Chris Burand compares agency management challenges with NASCAR’s: Learning to manage people and their emotions, while still succeeding on the track.
NASCAR has experienced incredible growth during the past five to ten years. Some people have historically looked at NASCAR as a sport full of simple rednecks. However, considering the revenue that most top-level NASCAR teams generate, I question the accuracy of this stereotype. These teams are quite successful!
The rapid growth of this sport has left many teams struggling, especially at the management level. Andy Graves, team manager for Chip Ganassi Racing, was quoted in USA Today as saying, “It’s my job to keep everyone’s environment right. I kind of think of it as a part-time baby sitter, part-time bartender. I have to listen to everyone’s problems and make sure that everyone gets along. The crew chief used to do this, plus run the fab shop and engine shop, manage the crew and testing, and handle all the other details too.”
This is similar to insurance agency management. When agencies only have $500,000 in revenue, one person can sell, manage company relations, manage the staff, and take care of most operating details. When an agency has $5 million in revenue, one person simply cannot perform all of these tasks. Although ignoring this situation is an option that many agency owners explore and work very hard to accomplish, it’s no way to run a business.
Hiring or appointing specific people to manage or supervise the Commercial Lines and Personal Lines staffs is a fairly easy decision for most agency managers. Appointing others to oversee accounting and automation is also pretty easy. The most difficult aspect for many owners is not related to a reluctance to give up authority. Instead, owners find it difficult to accept that as the agency grows, key people need more, rather than less, management.
In particular, producers need more management because their results are not as directly visible — which means that it takes a concerted effort to know what and how they’re doing. Furthermore, since many producers know that they’re less visible, they’ll take advantage of their obscurity by writing less than desirable risks, cutting corners on their submissions, and pushing off their work on the staff. Although most agency managers think that producers should be totally self-motivated, this is only wishful thinking. Producers need to be managed proactively if a growing agency is going to succeed.
Very few agency owners got into this business to manage people; yet as agencies grow, managing people becomes the key to success. In particular, few managers want to be the one who provides a shoulder to cry on. This isn’t part of most agency owners’ personalities, especially when the line of people needing a shoulder to cry on seems unending. If the agency owner/manager is not going to perform this job in today’s larger agencies, someone must.
Success always brings new challenges. NASCAR’s challenge, and those of many agencies, is quite similar: Learning to manage people and their emotions, while still succeeding on the track. Many NASCAR teams have separated operational from emotional management by putting different managers in charge of each. This approach might make sense for your agency.