COVID-19 has turned the world on its axis. The health and wealth of nations have been hit on a global scale not seen for a lifetime. Governments, enterprises and the public at large have had to reconfigure their operations and behaviour amid an ongoing crisis with no clear exit strategy in sight.
Marsh is an insurance broker that excels in the expertise it provides to its clients: risk. When a client turns to Marsh to assess and manage associated risks with its operations, it trusts Marsh to provide the best fit, in terms of insurance and insurer. Marsh – with over 35,000 colleagues operating in more than 130 countries – is the world’s leading insurance broker and risk adviser and helps clients quantify and manage risk whilst also unlocking new opportunities for growth.
The notion of ‘risk’ associated with any human or business function gathers a sharp clarity when the world is gripped by an invisible killer. It is down to enterprises such as Marsh to provide some element of comfort and assurance to its clients amid a rapidly changing environment. To this end, Marsh published the Political Risk Map 2020: Mid-Year Update, providing risk ratings for 197 countries across nine perils covering the security, trading, and investment environment from January to July 2020. One key finding from the map found that all 197 rated countries experienced an increase in their risk scores between January and July 2020, compared to 30% in the same period in 2019. Of those that increased in score, the magnitude of the changes was also much greater in 2020. In 2019, 97% of increases were small (0.1-0.4), compared to 7% in 2020. Further, 40% of score increases have risen between 1.0 and 1.4 so far this year.
The COVID-19 pandemic’s economic and social impacts are driving significant shifts in global political risk — introducing new dynamics and accelerating existing geopolitical megatrends, such as trade protectionism and the transition to a multipolar world order.
“We segment our service delivery to clients based on their size and needs around risk and insurance,” explains Alistair Fraser, the CEO of UK Corporate at Marsh, from Marsh’s Bristol office. “Our role is to advise our clients on their insurance and risk requirements so that they can manage risk in a more controlled way, helping them to protect their business, roll out new products and services, and continue to thrive.”
Marsh’s Corporate business provides risk management advice, insurance brokerage and claims advocacy services to mid-size and large organisations through its extensive network of 20 UK offices. Unsurprisingly, for a prominent figure at a company intrinsically linked to risk, Fraser wants to discuss the COVID-19 pandemic. “As a business, there are lots of dynamics to a pandemic, not least to a changing world,” he says. “Risk in itself is changing for companies. If you look at some of our clients who perhaps historically did a lot of sales and revenue through physical assets, they’ve had to pivot and do it through digital platforms now, which brings with it, different types of risk. You’re not just insuring the building; you’ve got cyber risk, you’ve got reputational risk, you’ve got client data risk plus many others.
“The pandemic has resulted in some very interesting conversations with clients as they’ve adapted to rapidly evolving events. As their insurance broker and risk adviser, our role is to help clients to navigate what are unprecedented, and at times quite frightening, times.”
So, how did COVID-19 affect Marsh and its operations, while it was looking out for its clients? After all, Coronavirus sees no barriers to its spread. Fraser explains how Marsh mobilised when the impact of COVID-19 first hit: “Firstly, we mobilised through remote working extremely quickly and extremely efficiently. We’re very fortunate in that we’re an organisation that can transact its business remotely and already had a great deal of the infrastructure required already in place. On reflection, I think if we had tried to do something like that without the threat of a pandemic over us, it would have been a more challenging task. All of our colleagues across the UK got involved, took a positive attitude, and actually, I don’t think our service to our clients dipped at all. If anything, I think we’re probably closer to our clients now than we were previously because we are all engaged in the video conferencing type technology.”
Like many business leaders there have been some COVID-related shifts in operations and process that could still be here long after the pandemic has been successfully managed. “I’ve said to my executive team that if we go back to working the way we always worked, then we’ve failed. I think we’ve learned some brilliant new skills in terms of using video conferencing to get access to each other across the country, and also getting access to our clients in a more efficient way. I think our clients are more receptive to having ad hoc meetings by video conferencing rather than waiting for the formal, in-person meeting. I don’t think we can ever fully replace the formal, in-person meeting with clients for certain aspects of our work, but for getting our experts in front of clients, the new world is providing us with a huge opportunity. I also think the pandemic has brought us closer as a company.”
The ability to shift operations in the way Marsh has requires an agile and robust digital architecture, the result of an ongoing transformative programme of digital change at the company. “Look, our focus (the UK business) always has to be: where can we be better? Where can we make the colleague experience better? How do we make the client experience better? How can we be operationally better? How can we reduce inefficiency so that we can reinvest in talent and grow our existing talent? We’ve started to look at this in conjunction with our Executive Committee and with Rachel Hoyle, my COO, who’s been instrumental in driving this. A key focus is, where have we got inefficiencies in our process? And how can we use digital and technology to remove those inefficiencies?”
“It’s much more than a digital transformation,” says Hoyle from her Manchester office as she outlines the transformational programme at Marsh. Hoyle details two global initiatives currently running at Marsh: Operational Excellence (OpEx) and Digital. “You cannot realise one without the other,” she explains. “Within OpEx are operational reviews, whether it be re-skill alignment, BPI (Business Process Improvement) and enhancing offshore capabilities to digital technologies and solutions. These will create new business processes and customer experiences, fundamentally changing how we operate, which in turn enhances the colleague experience and provides value to our customers.”
A question often raised at the start of such a process, is ‘Why are we doing a digital transformation?’ “Regardless of the current climate, our clients and colleagues are ever evolving and changing, and so should we,” Hoyle explains. “As an organisation, by responding to these wants and needs, we are embracing change and encouraging growth. A well-executed digital transformation will ease the burden on many fronts. It can streamline operations without compromising client service, and increase employee efficiency while reducing overhead costs.” Fraser echoes this: “It’s about how do we make ourselves as efficient as possible, remove duplication of effort, improve the client experience, and improve the colleague experience. So that’s right down to how we do our invoicing. How can we use robotic software to do that? Our trading system, end -to-end; are all the stages necessary, and if they are necessary, do we have the right information in it? So, it’s that constant review of that, and then down to what client facing technology we want to deliver for clients that isn’t just a fascia for the business, but actually has real value to the client. Quite often companies rush to put out client facing technology because they feel they should have to, but does it really add value to the client experience? If it doesn’t, then there’s no point in doing it from my perspective.”
Marsh’s digital strategy focuses on emerging ideas and technologies, innovation, data labs, new digital products and insurtech collaboration, strengthened data, the client digital experience and analytics tools. The key focus, according to Hoyle however, is ensuring, at the heart of it all, that there is an “excellent experience for both colleagues and clients”. End to end trading platform benefits for colleagues include: automated workflow, single data entry and manual rekeying reduction, the pooling of client records in one single place and accurate market intelligence. Clients benefit from improved client service, quicker binds, standardised documentation and swift invoice production, Hoyle enthuses: “Digital solutions free up colleague time to focus on client services and the higher-level tasks, giving them increased job satisfaction and career development.”
Marsh’s transformation programme is fuelled by a collaborative spirit both internally and externally. “We have global relationships that extend to a local presence,” Hoyle explains. “Internally we have the Digital & Data Community, which allows us to build connectivity among colleagues sharing good practices, updates on local and global tools and initiatives, and enlists us as advocates for deployment of new digital applications into our business areas. What’s key throughout all of this is that we learn and grow together along the journey.”
Of course, digital transformation is a journey and not a destination. “It’s made huge improvements and we continue to prod and press and get feedback on what does, and doesn’t, work,” Fraser explains. “It all comes back to how, ultimately, we improve the colleague and client experience. And actually, if we improve the colleague experience, the client experience will improve anyway. There’s no replacement for the human connection in an advisory business like ours; we will always have that. It’s how we use digital technology to make the advisory piece as beneficial to the colleague and the client.”
For a business like Marsh, data is everything and a data-driven strategy runs through every aspect of its organisation to make informed decisions for clients. “I think the opportunity now is how do we digitise that data so we can use it both locally and internationally to help clients across the world,” Fraser. “Quite often we’ve had pockets of data in different parts of the world and people haven’t seen it or had access to it. Digitising it makes it far more accessible and beneficial for everybody.”
“We are a business that bases itself on doing things the right way,with integrity,” says Fraser. “And for me, that’s absolutely sacrosanct for any business that I want to operate with. I joined Marsh 13 years ago not only because of Marsh’s size and its expertise, but the human factor. The business has a great soul, which is down to having fantastic experts all over the world who can support clients, colleagues, and communities alike.”