Value Diversity to Thrive in a Global Market

It’s almost a cliché to say ours is a “people business.” However, there is no better way to describe a business in which success depends so heavily on the promises we make to people, and the way in which we deliver on those promises at the defining moment—the time of loss. Philosophically, I agree that people tend to have more in common than they do differences. But on a practical level, there is no deny­ing that successful carriers and agencies need employees who are grounded in different communities, cultures and age groups and can help us navigate those differences; whether that means understanding how customers communicate, define value, make purchasing decisions or what they expect from an insurer and agent when they experience a loss. We can help ensure that our industry remains relevant and respon­sive by hiring and developing diverse talent, and by building corporate cultures where that talent can thrive.

As an African-American who has been in the insurance business for 26 years, I’ve experienced first-hand the industry’s evolving views on diversity. When I entered the field in 1984, and for many years thereafter, diversity efforts were internally-focused and typically confined to women and racial minorities. While well-meaning, these efforts typically lacked focus and specificity. “Valuing diversity” was simply the right thing to do from a social and moral perspective, and if it led to better business results, that was a plus. A few things have changed since then.

First, the definition of diversity has expanded to include not only racial minorities and women, but also cultural and ethnic differences, sexual orientation, disabilities, generational differences, and perhaps, most important, diversity of thought—in short, a broader range of life experiences and perspectives. This is a much more inclusive view that has engaged larger numbers of people.
Second, there is growing evidence that companies with diverse workforces and management teams are more innovative and achieve bet­ter business results.

Third, demographic shifts have elevated diversity to a business imperative and added an external dimension to what were primarily inter­nal efforts. Thanks to a mountain of market research and media coverage, the profit potential of diverse markets is now front and center. Companies that were laggards on the diversity front—particularly with regard to marketing efforts—are scrambling to catch up, while those that were visionary enough to take early action are enjoying a distinct competitive advantage.

The data that is emerging demands our attention, even if we confine our view to the old definition of diversity—race and gender alone. A report recently published by the U.S. Commerce Department notes that the nation’s minority-owned firms, which now number four mil­lion, outgrew their counterparts in the number of firms, employees and size of payroll from 1997 to 2002. The report concludes that with greater access to capital in the years ahead, minority-owned firms could create 16 million jobs and $2.5 trillion in annual revenues. Also consider the fact that women-owned businesses contribute nearly $3 trillion to our national economy and create or maintain 23 million jobs, or 16% of the workforce. When you add customer segments and sub-segments such as gay and lesbian consumers, Gen X, recent immigrants and others to the mix, the business potential of diverse markets expands exponentially. To borrow from a phrase coined by James Carville during Bill Clinton’s presidential campaign, “It’s a growth market, stupid!”

The companies that make the most of it will be the ones that respond to the needs, interests and buying habits of these customers sooner—and better—than their competitors. To remain on that inside track, carriers and agencies alike need to attract the very best talent available from the broadest possible pool. In particular, insurers that depend on the independent agency system to sell their products need to engage with diverse agents and brokers who have insights and relationships that they don’t.

When I think about the future of the insurance industry in terms of its ability to attract and retain diverse talent and customers, I’m very optimistic. This is not because I think we’re more principled or visionary than other industries, but because I find it impossible to believe that an industry would neglect to act in a way that is so strongly in its best interests.

Over the years, it’s been gratifying to see diversity gain full status as a business imperative. A company’s ability to attract and develop diverse employees will only increase in importance as our market becomes increasingly global. Agents and carriers need to sustain and build on that momentum. Together, we have the power and responsibility to elevate our industry’s reputation for being an inclusive and forward-looking employer that understands its customers. This is clearly a change we all want to see.

Harold L. Morrison, Jr., is executive vice president and chief global field officer for The Chubb Corporation in Warren, N.J. Learn more about the Big “I” Diversity Task Force Webinar Series at Independentagent .com.