On this episode of The Ridiculously Amazing Insurance Podcast, Kelly, Dave, and Scott discuss the dynamics of family-based businesses, particularly insurance agencies. We are in the midst of the transitions from one generation to the next, and while there are benefits to this “continuing the family business” model, it is also filled with unique challenges.
The first-generation owners of insurance agencies (and any business, for that matter) started their business from scratch, meaning that they grew personally and professionally as the business grew, always able to take the pulse of the industry and make any necessary adjustments. They also most likely have been building their business with the ultimate goal of passing it along to the capable hands of their children when the time comes. With this expectation come certain pressures on both the parents and the children to make the transition work, to balance the foundational elements of the business model with the new tactics and opinions that drive the second-generation to achieve.
The challenges for second-generation members of the business come partially from these expectations: perhaps fooling them into thinking that they don’t have to go the extra mile in order to “earn” ownership, wanting to make their parents proud, or not really considering whether they want to take over the family business at all. These dynamics could lead them into complacency if they do not go into every day with the goal of being an impressive employee in the eyes of their parents and other employees, putting in the extra hours, being on time or early to meetings, providing creative solutions to problems, and being willing to take on even the most menial tasks for the good of the agency.
Kelly implores second-generation employees to refrain from calling their parents “Mom” or “Dad” and bringing up family drama in the business setting because it is not professional or helpful to the functioning of the business. Dave recommends that second-generation members be encouraged to work at an external company or carrier for a few years before coming back to the family business because it will provide crucial perspective and benchmarks for them as they cast their vision for the future of the agency that their parents first envisioned.
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