The banking industry, traditionally seen as 'sexier' than insurance, has fallen into disrepute. A number of HR professionals gathered at a Post roundtable to discuss how they can capitalise on this. Lynn Rouse reports
It is no secret that the insurance industry has not typically been the number one choice for prospective financial services employees - lured as they have been by the more lucrative salaries or sexier images of competing areas. But with the reputations of other sectors, most notably banking, slightly tarnished, does this present an opportunity for the general insurance sector to come out fighting? Should it be banging the drum, albeit in a carefully crafted way, to say that insurance is interesting, fun and ethical - that it is an attractive industry to aspire to work within? Or, is the insurance industry being tarred with the same brush and actually finding it harder to recruit the right candidates, with associated fears over job security and reputation?
To gauge what is happening on the ground - and identify where the key opportunities and challenges lie - Post recently hosted a round table, inviting HR directors from a range of insurance firms to share their experience. More importantly, the objective was to set an agenda for action on how the GI sector can act now to prepare for the eventual upturn in the economy.
To kick off the debate, guests were first asked whether they agree the current market offers an undeniable opportunity.
Paul Cann, HR director at Groupama Insurances, responded: "There is an immediate opportunity with the banks' large graduate schemes for example having powered down, and already I believe it is easier to attract better quality candidates. Whether that is going to be the case when the upturn comes, however, is debatable."
Alison Monsey, HR business partner at Aviva, confirmed that it is seeing more interest in terms of direct approaches "from people in the troubled financial sectors wanting to enter an industry that I guess feels broadly familiar" but stressed it is hard to know "which lever is pulling that outcome". "With all of the activity surrounding Norwich Union's brand change to Aviva, it is hard to determine whether that is due to the current climate or us being more high profile. People are starting to realise we are a global organisation and that is attractive - especially to those seeking some international experience."
Traditionally, there has been something of a salary divide between insurance and the rest of financial services. So has that gap now closed or does it remain an issue to overcome?
"Salary would be an issue when trying to attract top calibre graduates, because the banks were prepared to pay significantly higher than just about anybody else," conceded Mr Cann, who joined Groupama from outside the industry nine months ago. "And this will be an issue again in the future because banks will revert to type. We are never going to be able to compete pound for pound across a number of roles, so we have got to be slightly careful here."
Selling the positives
To which Sue Smith, senior vice president for HR at Ace Europe, responded: "We need to be focusing on what a career in insurance is all about and selling the positives rather than purely focusing on money."
Emma Thompson, head of HR for Axa Insurance, felt this is already happening to a degree, commenting: "We are finding people are focusing more on the overall package, what it is like to work for us as an organisation. It isn't just about the pounds that go into people's banks at the end of the day but being able to provide them with a flexible working environment or recognition in another form. The current climate is definitely making people reflect on where their priorities lie."
But Philip Gennoy, HR director for Allianz Insurance UK and a veteran of more than 10 years in the industry, cautioned against complacency with a warning. "In one sense the problem we are currently looking at is very short-term," he said. "We may well be able to get more people applying as graduates, perhaps attracting those who are being moved out of banking and want to find a 'haven' in an insurance company. But we would be kidding ourselves if we thought this meant we had turned a corner. The underlying issue for insurance is whether we are attractive enough to the kind of people we want at every job level. And that is a long-term issue, which is not going to correct itself overnight."
Ms Smith took this point on board, adding: "The other challenge linked to that is our ability to fully capitalise on the opportunity. None of us are immune from having to watch our own cost bases. As a sector, we may be faring slightly better but we can't afford to bloat our own expense base."
To which Ms Monsey replied: "I believe we are getting far better at paying attention to the talent we already have and are doing our utmost to avoid redundancies - trying to move talent more wisely than we have in the past. Of course, this means our need to look externally is diminishing and I worry we may miss a trick in terms of the capability that is out there. While what we are doing is a good thing, I don't want the balance to shift too far in one direction."
Industry projects, such as the Chartered Insurance Institute's Talent Initiative, then came under scrutiny, with Mr Gennoy accepting that some of the industry's attempts to communicate itself have not come to great success. "The underlying issue to address is how we portray ourselves, especially to the graduate population, vis-a-vis areas like banking. Banking traditionally has come across as sexier and a better route to take, which I don't understand but that's the reality. And at the moment we are in danger of thinking we've got this problem cracked simply because we have more people sending in their CVs." And he reiterated his warning: "If banking suddenly restored itself, surely the graduates who are sending their CVs to us would simply send them to the banking sector."
As another relative newcomer to the industry, Stuart Affleck, head of HR operations for LV, who joined the firm about eight months ago, commented: "We are still actively selecting from the talent coming into the marketplace and, yes, there has been a mass influx, but is it the right type? The absolute top talent we are all after is still going to be tough to find, even in this market. The key will be making sure our selection process remains top notch. We want to have the reputation of it being tough to get a position within LV and not just a walk in the park simply because the market is buoyant. We want people who get offered a job at LV to feel a sense of achievement after going through our selection processes - after all we had more than 20,000 applications in 2008 for just over 1000 jobs. So despite the mass influx of applications, we have still got to go out and fight for the top 10%."
The PR problem
As has so often been the case in the past, the debate then turned to the insurance industry's PR problem. "For want of a better way of putting it, insurance is a modest industry," said Mr Cann. "We should be out there shouting that the whole world of commerce, innovation and risk would grind to a halt if it wasn't for insurance. We need to up our game. If we are comparing ourselves with the banks, they certainly weren't shy about yelling how important they were for the whole world - at least before the crisis."
"I think that is absolutely right," responded Mr Gennoy. "All of our companies have got fantastic careers within them, and fantastic people with some outstanding talent. But I don't think that is understood, and projects like the CII's Talent Initiative are critical. Getting some of our role models out there and talking to young people in the university sector is vital. Those coming out of universities now communicate to one another in a tremendous way, far better than any of us ever did. They are extremely up-to-date and they sell our jobs better than any of us. So what we have got to ensure is that if we promise them attractive careers, excitement and international travel, then we deliver that."
At this point, an interesting trend emerged - recruitment has significantly shifted from agency to direct.
Lynne Stannard, HR director at Aon, was the first to highlight this point when she commented: "We perhaps face more of an issue because our brand isn't a household name or necessarily recognised outside the industry. Attracting people from within isn't a problem and we now recruit about 60% of our people directly, rather than through agencies. Historically, we have always used agencies and this is where the insurance industry has traditionally been sold."
And Mr Affleck said LV has found exactly the same thing in the past six months. "When I joined, LV had a 70% to 80% reliance on agencies to pitch and sell positions. Yet suddenly, since only November or December, that has completely flipped around. Now it is a 70% direct intake, supported by initiatives like our employee referral programme." Agreeing entirely with Mr Gennoy, he added: "The absolute best people to be getting our message out there are our own people and, over the last five months, we have hired more than 100 just from employee referrals, which is superb. It also generates a fantastic buzz and our focus is on the whole employee life cycle. If you split that down from attraction all the way through to the 'goodbye phase', we have to make sure the experience of a candidate or employee is absolutely what we promised."
Mr Gennoy added that, although there is an obvious cost driver behind a concerted switch to direct recruitment, it is arguably a move that makes more sense. "Agencies weren't necessarily the best people to be promoting our jobs, whereas our people are very much the best. They are the ones who bring the thing to life. Traditionally, the sector has relied on other people to sell it, even to the point of outsourcing recruitment functions."
Other guests agreed wholeheartedly, with one commenting: "We shouldn't be relying on other people to sell our industry - but we have been."
The conversation next turned to whether the longevity of many people's careers in insurance - often spending decades within a single firm - is a force for good or bad. Mr Cann said he believed people do tend to stay longer in insurance companies than other sectors, thinking of some Groupama employees "who have been there an awfully long time", adding that: "I think we should take that as a positive."
But Ms Monsey countered: "In some ways that presents a negative though doesn't it? In the 'deep' insurance skills, such as underwriting, the challenge lies in trying to attract younger people. Succession in that space can be more difficult because those guys seem to stay for ever. So we are looking at things like working with the Prince's Trust, trying to understand how we can help young people coming to the organisation and maybe take a career in that direction. But it is not just about graduates for me, there are also initiatives around school leavers. It's about convincing them they want that career in the first place isn't it?"
"I completely agree," commented Ms Thompson. "Tapping into that population of school and college leavers is paramount. We have a similar ageing profile of underwriters because, as you say, once people get into insurance, they don't particularly want to leave. Our solution has been to develop an apprenticeship scheme for underwriters and claims, which has been running for about three months. Apprentices get to sample different parts of the business but their primary aspiration is a role in claims or underwriting."
Growing your own
Chair Ant Gould, group editor-in-chief of Incisive Media's insurance division, said he had noted a definite trend in terms of 'growing your own' from school leaver level upwards, particularly on the claims side, and commented that wide-ranging training initiatives are vital if the industry is to highlight the 'portability' of the profession.
Mr Affleck agreed, commenting: "12 months ago, we set up a programme for school leavers around the country - close to our geographical bases - with a sponsorship qualification, and we have heavily engaged with schools to build brand awareness. In the past two years, LV has suddenly bounced into the household name category and that has really helped us endorse the schools qualification requirements in order to get a guaranteed interview at LV. We are now launching our first graduate programme."
At this point, Mr Gould challenged the guests on how best to package and promote the industry to young people: "There are two positions the insurance sector can take - it can go for sexy or safe. And they have both got pros and cons. Although I can't recall who said it, somebody in the insurance industry once commented that it is a 'great place for the mediocre to shine'."
This comment met with several retorts of 'too harsh' from around the table but, nevertheless, the challenge remains - how does the industry make itself more alluring?
Mr Gennoy replied: "The point about PR is a fundamental one, and I agree that this is a sector that has never followed through and delivered. But that might be changing. What I hear, particularly from the younger people, is they want transparency. People want the stories of what we have done to help people out - for example, how Buncefield was dealt with or the floods. We need to translate those stories and bring them alive - and I think there has never been more of an audience that wants to listen. Over the past few years, employees have got others to apply for jobs simply by telling them in detail what they do."
A tremendous opportunity
Mr Cann agreed, adding: "And there is a great history to this industry, a great story, but if you don't work within the industry, it will just pass you by." While Ms Smith suggested: "The 2012 Olympics could provide us with a tremendous opportunity, because it should really engage the country and insurance is going to be involved in so many different aspects."
For her part, Ms Thompson said she believed the need to tell 'inspirational stories' also motivates employees - something that could arguably result in them spreading a positive message to other potential recruits. "We have been undertaking some culture work and asking the question, what does insurance mean for you? For example, there were a lot of really inspirational stories surrounding the floods of 2007. Employees have been amazed, thinking 'I actually impacted that person's life in a positive way because I handled their claim and dealt with that individual'. They can see how insurance has made people's lives so much easier. So, I think there is a lot of inspiration out there that we just don't capitalise on."
In a bid to turn the discussion from anecdote to agenda for action, Mr Gould challenged the industry to devise single, powerful messages or straplines. "Everyone has their own brand to promote and positions to fight for but, underneath all that, what the industry hasn't got is a simple message that everybody could stick on their advertising and promotions. So why can't we do that?"
"I think that would benefit us all," replied Mr Gennoy. "I reserve the right to compete but we could all do better if the industry, as a whole, attracted more people."
Ms Smith suggested that 'security' could be a key message, with Mr Gould adding: "If you can get security and portability into the same message, you may have cracked it."
In a bid to facilitate the sharing of best practice, guests were then asked how they are tackling the issue of diversity within their workforces. Ms Stannard replied that Aon has been working on this for some time; it has a diversity council which has a number of different groups represented on it. She also offered the introduction of a diversity video as an example of insurance companies working together.
"We actually hooked up with Aviva, bought its diversity film and encouraged our employees to watch it. We decided to do this rather than going out and spending a lot of money on creating another one. So, we have started some collaboration there. We also don't ram diversity down employees' throats; what we are saying is this is something you really need to be aware of. And we are very keen to attract people from all sorts of ethnic backgrounds, so our resourcing strategy is about making sure we are recruiting in the right places and trying to think about all the different groups we could be excluding if we went purely for employee referral - or simply fished in the same pool."
Commenting that Allianz also has a diversity council, Mr Gennoy added: "I agree, the Aviva film is one of the best I have seen in terms of putting the message over very quickly."
This gave seed to the idea of the industry coming together to create a short, cross-industry 'day in the life' video, to illustrate the diversity of roles and opportunities within insurance, with Mr Gould bold enough to comment: "The Chartered Institute of Loss Adjusters had the idea of doing something along those lines but ended up with middle-aged men droning on for about 10 minutes, which destroyed the whole concept. So, we seem to be missing a trick. Again, rather than individual companies having to do things separately, we could establish a committee, whereby each participating company volunteers a couple of people - to generate a one minute video that shows the industry's variety and everyone would benefit."
Ms Smith added: "Technology is certainly enabling companies to do more of this, and in a way that is not cost prohibitive. We have just internally created Ace TV, and part of that is about getting short, sharp messages out using handheld cameras. If something happens, we say 'just film it and pop it up' on the intranet. But you can see how, by applying that approach, we could build up our external messages." Asked who should co-ordinate such an initiative, she conceded: "We have all probably got content that we can contribute; the issue is what portal to use and who creates the wrapper around it." For his part, Mr Gennoy added: "The CII has got a real opportunity and giving that initiative to them is very important." Although he said there is a danger in how participating companies are branded, he added that you could "show those clips without necessarily allocating companies because these jobs exist in all of our companies".
Biggest immediate challenge
To round off the discussion, guests were asked to detail their biggest immediate challenge on the recruitment and retention front. Many cited talent management as having come strongly to the fore. Ms Smith commented: "We are trying to be smart, putting a lot more emphasis on development planning for our people. For example, we have split out performance reviews from development planning to make sure there is a good discussion around the development piece. This is increasingly important for us and we are paying more attention to it. It doesn't necessarily mean there is more budget at the moment but it does mean we have to be more creative in how we devise solutions."
Mr Cann agreed, referring to Groupama's own Springboard programme. "This is paying dividends but our big challenge, now that we have identified these people, is to put development plans in place and find careers for them - - delivering on our promises. So when key roles come up, we are not looking externally but internally." Conceding that perhaps Groupama is a "little behind the curve" compared to other firms, he added: "We introduced our formal graduate programme a couple of years ago. It may be relatively modest in comparison to some others but, two years down the road, we have had two intakes and our retention rate is very high. So hopefully that proves we are doing something right, but it is easy to rest on your laurels. And the next couple of years are going to present an even bigger challenge to keep these people even longer."
Mr Gennoy had the final word - referring to Allianz's long-established underwriting academies and 'excellence in claims' initiatives. "Internally, we have got a lot of traction from that because our people believe us. The challenge, however, is keeping this going. We are better placed than we were three or five years ago to deal with these issues - but the challenge doesn't go away and things are constantly changing. Keeping it live is the real acid test."
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