It is a truth universally acknowledged that the London Market needs to change profoundly over the next few years. The risks we are protecting against, the companies we are dealing with, the tools we are adopting – everything is shifting, and we need to learn new skills and new ways of working. This is a once in a generation opportunity to reinvent the marketplace - but to do this will require bold, brave action and a focus on the skills and talent we need to succeed in the future.
The London Market Group is here to facilitate market-wide debate about the issues that concern everyone across the market. Good people are one of our most valued resources. So, with the help of KPMG, practitioners across all sectors have been engaged in thinking about where the London Market is now and where it needs to be in terms of skills. The gap they have identified is wide, and it is not just about technology – it covers, collaboration, innovation, communication and risk partnering.
In the last five years, the London Market has taken steps to put in place the foundations for a digital market. There has been good progress around adoption of e-placement and other tools. These steps should reduce our cost base by removing re-keying and other administrative tasks. The result is that now staff, at every level in underwriting and broking businesses, will be thinking about the impact of this on what they do every day, and how they and we stay competitive in the future.
In addition, our clients’ needs are changing. As more accurate and cheaper risk data becomes available, preventative solutions and response services will become more prevalent. We will need the skills to interpret the insights that data provides us with and expertise to provide the services our clients demand. To do that, we all need to learn new skills and ways of working. And we need to learn them now.
One of our key findings is that senior leaders in the London Market have to direct and manage change. They need the imagination to envision the future size and shape of their workforce, and key to this is creating an agile culture. Data and technology driven businesses are agile, creating products and services quickly. They test, learn, adapt and move on. This kind of culture requires leaders to let go, to empower their people, and to trust. It is a big ask in a culture driven by quarterly reports and formal boards, but a fundamental requirement for success.
They will also need to be able to coach and understand individuals, build a coherent strategy, and inspire purpose across cultural boundaries. There is a need to be empathetic yet bold in supporting long-standing market participants. Leaders must help these individuals to realise that their roles are shifting, that they are not immune to change, and they must help them through this process.
They also have to be brave enough to invest in new hires, new skills and new technology ahead of the curve. This is never easy, but it is unlikely that leaders will be able to build a critical mass of data and technology specialists with only incremental changes. This bravery extends to role-modelling the change required. Effective leaders know that junior staff look to them for signs that they mean what they say. Leaders must ask themselves, what am I doing to maintain my own skills, broaden my horizons, and learn about technology?
Developments in data and AI, as well as overarching societal shifts, offer us a once-in-a generation opportunity to reinvent our marketplace. Having the right skills in an organisation has always been important but now, in 2019, the Market is at a ‘tipping point’ that cannot be ignored. Market players need to be proactive in training the people they already have and ensuring that their roles evolve to meet industry needs. Individuals need to take control of their professional development. New talent also needs to come from outside our traditional hunting-grounds.
And this issue is urgent. London cannot wait for the next generation to grow up and fill the gap. The Market needs to be brave and bold. Whether you are a business or a market professional you need to take control of your skills gap - seize the opportunities, do not stick your head in the sand hoping the threat will disappear.