Megabuyte, February 2015. Original article.
The Megabuyte Interview: Michael Whitfield
Michael Whitfield talks about all sorts during our meeting, but everything he says is really about one thing: how culture is everything at Thomsons Online Benefits. Even the cheery pink decor in the headquarters in London’s Victoria is a symbol of the company’s values: “We are quite pink here. We talk about passion and fun, people are brave here, they can do stuff – that’s the essence of what we’re trying to achieve.” Recently Whitfield felt the company was becoming too process-y, with too many people changing the proverbial lightbulb, and issued a call for more pink: “Don’t tell me you can’t get it done for six months. Find a way! I feel the culture of this business, so if something doesn’t feel right it probably isn’t. I think that’s a great way to run a company.”
We’re sitting in Whitfield’s office, shared with co-founder Chris Bruce, surrounded by photographs of Whitfield with his colleagues. The CEO’s lanyard, worn over a grey jumper on this cold winter day, carries the same sort of badges as seen around the office: “Vitality”, reads one; another: “I’m tidy”. Whitfield could also be labelled as engaged and enthusiastic, with a knack for delivering even critical opinions in a respectful manner. “I don’t believe in cutthroat and ruthless, I think business is about relationships. That’s what keeps the world going around, and it keeps us honest as a business.”
The changing world of work
Thomsons Online Benefits turns 15 this year, having built a name for itself as a specialist software provider for employee benefits. “Most employers around the world provide some sort of benefits for their staff, but up until the last ten years they’ve not put much thought into how they provide those benefits, or whether employees actually want, need, or like them!”
Increasingly, employers are coming around to the fact that flexibility and choice are key to providing the benefits that attract the best staff. That can mean working remotely, job sharing, bring-your-own-device, health plans, or canteen vouchers: “I’ve always said to companies: you have to give people choice, you have to give people what they want. The millennial generation want something completely different to the baby boomers. People don’t have set retirement ages anymore, so that’s a choice they’re going to have to make.”
The Thomsons technology enables this flexibility, says Whitfield, but the changing world of work ultimately means the boundaries of employer and employee trust has to change. “And this is probably necessary if we want people to have better work-life balance, time to bring their kids up, more time to work, less barriers to working.” Most companies place major barriers to mothers coming back to work by demanding they work full time, says Whitfield: “You have to allow some flexibility. If not, your talent will go work somewhere else, or become a disgruntled employee.”
At Thomsons they practice what they preach, Whitfield assures me, explaining how most of the software engineers won’t show up until 10am, maybe even noon, but will happily work into the evenings: “I just want them to be in their optimal state to write code. […] This is about allowing people to do what they want in their lives, while also delivering the work we want at the appropriate time. I’m after getting the best quality, and having happy brilliant people working.”
After undergoing a series of changes in recent years, from the Retail Distribution Review to a partnership with private equity group ABRY Partners in Boston, Thomsons now has its ducks in a neat row: “Our core product is delivering benefits to clients online, and we feel very comfortable doing that,” says Whitfield, who is wary of losing focus through too much diversification. ”We decided to go with ABRY because we wanted a partner who understood the world. It was time to find a global player.” The company is contracted to clients in 120 countries over the next five years, with a determined focus on increasing its global presence. When facing off with the likes of Workday, Thomsons competes on the fact that benefits software is its core focus: “Lots of companies try to offer benefits software, but they are less successful because it’s part of a suite, or it’s an afterthought. For us, it’s all that we do.”
Asked if he feels Thomsons’ global plans are ambitious, the CEO rather thinks this has been a long time coming: “We have eight of the world’s top ten companies as clients, and you don’t get those easily.” He remembers when Google was scouting out the company before becoming a client, and someone commented how the Thomsons culture felt a bit like Google. Not that Whitfield wants to be Google – he wants to be Thomsons – but it’s a nice compliment. “No, I don’t think we’re at all ambitious. I think we are being realistic and our growth plans are very achievable. We achieve our numbers.”
Pushing for change
Whitfield describes founding Thomsons at 40 his “good midlife crisis”, although he’d been working with benefits and financial services a while time before this. “My original plan was to go to university and become a barrister. But my parents divorced and I had little guidance, so I ended up going to work at 18.” This was at Bentalls department store in Kingston, “the best retail training I ever had”, teaching Whitfield how to treat customers. Deciding there wasn’t any money in retail, Whitfield made the switch to financial services, moving through Bishop Cavanagh, Swire Fraser, Alexander Forbes: “I got thrust into a world where I dealt with individual clients, and those clients went on to become managing directors who then asked me to look after their companies. Those companies had benefit requirements, so that was my evolution.”
The spark that later became Thomsons Online Benefits came one Saturday when Whitfield was ordering groceries online: “I was on a big dial-up PC, it took hours and all the wrong stuff turned up, but it was fun because it was online!” This was around 1997. “And I thought, I must apply this to what I’m doing, there must be a way. That was the trigger.” Whitfield knew nothing about technology at the time, but there was so much paper-based admin around benefits, and this could be a chance to change it.
Whitfield’s ambitions for the company has certainly changed since the early days: “I had no idea how big it would get. I remember thinking at the time: wouldn’t it be good to get a million in recurring revenues?” He laughs; now over 80% of Thomsons’ £36.7m revenues are recurring. “I never thought we’d grow this big, but now I don’t think there’s any limit to how big we could grow. We have some fantastic clients and we love what we do. The world is a very small place, and it’s up to companies like to us to go and say…” Whitfield pauses. “When Chris and I first started, people told us we could never put all this online, getting rid of the paper.” Never? “No. You needed a wet signature.”
Well, you don’t need a wet signature anymore. Whitfield never finishes his point about what “companies like us” should go out in the world and do, but his next anecdote provides a hint: Thomsons also pioneered online pension enrollment in the UK by confronting the tax authorities about the red tape, illustrating how plucky little companies, which do just one thing really well, may just have the attitude and motivation to create change.
A bold move with more risk attached came four years into the life of the company, when a decision was made to scrap the home-made software and go with Microsoft’s .NET framework. “It was the best thing we ever did, because it allowed us the flexibility we have today. It was a brave thing to do and it went well – it didn’t have to go well! But it did.”
But the period that taught Whitfield the most came around 2010, when Thomsons “went off on a tangent”. The co-founders were advised to step back from the day-to-day runnings, and the company went from 125 to 250 people in the space of a year. “We had all these new people come in without Chris and I living and breathing the culture on a daily basis. The old people lived the values and the behaviours, and the new people didn’t care. After about six months I said: ‘Enough, this isn’t going to work. We are losing the culture which makes us special.’”
It took the co-founders six months to get the company back on track, but it became a lesson in sticking to your guns when you have a passionate conviction about where you want to go. “Of course you listen to advice, but if you know what you’re doing is right, it probably is. […] I learned a huge amount about the business, and about myself. We became a much better business and I became a much better leader.”
Running with your head up
Whitfield (56) is a Londoner, “born and bred all my life”, now living in Barnes where he’s chairman of the local rugby club. He has two children in London and three in Canada following “a couple of iterations” of marriage: “They are very diverse: my youngest in London are students. In Canada, one is running a university treasury department, he’s about to finish uni. One runs a business, one sells advertising.” Whitfield likes to get up at 5.30 every morning and “keep this old body in shape”, and he’s passionate about sports: “I still play the occasional game of rugby. I’m also into travel, reading, holidays, so yes, passionate in and out of work! But as I get older I feel I have sacrificed a lot in terms of time with the kids. I try and make up for that now. We spend time together, all the kids, they get on well.”
Proper work-life balance isn’t just something the CEO facilitates for his staff and customers, readily recognising he’s at his most creative after he’s been on holiday for a few weeks, “when my mind is rested and free from the clutter of the day-to-day work”. Getting some distance from the daily grind also ensures Whitfield can keep an eye on what’s on the horizon for the business: “You have to run a business with your head up, not down. That’s how you play sports as well.”
At Thomsons, this means talking to everyone in the company, and Whitfield makes sure to check in with every new face. “Your people keep you honest,” he says, not for the first time during our chat. “Nothing excites me more than a challenging period of growth, as I know I have to be really alert. You have to get up and work a bit faster and harder, and walk around the business more.”
Keeping in touch with the people of Thomsons, making sure the culture and the “pink mist” is strong, is without a doubt what motivates Whitfield: “When you are young you want to do it yourself, proving you are the best at what you do. Now I want to see my talent be the best. I look at my talent growing with the business, and it’s great to see them feeling empowered to do brilliant things. It’s that, not me, which will make this business great in the future.”