Houston…we have a knowledge perpetuation problem.
What would you think about an industry that will potentially lose 50% of its workforce to retirement in the next 10-15 years? How would you feel about a company that knew this would happen, but didn’t have a plan to get ahead of this pending crisis?
The U.S Bureau of Labor is projecting that in the next 15 years, the insurance industry workforce will be reduced by 50%. Additionally, almost 40% of firms are still owned by Baby Boomers.1 The statistics are daunting. Whether you choose to believe them or not – the facts remain that the insurance industry is facing a staffing crisis and the end doesn’t appear to be near. In fact, it’s just beginning.
More than 15 million U.S. workers—and counting—have quit their jobs since April 2021, a record pace that is disrupting businesses everywhere. Companies struggle to address the problem, and many continue to struggle for one simple reason: they don’t really understand why their employees are leaving in the first place.
Typically, when MarshBerry discusses perpetuation planning, it’s related to the continuous ownership structure of a firm. But the true definition of perpetuation is the act of causing something to continue. If you haven’t started addressing the looming issue of pending retirements and a shrinking employment pool, you have some catching up to do.
How to Start a Perpetuation Plan
Take an honest look at your firm today and ask yourself the following questions:
- Is my firm developing future leaders? Are we including them as part of the plan?
- Are we using technology to enhance effectiveness and reduce staff strain?
- How many team members are potentially retiring over the next five years?
- Am I creating a path for my team to perpetuate knowledge NOW to key staff members about accounts, coverages, and client/carrier relationships?
- Have I spoken with other leaders in the insurance industry about their agency planning, learned from the mistakes and executed on the strategies that have worked for them?
Not all is lost. But you can’t afford to let more time pass before you start seriously addressing this issue. It’s time you take a serious look at your 5- and 10-year goals. Create a strategic plan of execution for perpetuating relationships within your organization. Start grooming your future leaders, let them know they are a part of your perpetuation plan. Introduce your next generation of account managers to your clients so the relationships are perpetuated to their next generation of decision makers.
The time is now and it’s likely you can’t do it alone.
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1MarshBerry proprietary financial management system Perspectives for High Performance (PHP) as of 9/30/2021.
Help position your firm for success by completing the MarshBerry Broker Compensation Study by 2/28. The study compiles anonymous employee compensation structure, incentives and benefits information of independent agents and brokers and then summarizes the findings in a comprehensive report that will be available in April 2022. All participants that complete the study, and provide a valid email address, receive a complimentary copy of the report as well as an invite to attend a future FocalPoint webinar highlighting the results at no cost. The final report will allow you to better understand how your firm stacks up against your peers and will give you a leg up on recruiting new talent.