Canadian Execs Speak Out On Organizational Excellence.

The CEO of the National Quality Institute, Allan Ebedes, has conducted over 30 interviews with CEOs, CAOs, Presidents and Executives of large and small organizations from both the private and public sectors across Canada.

These senior executives have been asked to share their organizations’ best practices around the Drivers of Organizational Excellence as set out in the Canadian Framework for Business Excellence and the Healthy Workplace Framework, namely: Leadership, Planning, Customer Focus, People Focus, Supplier/Partner Focus, Process Management and Organizational Effectiveness.
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Interview with Kevin Dougherty, President, Sun Life Financial Canada

Background

Sun Life Financial went public in 2000, converting from a mutual company owned by policyholders to a public company. Demutualization enabled access to capital that allowed us to achieve significant domestic and international growth. For instance, we were able to use our stock as acquisition currency when we purchased Clarica ($7.2 billion), enhancing our domestic presence as a platform for international growth.

At the IPO our share price was $12.50. Today our share price is more than $46 representing a compound annual growth rate of approximately 25 per cent. We moved from a market capitalization of approximately $5 billion to more than $26 billion today. And in 2000 we were the 32nd largest life insurer in North America. Today we are the seventh largest insurer, passing 25 companies in less than six years. The company has clearly experienced significant success relative to our peer group, and we know there is a strong link between our achievements and our focus on quality and customers.

We first joined the National Quality Institute in 1997, and have since worked hard to implement the NQI Framework in many parts of our business.

On Mission
Our mission is to help our customers achieve lifetime financial security. This mission is at the heart of our products and services and is at the heart of what our employees focus on each and every day. In Canada, we are on the ground in approximately 900 communities from coast to coast. Virtually everywhere there is a town, Sun Life or Clarica is there supporting the needs of Canadians.

More broadly as a company we strive to be an international leader in the wealth management and protection businesses. Our strategy is essentially designed to use our strengths around the world to help our customers achieve lifetime financial security and to create value for our shareholders.

An important role for leaders in our organization is to connect the work of our employees to the company’s mission, and to instil pride in the company and their contributions to it. This communication is key. We continually reinforce where different parts of the business, and different people, fit into achieving the company’s mission.

Our team increasingly focuses on this higher sense of purpose – beyond writing insurance policies or answering the phone – driving towards our mission of helping customers achieve lifetime financial security is exciting and rewarding.

On Corporate Governance
Strong corporate governance is essential for the growth and success of any company. We firmly believe that you need to instil a culture that goes well beyond regulation and encourages employees to ask, “what’s the right thing to do?”

Sun Life has a well-developed code of ethics and market conduct guidelines. We have a strong compliance function and we have business unit compliance officers, reporting to the Risk Review Committee of the company’s Board of Directors. This structure helps ensure that all parts of the organization comply with the letter and the spirit of all regulations. Every employee also goes through a mandatory computer-based training module on our code of conduct annually. This training involves role-playing in which various scenarios are presented for employees to work through. We place the utmost importance on compliance with this code.

Sun Life’s governance is highly ranked by outside organizations. Last year, we were named one of the 100 most sustainable companies in the world, and one of the Top 100 employers in Canada.

On Business Planning Processes
Business Planning is an important dimension for a business like ours, where products, commitments and relationships span many years and decades.

We employ sophisticated techniques for planning purposes. For example, in our Group Benefits business, we use data from what we call The 3 Voices – the voices of the customer, the employee, and the shareholder – to advance our plans.

For the Voice of the Customer, we developed a Member Loyalty Index and a Customer Loyalty Index, which are quantitative and qualitative surveys of customers and group plan members. We also convene a National Client Advisory Council, bringing in our top 20 employer clients across Canada, three to four times a year, to discuss new product ideas and service concepts. While this might seem to be an expensive proposition, it pays for itself in many ways. It focuses our product development plans on high impact ideas and saves us from executing projects that were an executive’s pet idea, but somehow won’t actually fly. In the past, we have presented concepts to the client advisory council that turned out to be flawed and saved a million dollars in minutes by focusing on what our customers really need. At the same time, we get the opportunity to spend quality time with customers, and that is of tremendous value.

To obtain the Voice of the Employee, we run a series of employee focus groups on everything from work environment to business processes. We typically survey 600 employees each year, enabling us to get valuable ideas from the frontline, middle management, and many of the operational areas.

We listen to the Voice of the Shareholder through our finance areas and Corporate Office, and through feedback from analysts’ reports.

We build our Group Benefits plan around these 3 Voices, reflecting the NQI framework that challenges us to ensure we have the most rigorous kind of input into planning processes.

On Benchmarking and Measurement
We embrace the mantra, "You can't manage it if you can't measure it," and take a unique approach in closely monitoring and measuring our competitors’ performance as well as our own. This process drives our planning and target-setting efforts.

Our Advisory Loyalty Index surveys brokers and agents that do business with us and benchmarks our performance against the competition’s to assess our strengths and weaknesses as well as theirs. This has contributed meaningfully to our growing sales results and our industry leading customer retention.

We also have monthly Key Performance Indicators that track sales, expenses, and net income. A report is produced every Wednesday showing weekly statistics on sales and key service categories compared to the same week the previous year. We then use this data to monitor our progress and to take corrective action continuously. For instance in our Individual Insurance business unit, senior management huddles weekly to adjust activity in order to stay on plan. Action items that come out of these meetings filter right through the organization very quickly.

In this way, we retain a day-to-day focus on plans and results.

On Employee Empowerment and Recognition
Empowering employees, and recognizing their performance, motivates Sun Life’s employees to strive for excellence. There are many components to our recognition systems, and we have learned that non-monetary recognition is especially meaningful to employees.

One example, of many, illustrates how we reward employees who go the extra mile. A few years ago, a group plan member with a medical crisis was in a hospital in Florida at 6 p.m. on a Friday. The hospital would not discharge our customer until his coverage was validated by one of our suppliers whose office was closed. An employee in our call centre used his own credit card to pay $9,000 to the Florida hospital. He did this because he knew the coverage was in order and that Sun Life would back him up. This employee was subsequently inducted into our “Above and Beyond Club,” which annually recognizes twelve employees for heroic acts. A committee of employees, not managers, chooses these winning employees.

We have another popular program called VIP - which stands for Values Inspired Performance. Essentially, if you’re a colleague in another part of the company and you do something that is really exceptional, I can pull up a form on my screen, fill it out and thank my colleague for a job well done. I hit send, and it is copied to you, your boss, and anyone else I choose. This is just about noticing somebody doing something right and recognizing them for it – recognition, and positive reinforcement.

We also have another recognition system called the Managers’ Treasure Chest. When a manager wants to recognize someone, they go to the treasure chest and select Sun Life promotional items and then give it to the employee at the next employee weekly meeting. Our employees have a strong affinity to the company’s brand and they take pride in wearing our branded items.

Recognition and thanks from one’s peers is meaningful to employees. Of course, we also have incentive compensation aligned to all the different dimensions of performance, from financial to service quality, and so on.

On Performance Reviews
While we aim for annual performance reviews, and more frequently in many parts of the company, my philosophy is that this should be a continuous conversation, not a surprise kept for a single meeting. Week to week, you need to be close enough to the people you work with to share important feedback and to let them know how they are doing.

At the other extreme, in our call center we record every call and have people scoring a percentage of each customer service representatives calls, enabling managers to sit down with customer service personnel every week, and give positive and constructive feedback. If you ever wanted to profile a great call center, come and look at what we do; we’re very proud of our call centers.

On Coaching and Mentoring
Sun Life believes that the primary job of a leader is to help each person reporting directly to them to be as successful as possible, to reach their full potential.

I have seven senior leaders reporting directly to me, and I’m here today, and every day, to help make each of them successful and, in turn, they’re here to make the seven or ten people reporting to them successful, and so on down the line. This is a really powerful paradigm.

In today’s world, where you need performance every moment of every day, one can’t wait until the end of the year to give support and feedback.

On Training & Development
A traditional human resources approach is to focus mostly on the competencies in which a person is deficient. At Sun Life, we have turned this approach upside down.

While it is true that one needs to deal with weaknesses, it is equally or more important to focus on and invest in developing people’s natural strengths. How powerful can this be? By focusing people on developing and leveraging their natural talents, you might double their impact overnight!

We have found that it is more productive than trying to turn a marketing person into an accountant or vice-versa.

On Being a Good Corporate Citizen
At Sun Life, we’re fortunate that we can make a tremendous contribution to society by just doing our jobs well. Our mission is Help our customers achieve lifetime financial security. This is very powerful and rewarding. It is important to remember this.

For instance, we’ve paid out billions of dollars in life insurance benefits to families who have lost their breadwinners. We’ve paid billions more in disability benefits to workers whose jobs or disease have robbed them of their health. We’ve provided money for people with critical illnesses to obtain treatment that they otherwise could not afford. It makes us feel good to help Canadians during these difficult times. And we also help Canadians plan and prepare for many important life stages including going to school, getting married, protecting their family, buying a house and planning for retirement.

Beyond this significant impact, we have made a real difference in the lives of employees and advisors, the 11,000 plus people we employ from coast to coast. And I believe we have made a strong difference in the lives of new Canadians. Approximately one third of our Clarica sales force advisors are new to Canada and they work in their respective ethnic communities providing important advice, products and services to individuals who are unaccustomed to our banking and financial systems.

We have created thousands of jobs. We have invested in the communities in which we do business. We have backed large charities and many you never hear about. We have invested significantly in preventative healthcare. And we have received numerous international awards for our social responsibility and corporate citizenship efforts.

Yes, we do it because it feels good. But it’s also the right thing to do, and is an important element of building a successful company.

Definition of Success
At Sun Life, we define success in simple ways. Are our customers satisfied and loyal? Are our employees proud and do they enjoy what they do? Are we getting the support of shareholders?

Each of these elements is embedded in the NQI framework. I believe these are the best forward indicators of the health of our business, and we have to ask ourselves these questions every day.

At a personal level, I just love the business. It comes back to what I said earlier, if everybody reporting to me is extremely successful, and so on through the organization, not only is this very gratifying, but I know that together we will accomplish great things, and continue to be an industry leader.