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September 2019
The Human Capital Specialists | www.leathwaite.com
Tech is everyone's business -
Bridging the leadership gap in
Insurance
The Human Capital Specialists | www.leathwaite.com
London | New York | Hong Kong | Zurich
Tech is everyone's business - Bridging the
leadership gap in Insurance
By Katie Hevey, Executive Interim Consultant, Leathwaite
In a recent conversation with an insurance
industry veteran, Amanda Blanc, we discussed
how new technologies were continuing to
transform the insurance industry. When
focusing specifically on AI Amanda advised:
// AI in all its forms is a subject being talked
about at conferences and at a high level in
many organisations as if it’s something for the
future. In my view AI is with us right now;
allowing organisations to optimise use of their
data, improve operational efficiencies and
ultimately deliver improved outcomes for
customers. Therefore, it’s a topic for all leaders
to consider, not just those in the IT and
operations functions. If you are not using AI
right now you are getting left behind.
As Amanda highlights, there is a requirement
for every leader in an organisation to embrace
new technologies (such as AI), not only those
who sit within the technology and operations
functions. This echoed another conversation I
had with a senior leader in the insurance
industry who discussed that he had recently
presented to the board about technology being
“everyone’s business”.
Every function at every level is expected to have
a level of technical literacy.
CHRO’s are expected to advise the Exco on
people-related priorities whilst also providing
counsel around people analytics and insights.
Equally, Risk Officers are expected to be as
proficient at advising on regulatory change as
they are on the level of cyber risk their
organisation is exposed to.
When I first joined Leathwaite I witnessed how new technologies were being
introduced to the insurance sector as a way of supporting the current business
operations. Fast forward to today and technology is changing the face of an
insurance company, from creating new distribution models centred around
customer insight, through to claims processing.
The Human Capital Specialists | www.leathwaite.com
London | New York | Hong Kong | Zurich
Yet… we can’t escape the fact that the pace at
which technology is evolving makes it
challenging when considering the future
business model and the talent required to
support this.
So how are Talent Teams addressing this
challenge across different geographies and
functions, and what impact is this having upon
the ‘traditional’ leadership profile?
In digital and analytics, I have witnessed a
wealth of new senior leadership positions
emerge as companies seek to tackle this
conundrum. In fact, around 70% of the
leadership roles I have worked on in the last 18
months have been newly created roles.
In the weeks that followed I spent time with
Leathwaite’s functional practices discussing how
new technologies have changed the leadership
profile across their respective areas. In addition,
I was curious to understand whether some of
the trends seen in the UK were mirrored
overseas and spent time with my colleagues in
continental Europe and Hong Kong, which I
have summarised within the following sections
of this paper.
CIO
It will be of no surprise that the technology and
operations function at Leathwaite remains one
of our busiest practice areas. However, when
talking to my colleagues it became apparent
that the CIO role is becoming more business-
led with a number of CIO’s now having a seat at
the top table. Discussing this with Amy Mitchell,
a Director within this practice, she advised:
// We recently completed a study which
showed an increasing number of CIOs being
appointed to their company’s operating
committee. This demonstrated the importance
of technology in directly impacting customer
experience and therefore driving business
revenues. As such, a CIO is now expected to
complement their technical prowess with
excellent EQ and leadership skills in order to
take an organisation ‘on a journey,’ which is
currently a challenging combination of skills to
find.
To attract the talent required to meet this
“challenging combination of skills”, my
colleagues discussed how they network across
an increasingly broad range of industries, to
meet an increasing appetite for out of industry
talent.
When focusing on the insurance industry
specifically, they highlighted several out of
industry hires, including the CIO at AIG, John
Repko who was previously the CIO of Johnson
Controls (an electronics and automotive parts
business) and Chris Cochrane who was hired as
CITO by M&GPrudential, having previously
been the CIO at BT.
When discussing the evolving CIO role with my
colleague James Lawrence Brown, a partner
leading our Asia-Pacific business, he highlighted
that we cannot ignore how the introduction of
new technology generates a need for subject
matter experts, noting that a “demand for
specialist technology roles including analytics,
robotics, AI and cyber security remains notably
high.“
The Human Capital Specialists | www.leathwaite.com
London | New York | Hong Kong | Zurich
CFO
To understand how this is impacting the CFO
community, I spoke to Sophie Roebuck within
Leathwaite’s global Finance practice:
// The finance moves we have seen in 2019
suggest that traditional skills such as
controlling, accounting, tax, technical
accounting and FP&A remain key. However,
given the level of innovation within the
insurance sector, coupled with the continued
consolidation and the growth of insurtech, we
have seen an increased demand for CFOs that
can demonstrate a greater array of
commercial sills such as risk management,
analytics, pricing, capital management and
investor relations.
Sophie also went on to discuss how
enhancements in areas like data have also
generated another type of leadership profile;
// Finance functions are beginning to build
increasingly sophisticated data warehouses to
provide more in-depth analysis for the
business. Senior leaders with quantitative or
actuarial backgrounds are highly sought after
to lead these teams and act as a conduit
between finance and the business.
Risk and Compliance
Peter Johnson, a Director within Leathwaite’s
Legal, Risk and Compliance practice, provided
me with insights into how risk and compliance
functions within insurance are managing to
cope with the introduction of new technology:
// In an age where insurance companies are
looking to utilise new technological advances,
there is an increased focus from regulators on
operational resilience due to both potential
impacts on individual customers and market
stability. Regulators are ensuring that
insurance companies implement a further level
of risk due diligence, making sure there are
specialised risk officers with second line
accountability and expertise in areas such
cyber, data and fraud.
When commenting on how this translates to the
skills required within a leadership profile Peter
added:
// Insurance companies are looking to hire risk
and compliance officers who can provide
robust ongoing challenge internally on
potential risks with new technology
advancements and also effectively oversee
external third parties. As such, the ideal
profiles being sought are individuals who have
both a technology and risk/compliance
background.
The Human Capital Specialists | www.leathwaite.com
London | New York | Hong Kong | Zurich
Cecilia Burns, based in our Zurich office, added
a continental Europe perspective:
// Across continental Europe we are seeing
out of industry appointments to introduce the
experience required. For example, Munich Re
hired their Group General Counsel & Chief
Compliance Officer from outside of the
industry. It can be argued that this was with a
view of changing the culture and perception
of the function internally.
Chief Digital Officer & Chief
Customer Officer
Looking at how the role of the Chief Digital
Officer has changed over the years I couldn’t
help but reflect on how the skillset of the
individual is dependent on the organisation. In
recent years there has been the increased need
for businesses to deliver a digital strategy from
the top down, allowing this role to evolve. This
was highlighted in PwC’s recent ‘Chief Digital
Officer’ Study where they analysed CDO’s
across 2,500 public companies:
// Previously, CDO roles tended to be filled by
people from market-facing functions,
including marketing, customer services, sales,
or distribution. Now, organisations are
increasingly seeking CDOs with strategy and
technology backgrounds - those who are able
to work at the C-level across functional silos
and who are capable of understanding the
disruptions enabled by technology.
PwC highlighted that the number of CDO’s with
a technical background has increased to 41%
(from just 14% in 2014). Furthermore, 54% of
CDO’s were operating at board level in contrast
to 42% in 2014.
I was keen to get my colleague James’ thoughts
to understand if he was seeing this pattern
emerge in Asia:
// Digital strategy is increasingly being
imbedded into corporate strategy and
impacting the whole organisation and
leadership profiles. This is fuelling a need for
leadership that can drive mindset and culture
changes across more traditional organisational
models.
From my personal perspective, I have also
witnessed a new role driven by an increased
focus on the creation of ideas, change initiatives
and technology advancements aimed at
improving customer experience. This is the role
of the Chief Customer Officer (CCO).
Recent appointments of CCO’s include; Zurich
Insurance hiring Conny Kalcher from LEGO
Group as their CCO and M&G Prudential
internally moving David MacMillan into the
position of Chief Customer Distribution Officer.
Like the role of the CDO, the success of a CCO
is dependent on the sponsorship given to this
individual and collaboration from other
functions. In addition, the blend of experience
and skills required to be an effective CCO may
be found in someone who has previously
managed a business as a CEO, for example the
CCO at Ageas, Ant Middle was previously the
CEO of Ageas Retail.
The Human Capital Specialists | www.leathwaite.com
London | New York | Hong Kong | Zurich
Conclusion
In conclusion, having spent time with my colleagues across Leathwaite discussing how the traditional
leadership profile in insurance had been challenged, it became clear that the common thread across
every conversation was the need for leaders to have a blend of technical and commercial experience.
In addition, with the pace of innovation in insurance, there is a strong need for every leader to have a
high level of emotional intelligence allowing them to build relationships across the business, working
collaboratively to deliver the new technology required.
Yet many companies are currently struggling to find leaders who can fit this new mould. So what
options can Talent Teams apply both now and in the future to help bridge the talent gap?
Build an Agile Short AND Long Term Talent Strategy
In a number of instances, there may be the need for organisations to engage an executive interim
resource as a way of introducing the skills and experience required. An interim solution could “bridge
the gap” when one of the executives within an organisation may need support in their development to
becoming a future leader. In addition, I have seen businesses utilising the interim model when they
have restructured and need someone to “plug the gap” in leadership ahead of the search for a
permanent incumbent.
As mentioned previously, 70% of the roles I focus on are newly-created and an interim solution can
often provide the flexibility required for an organisation to see whether they have structured the role
correctly, including where it sits within the business.
Think Cross-Industry
Across all functional areas, businesses will need to broaden their search for talent by looking at other
industries. This is due to the level of technical ability required, which may not be found when looking
purely within the insurance/financial services market. When looking to introduce out of industry talent,
remember that you will need to provide the right level of support and sponsorship for the individual to
thrive in the new environment.
Build your network of Collaborative Partners
The talent sought may require a blend of cross-functional experience and, as such, it is important for
companies to partner with firms who can collaborate across each of these functional areas. Your
partners should be people who understand the nuances of your organisation and focus on the
behaviours which will lead the business to work collaboratively in the future.
In summary, technological change will continue to force a shift in the leadership profile of functional
heads across the entire business model within insurance. Companies that embrace this now and accept
that they need to build a fluid and diverse human capital strategy in order to maintain competitive
advantage, are most likely to thrive.
The Human Capital Specialists | www.leathwaite.com
London | New York | Hong Kong | Zurich
Leathwaite was established with one clear purpose: to help organisations secure the best Human Capital
within Support, Enablement & Control Functions.
This is done via 4 solutions, 4 offices, 100 people and over 150 clients, globally.
The Human Capital Specialists
Sophie Roebuck
T: +44 207 151 5129
Rebecca Otter
T: +44 207 151 5132
Peter Johnson
T: +44 207 151 5128
Click here to read
our latest Executive
Interim Newsletter,
‘The GIG’.
Katie leads the Interim Commercial and Digital business focusing on C-suite, MD and Director level placements in Digital, Data, Analytics, Sales, Marketing and Product with expertise across financial services (including challenger banks, fintech, insurance and payments).
T: +44 207 151 5147 E: [email protected]
About the Author:
Meet the team>
James Lawrence-Brown
T: +852 3152 2463
Amy Mitchell
T: +44 207 151 5154
Cecilia Burns
T: +41 44 214 6640
