Ensuring the Right Change

By embracing strong change management principles, an insurer put itself on a growth trajectory.

After weathering the financial crisis, a global insurance company realized it would need to fundamentally transform itself to improve performance and maintain long-term growth. The company engaged BCG in a change enablement program to start the transformation process and improve the organization's efficiency and effectiveness. Critically, the organization wanted to develop internal change-management skills, so it would be better prepared to implement future changes on its own. 

To start the yearlong engagement, BCG conducted an organization and culture diagnostic to identify significant barriers to success. The diagnostic uncovered problems with the company’s operating model, along with a high cost structure. In response, BCG helped the company design a new functional operating model and identify a portfolio of initiatives that would help reduce overall costs by approximately $500 million.

Enabling Future Change

With a new strategy and business model in place, the company underwent an organization redesign to better align functional and business units, reducing management costs by 20%.

To help implement the transformation, BCG rolled out a comprehensive change management plan aimed at improving engagement and reinforcing specific cultural changes, such as spurring collaboration across business units. One critical aspect of the implementation was Rigorous Program Management (RPM), which ensures that senior leaders can receive the right level of information and gain visibility into the status of specific initiatives—and the overall effort. RPM emphasizes “minimum sufficiency,” meaning that communication is limited to outlier events and problems, rather than overwhelming amounts of status information. As a result, leaders were able to identify potential issues and make the necessary forward-looking course corrections.

A core focus of the overall effort was to ensure that company emerged better prepared to drive future change initiatives. To that end, 100 leaders were trained in the RPM methodology, and more than 800 leaders underwent training on organization design. Those are now internal capabilities that the company can use to implement subsequent change efforts. 

The company is currently ahead of their predicted timeline to deliver $500 million in cost savings.

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Change Management