Past, present and future leadership of The Greenwich Group is represented here. Chris McVicker, seated, is a former chairman of the group. Mike Mahoney, standing left, is the current chairman, and Johnny Pitts will become chairman later this year.
What happens when you bring together 17 of the country's top-performing specialty brokerage agencies and invite them to share market information, management strategies, and automation know-how?
Plenty! In this article we'll meet some of the key players in The Greenwich Group, whose high-achieving members are helping each other boost profits and increase their individual and collective power in today's challenging property/casualty marketplace.
Like many great ideas, The Greenwich Group was born of adversity. Mike Mahoney, the group's current chairman, explains that in 1984, when a large national agency with branch offices around the country was preparing to go out of business, the managers of several of the branches decided to buy their regional operations from the owner. Although each was now running a separate business, they wanted to keep in touch--and that was the beginning of The Greenwich Group of America.
Core values: Trust and support
Although the group has changed and evolved over the years, Mahoney says some things have stayed the same. "The Greenwich Group's core values are still very much in place," he asserts. "There's total trust among us; we have no concern about divulging information. We have a strong shared interest in helping each other succeed."
Because the national agency had been a major force in the income producing property market, the former branch managers who started The Greenwich Group had the common bond of an expertise in habitational risks. As the group expanded, new agencies brought knowledge of different market segments, Mahoney notes. As the owner of Maritime General Agency on Long Island, which specializes in niche markets for marine insurance, he joined Greenwich to introduce his marine MGA, for which he has nationwide underwriting authority from AIG.
Now 17 members strong, Greenwich accounts for premium volume of $892 million. Its members retain their individuality and operate independently as affiliates of the group, meeting regularly to share ideas and learn from insurers about new progams in each member's areas of specialization. Some Greenwich Group members operate on a retail basis, whereas others are focused on identifying markets for a wide variety of specialty programs for which they can act as program managers or managing general agents.
Members sign an affiliation agreement, in which they agree to abide by the group's bylaws and to conduct themselves professionally, adhering to a written code of conduct. The key expectation of members, Mahoney explains, is that they make a sincere effort to help other members with problems. "If a member calls with an exposure in our area of expertise or geographic capability, we are committed to assisting the member agent satisfy the needs of his customer."
Mahoney further comments, "A bylaws change is taking place. Because there is such significant ownership movement in our industry, there has been flexibility offered in retaining membership even if now owned by another organization. Though the agent is in a new capacity, relationships have become personal and cannot be broken. In a member's new role as a part of a larger organization, entrepreneurial insight still very much exists and a different perspective makes the group even more valuable in networking ideas."
The group that convened for The Greenwich Group's midwinter meeting earlier this year included (front row, from left) Mike Skinner, Kelly Miller, Mike Mahoney, Jon Penn, Jack Shreffler, Johnny Pitts, and David Villari. In the back row, from left are Brad Pearce, Tom Bowman II, Chris McVicker, Bill Cadenhead, Walter Klein, Jr., Jeff Jones, Tommy Huval, Cliff Miller, Dick Rottman, Marc Levin, Terry Hendrickson, and John Hendrickson. (Not pictured are Harry Washburne and Bill Van Beurden.)
The chairmanship is a rotating position with a two-year incumbency; the member who serves as agenda chairman, arranging the group's regular meetings, is next in line for the chairmanship.
Geographic diversity aids clients
A key to the success of The Greenwich Group, Mahoney observes, is that it selects members in key geographic locations where there's no overlap of marketing territories, so members are supporting rather than competing with each other. In addition to Long Island, where Mahoney's agency is located, group members are based in Arizona, California, Connecticut, Florida, Georgia, Louisiana, Massachusetts, Minnesota, Missouri, Nevada, New Jersey, upstate New York, Oklahoma, Tennessee, Texas, and Washington, D.C., Oregon and Washington state.
"We don't pursue growth for growth's sake, but we've targeted areas like Chicago, Denver and Kansas City where we don't currently have representation. We're constantly on the lookout for new people in those areas," Mahoney says, adding that new agents come into the group primarily on the basis of relationships with current members.
The Greenwich Group's geographic reach pays dividends for both member agencies and their clients. Being able to call on high-level expertise from colleagues in key cities across the country allows members to offer their clients the benefit of crucial local market knowledge and contacts that otherwise wouldn't be available except at a high price. And because of the members' strong commitment to supporting each other, there's a level of trust that serves as the foundation for mutually beneficial relationships.
Group meetings: Opportunities to learn and grow
Greenwich Group members meet twice a year (more often if necessary) to exchange information and hear from experts in a wide variety of areas. Insurance company executives such as Hank Greenberg address the meetings on key industry trends, while marketing representatives introduce new programs that may be appealing to members. "Our primary focus is to talk to people who are doing programs," Mahoney says. "Some of our members operate on a retail basis and have not traditionally been program oriented--but they're beginning to get excited about it."
Among themselves, members share information about new markets and products, as well as contacts. Because of the high level of trust within the group, Mahoney emphasizes, members are never hesitant to divulge information that their colleagues might find helpful. "We ask each other: 'Who do you have the pen for? Do you have binding and pricing authority for sub-produced business? What's the program's geographic limit?' Obviously, the more of our members who are involved in a particular program, the more profitable that program will be for each of us."
Another feature of each Greenwich Group meeting is a presentation by a prominent consultant, such as Roger Sitkins or John Jaques, who is paid for his/her appearance. "We ask these experts in what direction they're heading their clients, and why," Mahoney explains, adding that often a group member will later decide to retain a guest consultant for additional advice. A recent topic was changes in agency valuation, which gave group members the opportunity to learn where they stood vis a vis the consultant's clients.
At their midwinter meeting earlier this year, members discussed a number of key initiatives, one of which was the formation of a Greenwich Group captive. With this structure established, Mahoney explains, "Any member who has a program could bring it to an insurer and explain that underwriting, production, and management facilities are in place." Another topic of discussion was a proposal to form an insurance executives' advisory council, composed of respected industry watchers who have a solid overview of the business. "These people don't necessarily have to be top insurance executives, but they definitely should be movers and shakers with a good take on industry trends and directions," Mahoney says. "We want to run our position papers by them and solicit their input." Initially, the council will consist of six members; it may expand to eight.
Ideas are the lifeblood
Whether the subject is premium financing, workers compensation rating, employee manuals, team building, or other strategies for success, members benefit from comparing notes and sharing ideas. "Everyone participates actively in our discussions," Mahoney asserts. "No one holds back." In addition to their trust-based business relationships, he notes, members often develop strong personal ties as well.
As the primary purpose of The Greenwich Group is to create a supportive forum for the sharing of successful ideas, it's no surprise that ideas are literally the price of admission to the group's meetings. At a working lunch session, every member must present to the group one great idea and one problem. This exchange, Mahoney observes, has generated plenty of creative ideas everyone can use.
Attendance at Greenwich Group meetings is mandatory--and this rule is strictly enforced by the imposition of a $250 fine for each day of a meeting a member misses. "We rarely have to levy the fine; it's more of a reminder," Mahoney notes. A member who must be absent is permitted to send a partner or other staff member of comparable stature; this person "must be someone who will bring something to the table and will provide quality input." It's a Greenwich Group rule that each member must bring value to the meeting equal to what he/she takes away in terms of insight, knowledge, and feedback. "I go to meetings because I expect to take away at least five times what I came with--and leave my fellow members with the same," Mahoney says. "That's our biggest responsibility to each other."
Fines aren't imposed just for missing meetings. At the recent midwinter gathering, in recognition of the importance of the Internet in insurance marketing, each group member was required to have an agency Web page up and running--or pay a fine of $200. Any member who had a Web page that didn't display the Greenwich Group logo was also fined $200. The group's next objective, Mahoney says, is to link each member's Web page to The Greenwich Group page.
Group discounts
Among the benefits enjoyed by Greenwich Group members are discounts on goods and services. For example, Mahoney explains, "We've formed a successful partnership with a premium finance company. In 1998 we arranged $10 million of premium financing through one vendor--that's the kind of volume that allows us to negotiate better rates for our clients." The group also was able to provide long-distance telephone service for members at significant savings. "We use our size to negotiate discounts," Mahoney comments.
Praise from members
Each of The Greenwich Group's 17 members is enthusiastic and positive about the benefits of involvement in the group--none more so than Chris McVicker, one of the original members and a former chairman, who owns The Flanders Group of Pittsford, New York. A $40 million retail agency, The Flanders Group also serves as an administrator for programs in its major niche markets: owners of income-producing properties; recreational boat dealers; nursery and landscaping operations; machine shops and metalworkers; refuse haulers; and recreational vehicle dealers and nonfranchised auto dealers.
In McVicker's view, the key to the success of The Greenwich Group is its code of ethics, which demands that members be strictly accountable to each other. "It gives us a track to run on, and it's really the reason we've lasted," he observes. "This high level of integrity among the members is vital to the positive perception of The Greenwich Group in the marketplace. We each strive to be a high performer for the group, and there's genuine good will generated by each other's success." It's a great source of pride to the group, McVicker comments, that among its 17 members, two have been selected as Rough Notes' Marketing Agency of the Year: The Flanders Group for 1996, and the Huval Companies of Louisiana for 1998.
Like Mike Mahoney, McVicker looks forward eagerly to the group's meetings. "Greenwich Group members have their fingers in so many pies that someone always brings ideas that are new, exciting, and helpful," he comments. In particular, he says, "The back-office aspects are extremely valuable to me. We share how we're handling producer and staff compensation programs, and we also discuss profitability ratios. On the automation side, we all benefit from the knowledge of Bill Cadenhead and Jack Shreffler, our computer 'wizards,' who share cutting-edge information with us."
With respect to the group's value as a joint marketing resource, McVicker says, "There's no question about it. As a group, we're able to negotiate with insurers on a true partnership basis. In terms of marketing strategy, our key objective is to bring program administrators and insurers to our meetings so we can learn what we have to offer to each other." McVicker also appreciates the opportunity to hear from top consultants at meetings. "Many of us outsource functions to consultants," he explains. "We're constantly in a learning posture with respect to running our agencies."
A matter of trust
Also enthusiastic about membership in The Greenwich Group is Johnny Pitts, a partner in Lipscomb & Pitts Insurance of Memphis, an all-lines agency that serves the entire United States, with an emphasis on accounts in the mid-south part of the country. Among the agency's niche markets are transportation, certain classes of manufacturing, and grocery stores. Pitts joined The Greenwich Group in 1996 after being invited to a meeting by Chris McVicker. "My main reason for joining was to network and share ideas," he explains. "What I get is worth far more than the cost of the trip and the dues." Currently serving as the group's agenda chairman, Pitts will become chairman at the end of Mike Mahoney's term later this year.
Membership in The Greenwich Group has been beneficial to Lipscomb & Pitts in a number of ways, Pitts says, citing increased volume, access to advice from other members, and information about new markets. For example, he says, "I just faxed fellow members about a difficult class of business I was handling. Within an hour I got four calls with market suggestions." Pitts also values the opportunity to brainstorm with other members about agency management issues.
Like Mahoney and McVicker, Pitts believes the success of The Greenwich Group is the high level of trust among its members. "It's great to turn to a peer you can trust--someone who's not a competitor but is a partner in your success," he says. "I can share highly sensitive information and be sure it will be kept in confidence." At The Greenwich Group, he says, "For every problem, there are 17 solutions. We share ideas, we brainstorm--and we get things done." *
©COPYRIGHT: The Rough Notes Magazine, 1999