From left: John A. Wright, CPCU, Principal; Bruce R. White, CPCU, Executive Vice President; Douglas J. Friel, VicePresident Commercial Insurance; Patrick J. Mullen, Vice President Commercial Insurance.

By Dennis H. Pillsbury

ohnson, Kendall & Johnson, Inc.,Newtown, Pennsylvania, comesby its focus on client servicehonestly. Its predecessor, TheJohnson Companies, had a

history of always looking for ways tohelp clients—and one of those waysmade the company famous in thebenefits world. One of its subsidiaries,Johnson Benna, an executivecompensation and pension consultingfirm, developed and sold the first401(k) plan in 1980. Ted Benna wasn’tlooking to change the retirementplanning world; he was simply lookingfor an effective way to serve hisclients and noticed a loophole in thetax code. I don’t need to tell you howsuccessful his idea has become.

Anyway, back to The JohnsonCompanies. It was founded in 1956 asa life, retirement planning, andbenefits firm by Ed and DaveJohnson. In 1959, Ted Kendall joined

the firm from the old Aetna to provideproperty/casualty expertise. Inaddition to Johnson Benna, otherunits included JohnsonAdministrators, a TPA for benefitsfirm, and Johnson, Kendall &Johnson for property/casualty.

In 1990, Ed and Dave decided tosell The Johnson Companies. By1994, two of the leading producers atJohnson, Kendall & Johnson, Inc.—Bruce White and John Wright—reached an agreement to buy thefirm. “That’s when we becameindependent,” Bruce remembers.

Bruce, who serves as executivevice president of the agency, saysthat they immediately started to“refocus ourselves to become truepartners with clients. We wanted todevelop clients who were seriousabout managing risk. And that gaveus the freedom to develop risktransfer programs that reflectedthose efforts. The focus shifted awayfrom selling insurance and towardrisk mitigation with insurance as a

tool to help transfer the costs ofunavoidable risk.”

A risk boutique

Like many agencies, Johnson,Kendall & Johnson determined tobecome a boutique operation thatfocused on a specific niche. But unlikemany agencies that defined thatniche by type of business or line ofbusiness, JK&J focused on finding theright clients. “Our niche was riskmitigation,” Bruce maintains proudly.“One of our first new hires afterbecoming independent was a safetyengineer. We now have three on staff.

“Our goal was to keep our clientsfocused on improving their riskprofile. In addition to safetyengineers, we also developed asupport staff that could help clientswith contract reviews, or to performdue diligence in the event of aproposed acquisition or the additionof a new division. In essence, webecame an all-purpose tool that the

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client could use to solve any risk-related problem.”

At the same time, the agencyformed a claims advocacy group tomake certain that, when claims didoccur, “our clients stayed at theforefront of the insurance company,”Bruce notes. The group includesclaims experts who “understand thelevel of detail that an insurancecompany wants when a claim occurs.And we make certain that we provide

that detail so there will be no glitchesin the process.”

Bruce continues: “Our people alsospeak the language of insurancecompany claims people so they candiscuss any problems with thecompany and get them resolvedquickly. At the same time, we keep intouch with the affected client on aregular basis to let him or her knowthe progress of the claim and when toexpect final resolution. This three way

communication—agency, companyand client—is a vital part of what weprovide to our clients.”

Finding and keeping producers

Because of the unique nature ofthe agency, Bruce and John decidedthat the best way to get producersthat fit into the culture was todevelop their own “homegrownproduction talent. We made that

The Client Management Group.

The Client Resource Group.

decision in 1995. We wanted to trainproducers to become professionalswho relied on greater knowledge andbecome a resource to their clients.That’s not always the guy with thestrong sales drive, although that’scertainly a necessary ingredient, sinceyou do need someone who will close.

“Unfortunately, when we startedcollege recruiting to find people thatfit into our risk management culture,we found out that we weren’t verygood at it,” Bruce remembers.“Fortunately, we found Bud Antrimand he helped us put together arecruiting and mentoring program.”Antrim, who is managing partner atThe CIB Group, LLC, was head ofWoodgate Partners at the time, a firmthat specialized in college recruitingfor the insurance industry.

His approach includes establish-ing relationships with local colleges,screening applicants, presenting toptalent to the agency and then helpingthem develop a structured trainingprogram so the talent will stay withthe agency. (For additional informa-tion about Antrim’s approach, see“Back to School” in the December2001 issue of Rough Notes magazine.)

In 1997, Johnson, Kendall &Johnson hired its first recruit, DougFriel, and put him through the JKJMentoring Program that Bud Antrimhelped them create. To show howsuccessful the program has been,Doug is now a partner in the agency.

The JKJ Mentoring Programinvolves a five-year process that startsout focusing on class work activityand support type activity designed toturn the candidate into a risk man-agement expert. “The candidate willalso be involved in doing researchwhen we’re working on a client’sneeds,” Bruce points out, “so that he orshe will be familiar with what to lookfor when developing a risk manage-ment program for our clients.

“By the third year, the candidate isbeginning to develop a book ofbusiness, getting the first few hundredthousand of revenue in the next twoyears. In the fifth year, he or she willstart gaining some independence,although still working on a team basiswith the group to which they wereassigned when they were hired. I’malways in that group,” Bruce notes.

“Once the candidate gains thatindependence, he also will develop his

own team. We’ve had great successwith this program. Our hit ratio isaround 75%.”

Hire for life

“Our hiring and mentoring processreally differentiates us. We hire as acompany,” Bruce says. “Our producerswill go to the college and spend theday there meeting candidates. A fewwill be selected to come back to ouroffice and meet with us. After a briefintroduction to the firm and ameeting with the management teamfor about an hour, they will then meetindividually with 10 to 15 JKJ peoplefor about 20 minutes each. These arepeople from all levels at the agency—the people who do the work. Everyone of our 56 employees is importantto us and we want them involved inmeeting potential new hires. We wanttheir input and we want to make thatclear to the candidate.

“After the individual meetings, weget back together for a social hour-and-a-half session that is designed tosee how they deal with a socialsetting. We then decide on whom tobring back for follow up. That may

The Production Team.

involve six or seven breakfastmeetings so that we really get toknow the person before we hire themand they get to know us. When wehire, we hire for life, and weemphasize that in our introduction.

“We also emphasize our culture ofentrepreneurship where ownership ispassed on from generation togeneration (not family), and Doug isan example of that. People whoproduce are invited to become owners.In addition, the agency also ispartially owned by an ESOP.

“We are looking for some uniqueskill sets,” Bruce admits. “Forexample, I have clients that I’ve hadfor 23 years and I must bring newideas and passion every time I meetwith them. So we look for people whocan sustain energy doing the samekinds of things.”

An international flavor

In addition to serving the peopleand businesses in their area ofPennsylvania, the agency is involvedin placing coverages internationallythrough its relationship with UniBAPartners, an independent globalnetwork that provides insurancebroking, risk management andemployee benefits solutions in morethan 120 countries.

“We’ve also had a lot of businessopportunities with German-ownedcompanies and recently formedJKJ&H International (the H is forFriedrich E. Hortkorn GmbH, theGerman broker that is a partner inthis venture). We’ve worked togetherwith Hortkorn for about 10 years.There are cultural differences thatmake it imperative that we bothhave local representation. It allowsus to provide true consultativeinsurance and risk managementunderstanding despite those culturaldifferences. Having a partner thatunderstands those differences andcan adapt risk management andsafety programs to reflect thosedifferences is key in developing andretaining international clients. Wealso have developed a closerelationship with the GermanAmerican Chamber of Commerce.”

The partnership with Hortkornhas been very successful, so “we areworking on a similar partnership witha Canadian firm,” Bruce points out.

It’s all about the team

“For us, it’s all about the cultureand the team,” Bruce concludes. “Werecognize that we have to pay peoplewell and treat them well so that eachindividual understands that we view

him or her as an important part ofour agency. Our method involves along-term commitment, especially indeveloping new production talent.John and I have not produced newbusiness revenue in our names inmore than a decade. It’s alwaysdeveloped in conjunction with one ofthe young producers. We want to getthem to $500,000 in revenue, and youcan accomplish that with a teambehind you.

“And those teams never end. Weall still stay in touch with theclients that we’ve developed as ateam, even though the producermay take the lead. It helps toenhance the knowledge base theclient can depend on and maintain alevel of passion that one individualmay not have available every day.Thanks to the efforts of all ourpeople, we finished last year with$150 million in premiums, a smallincrease from the prior year in avery tough market.”

The spirit of entrepreneurshipand teamwork that pervadesJohnson, Kendall & Johnson hasresulted in a risk managementboutique that takes excellent care ofits clients. We at Rough Notes areproud to recognize the agency asthis month’s Marketing Agency ofthe Month.�

The International Unit.