MARKETING AGENCY OF THE MONTH

Everybody have fun tonight

Philosophy of sharing creates agency powerhouse in Illinois

By Dennis H. Pillsbury

When Jim Blackburn established Assurance Agency in the northwestern suburbs of Chicago, Illinois, it was primarily to write coverage for a fledgling but growing construction industry. That was in 1961. Anyone who has been to the area today would say that Jim was prophetic. Construction of every variety continues apace. In fact, it is hard to imagine that there was ever a time when some type of construction wasn’t occurring in this area. It seems omnipresent.

Jim established the agency as one that placed service to clients first and foremost. In fact, says Tony Chimino, president and CEO, “One of the first employees was a safety professional. That general ideology carries through today,” he adds.

From 1961 through 1990, construction remained the major focus of the agency and “continues to be a major specialty for us,” Tony notes. However, Assurance began diversifying into other areas in 1990 as the agency grew and producers with other specialties and interests came aboard. Then, in 1995, Jim and his then-partner Jerry Powell divested themselves of 51% of the company by trading the stock to five producers in exchange for ownership of their books. Jim’s son, Jeff, was one of those producers.

“This model of sharing stock with deserving employees became our method for perpetuating the agency,” Tony says. “It also was aimed at helping us maintain our independence, which is a key driving factor. Today, we have 18 employees with shares in the agency.

“Every key employee has a chance to be a shareholder,” he adds, “based on time in the company or time plus the size of the book for producers. The stock is retired when they reach a certain point in their life. This gives us an active, funded perpetuation plan that will preserve our independence going forward and keep employees motivated and part of the team.”

Tony, who joined the agency in 1996 after five years with Fireman’s Fund, points out that the model definitely works. “When I joined the agency, our revenue was around $6 million. We will end this year at around $35.2 million, and that is all organic growth. We now have 177 full-time employees.”

Thriving with change

The model of involving all employees also requires a willingness on the part of employees to deal with change. Four years after Tony joined the agency, he and the rest of the ownership team recognized the need for a reorganization that would better utilize the talents of all the people in the agency and would result in “more formalized processes that would allow for controlled growth,” Tony adds. For a number of employees, that meant changing positions and even, in some cases, accepting a lesser title.

“Assurance has a proud history of explaining to employees why we are making any and all changes,” notes Steven Handmaker, vice president, marketing and communications. “This knowledge helps our people willingly go along and embrace change. Of course, even while change is occurring, we maintain our culture of fun and involvement.”

Steven adds, “At Assurance, culture is paramount. Take, for example, the program we set up to capture new ideas from all our employees. We created a character named Ivan Idea. For every idea submitted to Ivan, an employee gets a $5 gift card to a local store, and there is no limit to the amount of ideas we’ll accept. We also offer a bonus certificate for the best idea of the quarter.”

“Our idea program works because often the best suggestions come from the team members handling the administration of policies and interacting with our clients on a daily basis, those who are the first to see what is needed to improve processes and provide better service,” Tony continues. “We wanted to tap into this knowledge in a way that was fun and rewarding. We have implemented many of these ideas, and they have enhanced our agency performance.”

In 2006, there was a second reorganization that involved bringing in outside leadership to fill some positions that just did not match the desires of the people inside the agency. “We set up four practices in the agency under three property/casualty practice leaders and one employee benefits leader,” Tony says. “Three of the practice leaders came from outside. We identified talented individuals who could bring a focus and strength to our key areas of opportunity.

“One of the tasks of the practice leaders is to hold producers accountable for fulfilling their sales goals,” he adds. “Each producer submits his or her own plan at the start of the year. We also provide motivation through rewards for new production. We offer a trip for $200,000 in new commissions, and also have contests every quarter with ‘Quarterly Pride’ awards. Producers use various techniques for bringing in new clients including referrals, strategic partnerships with key centers of influence and cold calling.

“The reorganization created some stress,” Tony observes, “so we decided to really focus on fun this year.”

“Every year, we have a theme,” Steven continues. “This year we decided on Wang Chung as our theme. It comes from a notoriously cheesy old pop song where the lyrics are ‘Everybody have fun tonight, Everybody Wang Chung tonight.’ All year long we’ve taken this silly song to heart and made it mean something.

“We’ve had an ice cream social, surprised employees with $50 cash, and played a number of games where employees could win prizes. This included a chance to roll dice for cash and prizes in recognition of our new business and retention efforts,” Steven explains. “In addition, twice a year, service people nominated by their managers for excellent client service now have an opportunity to spin a ‘Wang Chung’ wheel for prizes worth up to $400.”

Education and development

In addition to creating an atmosphere of fun and camaraderie, the agency also spends a lot of time on employee development and education. “We delineate ways for employees to grow as professionals,” Tony says. “Many of our employees have worked their way up within the company, and we encourage this by supporting continuing education and development. We have a real lucrative education and development program.”

Steven continues, “We understand that happy and educated employees mean happy clients. We have account teams that build on the deep and lasting relationships our producers develop with clients. And to make certain that producers are committed to those relationships, we let them know how important renewals are to us by paying the same commissions for new and renewal business. Of course, we have the steady stream of rewards and recognition for service people.”

“This culture based on relationships has allowed us to deliver with flawless execution on our commitments to our clients,” Tony says. “Because of this, we are able to quantify what our clients can expect from us and know that we will be able to deliver on that promise.”

Steven adds, “We view education as a cornerstone for our ability to serve our clients. Employees need to keep up with what is happening in the industry and continually improve through education and effort. We’re proud of the fact that around 75% of our employees currently are pursuing designations. More than 30 received designations last year.

“Everybody here is dedicated to bettering themselves. This has become a destination agency for the best and the brightest,” he declares. “Many talented people are calling us to come work here. It makes this an exciting place to work and an exciting time to be here.”

Giving back

“We are dedicated to our community,” Tony says. “And we show this by supporting local charities with both money and time. We set up Assurance Caring Together (ACT) to give money to local charities. But we’ve gone a step further by offering every employee a day off to do charity work. The day off is called ACT time. Our employees have been involved in repairing houses, running a tennis tournament for Special Olympics, collecting and distributing food to the needy and so on. Every year, we have a kickoff for ACT. Everybody gets an ACT shirt. It’s really been a bonding experience.”

“This togetherness also is fostered by our openness with all our information,” Steven adds. “We post all our financials so everyone can see how we’re doing and how close we are to reaching our goals. We recently had a retreat to develop a five-year strategic plan and we expect to communicate to every employee exactly where we are going and how we will get there together.

“This really helps to solidify the feeling that we are all part of a 177-member team. And every employee really is a stakeholder,” he says. “They participate in our profit-sharing plan and know that reaching our goals will have a direct impact on the amount that is contributed by the agency to that plan.”

Steven concludes: “Happy employees is our number one goal. That drives the great service and the execution of all plans and the desire to innovate. As managers, we need to provide employees with ways to develop professionally and to provide them with the tools they need to succeed.”

Rough Notes is proud to recognize Assurance Agency as this month’s Marketing Agency of the Month. The agency represents what is best about the independent agency system and shows yet again why this is a system that is here to stay. *