Tom McCoy (right), editor in chief of Rough Notes Magazine, presents the Marketing Agency of the Year Award to executives of The Flanders Group (left to right): Nancy Dehm, senior vice president, Heather Dougherty, vice president, safety groups; Michael Pollack, CPCU, property/casualty manager; and Chris McVicker, president.
By Thomas A. McCoy
What an agency can accomplish rests on the shoulders of all its employees. Chris McVicker, president of The Flanders Group of Rochester, New York, doesn't just preach that management philosophy. He practices it. So when his agency was named by Rough Notes readers as the 1996 Rough Notes Marketing Agency of the Year, McVicker wanted all of his employees involved in the celebration.
Within three weeks of being notified of the award, McVicker brought his entire agency staff with him to Indianapolis by chartered airplane for the award dinner. (Fifteen of the 20 employees attended; only those with commitments they couldn't break were not present.)
"This is our Super Bowl," said Chris. "We wanted to make the most of it."
It wasn't hard to spot the Flanders Group employees among the audience of more than 50 people at the award dinner. They all wore black tuxedos, red ties, red cummerbunds and white tennis shoes with "The Flanders Group" emblazoned upon the sides, supporting the agency's credo that "we run hard for our clients."
Others at the award dinner included McVicker's wife and three daughters, five former Rough Notes cover agents, insurance company executives, the Flanders Group's banker and industry consultants who work with the agency.
The 16-year-old Flanders Group, whose achievements were chronicled in last October's cover story, was an overwhelming choice of Rough Notes readers for Marketing Agency of the Year. Readers cited the agency's growth during the '90s from $940,000 in revenues per year to the current level of $4 million in annual revenues. They also lauded the agency's enviable record of efficiency: revenue per employee of almost $200,000.
At the award dinner McVicker was presented with the Rough Notes Marketing Agency of the Year plaque as well as congratulatory plaques or letters sent by the PIA of New York, the IIA of New York, the Independent Insurance Agents of America, the Monroe County (New York) Executives Office, New York State Senator Jim Alesi, and Representative Bill Paxon of the U.S. House of Representatives.
Touched by the opportunity to share the limelight with his colleagues, McVicker said, "Thanks for giving us this opportunity to dance a little bit around the fire together."
For McVicker, celebrating "his way," meant closing the agency for a weekday, getting some 32 people (including the agency employees, two of whom had never flown before, and guests) onto the plane for a noon flight to Indianapolis. They arrived at the hotel site of the dinner late in the afternoon. Agency employees had an hour to change into their tuxedos and prepare for an evening of pictures, laughs, congratulations and memories that will last forever.
They returned to Rochester late at night, and it was business as usual the next day despite a short amount of sleep.
For Chris McVicker and his wife Bernadette Guzzardo, it's never been difficult to remember how long The Flanders Group has been in existence. Their triplet daughters were born on the day they bought the agency. "I had been working right up to that time," Bernadette recalls, "so on that day we went from two incomes to one, borrowed $440,000 to buy the agency, and went from a couple to a family of five."
Before the agency was even open for business McVicker did some careful planning--first in choosing an agency name. "I looked for something I could tie to my own Scottish ancestry," he says, "but I couldn't find anything that seemed right."
He then read about the Flanders region of Belgium where as early as the 8th century A.D., groups or guilds of businesses joined together to help each other in times of peril, including insuring against risk. For a commercial agency, The Flanders Group name--along with a medieval looking, rampant lion symbol as their logo--seemed a perfect fit.
The agency concentrates virtually its entire book of business in seven commercial specialties: workers compensation for real estate owners and managers, recreational boat dealers and marine operators, nursery and landscape firms, machine shops and metal workers, glass shops and glaziers and recreational vehicle dealers and auto dealers. They have just created a new crevice market for refuse contractors.
"By concentrating on our defined markets we're able to learn a tremendous amount about these industries and watch for developments that affect our clients," says Bobbie Allen, AAI, ARM, senior account manager.
"High trust" management style
Penny Ciaburri of PLC Associates, a consulting firm that works with the agency, characterizes McVicker's management style as "very high trust." Bobbie Allen, who worked for three other agencies prior to joining The Flanders Group three years ago, agrees. "One thing that's different here is that employees are not afraid to provide management with their ideas," says Allen.
Another striking management trait of McVicker is his admission that despite all the agency's success, they don't have all the answers in-house. They need the help of outside experts. The agency maintains a stable of consultants on retainer who help advise them on sales and support functions, hiring, profitability analysis, advertising and marketing materials and conflict resolution.
Conflict resolution? That might sound like something an agency owner would only want to handle alone. But for The Flanders Group, it's just one more area where outside experts can provide invaluable help.
"Amazingly enough," McVicker says with a wry smile, "in our agency conflicts do sometimes arise. It's a result of the kind of hard charging people we have. Penny Ciaburri works with us to understand the dynamics of our relationships with each other."
Ciaburri's work includes "team building"--a particularly important function because they use teams of employees to maintain rapport with clients in their targeted lines of business.
Planning takes precedence
Acquisition of business is carried out in a carefully planned manner. They use telemarketing, some conducted internally and some by outside firms, to obtain names of potential prospects. Next, producers carefully screen the names to determine if the business qualifies and is the type of account they wish to write.
Then, says McVicker, "Our first face to face meeting with the prospect is a diagnostic call. We ask for the current premiums as well as another checklist of items we require to proceed. This way we'll know how serious they are about giving us a chance to write their business."
When prospects decline to provide the producer with required information, the producer simply thanks them and respectfully declines being involved. McVicker explains, "We've adopted some wisdom from Roger Sitkins, one of our consultants, who says, 'The best day to lose a sale is the first day.'"
But when prospects go forward with the proposal process, The Flanders Group makes sure that these prospects know how important their potential business is to the agency. The receive a "letter of intent" from the agency outlining the commitments, affirmations and requirements agreed to in the face-to-face meeting. They receive agency newsletters targeted at their industry as well as a personal letter from McVicker noting that the agency is working on writing their business and pledging the agency's resources if they become a customer.
The process has worked. The closing ratio of the business they quote is almost 80%.
Client retention has always been a major emphasis for The Flanders Group. "It all boils down to communication," says Valarie Webster, director of client services. "We attend their trade shows, send out our newsletters and visit our clients throughout the year."
But it goes further than that, Webster explains. "We want our clients to tell us about any missed opportunities--what we could be doing that we're not doing."
To make sure that happens, McVicker hired 21st Century Management, a Waltham, Massachusetts-based consulting firm, to do a major account retention study. The consulting firm, headed by Lynn Thomas, interviewed a variety of Flanders Group customers, asking them what they liked about the agency, as well as why they might leave the agency. Armed with 144 pages of data gleaned from the study, McVicker feels better prepared to retain business.
Among other things, he says, "It taught us that we no longer have to lead with price. Only when a customer expects a different level of service will they accept a different price."
McVicker cautions that to obtain the desired results from consultants requires an ongoing commitment. "Roger Sitkins says only 2% of those who attend his seminars actually go home and implement his recommended procedures. We're definitely part of that 2%. In fact, Roger says, we're part of the 1% who not only implement the recommendations, but then raise our standards to do even better.
"With Lynn Thomas' account retention study also, the value increases over time because each year you implement some recommendations and can measure the results against what you've already done."
McVicker's respect for the consultants he uses bespeaks his own instincts as a person who likes to measure results and set goals. "We compare ourselves to standards within our own industry and outside also," he says. "For example, we study the revenue per employee figures for our clients."
With The Flanders Group getting very close to $200,000 in revenues per employee, it's clear that by agency standards it is doing quite well. Outside the industry the agency also has been recognized for its growth. For the last three years the agency has appeared on the list of the "Rochester Top 100," compiled by the Chamber of Commerce and verified by KMPG Peat Marwick, as one of the 100 fastest growing privately-held firms in the area.
The Flanders Group actually ranked 43rd on the 1996 list and, as in the previous two years, was the only insurance agency on the list.
But for all its accomplishments, perhaps what's most noteworthy about The Flanders Group is that its people always seem to believe that they can do more. Whereas some successful agencies expect to rest on their laurels, The Flanders Group continues to set new objectives, trying to correct mistakes and achieve new heights--in sales effectiveness, client retention and productivity.
"We like to keep raising the bar," says McVicker. It's clear that Rough Notes readers feel their choice of the Marketing Agency of the Year has raised the bar pretty high already.
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Three quarters of the employees of The Flander Group traveled to Indianapolis for the Marketing Agency of the Year award presentation. Their white tennis shoes with The Flanders Group logo reinforce the agency's credo: "We run hard for our clients."
The Flanders Group is the eighth winner of our Marketing Agency of the Year honor. Rough Notes began featuring a Marketing Agency of the Month cover story in 1989, and each year since then readers have chosen the Marketing Agency of the Year from among the previous year's cover story agencies.
The Marketing Agencies of the Month have varied widely in size, location and mix of business, but all of them have demonstrated a solid track record of marketing strength and innovation.
Members of the Rough Notes editorial review board help select candidates for Marketing Agency of the Month. We will continue to accept nominations from agents, company executives and others in the industry for Marketing Agency of the Month.
If you want to make a suggestion, please submit the name and address of the agency, the principal(s) we can contact and a brief statement on why you feel they should be honored. Send it to Tom McCoy, Editor-in-chief, Rough Notes Magazine, 11690 Technology Dr., Carmel, IN 46032.