PETER ROBERTS Thatcham Pirelli Partco
Face to face with the corporate entrepreneur Peter Roberts has been stretching accepted definitions of entrepreneur for over 25 years, applying strategic direction and change management expertise to secure a brighter future for a diverse range of commercial and formerly non-commercial organisations. Executive Profiles asks the questions ...
EP: Serial entrepreneurs are often associated with getting businesses into shape for a profitable exit at the earliest opportunity, yet youâ€™ve acquired a reputation for building up organisations for the longer term. Do you consider yourself to be an entrepreneur? PR: Entrepreneurs are convinced that companies and people have much more to give - and that they have the means to get it out of them! As a corporate entrepreneur I may sometimes pursue different outcomes to others, but the vision and the skills to help realise them are essentially the same. EP: Youâ€™re coming to the end of your ten-year tenure as Chief Executive of Thatcham, the motor insurance repair research organisation. Is there a limit to what can be achieved with a not-for-profit research body? PR: When I started at Thatcham it was a UK-centric research outfit wholly
funded by its member companies. Today itâ€™s recognised as a world leading centre of excellence in motor insurance claims reduction. We have initiated projects that give our members a massive return on investment, trebled our investment in research and introduced products and services that generate enough income to meet 60% of our funding requirement. The whole process, which has positioned Thatcham to attract commercial revenue on a global scale, has required as much if not more entrepreneurial endeavour as any role in my career. EP: What particular skills do you bring to a project like this? PR: One of the key requirements is being able to define the course that a business will take over the next five years or so. You have to be able to envisage the likely business environment a long way out, not just over the coming months. And you need to be able to make particular decisions and harness the appropriate resources along the way that will keep things on track and realise the vision. EP: What is the background to your role with Thatcham? PR: The member insurance companies were questioning its value; it either had to be sorted or closed down. I took a look and was able to convince them that the technical know-how already in the organisation could be leveraged to give a much greater return on its research initiatives and to fundamentally change the funding model of the organisation.
EP: Did Thatcham represent a significant investment for the insurance companies? PR: Not a huge investment - the total annual levy was £6m at the time - but all expenditure is subject to scrutiny. Its research was potentially of value to the wider industry and I believed Thatcham would do better standing on its own two feet; serving commercial customers would sharpen up our market awareness and project management skills. In the event we increased turnover from £6m to £18m and made Thatcham self-sufficient by generating revenues on an international scale that meet 60% of the funding requirement (with the balance coming from insurers in the form of a levy which we capped at 2008 rates). EP: How did you change the funding model and introduce a commercial culture to such a long established not-for-profit organisation? PR: Thatcham had to be commercialised and moved towards making its way in the wider market, so we had to innovate and find global niches, taking responsibility for controlling project costs, delivering projects on time and satisfying customers. I am convinced that every company has a better company inside it. I looked for the factors needed to liberate that potential. There was a huge amount of know-how within Thatcham but most of it had stayed hidden. Engineers are not the most forthcoming on selling their wares and staff had become isolated from the wider industry. You have to help people find what they’ve got within themselves, energise them and give them a vision.
And continue to challenge them - and the business - to contribute more. A big part of my job was developing talent. I was a gardener providing water and other nourishment to my team. Of course, I had to pull out some weeds too! We opened the organisation up and now weâ€™re closely engaged with the repairers and have introduced initiatives like a kite marked repair standard that body shops must attain to receive insurance directed crash repairs, so ensuring insurance funded repairs are carried out safely. We also have every volume selling vehicle sold in the UK through our workshops and produce comprehensive repair methods to ensure the safe repair to the original safety rating. These vehicles are big global sellers, with long life cycles, so these repair methods are a big earner for Thatcham. EP: With the motor insurance business under so much pressure is it difficult to persuade insurers to continue to pay for Thatcham? PR: It is a tough market and many insurers are owned by private equity who naturally take a hard-nosed approach to our annual levy. But today we can say that if you invest in Thatcham you will get an immediate ROI on your levy! EP: Whatâ€™s the nature and scale of this return? PR: We have applied our knowledge proactively into tools which insurance claims staff can use to speed up claims processing and detect high risk claims. Our specialist engineers can tell when a whiplash or vehicle theft claim is suspect - the trick was to embed that knowledge into simple tools that
I am convinced that every company has a better company inside it.
thousands of claims handlers could use. In the case of whiplash claims alone we are helping insurers identify 15% of the ÂŁ1bn claims the industry believes to be potentially fraudulent - a phenomenal return on investment! Whiplash and vehicle theft are not confined to the UK - our standards and solutions are now being taken up around the world. Russia, Sweden and Norway have taken security and Europe is signing up for the whiplash tool. EP: Does your research influence vehicle manufacturers? PR: Thatcham provides the data used to set the group insurance ratings which is a key indicator to the insurance underwriter as to how risky a vehicle is. And our research also feeds into the overall NCAP safety ratings - so there are major incentives for manufacturers to perform well in this respect. So Thatcham effectively exerts leverage on global vehicle manufacturers to reduce motor claims costs. EP: Do you subscribe to the view that tough economic times give rise to new opportunities? PR: I have worked through three recessions and found each one invigorating for the business. It is a time to sharpen up; if you can survive then you will fly when the better times come. Back in 1983 at Pirelli Tyre Division where I became Sales and Marketing Director Milan told us we had one year to turn the company round, or be closed. It focuses the mind! Pirelli was close to the bottom of the global
productivity league - it was taking two weeks to change a tyre production mould. But we were able to achieve dramatic improvements by harnessing the expertise that was already on our shop floor. It was recognition that these guys that had the technical know-how and by empowering them to re-design the process we were able to get the changeover down to 11 minutes! EP: The early 80s was a low point for Pirelli. How did the business restore the credibility of its brand? PR: There is a simple marketing mix for success in tyres - high original equipment market share, premium branding and pricing, excellent trade relationships. At the time the business had none of these; the products were poor, the quality was dreadful; it had lost all of its OEM deals, the lifeblood for a tyre manufacturer. There had been no investment and the brand was nowhere. But the breakthrough was the introduction from Pirelli Italy of the low profile tyre. This gave us something to rekindle the magic of the Pirelli brand which had been buried for years. This eventually led to a series of high profile OEM deals particularly Porsche which cemented the reputation of the company as a premium high performance tyre brand. It was by no means an easy journey; we had to convince Italy HQ that it was essential that the UK should have its own branding campaign; we had to sell a premium product to dealers used to buying our tyres at 45% off list - with extra discount for cash! - and demonstrate to car manufacturers that Pirelli was once again a force to be reckoned with.
EP: What was the outcome? PR: We effectively changed the market - driven by this product innovation and rapidly dominated the premium sector, but it was only by energising the Pirelli people that it all became possible. Pre-tax profits went from a £12m loss in 1983 to a £10m profit in 1989. I even brought back the Pirelli calendar after a 10-year gap - which is still going strong as a huge branding device for the company today. EP: What’s the secret to ‘energising’ people in this way? PR: It is certainly not an approach confined to companies in trouble. When I was heading international business development for the Partco Group in the late 90s it was all about managing growth and integrating new acquisitions, but the need to fire up team members was equally vital. Sometimes you start with someone who is the most resistant to change, the most sceptical, then sooner or later that person eventually gets it and can become the most conscientious and productive team member. I think you have to build confidence in people by giving them space and responsibility; in my experience it enables many if not most people to fly. EP: Where do you go after Thatcham? PR: I have enjoyed every role I have undertaken, and do not intend to change! So I look for stimulus and achievement from helping companies get more out of themselves. My skills are transferrable so I will not be confined to any particular
industry - although my track record would suggest I have a natural empathy with engineers and an affinity with engineering in all its various forms. I think I would be most attracted to a non-exec role as a NED or interim in a smaller organisation where I would be able to draw on my core strategic and change management skills to help realise the potential. EP: Is it possible to make the same sort of contribution working armâ€™s-length as a non-exec? PR: My career encompasses numerous markets and products and I am used to getting a really good grasp of the markets and customers of an organisation with a view to extending its reach; I would continue to invest a lot of time to identify the strengths within - in terms of people, culture, product, history etc. I have always been able to go into a new management team and add something to it - not to swamp them - and to help accelerate where they are going in a non-executive, supportive way. But I will still keep in touch with the shop floor working out what people do, identifying the value of what they have got, and helping to take it to market. And I would seek to give the entire team more focus and, as vital as ever in the 21st Century, a sense of pride in the job! EP: How would you sum up your approach to business? PR: Just pick the market up, move it somewhere else, play to your own rules... and enjoy!
Your time at Thatcham has benefited the wider industry and I will always remember you for the fair minded approach that you applied to the many politically sensitive issues that you faced in your role and for the tremendous efforts that you exerted to help the repairer community. I am not sure that you ever received the plaudits that you deserved from the repairers.
During your time in office you have 'dragged the 'old economy Thatcham into the 21st century, who would have never thought you could have achieved what you have!
You've done a fantastic job.
Your direction Thatcham has built a great and unique position in the motor market both in the UK and in many parts of the globe. Thatcham has given a tremendous technical lead in every area affecting common, cross industry issues, many of which historically always seemed unattainable. You've managed to break through many of the barriers and greatly aided, through trust and your integrity, the finding of common ground for motor insurers and repairers to work from.
EP: If you believe that Peter Roberts could make a ‘none-exec’ contribution to your company - then begin the conversation at:
Professional Landmarks 2001 - 2011 Motor Insurance Research Centre (Thatcham) - Chief Executive 1997 - 2000 Partco Group Plc - Director: International & Business Development 1992 - 1996 Northern Electric Plc - Director Energy Marketing 1983 - 1991 Pirelli Limited Tyre Division - Sales & Marketing Director 1981 - 1983 NEI Thompson Ltd - Group Marketing Manager
Just pick the market up, move it somewhere else, play to your own rules â€Ś and enjoy!
PETER ROBERTS email@example.com
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Published on May 22, 2011
An Executive Profile of Peter Roberts exploring his skills, values and achievements as a Director in blue chip, SME and NFP companies, now o...