Published September 2013. Original article here (£).
The Megabuyte Interview: Andy Roberts
There is something casual and friendly about Andy Roberts, to the point where it sometimes feels more like a chat in the kitchen at a party than a conference room meeting. Before I know it we’ve drifted from software insurance, the bread and butter of The Innovation Group (TIG), into an animated debate about privacy and the internet. “Frankly, they are very welcome to monitor my emails, they are really quite dull!” The CEO jokes, but Roberts steers clear of social media: “I’m a technologist, but for someone in my position it’s a probably a bad idea. … I could see why you would do it if you want to be famous or get votes. But if you just want to do your job and have a family, like me, then maybe not.”
But modesty aside, Roberts is not just some bloke working in a Southampton office. The TIG we see today is the result of four years of heavy lifting, as Roberts’ CEO tenure has meant refinancing and restructuring the group in the effort of creating a genuinely integrated provider of software and business process services for the insurance sector.
This happens across eight geographies, and Roberts’ carry-on executive case is on the floor next to us during our London meeting; the CEO spends more time on the road than at home. With 2800 employees at TIG, and the same number again indirectly, someone needs to make sure everyone is pulling in the same direction: “Our organisational structure is small HQ, big country.” Does he enjoy all this travelling then? “Not really, no!” He laughs. “But it’s all part of the job of running an international company. You can’t do it through a video conference. You have to actually get there and be part of the company culture you’re visiting.”
BPAAS: A better process
With four acquisitions in the past 12 months, the biggest being Gemini Vehicle Solutions in April, Roberts is crafting TIG into a BPAAS provider – that’s Business-Process-as-a-Service and yes, it’s a thing: “It means I present you with a process and give it to you as a service. In a nutshell: say two cars have an accident. You insure one party, which may or may not be at fault, but all those details need to be sorted out on behalf of the two drivers and the insurance company. Broadly, what we do is take that process on from the insurer.”
That means assessing the damage, dispatching a hire car, sending the damaged car to a garage, and all the surrounding details. “Our principal interest is in driving efficiency in the repair process. And a very high level of customer satisfaction. We are very very very good at what we do,” asserts Roberts. “When you look at our turnover, about £200,000m, this means we are really repairing £2.3bn worth, as we get 10%. So we are managing a much bigger operational envelope than people realise.”
In three years’ time, Roberts reckons all our insurance will be stored in apps on our smartphones. This further automates the process because the app will have the policy details, while the phone will have the GPS location for pick-ups and drop-offs, and a camera for photographing the damage. This change is already underway with TIG’s ‘Rapid Assess’ feature: an instant repair quote can be delivered after users answer a few questions and photograph the damage and let the software can analyse shape and scope of the dent. “So instead of needing car hire for the two days it normally takes to get an estimate, it’s down to two minutes,” says Roberts. The thing about insurers is that they aren’t run all that efficiently, he whispers theatrically, so here TIG, aided by technology, has the opportunity to deliver time-savings, which translates into better margins.
But it’s not just TIG that benefits from technological advancements in the sector – insurers like it too: “ It’s all about mobility and big data. Let’s say you have a policy, in your mobile, for a nice house in New York and a hurricane is on its way. Insurers can push-market to you hurricane insurance for the next 90 days.” If this seems exploitative, insurers also have the option to push-market other services that could be useful, like names of companies to storm-proof a home.
In other words, there are lots of options for additional business processes for TIG to take on should they choose to do so. Roberts brings up another example, this time a property suffering from subsidence: “We bought Marishal Thompson because they are arborist. Tree people,” he says, explaining that subsidence is usually caused by trees drawing moisture from the earth. “That’s another capability we brought in-house rather than using an external consultant. It gives us a tighter, quicker and faster process.” He rejects the notion that owning, rather than outsourcing, all these links in the chain makes the operation clunkier, because owning them streamlines the operation. Plus you get to own their margins too. With life insurance it would be tricky as there are too many links, he adds, “but where it’s a pre-set risk, like subsidence, there are only a very few things that affect it and the biggest one is trees within close proximity of buildings”. This is where the CEO goes on to explain what happens to clay once trees get near it, which sounds like it should be beyond the required reading list for most tech executives. But it’s a good example of what it means to be a BPAAS provider: “We need to know how things like subsidence really work, because only that way can we provide it as a service.”
Back in the big seat
Before being appointed TIG’s CEO in February 2010, having joined the company as Chairman the year before, Roberts had spent the previous decade mainly in non-executive roles. But he is quick to point out how this was less of a choice and more a consequence of a long non-compete agreement from he was CEO of Data Sciences, which IBM bought in 1997. “No, I’d have been a CEO again the following morning! Trust me!” Instead he was Chairman of Civica, Magic4, Phoenix, Vega, and Kewill, “about 12 different companies between 1997 and 2003. And made another fortune, really”. Roberts thinks for a moment. “Bubble-dot-com was all good for me, apart from Kewill. I was still the chairman of Kewill on the far side of the bubble. Big error!” He laughs. “Because then I had to re-build it. Kewill’s share price went from £32 to 8p, so the CEO and CFO had to go, we had to restructure, sell off half the company, refinance it. A lot of hard work for the Chairman. … Most institutional investors blame the CEO when things go wrong, it’s a fact of life.”
But still, the top seat is where he wants to be? “Well, I was recruited into TIG as a non-exec Chairman, but I thought the positioning of the company was absolutely brilliant. We set out to refinance in 2009, and the City insisted on a regime change so the CEO had to go. That gave us the opportunity to restructure the company into the shape it now has,” says Roberts. “And that is really going well,” he adds, emphasising each word. So he will stay? “Yes definitely! I’m enjoying it. At my age (60) you don’t often get a company this clever, this sophisticated, to run. It’s great fun.”
Seeing people recognise what the company has built is what motivates Roberts, who’s not particularly into money or glitz: “The simple things in life are much more important to me.” Like gardening, I suggest jokingly, but Roberts is more into construction projects: Give me the digger!” He has three sons, aged 22 to 30: “Two are off the payroll, the last gets off in September. Then we are done.” So what happens then, I ask, around-the-world tickets for him and his wife? “You know, I quite like the idea of working with young people. It’s a real treat. You feel you are contributing in ways that maybe they can’t, but equally they are contributing in ways that you can’t. … As you get older you don’t panic as much. You’re more used to what goes wrong, as well as what goes right.”
Big picture thinking
And then there’s the ability to fix things when they do go wrong. Following the restructuring of Kewill, and now TIG, Roberts is comfortable with the process: distill out what the company does for the market, determine what is the business model. Then put the company up against that model, and look for why it’s not working. “You make lots of decisions based on that. Some are based on experience and intuition, but some are numbers-driven: size of market, segments in the market, how many sales people we have.” Then of course, the neatness is disturbed by the tricky factor that is people, the most complicated part of running a business: “If I were to give you one guide as a CEO it would be, just hire AAA people. Try to avoid CCC or below, and focus on the As and Bs, because they can go places. … It’s not one formula fits all, but in an international business like ours, with lots of different cultures, it does come back to the basics in the end.”
Roberts comes across as a big picture thinker, I point out to him. “Oh, you’ll get me onto my favourite topic now. Myers-Briggs personality assessment! My wife would say, ‘Get thee behind me Satan, you are looking inside me,’ but it’s nothing to do with that. It’s about how you interact with other people, and understanding why they respond to you the way they do. Such an important process. It’s fine to talk, but what about the listening and the returning? It’s very helpful to know what you are.”
But Roberts has another meeting waiting, meaning we’ve run out of time to discuss Myers-Briggs, the behavioural psychology theory of how we experience the world in terms of sensation, intuition, feeling and thinking. I email Roberts the next day though, having discovered my Myers-Briggs category is an INFJ, an introverted type. Roberts, who is an extroverted ENTJ, responds immediately: “One can usually move from ‘I’ to ‘E’ by adding three units of alcohol!”