Since you joined Guy Carpenter about a year ago, what have been the biggest changes to the marketplace and client expectations?
Over the past year we have an increasingly competitive marketplace with downward pressure on pricing aligned with increasing capacity and capital levels. As at January 1, 2010 we estimated there was around US$20 billion of excess capital within the industry though this has reduced to around US$13 billion at mid-year.
Clients are under increased pressure to develop strategies to optimize that excess capital for a greater return. More and more they are turning to their brokers for advice and counsel regarding risk and capital management strategies. In the last 12 months, we have shown the ability to respond to those expectations, and have developed strategies to bring even greater value to our clients.
What is the Guy Carpenter International Operations strategy?
One of our key objectives is to grow both our relative and absolute positions in the international marketplace. To achieve that we have a multi-fold strategy.
First, we are reinforcing our existing strong team by attracting talented people to join us. We have several new individuals and teams in our French, Benelux and Eastern Europe operations. In the UK and Ireland we have significantly strengthened our property operations and also brought in new people to drive growth opportunities in the marine business. You can expect to see more of this in the months to come.
Second, we are increasingly integrating the analytical and broking sides of the business. With this strategy, we can deliver to the client — particularly the C-suite — solutions that are seamless in transmission and reception. It means drawing resources from across our organization to build teams of the right people, who are able to “deliver the firm” and so provide immediate value to the client in the solutions they need.
Third, in a broader context, we feel the broker of the future is going to be a different kind of person. The Guy Carpenter broker will have integrated expertise, moving seamlessly from the analytic side of the business and providing strategic advice to the delivery of bespoke and integrated solutions from the global risk and capital marketplace.
How do the structural changes in the Guy Carpenter International Operations support that strategy?
The changes in the last 12 months have been focused on delivering value to our clients and growing our share of the broker pie.
Britt Newhouse, Chairman of Guy Carpenter, moved to London in July of 2009; I joined shortly thereafter and Britt has been extremely valuable and supportive in the development and implementation of our international plan.
We have since strengthened our senior management group. Nick Frankland is focused on leading our property and casualty teams across the UK and Europe as CEO of European Operations. At the same time, we recognized a need for cohesive leadership to drive our specialty businesses. Andy Marcell recently moved from his previous role in the Americas to become the CEO of our Global Practices, supported by Kevin Fisher, Chairman of Global Specialties.
Of course, we can’t lose sight of the fact that business production and client relationships are key to our future growth. Very soon, Vicky Carter will be joining us as Vice Chairman of International Operations to focus on driving new business. She will play a significant role in cultivating client and industry relationships across Europe.
Other changes we have made to our organizational structure will empower broker managers and enable senior broking teams to spend more time focusing on clients and delivering the value they expect from Guy Carpenter.
What else differentiates Guy Carpenter in the international marketplace?
There is a technology war amongst the leading brokers at the moment, and I am happy to say we’ve been recognized for having delivered some impressive analytical tools in the last 12 months, all to the benefit of our clients.
We rolled out version 5 of MetaRisk®, which demonstrates to clients a dynamic financial analysis capability that is second to none. Its multi-functionality, intuitive design, capacity for asset and liability models, and comprehensive view of balance sheets and reinsurance requirements have been very well received.
In 2009 we introduced innovative Pan Central and Eastern European Flood models. In 2010, in response to client demand, we built a unique French flood model from the ground-up. We continue to develop models elsewhere in our organization, such as the Dynamic Reserve Model, initiated in the United States and now increasingly utilized by our analysts across the international marketplace.
Our capabilities and innovations within our leading Global Analytics area fully support a growing need for the qualified and quantified advisory services and integrated solutions delivered through our global broking operations. In the end, our ability to deliver the full capabilities of our firm is our greatest differentiator, and it will provide our greatest opportunity for growth in the international arena going forward.