Practice makes perfect?

Royal & SunAlliance has undergone restructuring recently to facilitate broker access. Mike Jakeman talks to Tim Collison about this latest move towards providing a seamless service.

When Royal & SunAlliance scrapped Broker Division in 1998 and set up
a new commercial lines operation with a divisional structure, senior
executives pronounced that commercial brokers would start to receive a
better service from the company. Unfortunately, many did not see any real
difference and, for some, things got worse.


Brokers told RSA there were too many separate departments and offices for
them to navigate their way around. Others said they would dearly love to
do more business with the company, but no longer knew who to go to.


Something had to be done. At the beginning of this year, the decision was
made to scrap the divisional structure and to replace it with a single
operation: UK Commercial. Group chief executive Bob Mendelsohn - renown
for regularly shifting people around the group - brought in some fresh
blood from around the world to instigate the changes.


Duncan Boyle was shipped in from Australia as the new managing director
and Mike Jakeman was transferred from Canada, where he was vice president,
speciality lines, to become practices director (claims), UK
Commercial.


"Bob Mendelsohn took over in 1997, and in his first month he brought
together several groups to look at the commercial strategy - I was part of
that," explains Mr Jakeman. "It became clear that things were being done
differently around the world - what we wanted was one global business and
so we introduced the concept of practices. That is what we implemented in
Canada."


Division of labour


And, along with his underwriting counterpart, Peter Burrows, that is what
Mr Jakeman is implementing over here.


RSA has divided the commercial market into three broad segments: commodity
(businesses with a turnover of less than £1m), core (turnover between £1m
and £100m) and risk managed (turnover in excess of £100m). It has divided
the country into five broad areas: London, South, Midlands & West,
Scotland & Northern Ireland and North. And, it has divided its operations
into several practices, including: marketing, distribution, underwriting
and claims.


The idea behind all of this is to streamline the operation and reduce the
number of access points into RSA. If the new system works as envisaged, a
broker will be able to place a risk via their particular area, or into one
of the enterprise centres that are being set up, and the various practices
will work together behind the scenes to deliver a seamless service.


"You can go anywhere in the organisation and have access to all the
different resources," says Mr Jakeman. "Whereas in the past a broker in a
more remote part of the country would have had to go to London for risk
management, they will now be able to access this through their local
office.


"The broker now has a virtual team working on their behalf, bringing
together all the different skills of the organisation."


Mr Jakeman stresses that the restructuring is resulting in a much flatter
management structure: "Underwriting skill is no longer channelled into a
small number of people. We are moving responsibility downwards. That means
more locally empowered underwriters."


As part of the restructuring process, RSA has prioritised four key aspects
of the business: commodity business, claims, underwriting and
distribution.


At the end of last month, the insurer unveiled its new approach to
commodity business. Following an 18-month pilot scheme, it has gone live
with a new Birmingham-based enterprise service centre for businesses with
turnovers of less than £1m. Simon Cooter, small business manager, says:
"Brokers told us they did not want to deal with teleoperators, they wanted
to talk to experienced underwriters. What we have done is built a brand
new system and brought in over 30 underwriters.


"A broker can now call the centre, speak to an underwriter and, in under
six minutes, on average, get a guaranteed quote. They can go on cover
there and then, or refer back to the client. Once the broker says 'yes',
with the push of a button, all the details are recorded on the system -
there is no need for rekeying - and a statement of facts is automatically
produced."


New product range


As part of the initiative, the insurer has produced a new range of small
business products, including: shops, offices, vans, contractors and small
business combined. Over 1000 brokers in the Midlands and the West will now
be given access to these policies through the new centre, with the
enterprise rolling out across the UK during 2000.


Mr Jakeman is well aware of the enormity of the task facing UK Commercial,
both in terms of solving all of its problems, and convincing brokers that
they have been solved. "One of the observations I made when I came over
here was that there was nobody with executive responsibility for claims
and underwriting. That has now been changed.


"I think in the past we didn't have a clear direction and that we were
trying to be all things to all men. We are now more focused."


Mr Jakeman adds: "I think we have a lot of people to convince about what
we are doing - particularly the brokers. However, part of the challenge we
face at the moment is getting our own people excited. Because we have been
beaten up by the press, the analysts, the stock market, the brokers and
even by some of the customers, we need to make sure we give our staff the
confidence to believe they can go out into the market place, hold their
heads up high and say we've got something to offer."
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