The case illustrates how Ping An can anticipate digital trends such as cloud computing and evolve from its core business to expand to new areas. Ping An began by selling property and casualty insurance but soon expanded to banking and financial services.
The firm then invested heavily in I.T. development in order to take part in the Internet economy, focusing on five verticals: financial services, healthcare, automobiles, real estate and smart cities.
In the five verticals, Ping An incubated 11 independent technology affiliates that dwarfed a valuation of $70 billion. By 2020, 3 companies were publicly traded as independent entities. Ping An was no longer a financial institution, instead, it had become a “finance + technology” and a “finance + ecosystem” company.
While so many financial institutions and other traditional businesses always talk about digitization and transformation, but the progress is pretty slow. Ping An is in a very different place.
The Ping An case is interesting both from a Chinese and a global perspective. As a firmly rooted Chinese firm, Ping An embodies the rise of a traditional company that learned to harness new technologies and compete with China’s pure technology players. From a global perspective, Ping An offers lessons in how to develop an ecosystem of technology affiliates: the firm has developed a set of best practices for incubating, funding and collaborating with spin-offs.
1) Explain how organizational structure, capital agenda, and key performance indicators can allow companies to scale up their innovations.
2) Understand how the latest technological developments such as artificial intelligence, the mobile internet, and cloud computing are redefining how value is created.