Prudential UK: Rebuilding a Mighty Business

In the mid-1980s, Prudential completely dominated the UK insurance market. Fifteen years later it was in grave danger of becoming irrelevant, and then things got worse with the post 9/11 collapse of stock markets and the ensuing downfall of its major product ("with profits" insurance). Led by a new CEO, Mark Wood, Prudential UK's management team embarked on a four-year rebuilding journey. The company was fragmented and had lost its direction. The product mix and distribution channels needed to be overhauled, as did the customer service systems and philosophies. The company had zero partnerships. And the corporate culture resembled that of a "country club". Yet, being in the insurance sector, the company had to continue projecting a reassuring image. This severely constrained the possibilities of making the case for change. Nevertheless, in the space of four years, Mark Wood and his team refocused the company, restored its pride and brought it back among the contenders. It emerged with solid assets - outstanding service, genuine innovation, funds for growth and improved relations with clients, IFAs and the regulator. It created options for itself. Learning objectives: The case focuses on the managerial and leadership aspects of a large-scale restructuring. It features some classic turnaround aspects, but also some unusual ones: 1) the rotating appointment of a "quartermaster" to drive performance in each quarter; 2) a leadership story that projects employees forward 1000 days; 3) regular periods of reflection time as a team; 4) the development of an internal business transformation capability, which involved up to 15 per cent of the workforce working off-line on change projects full-time. The case also raises issues around institutionalizing change.

• Turnarounds
• Business communication
• Leadership vision
• Strategy