The New Face of IT

Is your agency’s IT function helping the bottom line?

From running cable to staying atop technology trends, the job description for an in-house IT guru has never been straightforward. At many agencies, the role is shared—divided among principals, the office manager and a producer or CSR who has shown interest.

But explosions in online systems, social media and mobile technology are changing IT. It’s less about fixing and maintaining and more about improving processes and adding to agency profits.

“Today’s IT focuses on what the agency needs, not on what IT wants to do,” says Mike Harris, chief administrative officer at MHBT, a Dallas-based Best Practices Agency with more than 200 employees. “Is our next project going to add operational efficiencies to a business unit or move the needle for customer service? If not, we’re not doing it. This is the lens we view every IT project through.”

Key to continued success in today’s competitive markets and quickly changing tech environment, Harris says, is aligning an agency’s IT strategy with its business needs. “Principals don’t care what kind of server it is or how much memory something will add,” he says. “They want to know when they spend X dollars, they’re going to be able to do Y. If you as an IT person can’t do that, you lose credibility.”

Innovators Wanted

IT roles are changing—and they need to change, says Steve Anderson, president of Anderson Network, an IT consultancy in Nashville. “As more organizations move to the cloud, there’s less need for someone to plug stuff in, keep machines running and do software upgrades,” Anderson says. And that requires driving innovation into what has always been viewed as a more technical role, “because IT departments need to transition from expense departments to revenue departments.”

Anderson points to an agency that developed a marketing website to promote the firm’s marine program. “They used search engine optimization, and after six months to a year, that site was generating $40,000 per year in revenue,” says Anderson. “Their IT person did this through innovation—and by [seeing] the site as a revenue generator.”

Recent accomplishments at Carroll Insurance Group, a five-person agency in Maumee, Ohio, show that innovative, revenue-positive IT isn’t limited to large agencies with big budgets. Mike Carroll, president, injects innovation into his firm’s IT by doing much of the work himself. In the past 12 months, the agency has transitioned to a cloud version of its management system and the cloud version of Microsoft Outlook Exchange for email. Both moves were big wins, Carroll says, “because all that cloud-based technology saves you the stress and expense of replacing your server every three to five years. Plus, the Internet rarely goes down anymore, and now we can work with full capability from anywhere.”

Carroll Insurance Group is not unusual. According to the Big “I” 2013 Best Practices Study, top agencies in the smallest revenue category (less than $1.25 million annually) employ IT professionals at an average rate of 0.4%. That’s less than one half-time IT employee per agency. Matt Milliken, a technology consultant at B.H. Burke & Co., in Westbrook, Conn., says this lean staffing can be appropriate, especially when systems reside and operate in the cloud.

“Cloud-based technology brings a whole host of functionality and accessibility to your fingertips without the struggle to manage it,” Milliken says. “When agencies utilize cloud services, they eliminate the need for internal staff whose job is to maintain and update these platforms and management systems. System vendors who are already experts maintain and update the systems, and although minor issues may creep up, their capabilities, capacity and focus exceed what any single person at an agency could achieve.”

Bring In the Reinforcements

Outsourcing complex IT work, whether to system vendors or a local contractor, happens at agencies of every size. Best Practices agencies in the $5–$10 million revenues range employ just 1.2 IT employees on average, while agencies in the $10–$25 million range employ an average of 2.2. The largest Best Practices agencies (those with annual revenues more than $25 million) employ 6.6 IT professionals on average.

“The use of outside technology resources is often a critical component of an agency’s day-to-day operations and ensuring that all systems are functioning as they need to,” Milliken says. “For smaller agencies lacking the resources or need for full-time IT staff, this is a necessity. But even the largest agencies with full IT departments may have specialized needs that are more economically covered by a third party.”

The IT structure at Austin & Co., a 49-employee Best Practices agency based in Albany, N.Y., is a case in point. “We currently employ a full-time IT manager, and I oversee the department,” says Kelly Valmore, corporate controller and treasurer. “We utilize outside IT professionals when we need to integrate more complex projects.”

Austin & Co.’s current IT structure has been in place since 2010 and is unlikely to change this year. “We do an annual needs assessment for our IT structure that reviews our current state and any short-term and long-term needs to plan appropriately,” Valmore says. “We don’t have any immediate needs to expand our department, in light of using outside IT professionals when necessary.”

Lloyd Eisenrich, principal and president of Weatherby-Eisenrich Insurance, a Best Practices Agency in Andrews, Texas, has a similar setup at his firm. “We’ve used a third-party contractor for most of our IT needs for over 10 years,” Eisenrich says. “We also have a producer who has handled email and light IT since August. Before that, I did it.”

Weatherby-Eisenrich recently moved to its second online agency management system and will bring online self-service to personal accounts this spring. “We’re fairly isolated in this part of Texas, but for a rural agency with 10 employees, I think we’re very progressive,” says Eisenrich, who also uses a third form of IT support: agency management system user groups, accessed by phone.

IT On the Front Lines

User groups fill the gap between vendor training and day-to-day IT operations at many agencies. “Our office manager attends conference and user-group trainings,” says Matt Frierson, a partner at Pierson and Fendley Insurance, LLC, a 16-person Best Practices Agency in Paris, Texas. “She handles day-to-day administration of our agency management system, purchasing of new equipment and life-cycling of all of our technology and trouble-shooting in coordination with the vendor.”

Anderson believes system vendors should include more training in their new system packages. “For the first month or two on a new system, agencies have to change habits and they’re just trying to survive,” he says. When vendor training ends, users are often expected to be up to speed. Anderson recommends training every three months for the next year. “That way people can learn what they still don’t know, and find out what their system can do,” he explains.

Jason Hoeppner, a technology consultant at B.H. Burke & Co., says training also usually occurs between users—especially if a new employee is assigned to sit with someone more experienced to learn the business. But Hoeppner cautions against relying on user-to-user instruction to avoid the expense of formal training. “The responsibility of ensuring that all staff are adequately and consistently trained should reside with the person who manages IT,” he says.

Susan Hodges is an IA contributor.

SIDEBAR: Time For an IT Time-Out?

Even agencies with cutting-edge information technology can fall behind or miss out on trends that could improve their processes. If these red flags are happening at your agency, it might be time for a reboot:

• The agency management system goes down. “Having this happen today is just not acceptable,” says Steve Anderson, president of Anderson Network in Nashville. “If it happens, you might need outside help.”
• One or two IT professionals serve 200–300 employees. “If you have an agency this size and you’ve got one or two IT staff, something’s being given up,” says Mike Harris, chief administrative officer of MHBT, Inc. in Dallas. “Even with outsourced components, your guys are just focusing on day-to-day problems, and what suffers is innovation.”
• There’s a disconnect between staff members. “I’ve been to agency meetings where someone brings up a technology problem, but no one mentions it to IT because they don’t think IT will do anything,” Harris says. “The IT guy needs to get out of the computer room and become involved with the individual business units.”
• Technology glitches cause significant interruptions in daily operations. “If this is happening, then both IT tasks and their hardware need to be changed or at least updated,” says Jason Hoeppner, technology consultant at B.H. Burke & Co. in Westport, Conn. “Other than that, measuring the workloads of staff and their capacity is what should tip off an agency that changes are needed.” —S.H.