Aon-Willis and the Continuing Evolution of HR Consultants into Risk Advisors

I almost deleted the newsfeed in my email a few weeks back about Aon Corporation and Willis Towers Watson's plan to merge in an all-stock deal. This was last year's news, wasn't it? Or was it a couple of weeks ago? And didn't that deal fall through? I scratched my head. It seemed like another instance of gaslight-by-technology, like when Alexa blurts out "Sorry, I don't know that" when you never asked a question. The first thing I had to do was to confirm this news was current and real. It was.

Now I'm intrigued. I've followed both companies for many years, first as an industry insider and later as part of my research covering the HR consulting market for ALM. At one time, their component businesses—Hewitt Associates, Towers Perrin, and Watson Wyatt, along with Mercer—formed the Big Four of the HR consulting world. They dominated the space for decades when it was driven by employee benefits consulting, a mix of actuarial, brokerage, advisory and administrative services. This business, in turn, was dominated by defined benefit (DB) pensions consulting, a highly lucrative and dependable revenue stream until the 2000s, when employers started closing their DB plans to manage liabilities and reduce administrative costs.

The decline in DB consulting triggered market consolidation amongst the Big Four, beginning with Towers Perrin and Watson Wyatt's merger forming Towers Watson in 2009. In 2010, Aon acquired Hewitt Associates, merging it with its own HR business, Aon Consulting. The largest deal occurred in 2015, when Willis Group acquired Towers Watson to form Willis Towers Watson.