Ray Milne, managing director of Guardian Employee Benefits, probably dislikes the description, but he is clearly a canny Scot.
Milne was head-hunted by GEB from Scottish Life, where he had spent the last 14 years working his way up from an actuarial trainee in pensions administration to head of marketing. But after 14 years, the lure of a new company was too much to resist. He says: “I was aware that Guardian Employee Benefits had experienced a few lean years. Being a bit of a lazy guy I could see things were changing and thought I might as well jump on the bandwagon.”
He joined as director of corporate pensions in April 1996. But rather than simply ride the wave of Guardian’s success, Milne was instrumental in bring about a sea-change in the company’s fortunes.
The year he arrived the company was scheduled to lose £2m. He set about reducing expenses and as a result the company made a profit of £ 1 million. This was the first time in 10 years the company clocked up a profit, the year before it lost £5 million.
Not surprisingly, Milne was swiftly promoted. In June 1997 he was appointed managing director of Guardian Employee Benefits.
As he says: “It has certainly been a hectic 18 months.”
One of the reasons for GEB’s turnaround in fortunes has been the company’s Corporate Protection Menu. Milne says: “The market is moving towards a more flexible approach to employee benefits. The Corporate Protection Menu aims to meet this need.”
The menu is based on a concept that has caught on in the US and is rapidly gaining a foothold within UK companies. Rather than simply offer employees benefits such as medical insurance or life cover, these `flex’ or `cafeteria’ products provide employees with a menu from which they can chose the benefits that suit their lifestyles.
Milne says: “For younger staff, unmarried and with no dependants, life insurance is not really viewed as much of a bonus. They may prefer to exchange this benefit for a few extra days holiday a year. But as staff age and have families, life insurance and free healthcare are going to be more of a priority so they can choose these protection products.”
Although few companies in the UK offer these flex products, the numbers are increasing. Already, progressive companies like CCSB, Sony and the Mirror Group are offering their staff these benefits. Milne says: “In a short space of time, Guardian’s Corporate Protection Menu has become one of the leading products in this area.”
He adds: “Companies offering a flex product can make savings by using just one insurer. At GEB we can offer pensions, life insurance, critical illness cover, income protection and can draw from products that are also offered by other parts of the Guardian group, like PMI from Guardian Health and policies from the general insurance division.”
Not only do employers save money, but research from America has indicated that flexible employee benefits are more valued by staff – so companies can save money and keep their staff happy too. Milne adds: “Even with a standard corporate pension most employees do not believe that their employer is matching their own contribution pound for pound. They assume that for every pound they put in the employer will add about 20p. But with a flex product staff are more aware of the tangible benefits that their employer is offering them.”
This has involved Milne going on `fact-finding’ missions to America. He says he was struck between the different attitude of US employees. “It is a very different working culture. They do not expect the same benefits that UK workers do.”
But it is not only the insurance products that have an American flavour at GEB. Since Milne’s appointment there has been significant changes in the company’s culture. He says: “I have hit on quite a few crazy American ideas, but they all seem to have gone down quite well at Guardian.” Odd as it may seem one particular idea that has caught on is standing meeting rooms.
Milne has tried to encourage a more open style of management at GEB, not just with the fixtures and fittings in the new offices but by encouraging more communication between management and staff. One of his first jobs on becoming managing director was to re-locate his staff. Rather than simply making a decision on economic factors, Milne asked his staff where they wanted to go. It emerged that most would rather stay in Edinburugh’s city centre than move out to a business park. So Milne organised the move and managed to negotiate the lowest city centre property deal in five years.
The new office is a far cry from the first Guardian building that Milne walked into. He says: “There were marble fireplaces and oak panelled meeting rooms. I was shocked to discover that outside my office there were two male toilets, one for managers and one for senior management, but no ladies. Apparently when we had a female IFA visiting someone would have to stand guard while she used the gents.”
He adds: “Obviously when they had been built, female managers were something of a rarity and no-one had seen fit to change things since.”
But Milne made it a priority to change things. Although he adds: “Unfortunately the urinals in the gents were listed, so we had to hide them behind large mahogany box.”
In the new office no such archaic discriminations exist. Milne does not even have his own office. He sits in the.open plan office along with his staff. He says: “We have a few meeting rooms, which anyone can book, but they are only used 30% of the time. Most people have meetings at their desk. And I have introduced open spaces outside the kitchens and coffee machines where staff can have informal `standing meetings’ as and when they choose.”
Milne is keen not to distance himself from staff activities. For Comic Relief he joined other managers in coming to work in fancy dress. Unfortunately the day clashed with an actuarial council meeting. “It must have been the only time that an actuarial meeting was conducted where one of the council members was dressed as an Arab sheikh,” he says. But his efforts were not in vain. The staff raised £6,000 for charity.
Milne is also keen that his staff share his vision regarding the company’s future. He says: “Ask any employee and they will be able to tell you what the Project 399 is. We aim to be one of the top three companies providing employee benefits by 1999. It is simple and snappy, not some vague mission statement. Staff then have a clear idea of where we are going and how they can play a part in that.”
At present the company is in the top five. Before the Corporate Protection Menu was launched Guardian Employee Benefits did not even make it into the top 10.
As well as knowing where the company is heading, Milne also wants to ensure that staff understand the Guardian’s strategic objectives and core values. Again this may sound rather Americanised for some British insurance companies, but Milne insists that the message is getting through. Each member of staff is issued with a card which lists both the values and objectives of the company. Milne says: “If you look around the office you will see that most people have these on their desks. We hope it makes them see that they have a vital role to play in the success of our company.”
It is yet another example of Milne’s creative approach combined with Scottish common sense. So it is hardly surprising Guardian has taken the employee benefits market by storm, meeting the demands of the modern workforce and its changing needs.