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Insuring the future at ERGO

Although still profitable, ERGO faced a few issues of its own. Above all it needed an overhaul and a new injection of energy to its sales organisation. We hear how it’s possible to redirect the focus and get 100s of entrepreneurs working for you. We also hear how managers have to lead from the front to get things done.

The ERGO Insurance Group belongs to one of the larger insurance businesses in Europe – 40 million customers worldwide and income from premiums of almost 18.6 billion € in 2012.  It evolved from a 1997 merger of two insurance companies – Victoria Holdings and Hamburg-Mannheimer, and today is owned by Munich Re, the large reinsurance company. These mergers and changes have made ERGO what it is today, and just as the world has evolved – so has ERGO Belgium; radically and for the better.

The company in Belgium understood that if it wanted to survive and thrive in this new environment that it had to adapt and change the way it did business. The fact that the global financial crisis occurred right at the same as the new brand launch meant it was required to manoeuvre its way through a minefield of uncertainty and doubt. With hindsight though, it’s clear that it provided a perfect opportunity and impetus for the further change that was required.

Phillippe Lison is Managing Director of ERGO Insurance NV in Belgium. He and his experienced team have led from the front and been instrumental in transforming the business,. He has made sure that it is now much more aligned with the needs and demands of an information-savvy, technologically aware and sophisticated marketplace, where customers expect transparency, service and accountability.

Major issues needed tackling

There were a number of issues that needed urgent attention, including the delivery structure which was no longer fit for purpose and had to be reviewed, overhauled and upgraded; equally the whole emphasis of the business needed to move away from simply selling insurance to being much more of an adviser and information provider on the services available and their suitability for individual clients. This required a different approach, and a review of the way personnel were identified and addressed.

Ergo Enjoys Change

The overall effect prompted ERGO to undergo many changes and create a new approach and a new way of thinking, one where the customer’s needs were  catered for in a very direct and targeted way. Since the change, the company has radically altered its perspective and structures to reflect the current market situation. Additional new staff has been recruited and entrepreneurship has become a key driver. Ergo Belgium created an ambitious coalition with key people in the sales organisation, redesigning the internal organization structure and modernizing the workspaces. This reflects the modern approach the business is now taking.

Change was inevitable

Lison explained how it all came about. “ERGO needed to become a more modern company – one that reflected today’s values and practices - while not forgetting the positive legacy of its original business. We fully admit that some of the company’s past selling theories were somewhat out dated and that’s the reason we’ve done our utmost to replace them with a much more consultative approach.. ”

Ergo Enjoys Change

As it turned out, circumstances and timing made it easier to push ERGO in this new improved direction. “In 2008, the global crisis was about to break so there was already a strong impetus to change our way of working. It’s also true that the Group was ahead of the game, and already developing our global strategy. So change was probably inevitable. The fact that we were already looking at new possibilities, structures and values meant that we were able to respond positively and quickly when it came to the organisational shift. And the name change too gave us an added push in the right direction.”

So what were the main features of this change that helped ERGO establish itself as a major player and recover some of the reputational ground lost in previous years. Lison continues, “For me it was clear, not only did we need to be a more free enterprise ourselves, but we equally had to continuously find young talent willing to work alongside us. Entrepreneurship in its most relevant and consumer-oriented form was what we were aiming for and luckily we were able to find examples of existing employees who were good role models for the rest of the network.”

Help from Vlerick

But it wasn’t only within the group that ERGO found what they were looking for. “We looked outside our industry and quickly recognised that institutions like Vlerick shared our entrepreneurial vision. It was clear from the very beginning that they understood the value of an innovative and ethical approach to business. From then on, we began to construct a sort of ‘think tank’ mentality within the business. This led us to create a space – both physical and mental – where people in the sales organisation and commercial staff could start thinking creatively, outside the original envelope. The result was a multi-disciplinary approach that was non-hierarchical, and we encouraged staff to challenge and disrupt the conventional thinking.”

“One of the outcomes we noted was even more trust in the organisation and management; now whether this was because of this inclusive activity or just a result of the more open and encouraging environment, we don’t know; but it helped to develop the sort of atmosphere where innovation and creativity could thrive. It was our aim to make our extended family embrace a culture that created value from uncertainty. And now, to a large extent, we think we have been able to achieve that.”

“We are still looking for opportunities to improve and innovate and partners like Vlerick can only be beneficial in that respect. We are still working to embed new values and the innovatory ethos deeper into the organisation with a planned and structured programme. Vlerick’s experience and its nurturing of the human element in the entrepreneurial spirit represents the sort of benchmark we are aiming for and provides some important clues as to how this can be accomplished.”

Advice to others

And what advice would Lison give to others thinking of embarking on this path? “Change has to start at the top. If you don’t really believe in and practice what you are preaching, people will soon find you out and the impetus for change will diminish. And management doesn’t just need passion and vision – they need to communicate it effectively too. They need to keep staff excited and engaged – and then give them some quick-win milestones so they continue the process. I believe,” he says, “that it’s also important to create opportunities for group bonding and sharing. There is nothing like a shared goal – and shared success – to motivate people. Of course, not everyone will be on the same page but this sort of activity can encourage the late adopters and spread the enthusiasm for change across the whole business. A team that is together has got much more chance of success than relying on a few stars among a group of perhaps reluctant or hesitant, participants.”

A word from Vlerick

Professor Hans Crijns: The Ergo case illustrates that entrepreneurial behaviour is also possible in more established and larger organisations. If you want real ‘intrapreneurs’ to work their socks of, then you have to give them 'space' to move. It’s also important to realise that it’ll never be 'for you' that they do it, but because their need for autonomy is one of the crucial entrepreneurial attributes. An entrepreneur is someone who sees an opportunity and creates an organisation in order to pursue it. Opportunity refining is a crucial part in the exploration phase, but it has to be followed by clear exploitation.

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