OUR BUSINESS

MMI is one of the largest insurance-based financial services groups listed on the South African stock exchange, the JSE, with an embedded value of R39 675 million, and a market capitalisation of R42 billion (as at 30 June 2014).

Created in December 2010 from the merger of Metropolitan Holdings and the Momentum Group, MMI conducts business in South Africa, in 12 African countries outside South Africa, as well as selected international countries.

MMI’s core businesses are long and short-term insurance, asset management, savings, investment, healthcare administration, health risk management, employee benefits, property management and rewards programmes. These product and service solutions are provided to all market segments through our main client-facing operating brands, Metropolitan, Momentum, Guardrisk and Eris.

OUR STRATEGY

In the last three years, MMI has successfully bedded down the merger and the benefits are being demonstrated in MMI’s strong results and the value it is creating for all stakeholders. To effectively compete and grow into the future, we reviewed our strategy to take account of developments in the environment and our industry, concluding that we should position MMI much closer to its clients through the implementation of a client-centric strategy. Our new vision, purpose, strategic focus areas and values all support value creation through the client-centric operating model.


INTRODUCING OUR CLIENT-CENTRIC STRATEGY

Strategy

strategic focus areas

Stategic_focus

Operating model FOR THE PERIOD 1 JULY 2013 – 30 JUNE 2014

Operational_model

This report is based on the operating model that was in place from 1 July 2013 to 30 June 2014, comprising a structure with six full value chain divisions and supporting group-wide functions (see diagram above). In support of MMI’s strategic focus on client-centricity, a new client-centric operating model will be rolled out over the next three years, from 1 July 2014 (see diagram below).

New operating model

New_operational_model

In the same way that MMI’s operating model must support its strategy, it needs an operating structure that enables optimal execution of the operating model. To achieve this, the group will be implementing an operating structure that comprises four segment businesses and one products and solutions business, supported by group-wide functions.

OUR FOUR SEGMENTS

Segments

NEW OPERATING STRUCTURE

Board_CEO

key performance indicators

Key_performance

METRIC

Weight
F2013

Weight
F2014

Weight
F2015

Return on embedded value

20%

20%

Core earnings

30%

25%

25%

Value of new business

20%

20%

20%

Integration expenses savings

15%

Transformation (FSC scorecard)

15%

15%

15%

Strategic projects

20%

20%

20%

Total

100%

100%

100%

longer-term performance indicators – Return on embedded value (ROEV)

As an indicator of financial performance over the medium to longer term, the group’s return on embedded value is measured on an annual basis, but averaged over a rolling three-year period. The targeted rate of return has been set at 300 basis points in excess of the annual growth in South Africa’s nominal gross domestic product (GDP). The target is reviewed on an annual basis.