This is a focus on the insurance sector - the big organisational / sector drivers and how they're influencing the way people work, the opportunities opening up as the industry embraces digitisation, personalisation, automation and artificial intelligence.
The sector is experiencing post pandemic growth and like other sectors is caught up in the war for talent as it repositions itself to attract the skills that it needs to fulfil its future potential.
Insurance sector guest Brian Marchal joins us from long standing and much valued AWA client Willis Towers Watson, to share experiences over the pandemic period, the embracing of hybrid working and the impact on space requirements in the post pandemic world.
Deloitte 2022 Industry Insurance Outlook (mentioned by Lisa)
AWA Host: Karen Plum
AWA Guest details: https://www.advanced-workplace.com/awa/about-awa/the-team/
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Music: courtesy of bensounds.com
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00:00:01 Karen Plum
Hello everyone. The insurance industry is adapting to life beyond COVID lockdowns, addressing a recruitment challenge and easing itself into more hybrid ways of working. The industry is becoming digital first, embracing automation and AI, so perhaps those innovations will prove attractive to the younger generation for whom a traditional nine to five job, or a job for life, just doesn't seem to cut it.
Let's find out how the sector is responding to these challenges.
INTRO: Welcome to the Changing the World of Work Podcast where we provide insightful, practical content to untangle and demystify workplace change. I'm Karen Plum, director at Advanced Workplace Associates, where we combine science with nearly 30 years’ experience, helping organizations change the way they work, for the better.
00:00:58 Karen Plum
In this focus on insurance, I spoke with a representative of a leading global insurance company, Willis Towers Watson, to get his views on the challenges. That's coming up later in the episode. But firstly, let's consider the insurance landscape with two of my senior AWA colleagues, Lisa Whited, who's based in the US and Isabel Barros in Brazil. Both have insurance clients and keep a close eye on the market.
I started by asking them to outline the key drivers in the sector.
00:01:29 Lisa Whited
So there’s a few things that I've been seeing in the insurance sector and this actually first one had been happening years ago before the pandemic, and that is aging out the people have been in the industry for a very long time, approaching retirement age and then that has been a challenge.
So recruitment of young talent continues to be a challenge for the insurance sector and a recent Deloitte study indicated that the recruitment challenge is one of the greatest for 2022. One third of the insurance companies that responded to this survey will increase their headcount, they had indicated and 43% said it is more difficult to find skilled candidates So that continues to be a real challenge in the insurance sector along with inflation and climate risk, as well as evolving customer preferences.
So there's a lot of things going on that actually lead to needing to focus on big societal problems such as worrying about future pandemics and natural catastrophes.
00:02:38 Izabel Barros
It's interesting that you say how hard it is to get new talent, because at the same time the industry is going digital first, so that somehow is beginning to attract more the younger generation. We see with a lot of clients that automation for fast claims is a big issue, advanced analytics and proactiveness become the norm, especially when you see collaboration between the traditional industry and the insurtech sector.
So there's some revival going on in the industry that the pandemic didn't make so explicit, so at the same time you have a lot of people aging out in the sector, a lot of more traditional workers etc., you have, sometimes we have one client that 50% of their new hires were hired in during the pandemic and they never been in an office before.
So there's this clash between the older generation, the new generation and how they're going to behave in the office when they come back so that that's another interesting thing. And that collaboration is not only between the traditional and new insurtech companies, but it's also happening within the older and more established corporations, so they're trying to figure out what that impact on workers and work is going to be.
One thing that we see, they are trying to eliminate this excessive dependence on the human effort, so using more of the machines to think - the big complex problems - and letting people really decide or make the decision on where to go. But the information comes a little bit better.
00:04:36 Lisa Whited
I love that. I think it's interesting as well - I couldn't help but think also a recent conversation where our younger person actually said what is a water cooler? If they've not been in an office, they literally don't know what a water – what is a water cooler - it's just such a foreign idea. So I just think, I thought that was such a simple graphic explanation of the big chasm between older workers and younger workers and what their experience is working.
And the focus on artificial intelligence, I mean, we've definitely seen this with the financial industry, which insurance is definitely related to, but what that can do in automation is also free up people to perhaps do work that is more aligned with their strengths - so instead of fearing the AI and what machine can do for us, it's finding opportunity to say well what then does that free me up to do. And I know one of our clients actually said they were able to realign a lot of their work and they didn't let a single person go. They did not let a single person go by investing in AI instead they were able to transition those folks to more rewarding work.
00:05:49 Izabel Barros
In the industry, there's a lot of new models coming up. The whole idea of personalization that AI allows us to do, because you have access to much more information than you did before, and the industry can respond to that much quicker. And that impacts how people work, right? They don't need to be all in the same place in the same environment, they don't need a water cooler to make it work, right?!
00:06:19 Karen Plum
Do you think this is really helping to reset the image of insurance as a sector?
00:06:26 Lisa Whited
I do Karen and you know what else I think is helping that image problem and it's really sort of weird, but it occurred to me - it's the advertising of the insurance companies has an impact on people thinking about the industry and often the people that I know, the leaders within insurance never expected to be there. They found their way into insurance at a younger age and have found such a rewarding career, and I think about one of our clients, who's a very senior woman in the industry, which often is male dominated at the top and she has had such a fantastic career and so rewarding for her.
I do think that there's definitely a transformation going on in the insurance sector.
00:07:12 Izabel Barros
Even the past two years with the pandemic made people think about insurance in a different way, especially the younger generations. If you look back, people never thought about it - they never needed it. The car, yeah, a car, and health insurance, yeah, that's something that my parents had for me and I'll think about it when I start working or something like that. And all the different kinds of insurance for business etc. and the ability to make it more personalized I think it changes a lot the image of insurance, because now you can make it for yourself. That's quite interesting and it changes even the attraction for that industry to make a difference.
00:07:58 Karen Plum
In terms of the clients that you work with and on what you're seeing within the industry, are insurance companies responding to the drive to hybrid ways of working?
00:08:10 Lisa Whited
Yeah, it’s a spectrum, as it often is, you can't just put everybody into one bucket. It really comes down to the mindset of the leader. So in the early days, very early days of the pandemic we had a client CEO contact us and say I gotta get my people back, you know, come in and help me figure this out. How do we get them all back and I was rebelling, I'm like come on, dude!
00:08:34 Karen Plum
You, rebelling? Surely not!!
00:08:37 Lisa Whited
No, never, never!! But you know, but that was the mindset and that was not different than how he had been four years previous. I knew that was his mindset.
Again, it's the mindset of that leadership team and the leader saying, we're gotta be responsive, we're going to, you know, think differently, let's figure this out, navigate a way, and they completely created a program that supports not just hybrid but literally supports, you know, it's work for your day. You determine where it is you need to be almost to the extent of remote first.
00:09:11 Izabel Barros
It's interesting Lisa, because we found with our clients that the more traditional they were, the biggest the leap they made with the imposition of COVID work from home. Because they never thought about it, all of a sudden in 24 hours they sent everybody home and then, ta dah! It was possible.
We have one of the CEOs we worked with, we were doing a program of implementing one day from home when the COVID start and he was scared to death about it. He and his whole leadership team and then all of a sudden everybody went home. And we stayed together during the COVID time as consultant and we saw the change in the culture happening and being better, becoming a better culture, a more inclusive culture and more people first culture. So they started to see that people were capable, trust became higher and people were happier, so the whole idea of not being able to maintain everybody was out - they are attracting more people.
And now they're going back and completely free - you go to the office when you need - they don't even have a model where oh, you gotta be there two days a week. No you just go when it makes sense to go. It's purposeful work and that's OK and everybody is happy they're using their new space that was closed for a year because it was ready before the pandemic allowed us to go back. And now everything is working. So I think that the social cohesion portion of it, that trust that you build with people in situations that are not the norm, are great assets that we are inheriting from this last period.
So if in the beginning people wanted to go back to the office no matter what, I'm seeing that people learnt to trust each other, stop looking over their shoulders and they saw it as possible. Now let's build together what this new hybrid is going to be.
00:11:31 Lisa Whited
And that organization will be the winner in the talent war. Just hands down, hands down. If this industry is having such a challenge recruiting great people and attracting them - an organization like you just described will absolutely have an upper hand over the one I described, which is much more command and control, and butts on seats. And that's I think what people need to recognize.
Leaders need to recognize that they can find a way. There are possibilities. Things can be better. But that fear of losing control is something that many organizations need help getting through, pushing through.
00:12:08 Karen Plum
So we've talked about the challenge around recruitment. And I think lots of companies in lots of sectors are finding it challenging to find good people, the right people, people with the right skills. Some organisations are adapting by recruiting for potential rather than trying to find the best fit for every role.
Are the insurance companies that you're familiar with recruiting because they're growing or because they've got turnover issues? Are they having difficulty retaining people as well?
00:12:38 Izabel Barros
We’re seeing a lot of growth in the industry. So I don't know if it's everywhere, but if you think about the situation where we are right now, especially with war coming up in Europe as a new situation, the logistics of working with big markets such as China and India when they are affected, that really affects production all over the world.
So we're seeing a lot of insurance companies growing into new markets, new products, new offerings, and that makes them grow in terms of needing more people. But one thing that we're seeing, depending on the industry, is that if the company is not adapting to what the market, in terms of what the people want for their careers, they're losing people anyway. Even if they're growing, they're not being able to retain the people. Unemployment market in general, it's not only the insurance companies, people just discover there's life outside of work in the past two years.
So people are not willing to go back to 12 hours outside your house, not seeing your kids and going back to that if they don't need to, they can find new careers.
00:14:00 Lisa Whited
The ones that have recognized the need to focus on learning and development also are more successful. One of our clients actually created sort of its internal university, if you will, to promote advancement in learning and development, which is really critical when we're hearing from people about what would cause them to stay with an organization? They want a clear path toward advancement and that learning and development it's an intrinsic human motivator, right, to master new information.
So it's beneficial not just to the organization, but also to the individual. It's how we grow and develop as humans and it motivates us. So that is one place I've seen those that are winning the war on talent if you will, are focusing more so on what they can offer their people as a clear path forward.
And IT and technology, I think again just going back to what Isabel was saying. It continues to be a real challenge to attract people in the insurance sector, focused on IT, and I think that's another place that they're really working hard to get talent. And so think of that as well when you imagine remote working. That usually, of almost any position, is one that could be remote or less often having to be physically in a workspace, if that's desirable for individuals, which clearly we're seeing, it is desirable.
00:15:26 Karen Plum
The other thing I wanted to pick up on was something that you said to me when we chatted recently Isabel, about young people not thinking in terms of industries or sectors.
00:15:38 Izabel Barros
They want to make sure that they have a career path to move on, and that's industry independent. They want to have experiences, they want to have realizations. They want to make sure that they are making a difference to the world, and if that doesn't match with their personality and the organization, they really move on to something else. It needs to be attractive; it needs to have a purpose.
Talking to an HR leader in a couple of organizations and one of them happened to be really in this sort of sector, is that when they hire people now with their recruiting, they're looking for the breadth of experience they had before joining the industry, so they really want to bring people with diverse experiences and background, not only that one specialized person that's been all their life and one only job. So that that's quite interesting - it's a major change, if you think about it.
00:16:40 Lisa Whited
To my own stereotypical view - I think about the insurance sector - I think of it as being white. It's heterosexual. It's white, it's mostly male. There's an opportunity for much more inclusion, belonging and diversity that would help that industry be attractive to others. And the other piece is societal justice. There's great opportunity that you maybe would not think of insurance as having that impact. Maybe you're sitting there thinking I need to go work for a nonprofit, an NGO, that's where I can make a big difference. And then the opportunity is maybe as a younger person you could make a huge impact in a way you never expected within the insurance industry.
00:17:27 Izabel Barros
I think that the whole idea of repurposing the industry itself and letting people know what the industry is about. I did that before this conversation - I asked a couple people what do you think insurers do and there was this blank glare at me like, what? Yes, what's insurance business, what they do? And it was like, they don't know.
People have no clue of what the insurers do, what the insurance industry is about. So maybe that's a great opportunity showing that you can not only reposition the industry, but you can make a major contribution to society. Letting people know what this is all about, what the potential is to make this more equitable, more inclusive and more diverse. So maybe that's one way that to think out of the box in terms of the industry.
00:18:30 Karen Plum
That's a really interesting challenge for the sector - repositioning itself in the minds of customers and talent alike. Ensuring everyone understands the relevance of the work they do in managing risks at many different levels - personal, organizational and societal.
And now let's shift gears a little. I talked to Brian Marchal, Workplace Strategy Director, Real Estate and Workplace Solutions, for Willis Towers Watson, a multinational risk management insurance brokerage and advisory company. We started by discussing the current drivers which resonated with what Lisa and Isabel told me earlier in this episode.
00:19:07 Brian Marchal
We're seeing a couple right now and I think as I've started to engage with our Lines of Business over the last six months to a year, the things that really continue to keep coming up are attracting and retaining the best talents. Which is nothing new, but I think the challenges have become even greater here over the last two years as we've seen, more and more people as part of the great resignation be willing to move on more quickly if a role is not a good fit.
So I think how we keep that best talent is becoming to the forefront even more. There's a lot of conversations around how do we figure out how our company and our teams remain effective when we're giving our colleagues more flexibility? That flexibility to work wherever they want to be their most effective self.
WTW has just more cautiously come back to the office. So I think we're now getting at the point where our teams are truly working hybrid with people in the office and at home. So how we give people the flexibility to kind of find their footing in this new world? I think we're seeing some real conversations around that and how we're going to figure that out in the future.
The third piece for me is about building culture, and as more people continue to work from home what drives people to want to work at WTW or any of our competitors? When you're sitting at home, what makes you part of our company, versus someone else? And really, how do we build that culture that makes people want to be part of our team and work with our company?
I think that's a big challenge that we're facing and a lot of the answers may not necessarily be with us, but with a lot of very senior people trying to figure out what sets us apart.
00:20:36 Karen Plum
It's interesting - we've had discussions on the podcast before about culture and where culture lives and what generates it. A lot of people, I think, certainly before the pandemic felt that culture was inevitably linked to place, and that it was the office that helped to tell you what that culture was. What do you feel about that now?
00:21:00 Brian Marchal
I still think the office plays a bit of a role when you're in there. It helps if it's got the right spaces for teams to get together. It can help with culture, but I think we've just found in the last two years that culture is about the team that you're in, the manager that you have sets the tone.
I look at the team that I work with as part of our real estate and facilities teams. And I think our leadership has set a really great culture around empowering people to get on and do their job. There's no micromanaging. They've made it a great place to work. And I think as you talk about culture from a very high level, our CEO, while he can set the values and the missions, my personal opinion is, he doesn't set the culture on my team or the teams that we work for.
I think it takes those individual managers to create a really great place to work, and I think our managers are gonna be tasked moving forward with a lot more responsibility for creating an environment where people want to work, and when people come and go, I think the saying has always been people don't leave jobs, they leave managers and I think we're going to see that even to a greater extent in the future.
00:22:01 Karen Plum
And I think you as an organization, you were on this journey before the pandemic hit, right?
00:22:07 Brian Marchal
In about 2016, as part of our Towers Watson and Willis merger, we really started to move to more agile working, a number of years ago. I think when the pandemic hit we had a relatively easy transition for people to go home and work remotely. But I think we're still learning a ton every single day around what it means to be a hybrid company as opposed to just people occasionally working from home and people moving around in the office.
I think everything that we did as agile pre COVID still has a major role to play when people come into the office. But seeing how that affects with a much greater percentage of our people working remotely now, I think there's just so much for us to learn over the next year and two years.
00:22:50 Karen Plum
Do you get the sense that it's mostly moving in the direction of there being more acceptance of more remote working? Or are there still some areas, perhaps where managers and leaders are a bit reluctant and would prefer people to be on in the office?
00:23:08 Brian Marchal
I think it comes down to the individual and we've had a lot of conversations where some really progressive managers are doing great things. They're going about setting up auto learning and development how to really help managers become better at this and we've got a couple countries that we have engaged with that are doing really great things within our business.
But always we have other managers that are still talking about - when we come back, everybody needs a desk and I think that's always going to happen. Certain people are just more flexible. They've got a better vision for where we're going in the future.
So it definitely is a mix. I think a much greater percentage of our leaders and our individual managers are on board. They see where the future is going. They can understand what colleagues are looking for as part of the teams, but there's always going to be some people who are just a bit more hesitant and they're going to be the tail of this that we have to bring along the same way.
00:24:00 Karen Plum
Do you think that perhaps the shortage of recruits, talent if you like or the competition for talent, is really helping to cement the need for this sort of level of flexibility? Is that something you think the organizations experiencing?
00:24:16 Brian Marchal
I think they have to be experiencing it and I don't have a lot of input in recruiting, but everybody I talk to, the articles I'm seeing, just talk about one of the number one first questions that people are asking is, is there flexibility in the role? Can I work remotely? Can I work in the office? If you're not providing your colleagues or potential recruits with that flexibility, I think a lot of people are moving on.
I think there's plenty of people that want to be back in the office and not five days a week, but maybe three days and four days there are some of those people who just enjoy that. But there's a lot of people who want to be there zero and one days, and we, I think we just have to give our people freedom. If we are hiring people for relatively middle and senior roles, they've clearly proven a track record and we have to give that trust. We have to give them empowerment for them to just do their job and I think that's the best thing that we can do moving forward is, just let people do their jobs.
00:25:09 Karen Plum
Absolutely, I couldn't agree with you more! So what's happening from the point of view of office space and the amount of space that you have as an organization. And I guess one of the opportunities is to reduce the footprint if people aren't coming into the office as much. Is that something that you've been able to push forward on?
00:25:29 Brian Marchal
Yeah, so we've done a couple things and it's very simplistic starting point is, we've created our workstyles, which means that colleagues will nominate whether they are in an office worker, they are a hybrid worker, or they’re remote. And they put this into our HR systems and very simply it starts to give us an idea of percentages for - in certain offices and countries, and by our Lines of Business, what our people are looking for as they go forward.
These are decisions that our colleagues are sitting down with their line manager and agreeing based n their role, what they think they can do. So I think it's giving really great conversations and setting expectations. And it also will help tell us is it 5% of our colleagues that want to work remote or is it 30% or somewhere in between?
So I think there's a lot of really great data that's coming out of this that in the future will help us design our offices. In the meantime I think we're seeing office attendance is greatly reduced from a pre COVID era and we've had workplace sensors within our office for 6-7 years now, so being able to compare that data pre and post has been really easy for us to see the numbers that are in the office, to just know that we don't need as much space as we did previously.
And I think a lot of people - there's big statements about people cutting percentages of square footage out of their portfolio and I don't think that we're looking to downsize. We absolutely will be reducing the size, how much square footage we have in our portfolio. It's not all about cost savings. I think what we're really looking to do is the fact that our colleagues are telling us that they don't want to go back to the office as much so I think we're just reacting and rightsizing based on what they're telling us. We absolutely will be reducing space, but it's just in a reflection of what our colleagues are looking for.
00:27:13 Karen Plum
Is the drive to carbon neutrality, net zero, sustainability - is that something which is a focus for you, or have you already sort of done all the low hanging fruit on that that you can do?
00:27:27 Brian Marchal
It's something that we have to continue to push for. Our real estate facilities teams, we've had a number of working groups come together to figure out what are the low hanging fruits that we can pick up. And then what are the bigger initiatives that we can start to drive. I think WW had an interesting time over the last two years, besides just the pandemic we also had the potential merger that was going to go through with Aon.
So figuring out what was going to happen next, we had to put some of these issues and big initiatives on pause for a little bit until we saw what shook out with that merger. For the reasons that have been publicized that merger didn't go through, we've had some new leadership, we have a new CEO and a lot of our senior executive committees have all been new positions as well.
So as they're sitting themselves in place, we're going to start to see some of these drivers come out, and whether they decide that net zero, carbon neutral, where they put a priority to it, we're going to find out very quickly, but our real estate and facilities teams are trying to put ourselves in a good position so that we can react with good ideas as we start to go forward.
00:28:29 Karen Plum
I valued Brian’s perspective as someone responsible for managing workplace strategy at a time when there are pressures to reduce space, make space work harder and to reduce its impact on the planet.
He also shared that he'd been surprised to discover his own personal preference to work most of the time at home. It was something he'd never have expected pre pandemic. We agreed that if it had only lasted six months, the result might have been very different. But after two years he feels very differently about where he's most effective. I think many people will share that experience.
And that's it for this episode. My thanks to Lisa, Izabel and Brian for exploring some of the challenges and opportunities facing the insurance sector and its way of working.
CLOSE: Thank you for listening to this episode of the Changing the World of Work podcast. Please follow or like the show so you don't miss any of our content. You can find more information on this episode in our show notes, including a link to the AWA website, if you'd like to know more about us. Hope to see you next time. Goodbye.