Interview: Ian Geden

Alistair Schofield speaks to Ian Geden, Chief Executive of UK-based financial services company NFU Mutual, about customer service excellence.


I recently spoke at a conference on customer service and was struck by two things; the first was the sincerity and enthusiasm with which many of the delegates described their vision of putting the customer ‘at the centre’ of their organisations, and secondly by the instinctive way in which those very same people blatantly ignored the customers when we ran a business simulation exercise.

These were not bad people - they had a genuine desire to focus their organisation on providing great customer service, but the truth is that the hierarchical structures that are at the heart of most of our organisations are designed for the benefit of the management, not for the benefit of customers.

I was interested to learn more about how some companies manage to overcome this dilemma and approached NFU Mutual.  I am a customer of NFU Mutual and I turned to them because they are one of only a few companies that I would recommend to friends, having been genuinely delighted by the quality of their service on more than one occasion.   

The following interview with NFU Mutual’s Chief Executive was conducted during October 2006.


What do you see as the main drivers of customer service in NFU Mutual?

“Attitude and mutuality.  I believe that customer service is a state of mind that needs to run through the organisation like DNA.  Mutuality helps as it means that there are no conflicts between the interests of our customers and those of our shareholders as they are one and the same people.”

While I can see the benefits of mutuality to customer service, I am not convinced that being a “plc” should be an obstacle to offering good service, would you agree?

“Yes, but mutuality makes a culture of service excellence easier to establish, let me give you an example.  A few years ago we noticed that the margins being generated by one of our products were increasing.  The product costs were linked to the cost of money and interest rates had been falling steadily for some time.  No one had complained to us that the costs were too high but we felt that they were.  We therefore reduced the charges in the same way as any other company might, but chose to back-date the cost reduction, returning more than a million pounds to our customers.  As a mutual that decision was easy as, unlike plc organisations, we only focus on customers and are not trying to balance customer and shareholder requirements.”

The critics of mutuality often suggest that it does not serve the best interests of customers as those companies are not exposed to the same reporting rigors as a plc.  How would you respond to them?  

“We use the phrase ‘muscular mutuality’ to describe our business.  This means that we combine all the disciplines of a plc with the benefits of being Mutual.  I would also argue that in many cases the rigors we impose on ourselves go above and beyond those of most plc’s, as our Board includes customers as well as experienced business leaders.”

You spoke earlier about customer service being a ‘state of mind’.  What do you do to create this attitude within the organisation?

“Perhaps the obvious answer is around training, objectives and mission statements.  But this only explains what we say, whereas people are influenced much more by what we do.” 

“Since becoming Chief Executive I have focused a great deal of time and effort on the processes that enable our employees and agents to deliver great customer service.  For example, we have recently completed a £50m investment in new computer systems that are designed to deliver better information to our staff to support them in providing better service.”

Although computer systems are important, service is about people.  How do you ensure that the people deliver good service?

“This comes down to recruiting the right staff, providing them with the right knowledge and information and ensuring that their rewards and recognition supports the customer service objectives.”

“For example, when we recruit new employees we place a great deal of emphasis on attributes such as empathy and understanding as this is much harder to train than product knowledge.”

“For existing employees, we have programmes that enable them to ‘buddy up’ with our Agents.  This provides them with the opportunity to see what life is like for the people on the ‘front line’ and to meet real customers.  As a result of this and other programmes, we believe that they see our customers as ‘real’ people, not simply a voice on the end of the phone.”

So far you have talked mainly about employees, but a lot of your sales and service is delivered through Agents who are not directly employed by you.  How do you ensure consistency of service in those circumstances?

“On the whole the process is the same, we involve the Agents in our business through the buddying scheme, we provide training and support and their commission structure encourages them to provide good customer service as only a small proportion of their income comes from new business, the majority comes from customers returning year after year.”

“Although our Agents are not employees, we like to think that we invest in them and support them in much the same way as though they were.  Furthermore, we aim to treat our employees in much the same way as we treat our Agents, by respecting them as individuals and empowering them to take responsibility and make decisions.”

You have a reputation as someone who has driven a change in the culture of the organisation since becoming CEO.  How easy have you found it to drive change within NFU Mutual?

“I believe that change gets easier the more you do.  In the early days the going was quite tough and we needed to make symbolic gestures to demonstrate that we were serious.  For example, we abolished offices for everyone, including myself.  It’s not that the offices were particularly important but it was making a statement that we were prepared to live up to our own rhetoric.”

“We also identified that change management was a skill that was in short supply within the company.  We therefore worked with external consultants Winchester White to help transfer better change management skills into the organisation and the senior management team made a conscious effort to constantly explain the reasons behind the changes we were making.”

“I now believe that we are getting better at managing change and that change is beginning to be accepted as a constant in the business.  The most important aspect of this is that our employees now believe that if they come across rules, regulations or structures that inhibit good customer service, then the organisation will listen to them if they make suggestions that will improve our processes.”

Good customer service can be expensive to provide.  What evidence do you have that the high standards of service you provide are cost effective?

“The evidence is overwhelming.  Apart from turnover, which has doubled in the last six years, the critical things we measure are persistence*, customer satisfaction and the number of policies they hold with us.  Persistency on general insurance products is running at 93% and our research indicates that the majority of our customers actively recommend NFU Mutual to friends and family.”

“In our traditional farming market, the average customer has between 6 and 7 policies in force with NFU Mutual and in the wider non-farming market, which now accounts for more than half of our turnover, the average customer has 3 policies.”
“The important point is that whereas the trend in the insurance industry as a whole is for people to move insurance company after making a claim, the trend at NFU Mutual is for people to place additional business with us after making a claim.  We directly attribute this to the quality of service we provide when customers need to make a claim.”   

“As an example it is worth mentioning that the very first customer of NFU Mutual was a Warwickshire farmer who took out a policy in 1910.  That same farm is still insured by us today - 96 years later!”

What are your plans for the future?

“Although I think we are doing well there is still a long way to go.  I would like to see us continuing to push down decision making within the organisation and to see our managers spending a far higher proportion of their time on developing our people.“

“In a competitive market customers will always have a choice as to who they purchase their insurance from and there will always be products that are comparable to ours.  But our people and our culture will always be unique to us and our success will be driven by our people delivering the highest standards of customer service available and therefore difficult for competitors to replicate.”   

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About NFU Mutual
The NFU Mutual was formed in 1910 by 7 Warwickshire farmers in order to provide a benefit to farmers joining the National Farmers Union, which had been formed 2 years earlier.

Although the NFU Mutual retains close links with the National Farmers Union, it is an independent business that today offers life, pensions, investment and general insurance products to farmers and non-farmers alike.

For further details visit or call 0800 316 4661 during office hours.

* Persistency is a measurement of the staying quality of insurance policies. High persistency means that a high percentage of policies stay in force for the full term of the contract, while low persistency means that a high percentage of policies lapse before the end of the contacted period.

Alistair Schofield is MD of Extensor.