For any business in any industry, the ability to transform an obstacle into an opportunity is what sets apart those who have tremendous success, and those who struggle to keep up. The COVID shutdown proved, in large part, that companies can operate successfully in a remote and hybrid setup. While there are some exceptions, as an industry, I think property casualty insurance companies completely fumbled the chance to leverage flexible work setup to attract industry talent, both internally and externally.
While it is necessary at times to have in-person team interactions for culture building, leadership meetings in-office to tackle dynamic challenges, and entry level staff seated near mentors and team subject matter experts, it’s also vital to remember that ‘Humans’ are the key ingredient to ‘Human Capital’, and humans are as dynamic as they come. What appeals to one individual may not be a priority for another. Therefore, the attempt for an organization to recreate the outdated one-size-fits-all blanket policy will lead to large populations voting with their feet and exiting to seek more work flexibility elsewhere.
It’s time to do some soul searching which often involves asking ourselves challenging questions:
- What type of organization and culture do you want to create?
- What level of talent do you want to attract?
- What are other companies and other industries doing to successfully mix hybrid, remote, and on-site setups?
- How can we leverage our brick and mortar office location to be a luxury instead of a hindrance?
- As leaders, at what point do we become the creative and dynamic thinkers our companies need us to be?
We believe that in order to win it’s time to really put people first.
In the context of insurance industry talent, an organization’s chosen mode of work has a significant impact on a multitude of factors, including but not limited to:
- The ability to attract high performers.
- The quality of talent development, particularly for recent graduates and those in entry-level positions.
- An organization’s ability to retain top talent, long-term.
Now that more companies have shifted their mode to more flexible arrangements, companies may feel pressured to choose one framework over another. If these recent developments have taught us anything, it is this: no one model fits all and therefore there is no right or wrong choice.
Frankly, each approach carries benefits and drawbacks alike:
| Model | Pros | Cons |
| Traditional | Stable environments for in-person collaboration; Effective training venues. | Overhead costs for companies; increased payroll and employee salaries; commute for employees; one-size-fits-all approach doesn’t fit all employees. |
| Remote | Reduced overhead for companies; green option; commute time traded in for increased productivity; employees can work from anywhere; companies can hire anywhere. | Collaboration less streamlined; training more disjointed; culture growth and maintenance strained. |
| Hybrid | Balanced approach; combines best of Traditional and Remote models | Not enough of one model or another for companies’ liking. |
Companies will need to study each style carefully to identify which mirrors their values, supports their corporate culture, and faithfully serves their future goals. This methodology allows firms to maintain a reasonable level of plasticity in order to ensure their company can flourish and remain competitive in an ever-evolving marketplace.
Traditional, Tried and True
If you’ve worked in this industry pre-COVID, there’s nothing mysterious about the traditional office work model. Cubicles, breakrooms, commutes, conference rooms, business parks; you remember it. While popular opinion seems to paint a less favorable narrative of office life today, it was – and to a significant extent still is – favored by many companies, and for justifiable reasons, too.
For one, offices provide stable environments for in-person collaboration and communication within teams and across business units. Secondly, offices serve as effective venues for training programs and career development. For example, new employees receive immense value learning a new culture and processes in-office with their team immediately available.
While the traditional framework may be the clear favorite for companies, it is seldom the favorite choice for employees. The approach is considered rigid as it offers no ability to work elsewhere. Plus, the burden rests primarily on the employee to spend five days a week commuting into the office. And, of course, there are always the ongoing expenses that companies incur whether the office is occupied or not. Lastly, companies will likely incur having to pay higher salaries to employees that will be spending 30, 60, 90 minutes commuting each way, putting miles on their car and spending more time in the office than at home.
“Being a hybrid organization ourselves, I get really excited every time I hear that another carrier has moved to being fully onsite, because we’ve made a lot of great hires as a result because people want the flexibility of a hybrid or remote setup,” said one Senior Vice President of Claims at a large national carrier.
While some employees relish the socializing that comes as a byproduct of office life, others find it carries too many distractions to be productive. With the rising popularity of remote and hybrid models, the traditional office format simply is less attractive to younger professionals who know other options exist. Nonetheless, companies utilizing the traditional format need to ponder the selection carefully as to whether a change in work style will continue to honor their corporate DNA.
A Remote Location
Remote working was the primary offering during the pandemic – borne out of necessity – and enabled by advancements in telecommunication technologies. While the arrangement’s popularity has tapered off somewhat, it is still a viable option for both company and employee alike. An employee can trade hours-long commute for productive hours at their desk, not to mention reaping the benefits of reduced transportation costs. Additionally, for the employee it offers the ability to work from anywhere, free from the cubicle.
For companies, there’s the benefit of greatly reduced overhead of having to lease and stock an office provided the company can negotiate current lease agreements. It also offers the ability to hire anywhere – regardless of geography – thus potentially increasing an organization’s internal talent level. Additionally, it provides a green option for organizations looking to reduce their carbon footprint.
The remote model isn’t perfect; it makes collaboration less streamlined, even with tech advancements. It puts more burden on everyone to foster and sustain the company’s culture. Additionally, it makes training of new employees and career development more difficult.
Given the extreme concern for the insurance industry’s ability to attract, develop, groom, and train talent, the remote option both helps and hurts. Executive leaders will need to study training programs and developmental strategies, and then juxtapose it with the idea of conducting in-person training while leveraging the benefits and attractors of being remote.
Put another way, it is more efficient to have a new employee learn in an in-person setting with teammates and office resources immediately accessible rather than via Teams for eight hours a day. While this arrangement may suffice for some companies, a large, complex, and dynamic organization may struggle to operate in this mode.
Hybrid Efficiency
Recognizing the in-office and remote options were not ideal, the hybrid approach was born and embraced by companies reluctant to transition to fully remote while also hesitant to return full time to the office. Using the hybrid framework, companies can leverage in-office attendance for team meetings, social events, and essential core operations such as career development and training. Just as important for employees, it gives them the ability to work remotely, a capability many didn’t want to relinquish post-pandemic.
While not ideal for all, it is enough of an attraction for talent to consider when in the market. Conversely, for companies using the traditional model, it cannot provide enough in-person hours for their liking.
Having a brick and mortar location will become a luxury for many carriers and firms. I use the term ‘luxury’ because companies will have to expend considerable expense for the added benefit of having a central meeting location (e.g., a headquarters or regional office) while simultaneously accepting that it will not be used to the level it was pre-pandemic. Nonetheless, the clear advantage is being able to host team gatherings and social functions to build culture, while also providing an office space for those who still prefer to visit with their colleagues several days a week.
One Model No Longer Fits All
With the rise of multiple work models, companies are faced with the dilemma of choosing a single approach to embrace for the foreseeable future. While each option offers its own set of pros and cons, choosing the method that aligns with a company’s values is paramount.
For an employee, they now have a choice of both where and how they work. Not only that, work flexibility has now become standard in compensation packages, along with salary, bonus, 401K, and other benefit offerings.
While companies ultimately have the final say on how they want their organization to function, they should be aware of the plethora of factors and study them closely before making decisions that will impact their trajectory and success.