Special Edition: Aon CEO Greg Case on 2024 and Evolving to Serve Clients

Andy Weitz:
Hello and welcome to On Aon. I'm Andy Weitz and I have the privilege of serving as the chief marketing officer here at Aon. The new year is upon us, and in this episode, we're going to take a look at what 2024 holds for our colleagues and clients. Specifically, we're going to take some time to dig into what we're hearing from those clients, really what's on their minds, and how our team is taking that feedback into account as we look to serve them more effectively and seek opportunities to grow together in the year ahead. And I'm very excited to share that with me today as our Chief Executive Officer, Greg Case. Thanks for being here, Greg.

Greg Case:
Thanks for the invitation, Andy. I have to say it's always a pleasure to kick off the year by talking about how we help our clients make better decisions.

Andy Weitz:
Great. Well put. On brand right out of the gate. I love it. I'm sure our dedicated listeners know this, but this is, in fact, the third year in a row that we've drawn the short straw and been asked to kick off the year here in January. It's a great time, though, because it's always a good time to talk about client need, but January feels particularly appropriate. We always try to step back at this time of the year, talk about the evolution of our firm, how we're looking to get better, faster on behalf of our clients. And it's worth noting that this has been historically a relatively popular episode. So, we've earned the right to come back and address our listeners. Again, I say without further ado, we get right into it.

So over the years when we've connected, we've talked about volatility and the impact that volatility has on businesses. And in the last couple of years, in particular, as an organization, we've begun to call out themes or megatrends that we see out there in the marketplace that we think will shape the year ahead. And this year, our research, both the formal survey work we do through awesome instruments like our global risk management survey. But maybe even more importantly, the informal anecdotal feedback we get in client meetings and opportunities can be them in large groups. The feedback we get from our client leaders. It's led to some real specificity around what those megatrends are for 24 and how our team feels they will shape the year ahead.

In an effort to keep it simple, you and I have talked about this; we bolded down to four shorthand phrases, trade, technology, weather and workforce, all of which I think are almost like headlines or categories for a larger conversation about the impact that these things have on our clients and how they connect back to our evolving capabilities, which we are increasingly talking about in the context of risk capital and human capital. So, with that backdrop, could you share more about what you're hearing from clients on these trends and how they're shaping what they ask of us and what word you to evolve and help them make better decisions on these topics?

Greg Case:
Andy, be delighted and a really excellent place to start here. As we begin 2024, I would say absolutely no question. And we know our world is more volatile in every respect. And from our perspective, the volatility is driven by a series of these transitions as you described, Andy, trade, technology, weather and workforce. Maybe first on trade, our clients are asking some really, really smart and tough questions really about the sustainability of globalization, where's it going to go? And from our view, there's no question. There are aspects of global trade that are absolutely universal. They're here to stay, but there's also more and more a flight to safety in the face of really massive geopolitical uncertainty. And obviously talking about Ukraine, Israel, China, Taiwan, among many other areas, which sets the stage for what really is a potential return to regions when it comes to supply chain management and geographic growth strategies. And that has implications for our multinational clients in many, many ways and our high growth middle market clients that are looking to expand in the lower cost geographic centers. So a lot happening, Andy, on the trade front.

Second, as you highlighted, is technology. And we all know there's no question. The world has gotten faster and more interconnected over the last five to ten years. The impact of artificial intelligence you see everywhere and specifically the role of generative AI and the role it's going to play in the coming years will be fundamental and will shift impacts in every organization, regardless of size or geography. And really, it's especially true when you think about the rise of things like intellectual property. We've talked a lot about this, Andy, around intellectual property as an asset class and the pivotal role it plays, especially in a service-based economy that really is fundamentally built off of intangible assets.

We've got trade, we've got technology, and you highlighted the third around weather. And look, this is obviously all about the reality of climate change and how it impacts all aspects of your business. And we're seeing a real evolution in how clients think about climate. Two to three years ago, there's a lot of talk about long-term targets, where it's going to go, how we all embrace ESG, and that absolutely remains relevant. But we're also seeing a realization that climate risk is really almost misstated. The real focus is on how climate impacts every aspect. And I mean Andy, every aspect of existing risk management and the overall risk management strategy and really ultimately a company and a client's growth strategy, we're seeing that now every day.

So having covered trade, technology, weather, and the fourth is around workforce, and this is another ongoing transition coming out of the pandemic, maybe the least predictable. Man, is it profound? And it really affects the future of work. It affects how you think about the model we've got. Is a hybrid model sustainable? What engages and motivates your team? How do you differentiate an organization from others? All these things are out there, Andy, and it's fundamental in the way we think about the definition of the workplace. And really it's been a redefinition of the workplace and we see a ton of client questions and need that are really at the intersection of what we're traditionally thought of as health, wealth and talent, which as you know now, we began to think about as our human capital capability.

Andy Weitz:
And Greg, awesome summary, first of all, but also, you touched on human capital there and I mentioned risk capital and human capital increasingly being the way we talk about our capabilities, it makes me think. Against those four megatrends, can you talk a little bit about what you're hearing from our leaders? Those folks on the front lines who are in the room with clients every day about what that focus means and how we're turning those issues, our focus on those issues into value for our clients?

Greg Case:
Love it, Andy. Great angle to go coming back to clients and I'll say when you talk to colleagues who are spending time with clients every day, among others, but these forces in particular have really in many respects, magnified and changed the stakes when you think about the battle for relevance with clients making a difference in what they do every day. And it really requires those leaders, our clients, to deliver against these expectations and really evolve how they make better decisions against these new and magnified challenges. And I have to say, it's really worth mentioning that all of these have evolved, not just who we talk to every day, but really evolved into the C-suites and boards of our clients around the world.

On the risk side, it's because these trends are increasing the total cost of risk, which means the line item that they look at, the cost they look at every day gets more and more scrutiny. And clients are really looking for a set of advisors, trusted advisors that can help them rethink how they take a more holistic view toward risk capital, why risk capital has become so much more relevant. And then on the people side, it's simply that there was just more interconnected, and it's the point we were talking about just a minute ago. Clients want an advisor that can deliver integrated solutions that consider the connection between traditional health and benefits, but also employ retirement planning and broad-based talent strategies. It's really one issue in how you optimize your human capital.

And for us, that means we've got to be bringing new innovative solutions that address these emerging risks and people challenges right to our clients. And we've got to Andy, as we've talked about before, accelerate the use of predictive analytics, not just looking back in time but going forward, deliver these new insights and really unlock access to new forms of capital.

And finally, I would say focusing on the growing demand for integrated solutions that tackle risk and people challenges together. It isn't just risk capital, isn't just human capital, it's really how they connect. And this is really as I was describing, the battle for client relevance. And it's dependent on really delivering value in our core business and solving for the expectations with these new capabilities. And we like to think that really, Andy, our united strategy has helped us keep pace with those expectations, but the reality is we. We've got to go further faster on behalf of our clients. And that really is the full rationale behind the three by three plan we rolled out last year.

Andy Weitz:
Well, Greg, I'm glad you brought that up. The three by three plan, I want to talk about that. That was next on my list and you made the obvious connection there to our Aon United strategy. We announced this three by three plan back in October when we talked about it, we boiled it down to three commitments that we're going to deliver on over the next three years. First, leveraging our risk capital and human capital structure and capability. Second, really embedding the Aon client leadership model, all the great things we're doing for enterprise clients and bringing those best practices to the large and middle market. And then third, accelerating our Aon Business Services plan. Would you talk more about that? I mean, why those three things and maybe how they connect to client need and really because this is what matters at the end of the day, how that translates into more value for colleagues, maybe making their jobs easier, making them more effective, delivering more value, what it means for clients in terms of solutions, then ultimately, obviously performance and what it means for shareholders?

Greg Case:
Andy, I'd love to, and I'll tell you since we've introduced the three by three plan, which is really reflection of client need, what they're telling us they need more than anything else, we've just built tremendous momentum around it. And the three by three plan really defines, as you said very well, three specific commitments we are delivering on behalf of clients and colleagues over the next three years. The first is really leveraging our risk capital and human capital structure. This doesn't exist anywhere else in our industry, and its the capability is about unlocking new integrated solutions across our core business that also address new requirements in client demand. So, leveraging risk capital and human capital.

The second is around embedding the Aon client leadership model. And this is really about taking the best practices in client leadership. We've established in our enterprise client segment and extending this really into how we serve large and middle market clients to further strengthen and expand those relationships. And finally is really around accelerating the and business services plan to set a new standard for service delivery. We literally want to define in a very different way how we bring our capabilities to clients. And we really call this affectionately becoming brilliant basics, really doing what we need to do on their behalf in a way that's never been done before, faster, more effective, more efficient.

And then in addition to that, accelerate the next generation of analytic tools that will help us deliver more value to our clients. And I do want to say, to be clear, Aon Business Services is really a catalyst for this. It really drives the entire three by three plan in a way we couldn't have done before and the work we've already put in around Aon Business Services now, we've got an opportunity to magnify that and really bring that to life on behalf of risk capital and human capital and how we embed the AI client leadership model. Pretty excited about it.

Andy Weitz:
And Greg, I'm glad you went there because that's where I wanted to go next. I mean, Aon Business Services is pretty central to everything you talked about in terms of enabling the three by three. When we announced the investment in Aon Business Services back in October. And to be clear, I mean we're what, five years plus into this journey at this point, we mentioned that the additional investment we're looking to make here will create better tools, better experiences, and make us even more relevant to clients. Can you talk more about that though? I mean, I think there's a lot of alignment around the firm about that being an obvious opportunity, but what are we doing to accelerate it? What are we doing to evolve and how does it translate into addressing those client needs you talked about at the top?

Greg Case:
Happy to, Andy. And as you described, it's really about products and platforms. And I got to say first on products, we have an absolutely awesome example from earlier this week. I was at the property symposium in Orlando, and for those who don't know what this is, this is an amazing event. It really is. The entire property world that exists today, these are buyers and insurance markets standstill. Literally, the earth standstill in property with the sole exception of in Orlando, Florida where 1,000 clients in insurance markets come together and really talk about what's going on. And you saw in that audience looking across the thousand literally on Tuesday when I was there, the power of risk capital as it relates to analytics.

And in this case, again, power through Aon Business Services, we're bringing together reinsurance and commercial risk data in a way it's never been done before and analytics. And we're creating a new suite of tools, and we actually introduced the property risk analyzer. And this analyzer delivers insights to clients in real time related to their overall global risk profile. It's just unbelievable to see. And we did it at scale for all the clients who are in the room, and it really allows them to better interact with markets, think about their position overall and take specific action against a new set of insights we're bringing with the property risk analyzer.

And then we're following that up, Andy, as you know well, not just with the risk analyzer on property, but similar tools on casualty cyber and climate and these products form a suite of advanced analytic tools that really considerably enhance and change the game on client serving capability that we can bring on their behalf. And there's absolutely no question. Aon Business Services has made our firm more efficient, but now the example we just went through, Andy, this is really the foundation that's fully in place and really we're accelerating with greater investment and truly raising the game on what it means, the client experience around what they see every day, the capability they get.

And these tools, coupled with the expertise of our colleagues and really delivered through our colleagues, this is really what allows us to live up to the idea that we're in the business of better decisions. We're giving them the capability to do things that affect their business, help them grow, help them build their house, as you might say, but also defend their house in terms of all the risks out there in the world and making better decisions in order to do that. And the opportunity we see as we actually bring this to life is why we invested 900 million in cash, a billion overall, to accelerate on business services as a real catalyst. So it's really back to your fundamental point that Aon Business Services is a game changer for us and how we accelerate what we're doing with risk capital and human capital and deliver through the Aon client leadership model and really tremendous excitement around our firm.

And I will say, coming out of the symposium, a lot of excitement with our clients who are essentially saying, "This looks great. We want more of this. We want it faster. We want to see it in a more complete way," and we're really excited about what you're doing because it fits with exactly what we need to get done on behalf of our agendas as we build our firms. And it really gets to the second aspect of how Aon Business Services is accelerating our progress around platforms.

Andy Weitz:
Well, I want to talk about platforms, Greg, but I got to just second what you said about this property symposium. It's so exciting to be at a point in this journey where we have these tools live and in the marketplace. We're delivering actionable insights to our clients. And I got to share a story I heard from a client leader yesterday where they were leaving Orlando and they shared this feedback from a client where they said, "It's so exciting to see tools like the Property Risk Analyzer. I feel like I'm in a place where I can stop settling for advice and start making better decisions," and I made the hair on my arms stand up because that's what we're trying to do. That's the frame we want to talk about.

But I don't want to lose track of this other point you made, which was around the notion of products and platforms. You mentioned platforms there at the end, and I'm going to take the bait. I want to better understand what we mean by platform in the context of a little bit of news that we made at the end of 2023 when we announced we'd signed a definitive agreement to acquire NFP, a leading middle market provider of risk and benefits and wealth and retirement plan advisory solutions, if you will. And I'd love if you could talk a little bit more about the connection between that acquisition and the three by three plan and really that idea of how Aon Business Services helps us build a platform to better serve the middle market.

Greg Case:
Absolutely, Andy. I'd be delighted. And I have to say, we could not be more excited about this addition to the Aon family and NFP, and it really starts with Doug Hammond and his team, and Doug's an amazing leader, been such a joy to get a chance to spend time with him and understand what they've accomplished and all that they have on the horizon and how as we come together, what we can do together. I just want to say Doug and the team, it's just an amazing group, a premier platform, and we are so impressed with how they go about their business, what they do every day. And it's fantastic to see the alignment as we think about the shared view of the opportunity. Everything we've covered in the last few minutes is really a viewpoint Doug and his team of NFP shared with us in a different way, but the alignment is amazing, and we've really got truly complementary capability and client bases that we now have a chance to do something very special with.

And I'll say we've appreciated the middle market for a long time, but couldn't access it in a way that we could really get better, not just bigger, Andy, as we've talked about, but better in the middle market on behalf of clients. But now if you think about it, we've got this amazing platform Doug and team have built truly incredible. We've got the investment in Aon Business Services through our three by three plan, and it really is helping our firm realize the opportunity to innovate on behalf of clients and to create very specific product offerings now in the middle market. So think about it, we can bring product innovation at scale into the middle market working with Doug and team to do things in the middle market that have never been done before. How cool is that? We've got this incredible platform that we can actually now potentially make even better.

Andy Weitz:
Connect that to Aon Business Services because it's obviously, to your point, a premier operation there that Doug and the team have built. But the idea of doing something special, how is Aon Business Services the catalyst for that?

Greg Case:
This is really because Aon Business Services, we can now deliver a very product-oriented approach at scale. So this is Andy, product innovation at scale for middle market clients in a way that brings previously unavailable offerings to these clients. Really, in many respects, it's how we're going to distinguish what we're doing from anyone else, from anybody else who's been in the space before. It's actually innovation into the middle market space. And this is why we're so excited about this opportunity and about NFP. Again, you start with one of the most distinctive operational platforms in the world, and now we've got our firm which can actually help them access the middle market in more effective ways through Aon Business Services, again, delivering product innovation at scale. And if you think about one of our future colleagues at NFP, they have been immensely successful. So think about this person sitting here in this opportunity and now they've got a chance to do exactly what they're doing today with even more capability that they get a chance to bring to their clients.

So for us, this is strength on strength. It's a platform and an opportunity that really doesn't exist today in its current form. And now we've got a chance to do something about that. And it's not just the capability, but the content that we're going to be able to bring together to the middle market is phenomenal. Maybe Andy, if I could just pick one example, Aon's Cyber Quotient Evaluation, we call it affectionately CyQu, which is really a proprietary e-submission platform that helps clients identify, measure, and manage the cyber risk exposure they've got. We're going to now be able to bring this with NFP into the middle market in a way that's never been done before.

So again, an already tremendous platform that we now aspire to make even better with the addition of a piece of product innovation we're going to bring, CyQu and there are a whole raft of others that we're going to bring to the equation as well. So, in essence, we could have thought about doing this organically over time, but wow, when you've got access to a platform and an opportunity like NFP that Doug and team have built over time and the capabilities of Aon Business Services to apply against it, we're in a perfect position to meet client needs, increasing client need in the middle market. And as you always say, go further, faster for our clients with this formula, which we're incredibly excited about.

Andy Weitz:
Greg, thank you. That connects it for me at least. I mean, we talk about further faster all the time when we talk about the three by three and now NFP, this independent but connected platform that has access to content and capability that we can really distribute at scale, throwing on business services to them really exciting and I think makes it very real for our colleagues and our clients. So, thank you for all that context and bigger picture. Thank you so much for the time today. There's so many reasons to be excited about the focus we've outlined, not just for '24, but really beyond.

And as always, we remain committed to evolving as you talk about constantly to better serve our clients. Obviously, that's been a core tenet of our Aon United strategy for over a decade. And as you just laid out with our three plan, we now can go further faster. We have Aon Business Services as the catalyst behind it, and we're making the significant investment that drives the plan forward over the next three years. And that NFP deal, I mean, it's poised to become, I think one of our first proof points demonstrating how Aon business services extends the benefit and the impacts of our firm to more clients in a really exciting high growth segment that we're going to be able to drive innovation in. And I just can't wait until we get that deal closed, which I know we're expecting that to happen in mid '24. I'm sure we'll be back sharing more about what we'll be doing together and then in the future. But as you can tell, there's a lot of momentum and a lot of excitement in the air I think at Aon right now.

Before we close, I just got to give a quick plug for the team here, Greg, and the upcoming season of the Aon podcast. Many of the things we covered at a high level today, we're going to dive deeper into especially some of those megatrends we talked about and how they connect to our capability and risk capital and human capital, including things like climate risk, which, as you've made the point, really impacts everything and emerging areas that are increasingly important to the C-suite, like employee wellbeing. So many important topics to cover here on the podcast.

But for right now, that is our show for today. So thank you all very much for listening. And again, Mr. Case, thanks again, Greg. It is great to be with you.

Greg Case:
Mr. Weitz, you too. And that was a lot of fun.