NAILBA Perspectives - Spring 2018 - 13

Keeping the succession plan a
secret is a mistake. Key staff members need to know what to do if the
unexpected happens. "It is important
to have both a well-positioned infrastructure and a well communicated
succession plan to be able to implement the plan," Meyer said. "Great
plans can be crafted, but if the staff,
procedures, and other infrastructure
components are not in alignment,
the plan will fall apart. This component of the business continuity plan
is often overlooked and should be a
significant part of the business continuity strategy."
Start Today if You Have
No Plan
When should a BGA develop its succession plan? "There is no time like
the present to begin," Meyer stressed.
"In fact, as soon as you finish reading
this article, you should start the ball
rolling on the initial phases of a plan
if you don't already have one.
"The primary goal in any succession plan is to create stability for the
business and its constituents and continuity of revenue flow in the absence
of the owner," she continued. "Without a plan, both stability and revenue are at risk. Unless the necessary
detailed contingencies are in place,
advisors/agents who write through
the BGA must find a new agency and
the staff who have depended upon
their jobs serving the BGA and their
clients are now unemployed with no
income. The same sad financial fate
will befall the owner's family members (generally spouses) who depend
on income from the agency if revenue
stalls or ceases."
The Agency Successor
Networking Group
NAILBA has a mechanism to help
members with the succession process. The Agency Successor Networking Group (ASNG) was co-founded by
Christi Daughenbaugh and Melinda
Meyer in 2011. At the time, Daughenbaugh was NAILBA's Chairperson and
Meyer was Chair of the Professional
Development Committee.
"As we progressed out of those
roles we wanted to leave a meaningful mark on NAILBA into the future,"
Meyer explained. "It was clear there
were two gaping holes in the indus-

NAILBA has a mechanism to help members
with the succession process: the Agency Successor
Networking Group.
try. Where was the next generation
BGA coming from? And how would they
build their own network? You may have
been born into the business, but do
you know how to build and lead a business? Our goal was to create a natural network of insurance professionals
who had already or would transition
into an ownership position at the BGA
level. With the collaboration of other
leaders within the NAILBA membership, our vision has grown into a group
of about 35 members."
ASNG is designed to help
NAILBA members who are, or soon
will be, transitioning into the role of
principal of their agency. Its goal is
to ensure that new NAILBA member
agency leaders are ready when they
assume the challenge. ASNG provides
its members with a number of benefits as they transition into leadership
of their firms. It focuses on providing leadership, management, and skill
training so these new agency leaders
will succeed. It also provides a network and support group of mentors
and other new leaders to help them
grow their agencies in the future. New
members must commit to active participation for at least three years.
To be eligible to join ASNG, NAILBA members must meet at least two
of the following criteria:
■■ Recently began serving as an
agency
principal
(suggested guideline: within the past
1-3 years)
■■ Designated as the successor to a
NAILBA agency via verbal or written commitment, and scheduled to
take over the agency in the near future (suggested guideline: within
1-5 years)
■■ Currently owns at least 25 percent of an agency and has
been given at least verbal
commitment of succession by
sitting principal
■■ Recommended by the agency
principal with the commitment
that the participant will succeed the sitting principal in the

near future (suggested guideline:
within 1-5 years)
The group conducts bi-monthly
teleconferences facilitated by a subject matter expert. They cover many
business areas of use to BGAs with
each call focusing on a specific transition or agency-management related topic. Each presentation is followed by a group question and answer
session. Calls are recorded for use by
group members later should they be
unable to participate live. A schedule
of upcoming teleconference dates and
topics is available here: http://www.
nailba.org/membership/asng.
One ASNG member is now president of the BGA founded by their parent. Even though the brokerage general agency industry has only existed
for about 40 years, since that firm was
founded, much has changed. Then
there were fewer products (and they
were simpler), less regulation, less
competition, limited technology, and
business was done on a handshake.
All of those changes had to be considered in the succession.
"The 'sales' organization of old has
morphed into a marketing and/or education focused organization," Meyer said. "Additionally, the BGAs that
grew the organization are phasing out
of the business or think differently
than the agent of new ownership. The
BGA of today demands data access on
their smartphone and instantaneous
response time. How does the successor navigate the necessary changes
to lead transition within the organization? ASNG provides young professionals a venue to share their ideas
and best practices while leading their
transitioning organizations."
Meet Some ASNG Leaders
Three ASNG leaders share how they
have benefited from participating in
the group.
Jerry Thomas, CFP®, External
Wholesaler and Point of Sale Rep at
J. L. Thomas and Company, is the
current Chair of the ASNG. Jerry and

his cousin, Kurt M. Thomas, CFP®,
CLU®, are the third generation working at the firm. Both cousins have
taken an active role in management
and have discussed different succession options.
Thomas values the webinars and
discussions on topics related to management and succession planning. "It
gives us the opportunity to bounce
ideas off each other and learn from
other BGA owners," Thomas said. "It
also helps us develop ideas regarding succession planning or management especially since owners can wear
multiple hats."
At his first ASNG session, Thomas
said Daughenbaugh and Michael Tessler did a great job telling their succession stories. "I realized that communication is key and starting earlier
is better than later," he recalled. "The
second thing I learned was none of
these transitions go the same way
and emotion and planning can make
or break a successful transition." What
he learned from the group that most
surprised him is "Nothing is official
until it's in writing!"
Thomas recommends joining ASNG
to potential BGA successors because
"You get to network with other people who do exactly what you do. You
have the opportunity to learn from
them by learning from their successes
and mistakes."
John Gilbert, Vice President of
Business Development at The National Benefit Corp. (TNBC), is the most
recent past Chair of ASNG and is
a member of the NAILBA Board of
Directors. Succession is an active
topic of discussion at his firm. "The
conversations around the succession plan in our firm have increased
in the last several months," he said.
"All of the involved parties seemed
to understand the time had come
to add clarity to the future of our
firm and how our firm would transition leadership. We aren't done with
the planning process yet, but 2018
will hopefully bring new opporwww.nailba.org 13

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Table of Contents for the Digital Edition of NAILBA Perspectives - Spring 2018