Around the world, opportunities abound in insurance and risk management. Steve Eginoire, BGS76, an advisory board member for the Vaughan Institute of Risk Management and Insurance, has taken part in helping Lockton Affinity expand its reach to include insurance brokerage offices in London with additional offices from Thailand to Brazil. It was an exciting opportunity for the company, one that further entrenched them into the global economy.
“It’s very difficult to maintain our historic pattern of organic growth strictly on U.S.-based business,” Steve says. “A firm our size needs a global footprint to maintain growth and vitality. While it’s very important to our business today, it will be critical in the next 10 to 15 years.”
Steve joined Lockton in 1987 and now serves as chairman and CEO of Lockton Affinity in Kansas City. He explains that Lockton had the opportunity in 2007 to acquire a nonequity partner with offices around the world. In London and the United Kingdom, the firm had more than 1,000 employees, with another 1,000 spread in 10 different offices, from Singapore to Mexico City.
Steve explains that Lockton had built its operation in the United States organically— in a sense, one person at a time.
“So it was a bit of a shock to inherit 2,000 people around the world with different languages and cultures,” he says. “Our challenge was to identify the people who had the same essential corporate culture as Lockton— they had to believe in taking care of customers and their fellow associates.”
While the local cultures were often drastically different, Steve says it was relatively easy to understand their context and customs.
“The reality of local culture is that it exists within our country. You don’t talk to and treat people exactly the same in Los Angeles as you would in New York or Atlanta. Local customs have to be understood, appreciated, and respected, but essentially, people are people.”
Nurturing the corporate culture outside of their U.S. operations was the greater challenge, and one that landed Steve in the hub of the transition; the U.K. Steve’s role was one of understanding and stewarding the Lockton culture—the whys and hows of their business. He went into the United Kingdom. knowing many members of upper management had worked for competing companies.
“They had preconceived ideas of who we were and how we do business. Some views were accurate and some were not.”
Within two years, by championing Lockton values and identifying strong leadership, the U.K. office was named Commercial Lines Broker of the Year. By 2010, it was recognized as a Best Place to Work, an honor that many Lockton offices have received.
Steve notes that some Lockton values are inherent values in certain parts of the world. For example, in Asia, the company’s long-term business strategy is viewed positively. On the downside, the company did not always possess the resources to address every cultural view.
“In Thailand, they want to show you what they’ve accomplished and to see a demonstration that you appreciate their contributions and success. Because of time and distance and modest management resources, it is sometimes difficult to take the time to prove your commitment to them.”
Cause and Effect
While Lockton worked on completing the merger, the economy around the world went into recession.
“Clearly, the global recession had an impact on our clients, which impacted us,” says Steve. “But areas of growth like Brazil and parts of Asia helped mitigate that. From an insurance perspective, it hit differently in the U.K. than in the U.S.”
Currency fluctuations were more of a short-term issue than recession. Steve says it highlighted the fact that the insurance industry is in fact global, and so was the recession, although pockets of growth continued.
Much more recently, Japan’s earthquake and tsunami disaster has just started to ripple out in terms of its effect on the global insurance market. Some insurers are being more conservative about writing new business, which Steve points out can have far-reaching effects. Each time one of these disasters hits, whether it’s Haiti, New Zealand, or Japan, the world learns more about the ripple effects.
Advice for Global Business
“The skill set for insurance success is the same around the world,” Steve says, but he notes that those choosing to work in a global insurance and risk management setting can enhance their careers with global business skills.
“The best way to be accepted in to the local culture, not surprisingly, is to learn the language,” Steve says.
He notes that Spanish can serve you in conversations in many countries in Europe and South America. With a huge number of Asian languages, it may be more difficult to choose just one that will serve your career.“If you have a fascination with politics and economics, insurance becomes a good avenue to put those interests to use,” says Steve. “Those who succeed understand the problems clients may face, such as currency fluctuation and pockets of rising inflation. The business environment is a lot more complicated today, so these are important to the skill set for global risk management.”