Lansing Regional Chamber Economic Club Meeting
Jackson National Life
September 4, 2014
Michael Wells, the C.E.O. of
Jackson National Life will be the speaker at this afternoon’s Lansing Regional
Chamber Economic Club Meeting. As they
are one of the most successful businesses in the tremendously successful
Lansing Area Insurance Sector, he will probably have something interesting to
say!
Deborah Muchmore of Kandler
Reed Khoury & Muchmore opened the ceremonies by reporting that in the
Lansing area, the insurance sector is the largest employer. Over 15,000 Lansing Area people work for
these companies. Greater Lansing has
more people employed in the Insurance Industry than any other area in the
state.
She then introduced Jim
Robinson from Michigan Farm Bureau. He
announced that there will be some significant growth in Lansing’s Airport and
the transportation offered. He
specifically mentioned that there will be more international destinations
offered from our airport.
He introduced John Brown from
Jackson National. Mr. Brown showed us a
video about the necessity of communicating with conviction. Specifically, the teacher in the video feels
that we are not assertive enough when we speak, especially when saying
declarative sentences. His point is that
there is too much emphasis placed on questioning authority and not enough
emphasis placed on communicating well.
The video contained a lot of great advice presented with a humorous
twist.
Finally, it was time to
introduce Mr. Wells. He tied in the
video by pointing out that Jackson National’s success during Mr. Wells’
nineteen year tenure has a lot to do with a culture that rewards clarity and
forthrightness.
Per Mr. Wells, most of the
Jackson National success comes from their culture and their employees. While Jackson National is a challenging place
to work, the dedication they get from their carefully selected employees
permits them to get the job done for their clients with fewer employees than
other insurance companies.
This permitted them to get
through the recent downturn without laying off employees like many other large
companies did. This commitment to
employees pays off with a hugely motivated employee base. Mr. Wells considers the employees as one of
his stakeholders along with his investors.
He points out that some
companies try to get cheap points with investors by laying off employees simply
to impress the investor public with how willing they are to appear “tough” by cutting
costs at employees’ expense. By being
tough all the time, he does not end up with fat that is needed to be trimmed
during tough times! The
performance-oriented culture at Jackson National pays off in many ways.
Another factor in Jackson
National’s success is that they carefully calculate and vet their products to
make sure that they are able to keep promises made to the people who buy their
annuities. All products are
mathematically and actuarially viable or they are not offered to the
public. It is easy to contrast this with
the over-aggressive products and sales techniques that got other insurance
companies into a great deal of trouble during the downturn.
This has led Jackson National
to a point where they had $27.3 billion in sales in 2013 and are the largest
provider of annuities in the United States market!
They spend a lot of time and
energy to make sure that they provide top level customer service. Mr. Wells said that Jackson National’s call
centers are the best in the Insurance Industry.
Their dedicated employee base is a huge factor in the success of this
part of their company.
He noted that they also don’t
spend much on advertising and branding.
They prefer to let the quality of their service and products speak for
itself. This also works toward lowering
their overhead and helping to keep their internal costs lower than their competition. Jackson National has the lowest expense to
assets ratio in the industry.
He discussed how they
carefully select employees who will adapt to their culture. One tool they use is the “Jackson Zone.” This is a program where they hire
undergraduate students to do data entry and other work that they formerly
outsourced to foreign countries.
This work is now done at the
Jackson Zone. It helps them to identify
students who have the traits necessary to be a good employee at a young
age. As insurance is not a “glamor”
industry, they need to use programs like this to help with a creative approach
to recruiting.
Mr. Wells spent a lot of time
discussing Jackson National’s commitment to charity. They encourage their employees to get
involved in non-profit organizations of their choice. Jackson National benefits from the increased
loyalty from employees who get to help causes they believe in.
Jackson National also
encourages employees to become involved with work on the boards of
non-profits. Non-profits are much more
difficult to manage effectively than for-profit companies. The challenging non-profit environment helps
to develop the managers’ skill sets which helps to make Jackson National more
efficient. This justifies the cost of
donating money to the charitable causes.
He finished up with a
discussion of the expansion of Jackson National’s facilities on Okemos Road in
Alaiedon Township. They are designing
the project to protect and preserve as much of the natural landscape as
possible. They are working to have a low
environmental impact and low energy use.
This will eventually allow
Jackson National to double the number of people employed at their
facility. He showed a virtual walk
through of the new space. It looks like
this facility will be a great place for people to work.
We are truly fortunate to
have so many jobs in the insurance industry in our area. It’s great to see that Jackson National is
working to stay competitive and to continue growing their business as well as
the number of jobs they provide in our community!
