Whenever the office phone rang, Jeanette Marais wanted to answer it. That was how she realised a career as an actuarial scientist wasn’t for her.
“I’ll tell you exactly how it happened,” says Marais, deputy CEO of the R30bn life insurance and investment group Momentum Metropolitan Holdings, since March last year.
“I worked in actuarial product development at Momentum in 1991. I very soon heard that the phone was ringing all day with advisers and clients asking technical questions about products and things, and trying to understand them. Whenever the phone rang, all the actuaries went ‘agh’... and I was saying: ‘Yes, give it to me, please. Can I speak to people?’ ”
It was at that point that the prospect of “going deeper into the spreadsheet” finally lost its appeal. Marais was halfway through a second degree in actuarial studies, but the die was cast. Give or take the odd hiatus – including a sabbatical that lasted a mere month – she’s run a high-octane career putting people at the centre of investment and life insurance companies.At one point, Marais was executive assistant to Hillie Meyer, then managing director of retail at Momentum prior to its 2010 merger with Metropolitan, and who has been CEO of the merged entity since 2018. The obvious question is whether she’ll step into Meyer’s shoes one day?
I’m cautioned not to make a big deal about this. Firstly, Meyer recently had his contract extended. Secondly, it’s just sensitive: There’s a number of people who’d treasure being the group’s future CEO.
Having said all that, Marais – who is unflinchingly direct – makes it clear: “Of course I have ambition, otherwise I would not have been here.”
In the case of Momentum Metropolitan, being “here” means the company’s Centurion head office. It requires a weekly commute from Cape Town.
“I’m happy to make that sacrifice for two reasons: One is my ambition. I have the ability to be CEO. Secondly, and the most important, is that I have a deep love for this organisation, for this brand, and what it stands for.”
Marais is arguably one of the most senior women in SA’s financial services sector, following the recent resignation of Maria Ramos from Absa, but it all began at Momentum. The route to her current position, however, has not been entirely linear. In fact, it was while working away from Momentum Metropolitan that she came to realise her purpose might be to return.
Marais had been head of Allan Gray’s distribution and client services from about 2009 when she heard and saw things at Momentum post the merger that suggested business wasn’t going well.
“I could see how it was slipping through their fingers. I said: ‘Guys, what are you up to?’ And I guess that’s when the call came.”
When Marais picked up the phone, it was Meyer inviting her back.
Back at Momentum Metropolitan, the job was simple: To stop a deterioration that had its roots in the structural misconception of previous management – a piece of centralised planning that damaged all that was best about Momentum, says Marais.
“The problem really started in 2014 and 2015 ... they adopted a whole new operating structure that was a matrix model. It completely removed product houses,” she says. “If you asked me any time in the 18 years what Momentum’s brilliance was; it was its obsession with advisers, [its] incredibly strong relationships with independent advisers.
“The second thing was its product excellence, but a product excellence because the people behind the product were close to the market.
“This new operating model destroyed all of those. It took the people who were supposed to be client-facing far away from them. It took all the product houses and it said: ‘You guys run in the background; we have a segment model in-between and those people will tell you what to develop.’ It was a disaster.”
The impact of the switch extended to all corners of the organisation. For instance, specialist brokers who were now being unsuccessfully asked to work as generalists, were leaving in droves.
Client service plummeted.
“In the investment business, our lost call rate was 35%, which meant we only answered the phone for 65% of the time,” says Marais. “The average waiting time – people who just left the music on and went about their business – was often up to seven minutes.”
But perhaps worst of all, Momentum Metropolitan lost accountability.
“You would walk into a room and there would be 16 people in the room and you would ask what decisions were going to be made that day, and they would say, no decisions ... Or sometimes, they made decisions but in trying to implement them it was just too hard, too complex, and too political.”
To appreciate the problem, it’s worth dwelling briefly on the scale of Momentum Metropolitan as a business.“
Let me draw you a picture,” says Marais, hauling out a notepad as she draughts pages of illustrations consisting of boxes in boxes, boxes with arrows coming out of them, boxes in circles to highlight their importance, titles triple-underlined ... it goes on for about 15 minutes.
It boils down to a portfolio of brands offering life assurance, short-term insurance, asset management and investment services. There’s a wellness programme – Momentum Multiply, the group’s data-play that anticipates and even modifies client behaviour – and then some bespoke enterprises, such as short-term insurance management company Guardrisk (described by Marais as a “jewel in the crown”), and a property company.
We didn’t really get on to what Metropolitan does.Meyer and Marais set to a three-year plan, known as ‘reset and grow’ – more checklist than strategy, says Marais – that started with the removal of ‘the matrix system’. Next was to reinstall an end-to-end business structure which was in Momentum’s DNA all along, she says.
“All of us are now responsible for our own human capital and we all have our own finance, risk and everything else. So, you could take my business today – this floor and that floor – and you could sell us and we could carry on and function.”
Brands backed by experts and champions were returned to the front of the organisation and, to use one example of the change, led to almost immediate improvement in lost call rates, down from 25% to 1% at Momentum Retail. There have been hiccups, though.
One was the headline-grabbing episode last year in which Momentum Metropolitan declined to pay a policy on the life of Nathan Ganas, who was shot dead. An autopsy discovered Ganas had not disclosed his raised blood sugar levels.
It didn’t matter the ombudsman supported Momentum Metropolitan’s decision; by the time the court of public opinion had stepped in – involving influential voices such as Thuli Madonsela and Redi Thlabi – Momentum had a giant-sized reputational crisis on its doorstep.
Marais says the brand was harmed, but in creating a policy that would pay an amount equal to the death benefit (limited to a maximum of R3m) in the case of violent crime, irrespective of previous medical history, the company changed the way the industry looks at similar future incidents. It’s tricky, though: insurance companies don’t want to encourage non-disclosure.
At least policyholders don’t pay: pay-outs made in future events come from Momentum Metropolitan profits, not policyholder funds.
For now, the market seems to have liked what it’s seen since Meyer and Marais took over. At the time of writing, the share price eased through a new 12-month high and recent financial numbers produced a 53% increase in normalised headline earnings.
Meyer is shooting for R3.6bn to R4bn in profits by 2021, and the company is eyeing market share growth again. The purchase of Alexander Forbes’ short-term insurance business was a coup for Marais. For R2bn, the group improved market share in the high LSM that would have taken years to build organically.
There may also be other opportunities cropping up among smaller insurance companies, especially as the economy crimps margins.
Some R500m is going into aYo, a mobile insurance joint venture with MTN, and India, where the group has another venture partner in a development described by Marais as “one that could become an absolute jewel in our crown” in the long run.
And the phone is being picked up quicker than ever. If in waiting for a Momentum adviser, clients are subjected to an AI-driven keypad walkabout: “Where Jeanette works, you get a human being.”