Case Study: If P&C’s improved staff performance

The story
Sweden’s If P&C Insurance is one of Scandinavia’s leading insurance companies, with revenues of SEK37bn ($5.7bn) across 11 countries.

The challenge
During a strategic review, If’s executives noticed varying levels of performance across different groups, and detected untapped talent among many employees dealing directly with customers. They concluded that this potential might be opened up with a more supportive and coaching-oriented style of management.

The strategy

“We thought that by acting in a slightly different way, and emphasising intrinsic rather than extrinsic motivation, our managers might make a real difference to the competence and performance of our employees,” says Hakan Johansson, one of the executives.

They identified a team in Mr Johansson’s division, which sold car insurance and was already performing well, for an experiment. Team leader Lotta Laitinen was excused from two hours a day of meetings and routine administration, which were handled by an obliging colleague, so she could spend time with her team, in groups and individually.

To get the process started, Mr Johansson put on a workshop, where Ms Laitinen’s team of 20 were asked to discuss the value of cross-selling – offering, say, car insurance to someone who has home insurance – and how it might be improved. The aim was to give the team more involvement in defining how they worked. Ms Laitinen then used her “extra” time to work more closely with the team: working with high performers to understand the tricks of their trade; listening in to sales calls; and one-to-one coaching .

Team members were also encouraged to listen in to and coach each other, with Ms Laitinen joining in and giving feedback.

What happened
After three weeks the results were measured in three ways: actual performance; through a questionnaire completed by everyone; and by selective interviews.

The headline figure was a 5 per cent rise in sales compared with the three previous weeks. However, that figure concealed some unanticipated differences – most notably, big improvements among the usually below-average performers.

The questionnaire responses were positive, with team members strongly agreeing that the approach was different, that they had more freedom to work in a way that suited them, that they got more time with the leader and that they felt more motivated. They wanted to continue to work in the same way.

Ms Laitinen’s reaction was also good, as she found fresh ways to work and experienced no disadvantage from not going to meetings.

A 5 per cent boost in sales over three weeks is impressive, while the cost of intervention was minimal.

The lessons
There are many proved ways of improving the quality of management in any company, but for various reasons – lack of time, motivation or skill – they are not implemented consistently. For example, some managers diligently provide feedback and coaching, while others know they should but don’t. All it took was a simple intervention from Mr Johansson and colleagues for a worthwhile change in behaviour to follow.

Why had this change not happened earlier? Ms Laitinen was not at fault; in fact, she was chosen for the experiment because she was competent, personable and open to new thinking. But, like many managers, she was so busy with administration that she did not make time to do the potentially more valuable parts of her job.

Improving the quality of management does not necessarily need fancy ideas, consultants or IT systems. Senior managers just need to be conscientious about doing the basic things right. At If, for example, the experiment has led to new initiatives designed to help free up the managers’ time so they can focus on the value-added parts of their roles.

- Financial Times, Feb 11. 2013