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12 March 2020 | 10-minute read
It’s difficult to understand whether planning for the future is futile in the constantly changing world in which we live. However, I wonder, has it always been like this? I recently watched the popular Netflix series The Crown (Royalists look away now). While watching one episode I experienced a penny drop moment - during The Queen’s first televised Christmas Broadcast she said, ‘this new medium [television] will make [my message] more personal and direct’. Is this much like social media (Twitter, Instagram, Facebook) now fooling us into thinking we have an insight into people’s real lives, that we can know and relate to others whom we don’t know personally?
The Queen continued to point out that television ‘is just another example of the speed at which things are changing all around us’. This was in 1957. There were many poignant points in this first televised speech, but what really stuck with me when I watched this (the real version thanks to YouTube) is the Queen’s reference to ‘unthinking people who carelessly throw away ageless ideals as if they were old and outworn machinery’, and being urged to ‘not be afraid of the future’. It has been a whopping 63 years since that first televised Queen’s speech, and yet some of the themes which were addressed about the future still resonate with me, even more so, they touch on why we created FutureFormers. Arguably, the pace of change is accelerating, but we must acknowledge that the world in which we live is always evolving, and this is something to embrace.
FutureFormers is a half-day event designed for Lloyd’s and London market professionals to explore the skills we will need in our workplaces now and in the future. FutureFormers was inspired by a number of reports published in 2019, notably LMA and PWC Claims workforce of the future, LMG and KPMG The Future of Skills in the London Market, and The Future at Lloyd’s Blueprint One. Each of these reports reference talent and people as the key to a successful future in the Lloyd’s and London insurance market. The Future at Lloyd’s Blueprint refers to people no less than 77 times covering topics from protecting the people, businesses and communities who buy our coverage, to the people with whom we work and the culture in which we operate.
The first FutureFormers was held in January 2020. We split the day into two sections, first focusing on the relationships between humans and technology and then looking at how we can put the customer at the centre of our decision making. Louisa Clarke kicked off the day talking about human centricity and technology. Louisa told us how it takes the brain ‘just 33 seconds to process information about facial expressions’, some apps take longer than that to download! Up next, Orlando Machado, Chief Data Scientist from Aviva spoke about Aviva’s ability to disrupt from within and told us how Aviva people adopt the mantra ‘I am not the customer’ in order to really listen to what people want from Aviva services. At Lloyd’s Banking Group they encourage ‘Working Out Loud’ which Innovation and Strategy Leader Kate Bohn went on to explain, ‘this way of working builds an innovative culture for the organisation, it’s a way of building relationships across the business to achieve goals, develop skills or explore a new topic’. We then investigated the relationships between customers and insurers. Sally Blake, Customer Performance and Insights Manager at Zurich urged us to bring the customer on the journey with us, ‘whilst we cannot predict the future, we still need to make decisions today’. David Harrison, Head of Operational Excellence, gave us an insight into how the change which started in Claims at Ageas has revolutionised the way they work; they have given their people freedom from command and control and have followed John Seddon’s thinking of ‘organisations serving people’. Our final speaker was Chris Moore, who worked with Lloyd’s to launch their relationship with sharing economy clients, clients who now feel that they receive a first-class service from Lloyd’s on their global risks through the agglomeration of expertise in the square mile. All our presenters spoke of how people are central to change. People are central to a successful future, people who will bring their many skills, experiences and knowledge to bear in order to realise our collective desire to serve our clients with increasing effectiveness and work in a more human environment.
What are the barriers to embracing future ways of working?
We were thrilled to see so much interest in FutureFormers, with over 220 registered delegates, we knew that there would be relevant and thought-provoking feedback from the varied professionals in the room: HR, Operations, Underwriting, Claims, Risk, Broking and many other specialists. We heard from our audience on numerous topics and certain themes emerged around what needs to be addressed for Lloyd’s and the London market to remain relevant.
‘Some of the talks didn’t seem as relevant to London market carriers as we don’t tend to be client facing’ – FutureFormers attendee, 2020
I think that we struggle to define the client (or customer, if you will) in insurance. It’s an age-old problem. I was previously an underwriter and during my tenure, one organisation I worked in decided to focus on ‘client intimacy’ as their key differentiating value discipline.
Treacy and Wiersema (1993)
This caused no end of debates within the organisation. In team meetings we had ‘client-intimacy’ as a standing agenda item, but who did we define as the client? Was it our brokers? Was it our producing brokers? Was it our coverholders? Was it the assured? The re-assured? I think this becomes a big distraction for us in insurance. Put simply we offer an intangible product – a promise to pay – but we transact with intermediaries, and we’re not in a retail environment, so it all becomes a bit confusing. To me, the answer is yes to all those questions. Yes, the coverholder is your client, the broker is your client, the insured is your client, so is the reinsured. Whether you work in Finance, HR or Operations - you have clients too. Your client in this case may be internal and external, it could be that you provide services to underwriters (they are your client), while underwriters provide coverage for insureds (also a client). It really shouldn’t be so difficult for us to ask ourselves in every situation we engage in at work – is this making it easier for our clients to do business with us? One of the key tenets to Ageas’ way of working is the question ‘is it easy?’. We should be making it simple for clients to buy our policies, receive documentation and have their claims paid and we all have a role to play in this. Not only is this fundamental from a human perspective, but we also work in a regulated industry, we have done our CII exams, we understand that the FCA expects regulated firms to put the customer at the centre of our businesses and that the PRA requires firms to take reasonable care to ensure the suitability of its advice. Therefore, we all have a responsibility to do the right thing for our clients, however these people are defined.
‘Culture is talked about a lot.’ – FutureFormers attendee, 2020
What do we want to keep about the culture?
Now this is where I feel that the Queen’s 1957 speech really comes into its own, particularly her reference to ‘ageless ideals’, I could write another 2000 words on why I think insurance is a great career path, but I don’t want to digress too much. In a nutshell, for me, insurance is full of brilliant people. I find inspiration in the passion that people have for the work that they do, in the first company I worked in, I remember getting goosebumps as the Head of Claims remembered how the tragedy surrounding the twin towers unfolded and what it meant for the people who we insured, he went on to describe how quickly we responded to New Zealand quake damage and what struck me is that insurance creates resilience. Without it, no business could exist and crucially it provides a social impact when times are hard. We realise that there are some cultural changes which would be welcomed in insurance, from inclusivity to change management, but we must celebrate what we are good at too. Many industries, including newer shinier players on the scene like Fintech and Insurtech, also have issues to tackle around inclusivity. As recently as January 2020, one UK fintech hit the press for their ‘toxic workplace culture’, we are not the only ones tackling this complex issue. Comments at FutureFormers were encouraging, we must ‘look at what is good about the culture or what needs to happen to make people want to change’. There was a sense that people try to change culture through policy, not through challenging people to change undesirable behaviours and that really we should be aiming to shift these sorts of behaviours.
‘If we do all this customer work will our costs go up and our returns be lower - will capital walk away?’ - FutureFormers attendee, 2020
There were some concerns from the audience about our ability to do both innovation and cost reduction simultaneously, there were questions as to whether these are mutually exclusive activities and that one comes at the expense of the other.
However, many studies have pointed to the benefits of a culture of continuous improvement being fostered during a period of cost reduction. This culture of cost optimisation can be embedded through ownership and clear incentivisation of continuous improvement, staff should be continually looking for improvement opportunities, building a culture of good versus bad costs (PWC, 2016).
The Future at Lloyd’s is also looking to tackle this and has very carefully selected the priority areas for 2020, focussing first on ‘the Complex risk platform (including next generation PPL); Lloyd's risk exchange (including digital coverholder solution); and the claims solution. Lloyd’s is also prioritising three other components that are essential parts of Future at Lloyd's infrastructure. These are: data and technology; middle and back office (including accounting and settlement); and lead/follow (Lloyd’s, 2020).
We know that tech is changing everything; we know that because we can now order our oat milk latte (extra hot!) by merely glancing at our mobile phone. We have discovered fitness classes we didn’t know existed thanks to apps like ClassPass, we manage to while-away many a commuter journey by watching our favourite Netflix show, listening to Peter Crouch’s podcast and at the same time booking a flight on Skyscanner while downloading a Spotify playlist for the after work run. While this might just be me (well, sort of, I’ve never listened to Peter Crouch) – I don’t know what I would do without the ease and simplicity of using Citymapper to navigate my way around pretty much any city I have ever visited. Yet we are still catching up in our business lives and the possibilities are endless. After the presentations we invited a group of senior market professionals, CEOs, CIOs and Heads of Innovation amongst others, to gather feedback from the audience. At LMA we want to hear from our members on how we can enable our market to be fit for the future. We facilitated the discussion on what we all should be doing within our own roles to be prepared for the changes that will be occurring in the workplace. We are also alert to the recommendations from reports like The Future of Skills in the London market, which suggested the following actions for market bodies:
- Become a skills advocate
- Partner with educators and the government to close the skills gap.
- Create a vision that resonates with the next generation
At the LMA we have a reputation for providing bespoke technical skills training to insurance professionals through the LMA Academy. Our Claims team has partnered with PWC to investigate where our skills gaps are through designing and delivering capability assessments and we will soon be launching future focused training programmes. We intend to support and partner with organisations to provide different secondment opportunities to drive a customer focussed culture in the insurance industry.
‘This event had a lot to offer; diverse panel, diverse content from product through to well-being; fantastic. Please give us more’ – FutureFormers attendee, 2020
We will run FutureFormers again because we believe it is important to give people space away from their day jobs to meet with others within and outside their own businesses to discuss the art of the possible. We know that we aren’t Google, but it’s unavoidable: tech is going to impact our industry for the better. Not only that, but there is evidence to suggest that workplaces which promote a culture of creativity are likely to have more motivated and productive employees. Fundamentally, we cannot avoid change, our industry is changing, as the world is changing. Tech will enable us to do our jobs more effectively, but all change initiatives can only succeed if you have the right balance of people, processes and technology and at LMA we look forward to being part of shaping this future through our training programmes, our input into the Future at Lloyd’s, our committees and all of the other important and vital work we do for the Lloyd’s market.
Disclaimer: Peta left the LMA in February 2020. Please look out for details of the next FutureFormers event on our website. If you have any questions, please direct them to Rob Myers.