CEO of Axa UK & Ireland Claudio Gienal launches strategy rethink; talks XL deal
With six months under his belt as CEO of Axa UK & Ireland, Claudio Gienal has started a strategy revamp to take the business into the future.
Gienal, who became CEO in September 2018, has highlighted three priority areas in a six month process.
Priority one, he said, is to ensure Axa UK has a healthy relationship with the regulator “which we know in this market is not always an easy thing to do,” he added.
“But it is key to me because in principle I agree with what the regulator tries to achieve in having a good customer outcome by having a healthy market. We might have different views on how we get there but I'm absolutely aligned with what they are trying to achieve.”
Gienal’s second strategic priority is “simplicity” by which he means making sure Axa has stable systems “so we can serve our customers well, and when people log in things work. Making sure that the basics work, and work well”.
He said that there is another simplification piece around integrating Axa’s acquisitions. “We have a wonderful set of pieces but they're not as integrated and simplified as they should be. So we spent some time thinking about how we start integrate these pieces, so we don’t do things twice or three times.”
Streamlined integration is good for the customer because it’s consistent and it’s good for our people because they have meaningful jobs, he explained. “I hate the thought that [our employees] do things they don’t need to because it was part of a process decided 10 years ago. So we’re going through the whole process to make sure it has good outcomes for the customer.”
His third strategic priority is the strategy itself “because we always need to be sure we know why we do the things that we do decide to do”. He smiled: “Most of the time we do know that. But for the team here, we have grown a lot in the last year, we need more clarity about where we want to play and how we want to play it. For some things it’s obvious but not for all.”
To solve this conundrum, Gienal and his senior team has launched an exercise over six months to engage employees to help think through who Axa wants to be and why, and “more importantly” how can we be distinctive in the market.
“So, how can we achieve things to be competitive, it can’t just be price. We need to find other ways to be meaningful to our customers. That’s easier said than done, so we’re working on that one.”
Axa UK has started “a little experiment”, as Gienal referred to it. “We wrote to everybody [at the company] saying ‘do you want to help us with the strategy? We want colleagues to help us’.
“We got hundreds of answers saying yes, so we selected 20 of them to have a good representation of people across geographies and from different parts of the business and from different backgrounds to give us a diversity of thinking.”
He said that this engagement with a broader range of colleagues aims to brings a different angle to what is important to Axa UK.
“And when it comes to explaining to everybody what we want to do going forward in theory it will be very helpful to have 20 people who understand it. If they understand what we are trying to do with the strategy then we have done well. It's not complicated and it means something to our people. That is where we are up to.”
Commenting on how Axa will integrate its acquisitions into the business more, and how the purchase of XL has affected the wider group, he said: “My view [of the XL deal] is it is strategically important deal. Most of the things that point towards the future in the commercial aspect of insurance will be more relevant. So we have decided to buy someone who is strong in that strategic sense.
“We had a capability but it was always subscale to the Allianzes and Zurichs, so to be able to compete there and improve the stance in the US this [acquisition] was the absolutely right thing to do.
“For the UK, the business I have (UK and Ireland) is SME, mid-market and lower end of mid-market. XL is much more focused on the bigger accounts.”
But he added: “We work close together. This week we had a broker event where you have both. XL was there I was there, we were all there with brokers.”
He said that Axa’s balance sheet is a global one but added: “It's technically required to do the business that we do. There’s no way we could buy the risks that we do on my balance sheet. It wouldn’t make sense.”
He said that competitors like Allianz “would bundle these things on a balance sheet that allows the UK much more capacity to compete in the space they do”, adding: that for Axa: “It makes sense to keep it separate in terms of structure but when it comes to market we are very keen to be very close together. One of the objectives is when it comes to BIBA we will all be in the same place. It’ll be a good test whether if we can explain to our partners and brokers there who does what.
“Purely selfishly from my point of view, [the XL deal] has allowed us a much broader toolset of what we can offer to our brokers and customers. We are working on bringing some of the specialty lines to the regional brokers, which we couldn’t before because we didn’t have the balance sheet to carry that. Cyber is another one. At the moment for the UK there is a lot of upside. For us but also our partners because we can offer more of a tool set that we couldn’t before.”
Gienal joined AXA Group in 2017 as chief strategic development officer for the European markets. He has also previously served as CEO of Zurich Life Switzerland and chief operating officer at Zurich UK.
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