Back to school 2021 - Reflections on the return to the office

The return to work in September has always felt like the return to school – a new term and new challenges. In this mid-pandemic world, that has not completely changed, but “back to school” does have a different feel this year.  The kids headed to their new term at school (and indeed new schools as well) but I was not just heading to my study. I was returning to “The Office” - with some excitement and anxiety. The train was slightly busier than I’d like (but a fraction of pre-pandemic levels), with odd tension between mask-wearers and others and a typically British problem - deciding where it is sociably acceptable to sit.

Coming back to the office and meeting clients in person has been brilliant. I am more energised and the days have been flying by. So with all of this energy and a renewed enjoyment of the commute as a time to think (and write), what did I find upon my return to the office? 3 key things: resilience; a new way of working; and an urgency around change. 

Resilience

An industry which prides itself in helping others has turned out to be rather good at surviving (and indeed thriving) through a crisis. The effort that so often is focused on others has also seen the need to look inwards. Whilst it has not all been plain sailing, the transition of most organisations to virtual working was way better than most people expected and much less troublesome than most regulators feared. Boards, executive teams and all of their people should be incredibly proud of what they achieved. No Business Continuity Plan that I ever saw was based on 100% of staff having to work from home, but that is what was managed.

Working from home has not come without its challenges, too numerous to cover here. Some of the key risks that have emerged however have been as follows:-

Cyber

Cyber “threat actors” thrive on points of access and points of weakness in access.  Creating thousands more doorways into systems was a requirement to make sure businesses could keep running. It was however a significant change in the risk profile for most businesses. Attacks are on the rise, successful attempts are increasing and whilst there has been resilience, it is clear that there is a lot more risk. Companies are having to work harder than ever

Stress and pressure

we have all felt a lot more pressure in the last 2 years with additional complications to add to busy lives. As companies work out the best way for teams to work most effectively together, the flexibility that many have found during the pandemic is now under threat. There seems to be more pressure and stress as people return in some form to the office as when we all decamped home so quickly.  For others, the stress has not stopped – the pressure to keep working hard for your business, to protect your job and to support your family has resulted in a huge number of cases of stress. Mental health issues are prominent and companies have an important role to play in supporting their employees through these challenging times.

A new way of working

Hybrid working is one of the terms of 2021 – finding the right corporate and individual blend of home working and office working.  It is clear that most companies still have a long way to go before a really effective pattern can be established.  For some companies, the pandemic has accelerated a move to virtual working which had already started – for others, the return to the office could not have come more quickly.  The biggest challenge seems to be where the corporate strategy does not fit with the desires of its people.  Companies are having to do ever more to find the right balance.  There are some interesting approaches being taken to “encourage” people back to the office – I have heard the whole spectrum of ideas – from mandatory attendance through “Super Tuesdays”, financial incentives and even Puppy cuddling at work.  Technological advances are helping hybrid meetings work more effectively and I am sure that there will be more to come.  This September had also seen a “New year” effect on many people with people changing jobs and companies at a much higher rate than normal.

A new urgency around change

Never before in my career has there been such an urgency around change.  The pandemic has brought a number of issues which were important, but not urgent, into very sharp focus.  My top 2 are as follows:

Digital

Whilst all companies managed through the pandemic, for most, it brought into sharp relief the limitations of ageing technology and processes.  With a combination of the threat of new entrants without the burden of legacy systems and the urgent need to work out how to work plug into the new digital solution being developed as part of Lloyd’s Blueprint 2.0, companies need to act and act fast.

The benefits in digitisation are clear – efficiency, enhanced data and analytics, client connection and interaction.  The risks are also clear and the costs, whilst likely to be high, are uncertain.  There is a huge amount of misinformation and misunderstanding within businesses.  I have had many discussions with C-suite executives who have become completely confused by the endless presentations using newly created jargon which focus on technological features and rarely get to the business benefits and a real view of what the future will look like.  Digital should make business easier – I’m hoping that business is going to start making digital easier!

ESG 

The purpose of insurance has again been a major focus through the pandemic, with insurers paying out billions of claims to their policyholders.  It has not all been plain sailing however, and I think that some of the challenges of Business Interruption claims have not shown the industry in the best light.  In the coming year or two, I believe that the industry has an opportunity to rectify that position and to do a better job, alongside its industry associations, in setting out how insurance benefits us all and how insurers helped people and business through an unprecedented time.

The other key part of ESG is the focus on the Climate Emergency.  The first reporting cycles which have included reporting on ESG have now come about and companies are finding out the difficulties of gathering and reporting data on how their organisations perform.  This is an important first step, alongside the regulator’s focus on assessing climate change stresses, but the real change is just around the corner.  As companies look at what the reporting is saying about their business, attention will shift to the impact on strategy.  In the London Market, climate related events have always been front of mind due to the volume of catastrophe covers sold.  Now, insurers are having to renew and refresh their strategies to look at how all underwriting and investing will need to transform in order to balance the need to support long-standing customers alongside meeting Net Zero targets.  I have been part of a number of these discussions which are fascinating - but they are at the start of the journey.  There is a long way to go and we will need to be collaborative as an industry to address these complex changes.