Leading and managing in an actuarial firm has a number of unique features. These are organisations that tend to attract very bright people, who enter the profession to put into practice their technical training. Yet, actuarial firms are also businesses. They buy and sell services, have clients and people to manage, money to collect and profit to make.
Sadly, it is often the case that neither the training of the professionals nor their early career prepares them for future management, leadership and business responsibilities.
Whilst tremendous time, money and effort is devoted to perfecting technical knowledge, historically actuaries have been left to develop their leadership skills by trial and error. As one managing partner recently said to us ‘trial and error has, at times, been very costly for this firm.” Increasingly, firms are realising that future success is reliant on more than technical excellence. In a client world where technical expertise is taken for granted, differentiation demands excellent client facing and people management ability.
The balanced professional
“The actuarial world is no longer one where specialists hide away practising their magic” – the HR director of an actuarial firm.
Increasingly firms now recognise a need for ‘balanced’ professionals and are rethinking both graduate recruitment and personal development programmes.
“We look to recruit much more rounded individuals these days. They are still very bright, but may not necessarily have a first degree”. – the managing partner of a leading actuarial consultancy
So what is the ‘balanced’ professional?
Many firms tell us that what they are looking for in the ideal partner is something like the diagram below. Their ‘ideal’ partner is one that will help drive the firm forward and help it achieve its business goals most effectively. This professional understands the importance of being commercially-minded, spends time delivering client service, allocates time to developing existing clients and new clients, whilst focusing effort also on leading and motivating their team. They also need to keep their technical skills up to date and apply those skills to their client work.
Often in reality, the diagram is more like that which appears in figure 2:
There are many reasons why there is a mismatch between what so many professionals believe is the correct balance for sustained business success and what actually happens. However, there are plenty of firms working towards the ideal model and some are already there.
Leadership is an activity, not a position or role. Leadership at all levels in the actuarial environment has huge significance. Actuarial services depend on people and is reliant on intellectual capital. Nowhere can it be more true that ‘people are our greatest asset’- and leadership, after all, is about people. Professionals in particular tend to respond better to those with the ability to inspire, influence and persuade than those who try to ‘manage’ them.
There are five fundamental building blocks that underpin leadership.
- Team building
“You cannot be a good leader without being a good manager’ John Adair in ‘Not Bosses But Leaders’
Management is fundamental to administering a successful business; it involves schedules, disciplines, checklists, and rules that define and monitor performance. Good leaders are strong managers who ensure that the business operates in a disciplined manner. They do not shirk the responsibilities of the annual appraisal of their people and are firm in the application of performance standards. Sadly this building block is one that many of those in leadership positions never seem to get beyond.
Whether leading a team or a firm, we are ultimately striving to achieve something. To ensure everyone works effectively towards this common goal, firstly they need to understand it. Giving direction is fundamental to anyone in a leadership role. It requires vision, or the ability to paint a picture in words of what needs to be achieved. The most successful teams we have worked with have that clarity of vision. They tend to be singing from the same hymn sheet and they are enthusiastic about the words.
Having interviewed many people in successful professional firms, a common characteristic they associate with good business leadership is inspiration. Inspiration is the ability to encourage in members of the team a personal desire to help achieve the firms’ objectives. It is about the careful use of words to motivate and inspire. Contrary to some views, we believe the team leader doesn’t need to be charismatic to inspire. They do, however, need excellent interpersonal skills to engage members of their team.
Leading by example may be an old cliché but it is fundamental to developing the right behaviours. Where the actions of any leader are in conflict with how they demand others should behave; you can have no doubt that individuals will follow the leader’s actions and not their words. If a manager demands punctuality at the start of meetings, but continually turns up late, the team soon learns that the ‘real’ rules are that it is ok to be late.
All the good leaders we meet seem to think ‘team first’. They realise that their vision can only be achieved through the synergy created in a high performance team. That doesn’t just mean bringing in the right technical skills, it also requires the right blend of personalities – for example thinkers, doers, strategists and pragmatists.
Qualities of leadership
We have asked hundreds of professional staff during our work with them what they want from the leaders within their firm. The common qualities they have fed back are:
- Being dependable
- Genuine interest
People do want their leaders to behave with integrity and stick to their values in good times and tough times. They want to be able to trust and be trusted and want their leaders to be consistent in the way they deal with people and situations. Above all they want their leaders to demonstrate by their actions that they are genuinely interested in them, their aspirations and motivations.
In some firms there is well-defined route map of leadership development that will prepare each individual, not only for what is expected of them in their current role, but what is expected of them prior to any promotion. These firms are developing their own ‘stars’ for the future.
In some firms where this has not been seen as a business priority, there is still a tendency to hope that those other skills demanded by the business will somehow magically appear as individuals are promoted.
Leadership in actuarial firms needs subtlety, a high degree of interpersonal skills, the ability to inspire but above all the ability to influence. This can be developed in people and should not be left to chance.
- How do I find the time? Published 9th January 2009
- Brilliance in Business Development Published 6th June 2008
- Business development: get up and go Published 11th December 2008
- Making a Breakthrough Published 14th May 2009