How to Build a Multigenerational Workforce

Almost five years ago, INSURICA Insurance Management Network faced declining organic growth, an average producer age in the 50s and multiple employees on the verge of retirement.

INSURICA responded by developing a robust recruiting, hiring and assimilation program to focus more on growth and perpetuating agency talent. Now, the Oklahoma City, Oklahoma-based firm boasts nearly 50 new producers, a vice president of sales development, a technical trainer and an internal recruiter to bring a strategic plan to fruition for the 26-branch organization.

“This has been a breath of fresh air,” says Michael Ross, president & CEO. “It’s been challenging—both financially and from a manpower and management standpoint—but I would say that our commitment to dive in and do this is the best decision we’ve made in the last 15-20 years.”

‘Generational Capacity’

According to consulting firm LifeCourse Associates, 84% of independent agents agree real generational differences affect work—and 72% of them believe those differences pose real workplace challenges. “Every generation has its own personality,” says Warren Wright, executive vice president at LifeCourse. “You have to realize what that personality is if you’re going to have to manage it.”

Reagan Consulting’s “Producer Recruiting & Development” study introduces the term “generational capacity,” which defines a healthy agency as one that has an equal spread of producers, business volume and new business contribution within each generational cohort. The more balanced each generation with respect to the others, the healthier the agency.

“I think a lot of firms are waking up to the fact that their demographics have gotten away from them,” says Kevin Stipe, president of Reagan. “They haven’t restocked their talents as proactively as they should.”

According to Reagan, the ideal spread looks like a “gentle, upside down bell curve”: A composite from the top 25% of firms shows that a healthy production force should consist of producers both below age 35 and over age 55 representing 28% distribution each, with 22% of the workforce represented in the two 26–45 and 46–55 year-old age brackets.

Tim Cleary, director of sales in property and casualty at M3 Insurance with locations throughout Wisconsin, says reaching this balanced generational spread is “a chance for the agency to effectively perpetuate its intellectual capital, as well as having a staff of producers that has real capacity for growth.”

How can your agency get there? “It helps to put together an integrated strategic plan first that takes into consideration all elements of the HR life cycle: attract, recruit, onboard, engage and retain,” Wright says.

To begin developing a healthier workforce, start with an evaluation of where you stand. Jim Caragher, managing partner at career development firm CIB Group Services LLC, suggests you weigh the generational mix of your current producer staff “and then try and look ahead and ask, ‘What do I need this producer staff to look like in a year, three years, five years?’”

Hire

INSURICA is a diamond in the rough when it comes to new hires. Two-thirds of agencies did not hire a new producer in 2012–2014, according to the 2014 Future One Agency Universe Study. And of the 34% that did, 22% hired just one. But Ross’s agency has hired 10–15 every year—nearly 85% millennials—since implementing its strategic plan almost five years ago.

Stipe says it comes down to a multi-dimensional hiring strategy. “Many firms have focused on hiring older producers—not because they wanted older people, but because it was easier to hire people with experience,” Stipe says.

The CIB Group combats that tactic by recruiting salespeople who are already working in a B2B sales environment and specifically placing them in commercial producer roles. While some positions may require more technical knowledge, Caragher and his firm recognize a successful producer needs inherent selling skills first and foremost. The insurance lingo can come later.

“If you’re heavily weighting technical insurance knowledge and experience over sales acumen and skills, you’re probably going to make a mistake in producer hiring,” Caragher explains. “Most recruiting firms that work with insurance agents and brokers are trying to take producers from one agency and steal them and move them into another agency. But we’re trying to go into the big ocean of sales forces outside of insurance and find great people and bring them into this business.”

It’s no easy feat given the public’s perception of the insurance industry as “boring” and “lame”—what Caragher calls a “benign ignorance” about what insurance actually is. According to LifeCourse, only 24% of millennials assigned an average favorable rating to the insurance industry as a place to work, compared to 43% of boomers and 31% of Gen Xers who reported the same positive perception.

“Sales is something that is viewed differently and not necessarily positively by millennials compared to other generations because it doesn’t necessarily fit their generational personality,” Wright says. “It’s high risk, high reward—and millennials tend to be a risk-averse generation.”

To ultimately find equal generational representation among producers, a firm needs a strong recruiting process—a “people strategy.” To start, Caragher suggests investigating your needs by role, then determining where you’re going to find them.

INSURICA ensures it hires the best of the best through initiatives like personality testing, a multi-interview process and a sales reluctance test. “We firmly believe in testing. There are great insurance people that make excellent account executives, but not necessarily great producers,” Ross says. “We have to remain very disciplined and patient while going through the process of testing, interviewing and reference checking—all those things that sometimes become formalities—so that we find the right person and are not hiring bodies just to fill seats.”

“Most agencies could do a really good job finding new people if they just invest some time and network from the people working there today,” Caragher says. “Find what you need people-wise and then find people networking out from your existing staff.”

This strategy also works for M3: Its human resources department is open to all areas of recruitment, but specifically uses its own personnel as “effective recruiters to find people in the marketplace,” Cleary says. “Having multiple sources managing the pipeline through our HR area has been very helpful.”

Nurture

Achieving healthy generational representation among producers is just the beginning. The work should continue post-hiring to maintain agency health and perpetuation.

While offering an in-house professional development team, M3 creates individual development plans for new producers. “It can talk about their technical and sales expertise, setting realistic prospect goals, setting short- and long-term goals for what their book of business looks like in the next 12, 24, 36 months,” Cleary explains, adding that the goal is to provide salespeople “with a career plan they are involved in. They have to be involved. It has to make sense and it has to motivate them.”

M3 has applied mentorship and coaching in the past—arming employees with tools, resources and team comradery. “We feel like if our distribution of sales is across several different generations, then we know that we have the internal expertise for those generations to teach other generations on what steps they took in order for them to succeed,” Cleary says.

Caragher has also enjoyed success in this area: “We learned that it’s a huge benefit to have a coaching development program in place,” he says. The CIB Group implements a six-month program for newly placed producers to receive coaching from a retired experienced producer, usually supplementing the agency’s development program. A strong mentoring program is not only virtually necessary for a freshly licensed producer, but also a selling point for recruitment—any ambitious, early-career employee wants to learn.

In addition to adding a general business etiquette portion to new producer training, Insurica uses one-, two-, six- and 12-month milestone markers to measure new producers. “We’re very hands-on and transparent with the numbers and production among all generations,” Ross says.

The agency has even carried out a multi-generational training program throughout its 26 branches “because our more seasoned folks—me included—need to keep our minds open and look at the value millennials bring to the organization,” Ross says—which means being “more understanding of the different ways in which they operate.”

Consider LifeCourse data that reports millennial preferences for a mentorship program (81%), hands-on guidance (72%) and acquiring new skills (59%) at their organization—all much lower priorities among boomer and Gen Xers.

“With millennials, you have to be very directive, specific and hands-on, setting clear goals and expectations, developing strong guidelines and giving regular feedback,” Wright says. “Let’s say you do recruit the best and the brightest, but the second problem is that once they’re there, they walk into an environment that they don’t like very much because it’s a boomer environment. It’s structured, top-down and hierarchal.”

Stipe says the result of a multigenerational staff presents healthy challenges. “You have a wide variety of perceptions and life experiences,” he says. “It’s in the category of healthy conflict, where baby boomers don’t see the world the same way millennials do. I don’t think I want an organization with just one or the other. Having the three different perspectives of those three different generations is helpful and youthful.”

Morgan Smith is IA assistant editor.