Page 139 - HBR Leader's Handbook: Make an Impact, Inspire Your Organization, and Get to the Next Level

128 HBR Leader’s Handbook

property and casualty, Macia was the only person at XL who could do
something about them. As a relative newcomer to the company, she was
also uniquely able to identify them, since they had become part of the land-
scape over time and therefore were invisible to most of her team.
The structural issue emerged during Macia’s very first meeting with
her new direct reports. At the meeting, Macia realized that only two of the
organization’s eight business leaders (the heads of the property and ca-
sualty units) were represented at the table. Her other direct reports were
all leading the company’s support areas such as operations, finance, and
human resources. “This is upside down,” she recalls thinking. “While sup-
port functions are important, they aren’t directly accountable for getting
results.” As she considered the issue further, she recognized that the orga-
nization’s structure made the staff functions more powerful than the busi-
ness leaders, so those support functions in effect were making decisions for
the enterprise instead of enabling profitable growth. More concerning, the
other business leaders, who oversaw auto, home, commercial, and other
business units, reported to Macia only through the property and casualty
heads. Based on this insight, Macia consolidated the support functions
under a newly created chief operating officer position and elevated the
other six business leaders to report directly to her along with the COO, the
head of distribution, and the head of underwriting. This de-layering
allowed her to focus more directly on the business leaders and the growth
plans that they were developing and executing.
On the underwriting side, Macia also saw a major institutional barrier.
The underwriting group had excellent technical skills in risk assessment
and pricing. But Macia saw that the group’s core process was focused in-
ward: the underwriters waited for coverage proposals to come from bro-
kers and then evaluated them using their strict technical criteria. Because
of this process, XL ended up writing a very small percentage of the pro-
posals that came to it and invested a lot of time assessing and rejecting the
opportunities that weren’t right for it.
Macia recognized that there were opportunities to improve this pro-
cess. She organized a Work-Out session (like the one described in chapter
3) for underwriters and businesspeople to jointly figure out how to stream-