The feeling’s mutual: How an acquisition accelerated Northwestern Mutual’s digital transformation

Read Article
Two distinct operational models collide to form a blended third culture and deliver meaningful financial innovation to consumers


Vivek Bedi

Vivek Bedi is the Head of Product at LearnVest and Head of Consumer Experience Products at Northwestern Mutual. He is a passionate leader with extensive experience leading global adoption and expansion across the areas of technology, product management, sales, marketing, and operations.

“The name Northwestern Mutual was created when Milwaukee was the most northwestern part of the United States…9 years after the state of Wisconsin joined the union,” Charles Worman says with a slight chuckle. The company’s product director and unofficial historian considers how drastically the world has changed since then. “We’re a 160 year old company whose bread and butter was life insurance and risk products – but for the last 10-15 years we’ve been transforming into a holistic financial planning company.”

One of the nation’s oldest and most cherished brands has a familiar story about reinventing itself for the digital world, but with a twist. In March 2015, Northwestern Mutual acquired LearnVest, a fast-growing New York-based startup with a personal finance tracking suite. Instead of fully integrating the technology and employees into itself, Northwestern Mutual saw value in maintaining LearnVest’s entrepreneurial and digital-first approach.

“Northwestern Mutual has always had a traditional culture that really values the field advisor, being client-centric, and explaining our business principles,” explains Vivek Bedi, who is both the VP of Consumer Experience of Northwestern Mutual and the Head of Product at LearnVest. “LearnVest, on the other hand, has always been focused on brand, innovation, and design.”

Wearing two hats and sitting at the intersection of different operational models has given Bedi a unique perspective. “Together, we’ve built a blended third-culture as I like to put it. A culture that really thinks about taking risks, experimenting, but also [embracing] those core commitments from Northwestern Mutual.”

Blending these teams and bringing the cultures together has been really empowering, and that’s been really evident in some of the projects we’re working on

Vivek Bedi

Whereas many high-profile acquisitions seem to be more about ‘innovation theater’ than actual substance, Northwestern Mutual has eschewed the notion that old dogs can’t learn new tricks.

Worman describes how his Milwaukee-based team has embraced a fundamentally different approach to building products. “Marketing generally was calling all the shots – in terms of the technology we were using, in terms of the approach, it was very siloed.”

He gets excited as he talks about the change still taking place.

“We really stepped out of that by bringing in the engineering teams, the design teams, doing this as more of a collaborative effort,” he explains. “As we build out a cohesive digital experience, we’re not just looking at what we need internally, but looking at what consumers need.”

The magic of being customer-focused is that it also energizes employees.


Spearheading a Digital Transformation

“Years ago, there was some frustration from teams about a better way of working, better tools we could use to streamline our approach,” Worman recalls. “What I really love about the direction Northwestern Mutual is going is that senior executives are hearing that, they’re listening, and they’re making sure that they’re adapting to meet the needs that teams are requesting.”

Best of all, according to Bedi, it’s translating into tangible results. “Blending these teams and bringing the cultures together has been really empowering, and that’s been really evident in some of the projects we’re working on,” he says.

No example is more evident than the ambitious initiative to overhaul Northwestern Mutual’s website,

Hitting refresh

“Historically, we had a corporate website,” Worman explains. “So it met the needs of all the various stakeholders that we have in the organization.” He provides examples of how the communications team required the site to list the company’s history and values, while the career distribution team was focused on highlighting openings for potential field representatives.

“To be honest, the various sections of the website spoke to those requirements. The problem though is that it wasn’t cohesive,” he says. “It felt like a bulletin board.” Traffic and conversion rates were less than stellar.

Fortunately, the stakeholders recognized this and rallied behind a vision to move from a corporate website to a consumer website. “Instead of figuring out what Northwestern Mutual’s needs are, we wanted to take a step back to figure out what the consumer needs are, and make sure that we develop the website to accommodate them.”

But changing perspectives is easier said than done, especially within an established organization. Fortunately, the ideal partners were just a quick flight away.

“You [could barely] customize the website before,” reflects Kimberly Tzeng, a product manager at LearnVest who was called on to help spearhead the redesign efforts. “From a technology standpoint it wasn’t dynamic, and there was usually just one stakeholder making decisions.”

By applying cutting-edge methodologies for both technology development and cross-functional collaboration, Tzeng operated from LearnVest’s office near Union Square in Manhattan to accelerate development of Northwestern Mutual’s new website. Her first priority though was to develop empathy for stakeholders and users, fully cognizant of her perceived role as new kid on the block.

“We had to reach out to all these different groups, including marketing, communications, investments, insurance, customer service, and careers,” Tzeng says. “We set up meetings from the beginning to align everyone with the mission.” She then instituted two-week development cycles, called sprints, so that requirements could be frequently reevaluated and reprioritized as circumstances changed and new data became available.

“We wanted to make sure that we weren’t wasting time building something that was incorrect the entire time,” Tzeng says. “Now it’s a much more collaborative process.”

But interpersonal relations alone weren’t enough to drive meaningful change. To do that, Tzeng also needed data. “We did user research – half with people who weren’t our clients and half with people who are clients to make sure our prototypes resonated with both,” she explains. “We used the feedback to determine whether we were going in the right direction.”

Worman credits the team’s emphasis on data-driven decision making as key to the overall execution. “Taking that research and data back to stakeholders to actually prove to them our hypothesis and the reasons for strategic decisions that we were making…that really put their minds at ease,” he says.

For example, the original website dedicated significant space to information about careers and job openings. Worman and Tzeng considered the impact of demoting the section to the site’s footer, a more common location for career-related information. Doing so would enable the team to leverage valuable screen real estate for other pertinent information, such as an overview of the company’s financial services. By testing prototypes with more than 700 users, they showed that visitors naturally scrolled to the footer to look for career-related information, and that conversion rates might even be higher with the proposed reorientation.

The new site, launched in September 2017 is already performing significantly better across virtually every metric. According to Tzeng, the percentage of users that visit a page before exiting the site altogether, also known as the ‘bounce rate,’ has dropped by 40%, meaning that users better understand how to navigate the site. Most importantly, that’s true for multiple user groups – whether a visitor is looking for a job or to purchase life insurance.

“In terms of connecting visitors with a financial advisor, we’re getting a lot of quality digital leads,” Tzeng says. “That wasn’t the case in the past.”

Those benefits are already making a significant impact for Northwestern Mutual’s business.

“[The changes are] helping us do things like improve our marketing spend,” Worman proclaims. “We can start investing in channels that we know have a higher conversion rate, instead of a spray and pray model.”

How the sausage is made


Adopting New Workflows and Technologies

On the surface, the redesign initiative feels like it was executed seamlessly. But it could have just as quickly gone sideways due to technical constraints.

Within large organizations, it’s common for engineering teams to struggle as they balance two opposing concerns: executives demand estimates and deadlines, while product managers require flexibility and adaptation. A consumer-first strategy may have opened the door to various site improvements, but the team wouldn’t have been as successful without Northwestern Mutual’s eagerness to also embrace a more iterative approach to technology development.

“What’s great about our approach is that we morphed it to fit our team and how we work,” says Jason Fong, the tech lead for the small but dedicated engineering group responsible for “We didn’t stick to a strict methodology where we had to have estimates for everything we were doing.”

That’s a stark contrast to how Fong’s team worked in the past.

“Before, we used to do waterfall projects,” Fong explains, referencing a development methodology in which phases are pre-planned and work is executed sequentially through those phases. “We would meet with business partners, get 100-pages of requirements documentation, come back eight months later with a product, and not talk to them in between that whole time. We would hope that we met what they wanted, but it usually didn’t work out.”

Everything changes so fast. To mandate that one technology is what you have to use across everything chains you down. I think it’s great that we have a lot more input.

Rick Allen

For the redesign, his team adopted an agile methodology, in which development phases are iteratively cycled through. But even that alone wasn’t enough for the team to be truly effective. An archaic technical infrastructure made frequent updates prohibitively time-consuming until Northwestern Mutual shuffled teams to be more collaborative and autonomous, according to Derek Zernach, an associate engineer on the team.

“In the past, when we needed to set up a database, we’d have to submit a form and then wait awhile,” he recalls. “This time, we worked with the infrastructure team directly.”

His colleague, Rick Allen, concurs. “It used to be a three to four month run-up time for us to [deploy an] update, and that created a lot of anxiety,” the senior engineer says. “Now we can spin things out more than once a week if we need, allowing stakeholders to get things live quicker, and for us to work faster.”

Beyond collaboration, the engineering team also benefits from greater autonomy with regard to decision making. “We have a lot of freedom with the languages and frameworks that we use,” Zernach says. “Before it was ‘these are the approved frameworks – go ahead and go at it.’”

That freedom leads to clear and tangible benefits that even non-technical executives can advocate for.

“It allows us to experiment with new things or get to the leading edge of technologies,” Allen explains. “Everything changes so fast. To mandate that one technology is what you have to use across everything chains you down. I think it’s great that we have a lot more input.”

The engineering team decided to transition away entirely from technologies hosted on-premise to cloud-based microservices, essentially selecting best-in-class solutions for each aspect of development rather than a powerful but monolithic stack. What they lost in standardization they more than gained in function.

“If one thing fails, if search goes down, the rest of the website is still running,” Allen proclaims.

But it’s not just about risk mitigation. The site can now be updated in seconds rather than hours, and loads 10x faster for visitors. The technology infrastructure also enables the engineering team to offer real-time analytics and personalized experiences based on what a visitor is currently doing.

You’d be forgiven for momentarily forgetting that you’re reading about a financial services company founded in 1857.

Lessons for your digital transformation

The redesign is a new face for the company in more ways than one. “For me personally, one of the proudest moments of this project is actually not the project,” Bedi glowingly remarks. “It’s that the team is coming together. They’re a well-oiled machine. We cracked that code of having a virtual team across two different regions.”

The site is also a case study for other organizations and executives to draw numerous lessons about transformation. Three takeaways are readily apparent:

Go all-in, one bet at a time


Rebranding a Historic Organization One Step at a Time

Introducing new methodologies to an entire workforce can be disruptive. To mitigate risk, Northwestern Mutual went all-in but with just the team initially. By giving them autonomy to experiment with new modes of development, collaboration, and decision making, Northwestern Mutual efficiently validated what worked and what didn’t. “Because this has worked so well, we’re creating a model for other teams,” Tzeng confirms.

There is no such thing as over-communicating

Tzeng knows that success isn’t about doing things the LearnVest way or the Northwestern Mutual way. It’s about understanding stakeholder objectives and rallying them around an objective. That’s an ongoing responsibility for any project, she says. Product managers and individual decision-makers can’t rely on passive participation, especially in a large company with competing priorities. They should continuously listen, learn, and communicate.

Add a consumer lens

A successful digital transformation is only half about the organization undergoing it. To be effective, it must also directly translate into strategic and tactical capabilities that address rapidly transforming consumer needs. Every action that Northwestern Mutual executed, from acquiring LearnVest and maintaining its culture, to shifting from waterfall to agile, was ultimately about customers as much as it was about employees. Unlike some digital transformations which focus entirely inwardly on factors such as loosening dress codes and embracing scooters in the office, Northwestern Mutual’s transformation was fundamentally about establishing the capability to iterate faster toward delivering customer value.

Don’t change the sales channel: How Northwestern Mutual is transforming the way 8,000 financial representatives work in the digital age

Read More

How design thinking enables XO Group to build products for life’s most meaningful moments

Read More

Bridging the gap: How and why product management differs from company to company

Read More