042 – Building Your Insurance Agency’s Operational Team: Who To Hire And When

BUILDING YOUR AGENCY’S OPERATIONAL TEAM: WHO TO HIRE AND WHEN – EPISODE 042

In this episode of The Digital Broker, Steve and Ryan analyze operational teams. By listening to this episode, you will learn:

  • Why operations are inseparable from growth, and what an operational team ought to look like depending on your agency’s size
  • What to expect from every member of your operational team, and how to choose the most qualified or appropriate members for your agency
  • How to communicate your goals and vision to your operational team

We talk a lot about operational excellence here at The Digital Broker, but it isn’t something you just wish into existence. Somebody has to design, modify, implement, and oversee it—all day, every day, for as long as you want to stay in business. Depending on the size of your agency, the job is likely to require more than one person. This is where an operational team comes in.

We define an operational team as a team of high-level managers who report to the Chief Operations Officer (COO). We’ve talked before about the leaders up top who set the vision for the agency; the operational team is the intermediaries who make sure the vision translates to actionable steps and procedures for the staff to follow. A small agency might have no formal operational team because various employees wear many hats, and that’s fine for a while. As soon as you decide you want to grow—in other words, as soon as you have a goal—an operational team becomes essential because they see to it that the goal is being worked toward.

(3:48) Let’s say a producer strikes out on her own and starts an agency from the ground up. She’ll need a couple of account managers and maybe another producer or two. But if her book of business remains compact, she can absolutely get by on a small staff without a COO. As the business grows, however, operational turbulence will start to kick in. To keep up with the increasing workload, staff members will resort to personalized, nonstandard procedures that might not be in the interest of the founding producer’s vision.

Standardization of procedures is a key tenet of operational excellence. Without it, you can forget about growing. Operations is so integral to growth that a COO is frequently the first executive an agency hires when it decides that it is time to scale. (7:18) Your success will be determined by what your employees do on a day-to-day basis, so it’s important that the COO be familiar with the daily grind of an agency, preferably by having moved up through its ranks in the past.

Hiring a COO doesn’t necessarily mean you’re now a huge agency obligated to go on a hiring spree. As long as your staff remains small, there is much that you can outsource: IT comes to mind. (11:52) You don’t really need a Head of IT at under 50 employees; beyond that, you might start to think about hiring a Chief Technology Officer (CTO), but not to disentangle computer wires to keep employees from tripping over them (although that’s important).

It is a common misconception that the head of IT must be a super nerd who handles menial technical tasks. Infrastructure and security are all things you can outsource even after you’ve become a large agency. A CTO will leverage outside expertise so she can spend time understanding how technology can solve the problems of the agency and its clients.

But if your agency gets to be over fifty strong, you might have to worry less about IT and more about HR. (18:31) At that size and beyond, you will be fighting for employees, so an employee engagement strategy becomes critical. Get yourself an exceptional head of human resources. Don’t settle for whoever happens to be dealing with HR tasks at the moment. An HR pro goes beyond rote tasks. She creates a culture of awesomeness that makes employees want to stay or be hired.

Just as important as who to hire and when is where to hire from. (20:56) Many times, a person will grow into a role from within—this is frequently the case with office managers who mature into COO’s. It is nice when that happens, but don’t be scared of hiring from elsewhere if you judge it to be in your agency’s best interest. Much of moving up the ranks happens laterally, meaning employees take on a new position at another agency because it might otherwise be weird for them to boss around the folks they used to work alongside or under. In some cases, you might elect to hire from outside as a matter of principle, to import a fresh perspective into your agency.

No matter what shape your operation team takes, remember that you’re dealing with people who have different attitudes, personalities, and expectations. It is not the end of the world if they clash, but it does create operational friction, which we’ve talked about in a previous episode. This is where you need a cool, calm, and responsible COO—it all goes back to that person.

There’s a lot more interplay today between the operational team and the principals. (23:43) You can no longer issue blunt directives without regard for the operational havoc they might wreak. No matter what your goals are, it is your operational team that will either make them happen or sends them back for revisions. Help them help you by listening to what they have to say. Pick the right people for the jobs so you can have the best conversations about your company’s future.

Oh, and speaking of conversations…

We want you to have one with us. Do you have experience assembling an operational team? What was it like to be part of one? Which operational achievements are you proud of—or where do you look back and think it all could have gone so much better with just a little more operational prowess?

Come share your stories in our LinkedIn discussion group.



Indio Technologies

Indio Technologies allows insurance agencies to turn their application and renewal process into a fully digital, modern customer experience. The white-labeled platform comes pre-loaded with a database of 4,000 digital “smart” insurance forms and applications, an auto-generated proposal tool, an e-signature solution, and secures document sharing. Over 150 agencies, big and small, use Indio to service over 300,000 business clients, including, MMA, HUB International, NFP, and Kapnick Insurance. In total, the company has raised $8M over two rounds of funding. Most recently, the company received $6M in Series A funding from investors such as 8VC, 500 Startups, Merus Capital, and Compound.

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