Monday, September 8, 2014

Lansing Regional Chamber - - Economic Club - - Presentation by Michael Wells - C.E.O. of Jackson National - September 4, 2014


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!

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