Making his mark: Christopher M. "Kip" Condron is hoping to use his extensive background in banking and financial services to position Axa Financial and its insurance subsidiary to compete for consumers' savings. (Q&A Life/Health).

The perfect blend of people and management is what Christopher M. "Kip" Condron calls an organization's key to success. After leading investment and financial-planning companies for years, Condron now puts his strategy for success to work at Axa Financial, one of the world's largest financial-services organizations.

"No matter how good a company's technology, products, brand or strategy, it won't be successful without the right people doing the right things all day, every day," Condron said. He has spent a large portion of his more than 25-year career undertaking this mission, and he is now meeting that challenge head-on during his first year as president and chief executive officer of New York City-based Axa Financial, a wholly owned subsidiary of Axa Group, and chairman and CEO of Axa Financial's principal insurance subsidiary, The Equitable Life Assurance Society of the United States. "We've flattened the retailsales organization of Axa Advisors from 18 regions to six divisions, so we can get closer to the ground and be more responsive to our clients," he said. "As a result, we've been focused on having people in the right places."

A native of Scranton, Pa., Condron began his career in investment management for CS. McKee & Co. in Pittsburgh. However, a life-changing turn of events at the age of 30 led him to refinance his house, quit his job and start a financial-planning firm, Condron Associates. In 1985, he sold Condron Associates to Ayco Corp., the financial- and tax-planning subsidiary of American Express, and became copresident. He later joined The Boston Co., which was aquired by Mellon Financial Corp. In 1993, he was named executive vice president of Mellon Financial, and six years later, he became president and chief operating officer. Also, Condron took over The Dreyfus Corp., Mellon's mutual fund subsidiary, and became the company's chairman and CEO.

"[Condron] brought added credibility to the story that Mellon Financial truly was committed to transforming itself from a traditional super-regional bank into a financial-services company," said Gerard Cassidy, managing director of equity research of RBC Capital Markets, who has followed Mellon Financial for the past several years. "Having him involved in the senior management team during that transition certainly added more credibility to the company's effort."

Condron is now fitting the variety of skills he acquired over the years into Axa Financial's corporate structure. Today, Axa Financial has grown to become one of the world's premier financial-services organizations through its strong brands: Axa Advisors, The Equitable Life Assurance Society of the United States, Axa Distributors LLC, Sanford C. Bernstein and Alliance Capital Management. Axa Financial reported about $483 billion in assets under management as of Dec. 31, 2000.

Condron is excited about meeting his new challenges. Reflecting on his first few months at Axa Financial, he talked recently about the impact of Sept. 11 on the industry and his company, how Axa and other insurers will be able to compete with banks for individuals' savings dollars and what he hopes to accomplish in the coming years.

Q : What have you accomplished during your first several months at Axa Financial, and what are your plans for the company during the coming years?

One of the reasons I found this position so attractive is that I believe entirely in the strategy that Axa Financial had before I came to the company and I think I have some value to add in executing against that strategy. The strategy says that we will provide the best financial advice to our clients and, in doing that, we will build very strong relationships with them. Axa has an open-architecture system. Therefore, if we do a good job in providing financial advice, we'll build credibility, and people will want to buy our products. I know a lot about financial planning because of my experience in starting a firm and running Ayco, and I feel this is an area in which I have added and will continue to add a fair amount of value.

In addition, I've been focused on brand. Although Equitable is a wonderful insurance brand, the brand we're trying to drive forward is the Axa brand, because it is a financial-services brand. Although we will keep the Equitable name and manufacture insurance products under that name, Axa is the brand we're now focused on. We renamed the field force Axa Advisors, so that there's no confusion. The company is Axa Financial, and we're looking at creating some identity-focused advertisements to be rolled out later this year.

We're also focused on products and have done a lot of interesting things with our products over the last few months. On Jan. 1, we introduced a new family of variable annuities and mutual funds called Axa Premier Funds. We selected money-management firms based on optimal investment-management features unique to each asset class. This design includes a combination of three subadvisers per equity fund and two on the bond fund. What makes these products unique is having not just one subadviser to run a large-cap fund, but having what we believe are the best three. We correlated their past performance so that when one is underperfoming, as they all do from time to time, the other two are performing strongly. We believe this uniqueness will benefit our consumers as a result of superior performance and by providing them the opportunity to invest in a way they couldn't do otherwise.

In addition, we've enhanced our life products. We introduced a very competitive fixed-annuity product in September 2001, and already it's been very well received in the market. We've also been focusing on trying to understand what our client base is looking for in terms of products, and we're striving to be very fast in delivering these offerings to the market.

I believe strategy, brand, products, people and compensation are the keys to success. I think that compensation drives all behavior. If you get your compensation plans right--have the right people doing the right things, have both the right strategies and the right products and you're working on your brand--everything will work. Balancing this blend has been my focus over the past several months.

Q: How have the events of Sept. 11 affected Axa's business and what, if any, longer-term effects do you expect to arise?

I think that it has obviously refocused people on life insurance and their own mortality. We have a substantial increase in the backlog of applications in the life area today, and our life sales have been moving upward. However, I'm not sure if that's attributed to 9/11 or to some of the enhancements we've made to our products. It's also clear that everyone is more focused on families and values than they were before the tragic events. This is interesting, because Axa Financial is a company rooted deep in history and family values, and that is a very big part of who we are and what we do. Our employees have made substantial personal commitments to the victims of 9/11, and we've been very generous as a company in supporting these contributions by matching them two-for-one. We think that sort of says it all.

Q: How do you see Axa and insurers in general as being positioned to compete with banks for individuals' savings dollars?

Here in the United States, we are different from the rest of world, due largely in part to Glass-Steagall. We've all grown up in a bifurcated or trifurcated environment in which we learned to buy our insurance from insurance agents, go to a bank for banking and savings needs and visit investment firms to purchase investment products. However, in Europe and Asia, we typically see banks and insurers own the assets of their clients, because they have been able to deliver everything to them. Now in the United States, banks can deliver insurance and investments, investment firms can offer customers insurance and banking products, and insurers can deliver banking and investment products.

Today, everybody can deliver everything, but we still need to teach American consumers that they can do one-stop shopping. The beauty about the way Axa Financial is structured is that we can deliver a total open architecture. For example, our fixed-annuity product has been a big winner in the banks, as banks have sold the majority of this product since we began offering it in September 2001 .We think that bank deposits are disintermediating, because they can be tracked. People are not leaving their money in savings accounts in banks, because they can get higher returns elsewhere, and FDIC insurance is only $100,000 and, for people with more than that, it's not particularly meaningful. Therefore, the savings opportunities we have through fixed annuities and the investment opportunities we have through an open-architecture system make us a very viable competitor to banks.

Although banks have all the customers--since everyone who is an investor has a banking relationship--one statistic that always resonates with me is that banks have only 12% of the total mutual fund distribution of business and have been relatively flat in terms of that percentage. I believe we also have significant relationships with those customers and are getting a better share of their business. That's where our focus lies.

Q: What is the status of converting agents to financial consultants, and how successful has this program been thus far?

This is part of the implementation of our strategy I talked about earlier. Approximately 3,200 of our financial professionals licensed in insurance are credentialed with Series 7, which allows them to deliver all investment products. Frankly, it's much easier to take a sales force and organization that is deep in history in insurance and teach them to deliver investment products and financial advice to clients than it is to take an investment-oriented sales force and teach them how to deal with insurance issues.

Q: what are your plans for technology and expanding the company's presence on the Web?

We have recently introduced Axa Online and the Online Wholesaler, which are designed for third-party distribution, where both broker and financial-planning clients can use the Web to access information about their client accounts. We're now in the process of building a new work station for our advisers. I would say when it comes to technology, we are both smart and thoughtful spenders. We're in the process of examining where we can best add value in our technology efforts, and we have a very disciplined process in allocating our technology dollars. As a result, I think we are quite efficient and effective in what we're getting for our clients.

Q: what do you foresee for the future of the industry and for Axa Financial?

I think there are a lot of changes afoot for both financial services and insurance, including more consolidation. Those companies that execute well against their strategies will be the proven winners. Just having the right strategy isn't good enough. Axa Financial has a very strong competitive edge with our strategy that perhaps doesn't sound all that different from our competitors. However, we've built the infrastructure and made the financial commitments to deliver against that strategy, and we are doing that all day, every day. So it's my strong belief that we'll be a very strong survivor here--one of maybe a handful of major financial-services companies with captive sales organizations that are successful.

RELATED ARTICLE: Christopher M. "Kip" Condron Position: President and chief executive officer of Axa Financial Inc. and chairman and CEO of Axa Financial's principal insurance subsidiary. The Equitable Life Assurance Society of the United States since May 2001.

Company: Axa Financial New York.

A.M. Best No. (Equitable): 06341

A.M. Best Rating (Equitable): A+ (Superior)

Career History: Prior to coming to Axa Financial Condron served as president and chief operating officer of Mellon Financial Corp since 1999 and was chairman and CEO of The Dreyfus Corp. Mellon's mutual fund subsidiary since 1995. He was the vice chairman of The Boston Co., an asset management and trust company which was acquired by Mellon in 1998. Before joining The Boston Co. in 1989 he-was co-president of Ayco Corp., which acquired Condron Associates, a financial-planning firm of which Condron was founder and president.

Education: Bachelor's degree in business from the University of Scranton in Pennsylvania.