Norwich Union (NU) staff are frustrated at the service they can give their customers and are mistrustful of senior management, an internal report reveals.

But the company acknowledges problems with low morale and service standards, and a claims turnaround has begun.

Human resources director John Ainley said: "We are shifting the culture of the organisation.

"Culture change takes time. We are starting on a journey that will make NU insurance very special."

Last week, Insurance Times reported on an internal survey of claims handlers that revealed worrying levels of discontent at the market leading insurer.

A second internal report now adds further evidence of dissatisfaction with senior management.

Staff from a corporate partners department in Worthing that deals with affinity agreements with large corporations completed two questionnaires in March. These indicated they were generally happy with the way in which they were treated, managed and communicated with.

But two follow-up focus groups held in late April revealed discontent within the ranks.

Comments made during the focus groups reinforce the impression that staff are frustrated with the levels of customer service they can provide.

When the group discussed customer service, one employee asked: "Does NU care about brokers any more?"

The comment came after another participant had complained about being prevented from explaining to a broker customer that a service had been dropped because the company was so short-staffed.

Another participant said: "[Affinity] partners are sweet-talked at high level by senior management, but the buck stops with local management which is not empowered to deliver the level of service promised due to changes and lack of experienced staff or too much work/constant change."

One contributor asked: "Do our corporate partners know how things are being run?"

Worried that spending on promotions - such as Norwich Union's `Together, We're Stronger' advertising campaign - came at the expense of quality staff, one commented: "Why is so much money spent on brand, advertising, sponsorship and stupid pens?

"Why can't this be invested in staff to retain quality staff and [make the company] able to afford more experienced staff?"

Another appeared to lay the blame for declining service standards at the feet of the company's top bosses.

"Senior managers should go back to the floor," was the comment.

Other major areas of dissatisfaction included working hours, appointment, contracts and stresses caused by upheaval and restructuring.

But the human resources department came in for some particularly strong criticism.

It was described as "very unsupportive", "unavailable", "not confidential" and biased towards managers.

Ainley said morale and customer service were "key issues" for 2002 in addition to profitability, after the company's focus on the bottom line.

He said: "We are shifting the culture of the organisation from one which was very controlling to one which is enabling."

Measuring morale and customer service was part of this drive.

Results from surveying all staff found an improvement from last year. The proportion planning to stay in NU for at least two years and who were proud to work for the company had risen to 66% this year from 55% last year.

Among innovations that would help were a customer service academy - combining training and performance evaluation for all customer-facing staff who would be rewarded financially - and promotion possibilities.

The company has introduced an underwriting academy to improve standards.

What they say about NU
"Does NU care about brokers any more?"

"How can service be maintained when we are always backfilling with inexperienced staff?"

"We are not happy with where we are in terms of morale and customer service."

"The best way to shift the culture is to be open about what's going well and what's not going well."

"Culture change takes time and we are starting on a journey that will make NU very special. Our aspiration is to be the best general insurer in the country." John Ainley, NU HR director