Executive Q&A: Stephen A. White President/CEO, Milliman


YOUTH: I was born in Oregon but came to Seattle when I was 4. My dad was the city manager of Mountlake Terrace for over 25 years. I was the numbers guy in the family. I went to O’Dea High School, then the University of Notre Dame, where I was a walk-on on the football team. I got to play a few games. I majored in math and joined Milliman right after graduation.

ACTUARIES: The actuarial profession really interests me, with its combination of business and math. What we do is put a present value on liabilities with uncertain futures. It’s like accounting with a futures bent to it. In accounting, you’re saying where things are today; the actuary tells you what a retirement plan or a life insurance policy is going to cost in the future. If a company changes the deductible in a health plan, for example, how much is that going to cost?

CAREER: When I joined Milliman in 1985, it had maybe 1,300 employees, about half of what we have today. After a couple of years working in Idaho in-house for Boise Cascade on its pensions and other actuarial needs, I returned to Seattle and got involved in management. I became a principal in 1993 and an equity partner in 1997. I worked with union funds jointly trusteed by labor and management. I also managed pension plans in which we evaluated the liabilities but also took over the administration with a call center and website for participants.

MILLIMAN: In terms of revenue, we are among the top three or four [actuarial firms] in the country. We have four business areas. We are probably second or third in the country in property-casualty, sixth in pensions, and first in life insurance and health consulting, where we work with hospitals and clinics on the best practices to deliver care. We have some of the best claims data available on cost experience for different claim types.

CULTURE: Milliman [founded by Wendell Milliman] first opened in 1947. When they added other offices in new locations, they decided to let those offices have control over their own destiny, with a separate profit structure. Even today, each practice elects its own equity partners, who share the profits of that office. One office might be quite a bit more profitable than another and the range of income for equity partners is also quite wide, but everyone is OK with that. That’s part of our culture.

TALENT: We attract people who are talented and want to have control and want to work hard and reap the benefits. That culture kind of feeds itself because the people who like the structure tend to be ambitious people who keep it going. We are very much into quality control with our work. We have a detailed peer review process in terms of who gets to be an equity partner, who has the authority to assign work. We also do a lot of collaboration on technology investments. IT and legal work are very much centralized and organized.

MARKET POTENTIAL: Our job is to help clients manage risk, and risk isn’t going away. The financial market is one area where there’s been a lot more volatility. That affects pensions and it affects life insurance in a big way since a lot of them have annuity products with minimum guarantees. Low interest rates are also a real struggle for those companies that have to provide those minimum guarantees over the long term. Our Chicago office works with many of the large insurance companies to provide hedging so that if the equity markets go down, the hedges can provide a backstop. That’s been quite successful. It really helps insurance companies take a lot of the risk out of the products they are offering.

INTERNATIONAL: This is another area that has accelerated, primarily in the insurance market. Big companies like Met Life and Munich Re are global and they are looking for expertise from a single company that can offer it across broad international markets. Right now, we have 55 offices and about half of them are outside the United States—maybe a dozen in Europe, a couple in Latin America, a couple in the Middle East and four or five in the Far East. We don’t expect to add a lot of new offices internationally, but we do expect each office to grow quite a bit. In Europe, regulators have added new, complex requirements for companies to prove their solvency. You have to do a lot of simulations: What happens in this or that situation? That has created more opportunities for actuarial firms.

COMPETITIVE ADVANTAGE: Our culture attracts more than its share of the high-level people. Another important advantage is the IT expertise we’ve developed over the past 15 to 20 years. Technology has become a big part of what we do. We have several hundred people in IT. A lot of it is based in Seattle because of the talent here. We developed a system that allows our insurance customers to do very intensive actuarial computations in the cloud. We were recognized by Microsoft as one of its technical partners of the year for that project. The group in Chicago doing the hedging work is also very IT focused. On the property-casualty side, we’re using IT to handle analytics prior to underwriting insurance. If you put in information like how old the house is, how far it is from the coast and what the zip code is it, the analytic tools can do more detailed calculations about the risks involved.

THE FUTURE: We’ve typically grown our revenues about 10 percent a year. We have a map for what we have to do differently as we become a $1 billion company in the coming years. Most of that growth will be organic. The CEO role at Milliman is not a traditional CEO role. Most of the strategy comes up from the individual practice areas. My job is to make sure we have quality people, maintain the culture and protect the brand—the reputation and the long history of quality. That’s a delicate advantage and we have to work hard to keep it.

SEATTLE: At the headquarters office in [downtown] Seattle, we have 400 to 500 people, including about 80 people who are focused on providing finance, taxes, legal, marketing and IT services for the whole firm. But we want to maintain our decentralized structure. It reduces bureaucracy and allows for more autonomy and flexibility. An expert on professional services firms brought in 20 years ago told us that while our growth was impressive, it couldn’t last with our decentralized structure and that we would have to change as we got bigger. They were wrong. We’ve still very decentralized and we’ve grown five times since then. But we do have to find ways to encourage more collaboration between offices.

Have no Fear [and other helpful suggestions from successful women.]

Have no Fear [and other helpful suggestions from successful women.]

How these enterprising women defied the odds and achieved success.
Adriane Brown is comfortable being uncomfortable. Roxie Schescke gains more by letting go. Megan Meade doesn’t believe asking for help is a shortcoming.
These women have used those life lessons in their trajectories to the top of a competitive business world in which women have been characterized as being “everywhere and nowhere.” It’s a male-dominated environment that to this day still preserves a glaring gender gap, widespread discrimination and a lack of diversity.
Brown, Schescke and Meade belong to a growing sisterhood of successful businesswomen who combine creativity and courage to lead fast-growing, multimillion-dollar companies. They are confident, fearless women who ignore the naysayers; ambitious, resourceful women who refuse to take no for an answer; imaginative, innovative women who view the world through a different lens; tenacious, independent women who turn conflicts and rejections into opportunities.
These women break down barriers and define what it means to be leaders in business — and in their communities. They pave the way to the future by mentoring other women and girls.
What most distinguishes them from their male counterparts is a different outlook, an inclusive company culture and a naturally collaborative style. “We are less competitive in our DNA,” says Jeanne Knutzen, founder, owner and CEO of Pace Staffing Network in Bellevue. “Don’t get me wrong. We are very competitive, but we have the mindset of ‘win, win,’ not ‘we win and somebody else loses.’ I’m more competitive for my customers. When they are winning, I’m winning.”
Knutzen started her recruiting, staffing and managed services company in 1975 when double standards were blatantly out in the open. She and her husband had identical balance sheets when they sought bank loans for their separate businesses. He was given carte blanche and she got a few hundred dollars that had to be paid back in 90 days. Today, her company brings in $15 million to $35 million a year. 
Paula Begoun, whose Seattle skin-care-products company Paula’s Choice has earned her the reputation as the Cosmetics Cop, says she found success through a combination of honesty, integrity, hard work and fun. “Work needs to be 50 percent work and 50 percent fun,” she says. “If that gets out of balance, something is wrong with your company’s culture.”
Knutzen and begoun are in fine company, even if they remain a distinct minority. Right now, women business owners account for about a quarter of the country’s Gross Domestic Product. But women are starting businesses at one and a half times the national average — about 1,288 a day — according to a 2015 State of Women-Owned Businesses report commissioned by American Express.
Last year, there were nearly 9.5 million woman-owned firms in the United States — 36 percent of all businesses in the country — and they generated about $1.5 trillion in revenues and employed 8 million people, according to the report. Between 1997 and 2015, when the number of businesses nationwide increased by 51 percent, the report says the number of woman-owned firms increased by 74 percent.
“We are seeing greater interest in the entrepreneurial ambitions of women, and these key factors are collaborating to open doors, increase access, and empower and enable women to succeed,” says Carla Harris, chair of the National Women’s Business Council in a 2015 report on women’s entrepreneurship. Harris predicts the number of woman-owned and woman-led businesses will more than double during the next five years.
That’s not to say it’s an easy road. Schescke, the owner of Indian Eyes in Pasco, endured years of prejudice and discrimination after leaving her Lakota reservation to live in an all-white community with a foster family in Nebraska, and later as a minority businesswoman working in the male-dominated construction-services industry.
Today, her “cradle-to-grave” logistics and facility support company is a prime contractor to the U.S. Department of Energy and holds a top government security clearance. Her firm was called in to provide “life-support services” when Pope Francis visited the United States last year and she was “boots down” as one of the first responders to the cleanup after Hurricane Katrina in 2005. “We were right in the middle of it — snake pits and all,” she says of the project, which lasted six years.
Schescke relies on her Lakota values and attributes much of her success to building a good team and delegating responsibility instead of trying to do it all herself. “That means letting go and then having the resources to support growth,” she says.
For Lee Rhodes, a cancer diagnosis led her to create Glassybaby. When she was going through treatment, she dropped a tea light into a rough-hewn glass vessel and found great comfort in the color and light. She was then inspired to sell her own hand-blown votives. Since 2001, Glassybaby has been a Seattle success story — in spite of critics who question its single-product orientation — and has donated nearly $5 million to more than 300 nonprofits.
Brown, president and COO of Intellectual Ventures in Bellevue, learned at a young age that it’s OK to be uncomfortable. When she was 8 years old growing up in Richmond, Virginia, she and her brother were the first African-American students to attend a formerly all-white school after the state began to end racial segregation. “At first, I was uncomfortable about the whole business of going to this new school,” Brown recalls. But she worked through the discomfort and discovered that people grow when they push themselves. “And it doesn’t feel so uncomfortable anymore,” she notes.
Brown is passionate about encouraging females to pursue education in the fields of science, technology, engineering and mathematics, and she supports STEM programs for girls of all ages.
A global study released this year by the Peterson Institute for International Economics in Washington, D.C., concluded that companies whose executive ranks are at least 30 percent female generate as much as six percentage points more in profits than firms with less robust female representation. 
“If you’re a firm and you’re discriminating against potential female leaders, that means you’re essentially doing a bad job of picking the best leader for your firm,” the study concluded.
Megan Meade, president and CEO of The Pacific Financial Group, a Bellevue boutique investment firm,  jokes that “it’s taken 20 years to become an overnight success.” Meade began as a file clerk in the business her father started in 1984 from their basement. It was hard enough to be a woman in a male-dominated field, but climbing her way up the corporate ladder under the shadow of her father made it even more difficult. She admits she was fired three separate times but learned from those experiences and returned to the company each time wiser and more resilient.
“It’s an endurance test,” she says. “When I was younger, I thought I knew more than I really did. … It was embarrassing but I didn’t dwell on it.”
She learned the hard way the importance of listening to others before jumping to conclusions and that asking for help is not a bad thing.
Those lessons paid off. Today, Pacific Financial is the third-largest investment firm, ranked by number of investors, in the Puget Sound region, with more than 11,000 clients and nearly $1.5 billion in assets under management.
Robin Shapiro, founder of Seattle-based Health Perspectives Group (HPG), and Cheryl Lubbert, president and CEO, have married science and business to create a dynamic duo in the health care industry. They were inspired by the work they did at their former biotech company, Immunex, where Shapiro worked in communications and Lubbert in health care research and marketing.
What started out as a platform for patients to tell their stories has grown into four patient advocacy specialty firms under the HPG umbrella, with a total of $14 million in annual sales. In her spare time, Shapiro, who grew up in a family of entrepreneurs, volunteers on the board of the Innovation and Entrepreneurship Center within the Albers School of Business and Economics at Seattle University.
“Both of us share a philosophy that we have the power to make our lives anything we want them to be,” says Lubbert, a microbiologist turned executive. “It’s about having a sense of fearlessness.’’ 
Her health care firm is not the only thing she has grown. She and her husband turned their Vashon Island pear and apple orchard into a thriving hard cider business called Nashi Orchards.
Tenacity and grit are the traits Rosanna Bowles says have steered her tableware design company, Rosanna, to success. She started her business in her 1920s Seattle bungalow when a 20-foot container filled with her first order of hand-painted Italian ceramics arrived. When she started to unpack the crates — with the help of a sympathetic delivery driver — she discovered wet wood shavings stuck to 10,000 dishes. Dismayed, yet undeterred, she recalls, “I just rolled up my sleeves and started washing them. It was like an I Love Lucy episode.”
In addition to her signature tableware, Bowles created commemorative pieces for Pope Francis’ 2015 visit to the United States and commemorative pieces for the National September 11 Memorial & Museum.
A trait these women share is that they are constantly reinventing themselves and their companies.
Lisa Hufford, founder and CEO of Simplicity Consulting in Kirkland, switched gears to start her own business. A former Microsoft sales director, she found her passion in consulting and helping companies build on-demand sales and marketing teams. Bolstered by high-profile tech clients, including Microsoft and Amazon, Hufford’s company has grown in the past 10 years to $42 million in revenues. It has about 250 employees and a database of more than 5,000 professionals.
She admits, however, that when it comes to work-life balance, there’s no magic solution. “Like most working parents,” she says, “you get good at juggling.”
Brown left a successful 30-year corporate career in the industrial sector for the world of inventions and intellectual property when she took on the COO role at Intellectual Ventures, where one of the most important core values is optimism. She was drawn to the private sector from a desire “to do something different, yet connected to the things I value.”
She was unafraid to leave respected, stable, 100-year-old companies to join a youthful, 10-year-old business that invests in inventions. “The opportunity to be a part of this early concept was something so promising and exciting that I just couldn’t resist,” she says.
Her advice to other women leading or working in companies of any size is “be fearless and surround yourself with a diverse group of people who complement your strengths and shore up your weaknesses.”
And she always comes back to that lesson she learned as a child: It’s OK to be uncomfortable.
“Women should embrace being comfortable while outside their comfort zone,” Brown says. “It’s in these times of discomfort that we can find who we are and what we are capable of achieving. … Fearlessness and the thrill of the challenge make new opportunities, great results and wonderful adventures possible.”