By CYRIL TUOHY, managing editor of Risk & Insurance®
NEW YORK CITY---Victor Krauze, Willis North America's new chairman and CEO, is as plainspoken as they come. He's the no-nonsense leader, the kind of understated type you might expect to find coming from the northern plains states.
As his former title of president and chief operating officer for Willis North America would suggest, Krauze is foremost an operations man. Holder of an undergraduate degree in applied statistics and a master's degree in business administration, the Minnesota native is all about execution, getting the job done on time and on or under budget.
In other words, Krauze is light on the bluster and heavy on the action. In 2011, the action at Willis North America means growing the large-account segment, a segment of the market dominated by the biggest two insurance brokers, Aon and Marsh.
"I wouldn't characterize it as us going after Marsh and Aon, though they tend to have a lot of that business," Krauze said in an interview with Risk & Insurance® at Willis North America's offices in New York three days before Christmas. "For us, it is more about going after the business that we think fits us and our specialties and what we do regardless of who the current broker is, and delivering our platform and playing to our strengths."
With larger accounts in mind, Willis North America has added some firepower to its managerial ranks. Last year, Willis brought in Martin J. Sullivan, former CEO of AIG, to help deliver global businesses to the firm. It also hired George Haitsch, former risk manager for SAP, to lead Willis Risk Solutions.
"Our goal is to grow significantly in the space, particularly in terms of client satisfaction and client retention," Haitsch said.
Thanks to its presence in fast-growing foreign markets, Willis is expected to deliver 4 percent organic revenue growth in 2011, according to analysts at Keefe, Bruyette & Woods in a December research note to investors. KBW on Dec. 13 upgraded Willis shares to "outperform."
Is that kind of growth possible for an insurance broker in this economy? While 4 percent growth in 2011 "seems good," Krauze said, "in this environment we're not going to hold a parade." No parade? That, too, seems in line with Krauze's "no fuss" approach.
Krauze also said that the most important test will be Willis' ability to deliver resources to clients. Boasting of employing the best people, owning a deeper bench, pushing the most advanced skills, and operating with the most efficient platforms and processes isn't much good if the firm can't bring all that talent to bear on behalf of risk managers.
"It's the actual delivery of those skills that matter, in what I would call a seamless environment that eliminates profit and loss issues between practice groups, countries or business lines," Krauze said. "They don't want to feel that there is any inhibition to getting what they need done, based on someone's desire for revenue or expense split."
"It's about bringing in the power of everyone at Willis and embracing the globality of firm and truly acting like a team," Krauze also said. "Easy to say, not always delivered out there in the world."
That's one of the reasons Krauze, who reports to Willis Group Chairman and CEO Joseph Plumeri, was promoted to the top North American spot last November: to deliver under the pressure and the politics of real-world conditions.
Plumeri, as colorful and animated an insurance executive as one might find, praised Krauze for his "outstanding performance at the frontlines during many watershed moments" in Willis' history.
Krauze, a 14-year veteran of Willis, said that any changes from the operations of his predecessor Don Bailey would be "incremental." Bailey left in December for Allstate as senior vice president of emerging businesses, which includes a motor club and coverage for jet skis, motorcycles, boats and commercial vehicles.
In five years, Krauze also said, Willis North America would like to book "twice the business we have right now." It's an ambitious goal, and one that may raise a few eyebrows given the weak economy.
Numbers aside, Krauze said he wants risk managers to feel that Willis is the best, even if buyers eventually choose a competitor.
"A big part of our goal is getting our level of service to a point people feel differently about us, versus the competition," Krauze said, noting that Willis' "flat" organization should help to reach this goal.
"Even if we have competition on a given account, or even if we get beat for some reason, people would regret having to leave us because of the service we've provided," he explained. "Then I know that Willis has done its job."
January 3, 2011
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