Insurers Face Rapidly Developing Talent Challenges

The traditional value exchange between carriers and professionals has given way to antagonistic goals undermining the development of institutional knowledge and a strong managerial pool.

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The twin challenges of talent and knowledge management are central to many of the conversations we have with insurance carrier CIOs now. The demographic realities are increasingly clear. By 2030, 75 percent of the U.S. Labor Force will be made up of Zoomers and Millennials. The leading edge of Gen X will be picking up Medicare cards and eligible for retirement. That’s a profound wake up call.

When I had the opportunity to host RPM Ventures NC’s most recent Silicon Valley Innovation event, I was struck by several attributes of the participants. One was that the average age was notably lower than had been the case previously. A second was the very high level of technical proficiency that spanned the audience—which contrasted with a general lack of deep knowledge of the industry. It implies both opportunities and risks as companies prepare for what comes next.

At the same time, I was clearly aware of the angst in some of the tech firms going through difficult downsizings. Companies that not so long ago were enticing people with free food and flexible work accommodations, were now going through a painful transition of their own, with an implied contract (not a legal one) being broken. Hard work and loyalty no longer were the dues to be paid for stability and security.

This isn’t the first time we’ve seen that kind of painful shift, for those graced with long memories. When I worked for a Tier-1 life carrier early in my career we also had free food, onsite child day care, and other amenities which invited long term relationships. That went out of vogue at one point, and a whole new generation of employees learned to manage the risks of corporate life through developing an array of skills and experiences which could be portable. Careers became a matter of managing a series of  “tours of duty” that are around five years long, and for those who do it well, the security comes from an ability to plan carefully, always ready for the next big move.

Focus on Hard Skills Impedes Development of Managers

But that has a price to be paid. One example is that there can be a focus on hard, technical, skills which are clearly portable, but lead to critical talent gaps for employers. As a case in point, many now tell us that it is difficult to get younger employees to take on managerial roles. For one thing, it takes away from hard skill development. For another, it seems like those roles are particularly vulnerable when cost cutting season arrives.

The advent of Gen AI into many organizations is fueling a new need for soft skills. As noted in a recent Fast Company article by USC professor Peter Cardon, the need to marry technical with the human elements are increasingly critical. Cyborgs may well be better than either pure human or technical capital, but integration is hard work. Many companies may have a new challenge trying to convince current and future workers that a shift in priorities is needed. No time to waste.

And yet changing minds and hearts, particularly when personal risks are involved, is difficult. A recent Washington Post article highlighted the challenge that exists for employees who have watched this century roiled by one financial crisis after another. Once and done transactions don’t change minds, but a commitment to long term changes can.

In an array of industries, such as manufacturing, we’ve seen companies (e.g., BMW) look to create longer term and more secure relationships with employees in recent years. It’s a work in progress but comparable approaches to training and development as part of more reciprocal, rather than transactional, relationships may be key to the future. Flexibility will clearly matter, but institutional knowledge is a form of IP that companies should manage carefully. The back half of the decade will be interesting, indeed. 

Fast Start For 2024: The Urgency of Talent Management

Rob McIsaac // Rob McIsaac is the President and CEO of RPM Ventures NC, LLC, an organization focused on developing deep and actionable insights that are specific to the insurance industry in North America. Prior to creating this, Rob served as an Executive Principal at Novarica (now Datos Insights), a technology research and advisory firm, where he leveraged his expertise in IT leadership and transformation as well as technology and business strategy for life, annuities, wealth management, and banking. He has broad experience in IT strategy and management in the insurance and financial services industries. Prior to joining Novarica, he served in a series of senior technology management positions including leading the Business Transformation Office at Nationwide Insurance, and as the Enterprise CIO for First Citizens Bank. Rob spent the majority of his earlier career at Guardian Life, where he was the Divisional CIO responsible for annuity, distribution and broker dealer operations, and at Prudential Insurance, where he held a variety of positions including leading e-Business development efforts. Rob holds a BA in Economics from Montclair State University, an MBA in Information Systems from Seton Hall University, and has received a number of business and technical designations from both LOMA/LIMRA and MIT. He can be reached directly at rob@RPMVenturesNC.Com.

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