Attending a meeting of Executive Search Consultants in London it would appear that the Executive Search Sector is alive and well and a developing market. Good news for Insurance Executive Solutions! The meeting was organised by the proposed governing body – Association of Executive Search Consultants which has been around (but in the background) for 20 years or so. Regulation – all be it self regulation – appears to be coming our way. This is surely a good thing from the client and candidate perspective – adherence to professional standards, training and educational requirements for practicing, accountability etc.
However, of more relevance here is the data which was used to demonstrate the existence of the “War on Talent” which, it was suggested is as alive today as it was in 2003 when the phrase was ‘coined’ by Mckinsey Consulting.
US data suggests that the “Baby Boom” generation of 77million people will be replaced by 44million. In 2010, there will be a 33% decrease in the number of workers over the age of 40 and 50% of the top people in US companies will leave over the course of the next 5 years. Obviously, when this data is extrapolated to apply to the UK, it is possible to see that change is on the horizon. This will come as no surprise to many in the Insurance Industry – where, as one example, consolidation is already rife due in part to an ageing population of broker owner-directors who are part of that “Baby Boom” generation – and who now wish to spend more time playing golf or collecting stamps.
Is there an increasing war for talent at the executive level? In general terms, declining population figures would suggest that that there is, however, bearing in mind market consolidation, ‘internetisation’ and the ever-increasing automation of process by IT, there are surely fewer jobs to fill at all levels as well as at the executive level. Perhaps, to some degree these factors will cancel eachother out?
Further data from a global study suggests that 75% of HR executives put attracting and retaining talent as their main priority and 40% of employers worldwide say that they are having trouble finding talent. Is this simply a feature of population statistics or are they looking in the wrong places for the wrong people? What might be a contributing factor is poor selection processes – both on the part of the recruiter or head-hunter and on the part hiring company. In too many instances in our experience the needs of HR, line management and the business are poorly aligned. Add to this the agenda of the external supplier – to make money! Poor hiring decisions, could be said to be inevitable! The answer is, of course to build long-term relationships with trusted suppliers – in that way successful placements are part of a continuum and not one-off ‘scrambles’ to make fees. Our data shows that our greatest long-term successes are with business where we know the senior staff extremely well, we know as much (if not more) about the business as most of its employees and the senior team shares with us their vision, their plans and their aspirations. That way we can work effectively on their behalf – both reactively and proactively – and if there is a war on talent we are already having successes behind enemy lines.
Finally, other data which might be of interest includes the following - to date, 50% of American Nobel Prize winners were born overseas. In addition, 50% of all successful US PhD students have been immigrants and 25% of Silicon Valley was started by Indians and Chinese. Data shows that China and India are now successfully taking back ex-pats and interestingly the US is reducing the number of Visas issued from 195,000 in 2007 to 65,000 in 2008. Clearly the antiquated Western immigration systems are not focussing on the acquisition of talent. The over-used 1990’s phrase “people are your greatest asset” must, of course still ring true, but perhaps it should be qualified – “your best people are your greatest asset”. Thus, in a changing world, be clear in your definition of ‘best’ and go out there and recruit and retain them – their intellect, their energy and their ideas will surely drive your business forward.
While there may or may not be a war on talent, there is always a battle for the best!
Tuesday, 20 November 2007
Your best people are your greatest asset
Wednesday, 14 November 2007
The heart of insurance
Insurance is often viewed as a ‘heartless’ business – all about making money and not about the customer! Ultimately, all business is surely about making money, but insurance should be a balanced gamble between the client and the underwriter.
On two occasions recently examples have come to light in which insurance businesses have shown that insurance is not all totally heartless!
A small business in Surrey specialises in providing travel insurance for ‘high risk’ individuals suffering from terminal and serious illnesses. Obviously this is business which most underwriters will run away from on the basis that it is simply too high risk. The company I am dealing with underwrites each case individually, with a knowledge of medical conditions, treatments and medical facilities at the destination – they truly assess “fitness to travel” at the point of travel from a medical point of view. Their plan at present is to look for more underwriting capacity in order to spread their underwriting risk so that they can underwrite some higher risks – in order to “truly make a difference to quality of life” in certain cases. Thus they want to insure the “uninsurable” and enable even more people to make those last trips to say goodbye to family and friends, to have that last memorable holiday etc. A heart-warming business in a cut-throat world.
The other example is an insurer which paid property damage claims during the flood – often within hours of the claims being made. In fact our experience indicates that the response to the “flood claims” by most insurers was fantastic. Also, what a good selling-point for insurance – you only need a single disaster to justify years and years of insurance premium payments!
Isn’t it time the insurance industry began a PR campaign promoting their good points?
On two occasions recently examples have come to light in which insurance businesses have shown that insurance is not all totally heartless!
A small business in Surrey specialises in providing travel insurance for ‘high risk’ individuals suffering from terminal and serious illnesses. Obviously this is business which most underwriters will run away from on the basis that it is simply too high risk. The company I am dealing with underwrites each case individually, with a knowledge of medical conditions, treatments and medical facilities at the destination – they truly assess “fitness to travel” at the point of travel from a medical point of view. Their plan at present is to look for more underwriting capacity in order to spread their underwriting risk so that they can underwrite some higher risks – in order to “truly make a difference to quality of life” in certain cases. Thus they want to insure the “uninsurable” and enable even more people to make those last trips to say goodbye to family and friends, to have that last memorable holiday etc. A heart-warming business in a cut-throat world.
The other example is an insurer which paid property damage claims during the flood – often within hours of the claims being made. In fact our experience indicates that the response to the “flood claims” by most insurers was fantastic. Also, what a good selling-point for insurance – you only need a single disaster to justify years and years of insurance premium payments!
Isn’t it time the insurance industry began a PR campaign promoting their good points?
Tuesday, 13 November 2007
Lloyds Brokers!
Operating as head-hunters in the UK insurance market we get involved in moving teams of brokers from one company to another – with their “books of business” (clients to the rest of us!). To some extent, this strikes me as verging towards unethical, but it is standard practice in the insurance industry – and we make sure that it is ‘above board’ – and in most cases we the book of business is moved on an agreed (usually commission sharing) basis for the first 12 months.
An interesting contrast appeared recently. We moved a 2 person team of Lloyd’s brokers from one Lloyd’s broker to another – with a book of business amounting to c.£550,000. We also moved a small team just outside London from one non-Lloyd’s broker to another non-Lloyd’s broker with a book of business amounting to c.£1m. Combined salary for the Lloyd’s team (excluding t&e, NI, tax, pension) was in excess of £160,000. Combined salary for the ‘provincial’ move (excluding t&e, NI, tax, pension) was less than £100,000 – yet almost twice as much business transferred!
Since our fees relate to salary, the Lloyd’s opportunity made more money for us! My concern, however is with the differential between the two with regard to revenue and remuneration – and my question is, “Is the Lloyd’s broker market sustainable long-term with such high salaries and such slim margins when compared with the ‘provincial market?” If I had a choice, I know which part of the insurance industry I would invest in! Look at the return Peter Cullum has made in 10 years for example!
However, I am sure that I must be missing something. These figures are not made up and they are not unusual. Is the explanation that business broked into Lloyd’s is so much more profitable than business broked into the company market? Are the bespoke Lloyd’s deals so much more lucrative? Do Lloyd’s brokers command such high salaries because of their genuine expertise, ability and market knowledge? Could 'provincial' brokers with books of business move to Lloyd's brokers and command significantly higher salaries?
I would value comments and answers – if there are any!
An interesting contrast appeared recently. We moved a 2 person team of Lloyd’s brokers from one Lloyd’s broker to another – with a book of business amounting to c.£550,000. We also moved a small team just outside London from one non-Lloyd’s broker to another non-Lloyd’s broker with a book of business amounting to c.£1m. Combined salary for the Lloyd’s team (excluding t&e, NI, tax, pension) was in excess of £160,000. Combined salary for the ‘provincial’ move (excluding t&e, NI, tax, pension) was less than £100,000 – yet almost twice as much business transferred!
Since our fees relate to salary, the Lloyd’s opportunity made more money for us! My concern, however is with the differential between the two with regard to revenue and remuneration – and my question is, “Is the Lloyd’s broker market sustainable long-term with such high salaries and such slim margins when compared with the ‘provincial market?” If I had a choice, I know which part of the insurance industry I would invest in! Look at the return Peter Cullum has made in 10 years for example!
However, I am sure that I must be missing something. These figures are not made up and they are not unusual. Is the explanation that business broked into Lloyd’s is so much more profitable than business broked into the company market? Are the bespoke Lloyd’s deals so much more lucrative? Do Lloyd’s brokers command such high salaries because of their genuine expertise, ability and market knowledge? Could 'provincial' brokers with books of business move to Lloyd's brokers and command significantly higher salaries?
I would value comments and answers – if there are any!
Monday, 12 November 2007
Commuting
How long does it take people to get to work – by car, by train, by bus? Does anybody actually walk to work these days? On a personal basis, a train commute of 80 minutes is not overly daunting – with the addition of a 10 minute drive at the beginning and a 20 minutes walk at the end! In fact, the time spent on the train is great for day dreaming, catching up on the latest news, light sleeping – and more importantly, working. Those annoying admin tasks which there is never time to do in the office, emails, research and the production of ideas. In fact the last two are what probably make commuting most enjoyable.
When else is it possible to devote lengthy periods of time to thought and new ideas? With constant emails, ringing telephones, chattering colleagues and the multitude of additional immediate tasks which we must complete every day.
Back to the question. By car, our research shows that an hour is about the maximum people are willing to undertake. By bus, only half an hour. By foot, twenty minutes. By train – up to 2 hours is “acceptable.” And of the four, the train is least stressful and the only one where serious work is actually possible. Of course there are those days when things don’t work out – trains are late, crowded or cancelled, but thankfully those days are exceptions.
Working in recruitment we no longer see the offer of ‘relocation packages’ – which was a standard part of any salary negotiation 5 years ago. They don’t exist. If you want the job you will either commute of you will move house at your own expense – as a show of commitment to the job!
An interesting instance at the moment. An insurance company client – seeking a senior manager – has rejected a candidate on the basis that they live 2 hours away. The candidate is willing and able to travel for that length of time – and indeed to pay for the commute himself. He sees the opportunity of working on the train as “additional research and development time”. Sadly, he hasn’t got the job despite a perfect work and educational history.
Is my client being unreasonable?
Are employees being bullied into working when they could be relaxing while commuting by train?
What is the optimum length of time for commuting?
How has the tide turned in favour of the employer with regard to relocation packages?
When else is it possible to devote lengthy periods of time to thought and new ideas? With constant emails, ringing telephones, chattering colleagues and the multitude of additional immediate tasks which we must complete every day.
Back to the question. By car, our research shows that an hour is about the maximum people are willing to undertake. By bus, only half an hour. By foot, twenty minutes. By train – up to 2 hours is “acceptable.” And of the four, the train is least stressful and the only one where serious work is actually possible. Of course there are those days when things don’t work out – trains are late, crowded or cancelled, but thankfully those days are exceptions.
Working in recruitment we no longer see the offer of ‘relocation packages’ – which was a standard part of any salary negotiation 5 years ago. They don’t exist. If you want the job you will either commute of you will move house at your own expense – as a show of commitment to the job!
An interesting instance at the moment. An insurance company client – seeking a senior manager – has rejected a candidate on the basis that they live 2 hours away. The candidate is willing and able to travel for that length of time – and indeed to pay for the commute himself. He sees the opportunity of working on the train as “additional research and development time”. Sadly, he hasn’t got the job despite a perfect work and educational history.
Is my client being unreasonable?
Are employees being bullied into working when they could be relaxing while commuting by train?
What is the optimum length of time for commuting?
How has the tide turned in favour of the employer with regard to relocation packages?
Friday, 9 November 2007
Who is planning your next career move?
You are happy with your present employer; your salary and bonus are better than OK; you enjoy the office banter and the camaraderie of Lloyd’s etc. Even so, can you deny that the phrase, “I am calling from a firm of head-hunters. Is this a good time for a conversation?” will get your attention and lead to immediate thoughts of further fame and fortune?
Being head-hunted really is recognition and verification of your status and your achievement. As head-hunters we aim to find the best person to fill a specific vacancy – not the best person who responds to an advert and not the best person who we happen to know, but the best person in the market who is willing and able to make the move.
This is achieved through a detailed and highly process-driven step-by-step research programme – the ‘search’ - which incorporates database interrogation, internet and directory research and a great deal of networking among ‘sources’ and ‘contacts in the market’.
Once potential candidates are identified and informally referenced through the network, the approach call is made. For those who are both suitable and interested, the exchange and assessment of information begins until the right candidate is placed in the right role.
How can you make certain that you will be noticed and approached by a good head-hunter? Obviously, being enthusiastic and good at your job is an advantage. Make the most of the learning opportunities offered by your employer to actively develop your skills. A healthy degree of ambition will stand you in good stead and will make sure you have the desire and drive to keep moving up the ladder. Also make sure you have a plan and a clear focus.
Whether looking for a job or not, being known to a head-hunter is never a bad thing. It will mean that your head-hunter is already actively looking for your next move – and you can bet you will be the first to know when they have found it. So, how can you make sure that you are on the radar screen?
Do your research and identify a good head-hunter. Find out about their operation, their experience and their track-record.
Work hard on your CV. Organise it – Profile; Employment History (beginning with your current role and ending with your first); Education and Qualifications; Personal Details. Keep it simple and no more than three pages. Make it clear what you have done, what you are doing and what you want to do. Be prepared for that approach call.
Know your market. Know your value in terms of skills, knowledge, ability and money – and BE REALISTIC.
Ensure that you have a list of contacts who are willing and able to provide confidential and informal professional references.
Be prepared to become a ‘source’. Assist when you are asked for advice or opinions – though never ‘spill the beans’ on your current employer as it is ‘bad form’ and really not why we are calling - after all we already know of you, so it is likely we will know all about your colleagues too.
Get yourself out there - NETWORK, NETWORK, NETWORK. ‘Showcase’ your skills, your knowledge, your experience. Go to conferences, get on speaker panels, write to the press etc. – take an active part in your market. We do, and that is most likely how we will meet.
When you are fully prepared, contact your carefully chosen head-hunter, meet him / her and begin the process of forging a mutually beneficial and long-term relationship.
You may well think that all this is a sales pitch, building my profile and promoting my business - in essence, “scratch my back and I’ll scratch yours”. Guilty as charged, but remember this, if you combine what you know with who you know, and you make strategic use of a good head-hunter, all you are guilty of is giving yourself a better chance of success.
Being head-hunted really is recognition and verification of your status and your achievement. As head-hunters we aim to find the best person to fill a specific vacancy – not the best person who responds to an advert and not the best person who we happen to know, but the best person in the market who is willing and able to make the move.
This is achieved through a detailed and highly process-driven step-by-step research programme – the ‘search’ - which incorporates database interrogation, internet and directory research and a great deal of networking among ‘sources’ and ‘contacts in the market’.
Once potential candidates are identified and informally referenced through the network, the approach call is made. For those who are both suitable and interested, the exchange and assessment of information begins until the right candidate is placed in the right role.
How can you make certain that you will be noticed and approached by a good head-hunter? Obviously, being enthusiastic and good at your job is an advantage. Make the most of the learning opportunities offered by your employer to actively develop your skills. A healthy degree of ambition will stand you in good stead and will make sure you have the desire and drive to keep moving up the ladder. Also make sure you have a plan and a clear focus.
Whether looking for a job or not, being known to a head-hunter is never a bad thing. It will mean that your head-hunter is already actively looking for your next move – and you can bet you will be the first to know when they have found it. So, how can you make sure that you are on the radar screen?
Do your research and identify a good head-hunter. Find out about their operation, their experience and their track-record.
Work hard on your CV. Organise it – Profile; Employment History (beginning with your current role and ending with your first); Education and Qualifications; Personal Details. Keep it simple and no more than three pages. Make it clear what you have done, what you are doing and what you want to do. Be prepared for that approach call.
Know your market. Know your value in terms of skills, knowledge, ability and money – and BE REALISTIC.
Ensure that you have a list of contacts who are willing and able to provide confidential and informal professional references.
Be prepared to become a ‘source’. Assist when you are asked for advice or opinions – though never ‘spill the beans’ on your current employer as it is ‘bad form’ and really not why we are calling - after all we already know of you, so it is likely we will know all about your colleagues too.
Get yourself out there - NETWORK, NETWORK, NETWORK. ‘Showcase’ your skills, your knowledge, your experience. Go to conferences, get on speaker panels, write to the press etc. – take an active part in your market. We do, and that is most likely how we will meet.
When you are fully prepared, contact your carefully chosen head-hunter, meet him / her and begin the process of forging a mutually beneficial and long-term relationship.
You may well think that all this is a sales pitch, building my profile and promoting my business - in essence, “scratch my back and I’ll scratch yours”. Guilty as charged, but remember this, if you combine what you know with who you know, and you make strategic use of a good head-hunter, all you are guilty of is giving yourself a better chance of success.
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