Among leadership teams, there tends to be two views about change. One: change is risky and means disrupting repetitive processes that leaders have been rewarded for improving over time. And two: change is something that can be delegated, like other implementation-based activities such as project management and risk. Actually, change programs are most successful when, as a result of external factors, there’s a shared sense of urgency to deliver tangible change.
Following the 2008 financial crisis, RBS Group was ordered to sell its insurance business by European Union regulators, as a condition of RBS receiving £45bn in state aid. RBS’s insurance business, led by Paul Geddes, was tasked with separating its operations from RBS Group into a standalone company, in order to be ready for either a trade sale to a competitor, or listing on the stock market.
It’s a testament to Geddes, and the insurance business’s leadership at the time, that they turned the opportunity into a positive exercise and used the separation process to create a viable, standalone, rebranded insurance organisation, now known as Direct Line Group. It took 18 months to separate out every single strand of the business, from customer data, to independent functions and governance. This was very much a case of operating from a burning platform.
The entire approach had to be one of controlled urgency, there was no plan B and the leadership teams embraced the need to shift their people on to the next step as rapidly and as efficiently as possible. Once the separation had been effected, the focus was on creating a new brand and rapidly building the business into a viable standalone operation.
In 2012 the board went for an IPO that turned out to be the biggest and most successful London stock market listing that year. Its success heralded the start of a new, post-crisis IPO era. The Direct Line Group’s share price has continued to climb since it floated. Paul Geddes remains the CEO of the quoted business.