What to Expect from Leadership Changes at Willis Towers Watson

Strategic Shifts Under New Leadership

New leadership at Willis Towers Watson is likely to focus on growth through M&A, disruptive business models, and AI, mirroring industry trends. Operational improvements and strategic initiatives, similar to those seen at competitors like AON, are expected to drive long-term growth and efficiency.

"Three-quarters (75%) of the CEOs surveyed see growth opportunities in the competitive environment, including big strategic areas like M&A and disruptive new business models, while 71% are optimistic that rapidly changing customer demographics, preferences and expectations could fuel growth." --- (MMC, press release, 2024/07/11)

"Moving to operating performance. We delivered strong operational improvement in Q1 with adjusted operating margins of 39.7%, an increase of 100 basis points, driven by revenue growth, portfolio mix shift, efficiencies from Aon Business Services, and restructuring savings, overcoming expense growth, including investments in colleagues and technology, to drive long-term growth." --- (AON, earning call, 2024/Q1)

"96% of CEOs see AI as a growth opportunity75% look to M&A, disruptive new business models for growthCEOs' biggest concerns include regulation, inflation, geopolitical instabilityNEW YORK, July 11, 2024 /PRNewswire/ -- The CEOs of New York Stock Exchange-listed companies are focused on the growth opportunities that lie ahead, overwhelmingly led by artificial intelligence and followed by major strategic initiatives such as mergers and acquisitions and disruptive new business models, according to a new survey, "The New Growth Agenda: How CEOs are Navigating Emerging Shifts in Geopolitics, Trade, Technology, and People," conducted by the Oliver Wyman Forum." --- (MMC, press release, 2024/07/11)

"As Christa begins to prepare for retirement, we are deeply grateful for her continued leadership throughout this transition and for the strong team she developed to advance our Aon United strategy." --- (AON, press release, 2024/04/03)

Impact on Employee Morale and Retention

Employee retention remains a top priority for HR and operations, with strategies focusing on aligning employee experiences with generational expectations and offering enticing benefits. Despite industry-wide challenges, effective planning and forecasting have helped maintain stable retention rates, reflecting a broader trend of reduced employee turnover.

"So, we are not seeing significant terminations here. So, overall, I think our work planning models and our ability to kind of forecast retention has helped us not have to push and pull on the joystick there to see how many more we need to bring on, how many do we need to take off." --- (AJG, earning call, 2024/Q1)

"Rewards was a bit more muted. And I think that's predominantly reflecting the impact of lower wage inflation and reduced employee turnover, which is driving some slightly lower demand for our clients at rewards projects." --- (MMC, earning call, 2024/Q2)

"Our latest U. S. Organizational Well-being report highlighted employee retention as a top priority for operations and HR leaders in 2024." --- (AJG, event transcript, 2024/06/25)

"Organizational Wellbeing Report, organizations continue to rank retention as the top priority for HR (62%) and second highest for operations (45%) — only behind growing revenue or sales." --- (AJG, press release, 2024/06/27)

""Employers should control what they can by continuously seeking opportunities to better align employee experiences with evolving generational expectations and offering benefits and programs that will entice their workforce to stay with the organization." The Gallagher study, which draws data and insights from more than 3,500 organizations across the U.S., identifies current and emerging trends with the goal of helping employers optimize the wellbeing of their organization as a whole by highlighting organizational strategy, HR technology, and healthcare costs considerations." --- (AJG, press release, 2024/06/27)

Potential Challenges and Risks

Leadership changes at Willis Towers Watson could face significant challenges and risks, including talent retention and acquisition due to potential FTC non-compete removals, managing ESG-related issues, and addressing people-related challenges. Additionally, navigating uncertainties in future results and responding to major trends like trade, technology, weather, and workforce will be critical.

"And then one last one, the FTC, right, is looking to potentially remove non-competes from – I guess my question is two-pronged from both the ability, I guess, to bring folks into Gallagher and also considering the potential to lose talent to other players, how do you think this could impact the company if it does actually go through?" --- (AJG, earning call, 2024/Q1)

"ENVIRONMENTAL, SOCIAL, AND GOVERNANCE For many companies, the management of ESG risks and opportunities has become increasingly important, and ESG-related challenges, such as extreme weather events, supply chain disruptions, cyber events, regulatory changes, ongoing public health impacts, and the increased focus on workforce resilience in various work environments, continue to create volatility and uncertainty for our clients." --- (AON, sec filing, 2024/Q1)

"In this Risk in Context podcast episode, we discuss some of the main people-related challenges that companies may face as they embark on major infrastructure projects and provide advice on how to attract and retain the necessary skills. https://t.co/u0dQvWbQ22 https://t.co/rCTlznDtio" --- (MMC, Twitter post, 2024/06/26)

"Actual results or events in the future are subject to a number of risks and uncertainties and may differ materially from those currently anticipated or desired or referenced in any forward-looking statements made as a result of a number of factors." --- (BRO, earning call, 2024/Q1)

"Business decision makers recognize the enormity of the challenges presented by the megatrends of Trade, Technology, Weather and Workforce and they are looking for actionable insights and innovative tools to more quickly address critical risk and people issues." --- (AON, press release, 2024/07/17)