What are some major technology challenges you faced in 2010?
Walker Sydnor: Technology does not stand still. Properly steering stable technological growth is an ongoing challenge in any industry. If you’re slow to adapt, you run the risk of being left behind in the marketplace. However, if you adopt new technology before it is stable and has proven value, you have wasted resources and exposed yourself to the even greater risk of instability. The challenge is to determine the proper balance between innovation and stability.
A specific challenge we faced in 2010 was maintaining communication and connectivity with customers and between our 8 branches, given the need to reduce the costs and environmental impact associated with travel. We’ve implemented technology enabling us to deliver educational seminars over the web to clients, prospects and internal staff. This allows us to maintain our close contact and provide that additional value that helps differentiate us from our competitors. We also have installed inter-office video conferencing throughout our organization to foster communication and teamwork between regionally separated offices.
Dennis Johnson: Difficult economic times force difficult choices. We needed to determine if we were going to invest in technology to maintain the ability to grow and develop the agency going forward, or freeze all spending. We decided that it was important to think of future opportunities; therefore, we invested in the infrastructure of the agency.
1. Storage. We have a tremendous amount of data. We have a document/enterprise management system that reduces paper and increases efficiency and productivity levels. We have installed a SAN (storage area network) to address the data storage issues and increase the storage infrastructure for our virtual network.
2. Data security. With the obligation that we have to protect our clients’ personal identification information, we must make available to all associates the ability to encrypt this information. This becomes a challenge internally as you work with the agency to develop the process and build the habit, but also externally as you respond to the carrier’s frustration at having to retrieve this information in a different manner.
Tom Cotton: Technology is a major factor driving agency sales and mergers. The last system upgrade we made was 2006 and we are scheduling our next upgrades now. Electronic file storage, transactional websites, dual or triple monitors, band width, system speed, direct company interface, all terms once discussed as dreams of the future are now minimum requirements of a modern agency.
Where do you turn for young talent? How do you mentor young agents?
Johnson: We source our new talent from outside the insurance industry, including from banking, healthcare, pharmaceuticals, printing and mortgage lending industries. We have discovered that we are not good at recruiting sales associates directly from college. Our typical sales associate has previous work experience.
Our mentoring program focuses on both knowledge and sales learning. It involves multiple people with specified roles and responsibilities. We use a sales selling system that provides a set offense for the new sales associate to run.
Cotton: We have made several new hires out of Project InVEST, an IIABA-sponsored program that provides high-school students exposure to the insurance industry by allowing them to open and operate a mock agency in their school. We also interview students in the business or risk management programs of our state universities. Young producers are run through our in-house producer training and required to begin an insurance designation program.
Sydnor: We go to three places. First, we are always happy to look at new graduates, though this must be a very careful look. As a matter of fact, we’ve had a couple good successes lately involving rising seniors who spend some time interning with us. This internship provides both the company and the candidate with a very thorough understanding of each other and the expectations attached to the role of a young producer.
Second, we will always consider a successful producer from another firm. This too involves its challenges, as a non-compete agreement generally comes along with that producer and we have to work through that carefully.
Third, and this is probably our favorite option, we look for the “one job out” candidate. In other words, mid to late 20s age-wise, enough job experience to understand personal strengths and weaknesses, the confidence gained from working through that first role and the energy and enthusiasm to learn how we do what we do.
In terms of mentoring, we have a number of areas where we provide direct one-on-one guidance from a technical standpoint. New producers generally spend about a year learning about our tools, our technology, our value platform and our culture. In addition to this type of training, which is provided by a number of people who work on various teams, we have a more formal mentoring structure, where each young producer is assigned to a veteran to make joint calls, talk through strategies and generally just provide guidance and support.
What services or lines of business are you focusing on for growth in 2011?
Sydnor: Like everyone else in the industry right now, our benefits practice is easiest to grow. We’ve been experiencing great successes and growth with our benefits group. There is significant pain in this area for employers, as well as a good deal of confusion. Our team has positioned itself well as knowledgeable and valuable partners who can help our clients navigate the complexities with good outcomes. Not surprisingly, in light of the market, organic growth in the property-casualty world is a bit more difficult.
Cotton: We have three areas of focus. The first is the high-valued homes and high net worth individuals.
The second in a Hispanic marketing initiative. The demographics of central Florida have changed. Currently 40 percent of the population is Hispanic, and there is no independent agency offering our market selection or service level. We have recruited Hispanic producers and support staff to fill this need.
The third is account rounding by offering employee benefits and financial services. Whatever form healthcare takes, people will need the advic e and assistance of a professional agent to guide them though the process.
Johnson: We are experiencing good growth in our employee benefits practice and expect that to continue in 2011. We have expanded our capabilities in employee benefits to respond to clients’ needs as they face the challenges of healthcare reform. We also are working on several internal initiatives to maximize our penetration into all of our clients for their insurance and risk management services.
How does your agency stand out from the competition?
Sydnor: I will keep this short and simple:
1. We always aim to hire and train better talent.
2. We continue to invest heavily in risk management resources.
3. As always, our employee ownership is our greatest cultural asset. We believe the power of this entrepreneurial culture is our most unique characteristic, particularly within our industry, and we will fiercely protect it as we believe it fosters better service to our clients and to each other.
Johnson: First, we are working collaboratively with our clients and prospects. Second, we are working with our clients and prospects to develop innovative solutions for their needs. Last, we deliver a plan for accountability that produces the results for the client or prospect.
Cotton: We commit to ongoing professional development. Every employee has at least one professional designation.
Secondly, we offer selection. If we obtain quotes from four companies, the customer will see all four quotes. Some insurance companies don’t like this, but it demonstrates to the client that we don’t eliminate the competition by market blocking just to push the highest paying product.
Finally, we encourage all employees to serve the industry or community. The list of industry leadership roles our employees have filled is far too numerous to mention.
How is your agency responding to the rise in online and social marketing? What are your initiatives?
Sydnor: We are supremely aware of the online and social media explosion. Our internal communications team has sought after the greatest expertise it could identify in our information-gathering phase, including collegiate business school forums. We have been watching what both our competitors and outside industries are doing in this realm and realize that a presence of some sort is almost mandated, but we’re still determining the best utilization for our industry. There are consultants calling weekly, offering their services in building this platform, but we’re stepping into it a little at a time so we can evaluate how it makes the most sense for us. Obviously, we strive to keep our website current and informative, but we’re taking on the newer media (Facebook, external blog, etc.) at a little slower pace.
Cotton: There is no doubt the next generation of insurance customers will purchase insurance though different means, but for now our customers still need an agent involved in the process. The challenge posed by representing multiple carriers and performing online transactions, while giving the customer the benefits of choice, is the industry’s next challenge.
The IIABA is working on a project that will allow independent agents to compete for the electronic buyer that is now being underserved by the one company/one product Internet sales companies.
The FAIA is working on a multiple company Internet quote and bind platform for independent agents.
Are you seeing any improvements in economic conditions or hardening market conditions?
Johnson: In our area of the country, we are not seeing much in the way of economic improvement this year. Most of our clients have adjusted their business environments to the new economic realities. We do see more stability because of the adjustments our clients have made.
The other new reality is a long, slow economic recovery to a business world that will be different from what we have known in the past. We also are not seeing any indications that market conditions will firm up in the near term. Everything we see and are experiencing continues to be soft market conditions with aggressive pricing, underwriting appetites, and policy terms/conditions that are very favorable to the client.
Sydnor: Frankly speaking, no. I think we will continue to feel the burn of this difficult economic environment and soft market for some time to come.
Cotton: Florida has suffered the same construction and development downturn as the rest of the country but we have the tourist economy to keep us afloat, so we have stabilized.
As for our market conditions, the election of a new governor and most likely appointment of a new insurance commissioner and how they are going to treat the voluntary market will determine our market going forward. It can only get better.