30 Rethinking organisational structure Regardless of which collaboration approach they choose, insur- from the traditional business will make it easier for us to rapidly ers are now restructuring their organisations in order to ensure and boldly implement new ideas.” their innovation activities can flourish. One common strategy is to carve the innovation arm out of the business, so that it op- MMI Holdings has created an entirely new disruptive innova- erates separately from the insurer’s other activities – the aim is tion capability it has christened Exponential. The unit is autono- to give such ventures greater freedom, unfettered from legacy mous in its decision making and falls outside the governance and processes or conservative and risk-averse attitudes. Examples management processes of the parent company. “We are setting include: up venture investment partnerships in the market to avoid the common pitfalls of corporate venture funds, such as selection ERGO Group has set up ERGO Digital Ventures to take respon- bias and political dynamics,” says Dan Smith of MMI. “We abso- sibility for all of the group’s digital and direct business activities. lutely realise the need to drive cultural change and a big element “We thereby created the cultural environment for innovation as of that is to be vocal in celebrating progress, to be inclusive with well as – for the first time – a strong separate digital pillar within senior leaders and to ensure that objectives, KPIs and compen- ERGO Group,” says Martin Pluschke of ERGO. “Its detachment sation are structured to drive engagement with start-ups.” Those insurers that proactively engage with start-ups are best placed to spot the winning ideas, the winning teams and forge the winning “ . “alliances and relationships Graham Jackson, PwC