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Global reach, local service

Willis CEO sets course

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NEW YORK--The new chairman and chief executive officer of Willis Group Ltd. is the first to admit that he doesn't know much about insurance brokering.

"I don't know what I don't know, so I've asked a lot of questions," said Joseph J. Plumeri.

But that ignorance can be turned to an advantage, he said. "When you are in virgin territory without any baggage, sometimes that is better because you don't have a sense of what you can't do."

A little over four months into the job, Mr. Plumeri said in a recent interview at his New York office that he has developed a vision for what he wants to do at Willis.

That vision is of a global brokerage that retains the personal touch, where employees feel appreciated and work on anything they can that will help their clients, whether it be traditional insurance brokering or advice on mutual fund selections.

As Willis expands its services, the brokerage will also expand its revenues through acquisitions, recruitment of brokers and organic growth. And it will do all this

with the backing of an owner that is looking to grow a company for the long term, Mr. Plumeri said.

The change in approach to running Willis is perhaps inevitable, given the differences between Willis' old ownership and management and the new.

Formerly, Willis was viewed as a blue-blooded British brokerage run by blue-blooded British brokers. Centered on Lloyd's of London and publicly owned, Willis steered clear of retail operations in the United States, preferring instead to maintain a servicing agreement with the former Johnson & Higgins. That arrangement ended in 1991, when Willis bought Corroon & Black, but the brokerage remained British-run and listed on the London Stock Exchange.

Willis' ownership changed in 1998, when it was bought by a consortium led by Kohlberg Kravis Roberts & Co. L.P. in New York. And the senior management also changed last September, when Mr. Plumeri succeeded the retiring Executive Chairman John Reeve.

Mr. Plumeri, from Trenton, N.J., brings to Willis a new perspective, with a background in securities brokering, banking and personal financial services and a flair for salesmanship. Before joining Willis, Mr. Plumeri led the integration of the consumer businesses at Citicorp and Travelers Inc., serving as CEO of Citibanking North America in addition to his existing post at Travelers, which had been as chairman and CEO of Primerica Financial Services.

Rather than running the company from London, Mr. Plumeri says he intends to spend less than half of each month there and the rest of the time in New York, Willis' North American headquarters in Nashville, Tenn., and "anywhere else I'm needed."

One of the first changes he has made to the London-based brokerage is to set up a global sales and marketing department, which Willis did not have before.

Other changes have been aimed at increasing communication between management and the rest of the staff. For example, Mr. Plumeri instituted his "Talk with Joe" program whereby employees are invited to e-mail him about any subject they choose and he'll reply himself. He has also implemented "Joe's notes," whereby, at the request of department heads, he'll write a note commending the efforts of individual employees.

But it won't be all change at Willis, Mr. Plumeri said. He stressed that the brokerage is full of talented people doing a great job. And he wants to maintain those strengths and grow them by improving service to customers.

And service is something he does know about, Mr. Plumeri said. His background is derived mainly from the diverse financial services provided by the companies that now make up Citigroup Inc. "That's not insurance broking, but they all had clients and the clients had to be serviced and had to be made to feel good about the companies I represented," he explained.

Service is one area where all insurance brokers need to improve, Mr. Plumeri said. For example, risk managers continually complain about the poor claims-handling services they endure, he said.

"Nobody has distinguished themselves in the claims area yet, but we are going to make a valiant effort," Mr. Plumeri said. To improve its claims servicing, Willis is implementing standards for tasks such as how long it takes to service a claim.

The companies that Mr. Plumeri formerly ran also focused on product innovation and marketing and sales, he said. And Willis' new global sales and marketing department will focus on cross selling and product development, he said.

The driving force behind such expansions in products and services by Willis is the desire to fill the "value gap," he said. Mr. Plumeri defined that as the difference between what a client can do for itself and what its brokerage can do for it. The wider the gap, the more opportunities there are for the brokerage, he said. "Everything we do will be to continue to define and grow that value gap," he said.

Additionally, he sees Willis as an adviser to clients rather than just an insurance brokerage, and the type of advice it gives will depend on clients' needs, Mr. Plumeri said.

"You then open up for yourself to a whole bunch of things that you can do in the future," Mr. Plumeri said. "Who says you can't do construction financing or premium financing or employee benefits and help individual employees with financing and investing? That takes you into banking and alliances with other companies," he said.

"I'd rather see what our clients want and then build Willis to meet those needs," he said.

To build Willis, Mr. Plumeri intends to take a diverse approach. "You can grow through recruiting, acquiring or by growing organically, and we intend to use all three."

Those growth efforts will focus primarily in the United States, Mr. Plumeri said. "When you look at the U.S., our business is not as big as it should be, given the size of the U.S." So, if an attractive company became available, Willis would buy it, he said.

Despite occasional rumors that KKR plans to sell Willis, Mr. Plumeri believes he will have the opportunity to build Willis for the long term. When he was recruited to run the company, Mr. Plumeri said, he was reassured that KKR wanted to "build a great company."

"You don't grow a great company in two, three or four years. I did not come with the understanding that it was going to be sold; I came here to build a great company, and that's what I'm going to do.... If you look at my track record, I'm a builder and a grower. I'm only equipped to grow and build," he said.

He described recent rumors that Willis would merge with rival London brokerage Jardine Lloyd Thompson P.L.C. as "poppycock." Instead, Willis will continue to thrive as a global brokerage, which is "a geographic fact," and expand its range of services, he said. "I think people are going to have a lot of fun watching Willis grow in leaps and bounds," he said.