Selecting Insurance Professionals

Transcription

1 Selecting Insurance Prfessinals By Bruce Rabik, MSc., B.Cmm., CIP f Cksn Walker and Jhn Marshal, PhD. f Self Management Resurces Grup The significance f hiring the right peple The inability t hire gd emplyees wh stick arund fr sme time has t cunt as the biggest frustratin f managers f insurance brkerages. At Cksn Walker s natinal brker cnsulting practice it is an ften-heard cmplaint frm all parts f Canada. Bth rural and urban lcatins experience a shrtage f skilled, experienced insurance prfessinals. Whether it is CSRs r prducers, mst brkerages struggle with finding and keeping gd emplyees. In small twn settings, brkers are faced with hiring individuals with n insurance experience and then experiencing great frustratin when thse same emplyees leave after much was invested in their training. In larger centres the talent pl is greater, but s are the emplyment pprtunities. Retentin is an issue, as emplyees knw there is a ready jb dwn the street at yur cmpetitin. This is nt merely smething t be shrugged ff. Fr thse wh get it right, selecting better emplyees and maintaining an ptimal level f emplyee retentin is a surce f significant cmpetitive advantage as well as prductivity. All brkers are familiar with the high cst f training a new emplyee. Sme may nt realize that there is ften a direct crrelatin between emplyee turnver and client retentin. Factr in the csts f terminating pr emplyees, headhunter fees, help wanted ads, and all the lst time and frustratin in dealing with this issue and its imprtance becmes clear. Our research indicates that fr mst rganizatins, a fifteen-percent increase in the effectiveness f the selectin f emplyees will result in a frty-percent increase in verall perfrmance. This dramatic leveraging f perfrmance is pssible as a result f the reductin r eliminatin f the csts nted abve, and als because better emplyee retentin means managers can spend mre time n mre prductive endeavurs, which fr brkers are ften sales related activities. Gd selectin leads t imprved perfrmance whether measured in sales r service. Further, high perfrming rganizatins tend t attract high perfrming individuals in a self-reinfrcing cycle. The selectin prcess The purpse f this article is t fcus n selectin techniques used fr hiring CSRs and prducers including interviews and the use f prfiling instruments. Prfiling instruments (cmmnly called persnality tests but mre prperly termed psychmetric instruments ) are an under-utilized tl by insurance brkers and ne that culd have a significant psitive impact n their staffing. There really is n excuse fr brkers nt t use prfiles in their hiring decisins. Mdern prfiles are simple t administer, relatively inexpensive and when used prperly, have a high degree f reliability. There are several cmpanies ffering a variety f prfiles t the insurance industry and sme ffer training n hw t use and interpret the prfile results.

2 The first step in using prfiles is t recgnize that prfiles wrk best as part f a prperly planned emplyee selectin and retentin prcess. That prcess includes the recruiting, selectin, hiring, training, and caching f yur emplyees. Recruitment invlves creating a pl f qualified candidates fr a psitin. Selectin means chsing the best candidate frm the recruitment pl. Hiring includes structuring the ffer f emplyment and the emplyment agreement and the rientatin f new emplyees t the rganizatin. Training new emplyees imparts t them the skills and knwledge necessary t perfrm at high levels. Caching is the nging prcess f reinfrcing effrt and perfrmance. All aspects f this prcess impact emplyee retentin rates. The best selectin techniques will nt cmpensate fr a small r prly qualified recruitment pl. During the first few mnths f emplyment, a new emplyee s perceptins f their place in the rganizatin is clured by prmises made during the emplyment agreement negtiatins and their rientatin t their new emplyer. After the first year, inadequate training and caching becmes a majr cause f emplyee turnver. In ther wrds, d any ne part wrng and yu run the risk f emplyee turnver. Mst brkers right nw are thinking sure, we d all that, but lk at this list f bservatins frm recent Cksn Walker reprts t brkers. In all cases the brkerage principal was unaware f the issue r had nt appreciated its impact. When a brkerage fund itself shrt f staff, it hired three peple in rapid successin withut prperly creating a recruitment pl. In eighteen mnths all three emplyees were gne. A new emplyee arrives n her first day t find that n ne has prepared a desk r telephne fr her and n ne has set aside the time t train her n the cmputer system. Pr rientatin and training led t turnver. At ne brkerage, perfrmance appraisals had nt been cnducted in tw years. During interviews with the staff, they reprt t Cksn Walker that management des nt appreciate them and des nt seem t care. A number f the staff were gne within mnths because f this pr caching. The interview After using varius recruitment techniques (ads in newspaper, headhunters etc.) mst brkers select their emplyees by the traditinal interview prcess. Questins are asked abut frmer emplyers, what was liked best abut the frmer jb, and where des the individual want t be in five years. We are all familiar with this srt f interview- the vast majrity f managers and brkers use these kinds f questins while interviewing prspective emplyees. The prblem with this typical interview scenari is that cnsiderable research shws that it is little better than randm chance in selecting the best (i.e. the individual wh is mre likely t be a high perfrmer and remain with the rganizatin) candidate between similarly qualified candidates. In ther wrds it tends t be a waste f time when an equally effective ptin wuld be t flip a cin when chsing between individuals wh have similar qualificatins n their resumes. Many brkers cmpund this prblem by indulging in an increasingly ppular practice f having either first r secnd interviews cnducted by frnt-line staff wh ften have had little r n experience r training in interview techniques. This apprach has the tendency t reduce the

3 interview prcess t a srt f ppularity cntest, i.e. did we like them based n hw well they spke. Persnal chemistry r cmpatibility can play an imprtant rle in selecting emplyees, hwever if it is the nly cnsideratin (beynd a cursry check f technical qualificatins) than it is likely that imprtant infrmatin abut the prspective emplyee is being missed. This is where a prperly structured interview and prfiles can play an imprtant rle. A prperly structured interview, referred t as a behaviural descriptin interview begins with the premise that past behaviur is the best predictr f future behaviur. It then includes a pattern f questins designed t illicit infrmatin abut past behaviurs that are indicative f success at yur brkerage. Fr example, if it is critical that yur CSRs can handle custmer files n their wn with little supervisin then an apprpriate pattern f questins might include Tell me abut hw much supervisin yu had a yur frmer emplyers, tell me abut a specific prblem n a client file and hw yu handled it, tell me abut a specific technical prblem that yu did nt knw the answer t and s frth. These questins asked in a lgical pattern are far mre likely t determine if the candidate exhibited the kind f behaviur in the past that yu need at yur rganizatin. The gal is t find ut what really happened in cnsiderable detail and nt just what the candidate said they liked r disliked abut their frmer psitin. Prper interviewing takes preparatin and discipline. There are bks, cnsultants, and a wide variety f curses available t assist brkers in the preparatin f behaviural descriptin interviewing. Use f prfiles The main bjective f psychmetric prfiles is t assist in the assessment f a candidate s ptential career fit and t predict future perfrmance, based n current skills, abilities, and cmpetencies. Gd prfiles have bjectivity as a main feature, that is, their use helps t cntrl bias and subjectivity that everyne has t sme degree when evaluating thers. Prfile results usually cnsist f self-descriptin assessments: candidates are asked t describe themselves by making chices amng varius prescribed wrds r phrases. The design f the instrument is critical: the best psychmetric assessment tls have little r n face validity ; that is, applicants shuld nt be able t guess hw they shuld answer t present themselves in a favurable light. They are nt fully aware f what each individual item cntributes t the verall picture they are building. One shuld be skeptical fr example f prfiles that rely n a limited number f questins t paint a picture f an individual. The typical prfile develped by the Self Management Grup has sme 160 carefully structured questins, which makes it nearly impssible fr smene t fl the prfile withut creating significant incnsistencies in the prfile results. Brkers ften ask, hw accurate are prfiles even after being tld that it is extremely imprbable that a candidate can fl the prfile. The answer is that a well-designed prfile shuld be almst 100% accurate, as measured by descriptive validity, r hw well the prfile describes the candidate. Predictive validity is an attribute f the larger prcess in which prfile results are used t help judge a candidate s fit t the pprtunity and envirnment. In this larger prcess, the applicant is cmpared t ther successful and unsuccessful perfrmers in specific crprate cultures and wrk envirnments. Brkers can increase the predictive validity f their selectin prcess by carefully examining and describing their current wrk envirnment and lking fr clues in the interview and the prfile

4 results fr a fit. If strict discipline and structured prcesses are valued at yur rganizatin as ppsed t strng self-management skills in an unstructured entrepreneurial envirnment, the interview and prfile results shuld be interpreted in different ways. This is nt as difficult as it might seem. The key is an bjective assessment f what yur culture is really like. We ften see a discnnect here, as many brker principals are successful cmmercial lines prducers while the rest f the rganizatin may nt live up t their self-image as sales driven entrepreneurs. Smetimes it is hard t see the frest fr the trees, when assessing what yur wn rganizatin is really like, especially in terms f yur CSRs and ther prducers value. Other techniques It is imprtant t use a variety f techniques t increase the predictive validity f yur selectin prcess. The results f each technique can reinfrce the thers. The table belw, based n the analysis f hundreds f validity studies, shws the average validity f several typical indicatrs f future perfrmance. Average Validities f Perfrmance Predictrs Technique Prfiles Jb Try-ut Reference Checks Schlastic Results Experience Unstructured Interviews Amunt f Educatin Interests Predictin Strength High High Medium There are a variety f ther written tests available such as variatins f intelligence and hnesty tests. The accuracy f hnesty tests remains cntrversial and brkers shuld use care when chsing tests t evaluate the integrity r hnesty f candidates. Intelligence tests are still used althugh due t the grund breaking wrk f Daniel Gleman we nw knw that emtinal intelligence is ften a better predictr f future perfrmance than intellectual ability alne. The better prfiles nw include emtinal intelligence aspects t them. Whether it is fr CSRs r prducers, best practices brkerages use a variety f selectin techniques t chse high perfrming staff that will remain with the firm fr many years. Prperly structured interviews and prfiling instruments shuld be at the centre f any selectin prcess.

5 Jhn Marshal is the President f Self Management Resurces Crpratin and a PhD. in psychlgy frm Yrk University. He became interested in the psychlgy f perfrmance as a player in the Philadelphia Flyers rganizatin and as a cach at Yrk University. He has designed several psychmetric prfiles, which are used by leading rganizatins thrughut Nrth America. Bruce Rabik is a partner at Cksn Walker and has a graduate degree in human resurce management. He is the frmer Chief Operating Officer f a majr reginal brkerage and has sat n the bard f directrs f several insurance peratins in Ontari and Alberta. Cksn Walker prvides the prfiles develped by Dr. Marshal t the insurance industry in Canada.