After four years out of the employee benefits world, Nick Burns, the man who has headed PIFC, Bluefin and Capita Employee Benefits, is now back at the helm of Gallagher Benefit Services UK, where he holds the role of CEO vacated by Tim Johnson. A lengthy sabbatical in the land of fintech start-ups has nurtured his taste for disruption, and he takes over at GBS with a plan to turn the consulting process upside down by putting business change at the centre of the proposition, delivering what he describes as ‘organisational wellbeing’.
For Burns this means going beyond traditional employee benefits consulting, and getting to grips with arguably the biggest challenge facing top management in UK industry – retaining quality staff.
Burns is passionate about his mission to turn around the UK’s culture of lamentably high staff turnover, which he believes is the flip side of a low level of employee engagement, loyalty and buy-in to employer’s value proposition.
“We are going to turn employee benefits consulting on its head to solve the people agenda, while still delivering excellent employee benefit services and products. The key is organisational wellbeing – that goes much deeper than the things people currently consult on.
“What is it that is keeping non-execs, CEOs, CFOs and HRDs awake at night? Is it ‘am I in the right default fund’, or ‘is the excess on my medical policy right?’ No. What is keeping them awake is ‘have I got the right talent in my business and how can I keep them’. Because that is what will make the business run better.
Do employee benefits solve any of these problems, yes, partly, but not the whole picture,” he says.
“Staff turnover is costing the UK about £4bn a year. It costs about £40,000 per person each time someone leaves. That excludes the salary – it can take 5 to 6 months for people to become profitable. The average turnover in professional services is 15 per cent, and this cost is generally accepted. So how about trying to reverse that trend for short term working spans, getting people to engage in and contribute to companies for a long time?” he says.
GBS could be the perfect company for him to realise his vision. With revenues well in excess of $1bn, it sits behind the big three in terms of scale globally. Its UK presence is relatively small but it has many of the components needed to realise Burns’ vision, and in less than three months he has taken another strategic step towards creating the organisational wellbeing he plans to launch in Q1 of 2020, with the acquisition of AHC, the pension, reward and change communications consultancy.
Burns says the acquisition of AHC, which completed at the beginning of this month, complements the firm’s two other communications businesses, Gallagher Communication, the organisation that evolved from GBS’s purchase of Shilling back in 2014, and Gatehouse, which was bought at the end of 2017.
“Bringing these together means Gallagher has one of the biggest employee communication businesses in the world,” says Burns.
This communication capability – across internal comms, business comms and benefits comms – will drive change within organisations, says Burns.
“We see communications as a key component of organisational wellbeing. With everything we build, we will be asking ‘does it help retention’ – pension, health, risk. And if not, we are going to ask why are doing it.”
For Burns this new top-down approach to change, with benefits consulting following the asking of more fundamental business questions, means bringing multiple disciplines to play within a single proposition, which will be called Gallagher Better Works.
“There are many components that are needed to achieve this sort of change within an organisation. You will need agency style communications, a branding business, a business that understands compensation, pay and reward expertise, career progression expertise, and organisations that can help clients with cultural change, including personal development. Nearly every piece of the jigsaw we have in Gallagher. We now have to bring lots of these disciplines together,” he says, adding that he will continue to be acquisitive to get the full toolbox of expertise that he needs.
Burns believes he can crack an opportunity that others have identified but have not properly attacked.
“Why do people go to work? How do employees help employees be more fulfilled and have a longer career? Some of the bigger consultancies have the constituent parts to help with this, and have great people and are good firms. But they haven’t linked it all together. They are still working in their silos. They struggle because of the way they are structured,” he says.
“It is the culture that attracts people to an organisation and part of the solution is wellbeing, retirement provision and healthcare. But if you are not starting at the top and working down you are not going to solve the real problems that companies face,” he says.
“The challenge for the corporate advisory market is how does it reorganise itself to provide the multidisciplinary approach, so that the employee goes on Glassdoor and says amazing things about the company that employs them. Employees are becoming consumers of employers. In the same way my daughter chooses whether she wants to buy her footwear from Asos or Amazon, she can also decide where she wants to work,” says Burns.
So will Burns’ new vision for Gallagher’s UK consulting business go as far as engaging with the way buildings are decorated and designed?
“As of today no, but as of tomorrow, the environment at work will be a factor. And a better place to work will not necessarily be a physical space. It will require new digital tools and deeper thinking about the employee value proposition. This in turn will force the employee benefit market to become more creative with their benefits,” he says.
Burns does not, on the other hand, see Gallagher building its own products, such as a master trust pension.
His four years out of the benefits consulting space has clearly given him an appetite for change and disruption. In his time following his departure from Capita he has worked with a number of fintechs, including payroll lender and financial wellbeing business Neyber.
“They said ‘we are going to do salary deducted loans’, and I helped them establish their presence in the employee benefits market,” he says.
Since then he has worked with a number of creative tech start-ups, a behavioural change business, and a communications business.
“This has taken me on an incredible journey. I was becoming stale at Capita, but after I left I became an ageless explorer. I rediscovered the importance of speed and agility, and the one lesson I have learned being outside of big consultancies is don’t have meetings for the sake of meetings. The other thing I would say is that talent in small companies is just as important as in big companies,” he says.
So why has Burns gone back to a big company after his time in the land of start- ups and disruptors?
“Smaller businesses are great, but they are capital constrained. It is so hard to grow. In larger companies it is harder to get things started, but once you do, you have got the capital to make sure that they happen,” he says.
So how have things changed since he has been away? “Well there are a few more start-ups like Neyber, Smarterly, Salary Finance, Earthmiles and HR tech companies popping up. The question is whether they can survive and scale and keep fundraising to remain relevant.
“But the main change is the move by bigger consultancies to become product providers. That makes me confused as a client.
“That also brings pressure on employees within these firms who have lived through consulting, but find themselves in a different environment now. But then most businesses realise that they have got to sell a solution of some sort.”
