The implementation of the changes will result in a reduction of around 4,000 roles across the UK by the end of 2007, approximately half of which are anticipated to be through compulsory redundancies. Norwich Union will seek to minimise compulsory redundancies through normal staff turnover, redeployment, not filling vacancies and voluntary redundancy where appropriate. Following this announcement the company will begin the formal consultation process with the staff representative bodies.
Of the reductions, around 1,000 operational roles will be offshored to India in line with existing plans already announced, while around 500 IT roles will be outsourced to third party suppliers.
The review was undertaken to ensure that the company fully capitalises on the changes in the way customers are buying insurance, the greater use of and access to technology, and to ensure it maximises the benefits from the closer integration of the life and general insurance businesses.
Norwich Union executive chairman Patrick Snowball said the operational changes were necessary to reshape and simplify operations to meet the challenges of the changing insurance marketplace.
He said: “We have to ensure that Norwich Union remains a highly efficient and successful company in what is an increasingly competitive and dynamic environment. Customers buying habits are changing rapidly as technology becomes more accessible, demonstrated by the fact that 50% of our new direct motor insurance policies are now bought online. Consumers, IFAs and brokers are increasingly operating in a self-service world and we have to continue to respond to this.”
“We recognise that tough decisions such as these are difficult for the people affected but they are absolutely necessary. We will look for every opportunity to redeploy staff in new roles and we will ensure those affected get specialist career advice.”
The main locations affected by today’s announcement are:
approximate role reductions
In addition to the above locations, 700 of the total role reductions will be across approximately 40 other Norwich Union offices and 107 BSM high street outlets (see below). There will also be a reduction of around 150 home worker roles.
The company expects around half of the total role reductions will be through compulsory redundancies.
Operational changes at BSM.
As a result of changes in the way people are booking driving lessons, the 107 high street outlets of BSM will close by December 2007. In future, BSM will operate a centralised sales and service operation along with up to 70 instructor service centres and 50 field-based managers providing support to its 3,400 driving instructors. Some of the work undertaken by the BSM centres will transfer to a new contact centre and the net reduction in roles as a result of these changes will be around 200. In the future, BSM's products will be sold via the internet and contact centre.