to differentiate their strategies and drive differentiated capabilities in order to gain a competitive advantage and become more profitable. What may have once been differentiating now looks like an also ran and insurers accordingly are taking a serious look at what’s better and how to achieve it. 

Oftentimes, in order to achieve these goals, companies often apply 'best' practices that other companies have used and/or industry observers advocate. However, this typically is nothing more than “me tooism” that results in no real differentiators and excursions down blind alleyways.

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Bruce Brodie

Managing Director, Insurance Strategy, PwC US

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