A new practice group from Willis called Willis Open has been started to help public entities and corporate businesses build alliances with minority-owned business enterprises (MBE) and women-owned business enterprises (WBE).
Kimberly Waller and Phillip Styles have come over from Aon Cornerstone, a unit of Aon Corp., to lead the new practice group that will help insureds looking to honor or expand their diversity and corporate responsibility commitments.
“The goal is to help our clients manage their risk, which a traditional broker would do, and reduce their cost of risk while partnering with diverse firms,” says Waller.
There has been increasing demand from clients for their brokerage partners to help them meet the minority and women-owned business requirement that many big companies or public entities have. These requirements usually come from the government if it provides funding to the business, which is usually the case for public entities.
“The common element in all these industries is they all have government funding and with that comes a strong emphasis on minority and women development,” says Waller.
The requirements can also be part of the businesses corporate responsibility strategy or come from a company’s consumer base that demands the business have WBE and MBE partners.
Waller says many companies have been looking at a local or regional level for partners because of limited resources, but that may not be the most effective strategy. Waller and Styles led a similar effort while at Aon as well.
“The interesting thing to me is this is not new,” says Waller. “The only thing we have said is that instead of cold calling, why don’t we develop relationships with the best partners first so we can work as a cohesive team versus slapping someone on a deal.”
Styles will work from Atlanta and Waller is in Chicago, so Styles says they have the ability to meet with partners across the country. They also plan to participate in local trade shows, chambers of commerce and networking events. Willis Open will arrange meetings with potential partners and put them through a vetting process.
“We can find out who they are and what they do and what is their skill set,” says Styles. “As we see opportunities to bring value to a client we will reach out to them.”
The opportunity to form these partnerships is certainly there. According to a 2007 study from the U.S. Department of Commerce’s Economics and Statistics Administration (ESA), women-owned businesses grew by 44 percent between 1997 and 2007 and now account for $1.2 trillion in economic output. That growth percentage is twice as fast as businesses owned by men.
MBE’s are also a huge segment of U.S. companies, with more than five million in the United States and more than $1 trillion generated in economic output to the U.S. economy, according to the U.S. Census Bureau’s 2007 “Survey of Business Owners.” The survey also found that the growth of minority-owned firms outpaced growth of non-minority-owned firms in gross receipts, employees, number of firms and population between 2002 and 2007.
“The fastest growing segments of small businesses are women and minority-owned firms,” says Waller. “And if you want to go after larger and more complex clients you will need a larger partner.”
Waller says this new initiative also represents the shift happening in the marketplace where agents are becoming more like business consultants because clients’ needs are more sophisticated and they demand more from their agents.
“If you are looking at a client who is a large public entity, because of how they get their dollars they have supply chain issues that need to be addressed, in addition to covering their traditional property and casualty risk,” says Waller.
Willis Open also expects to gain new insureds through this initiative because the company will have access to clients they may not have had otherwise. Waller says potential clients have expressed great interest in working with a broker that can help them meet their supplier diversity goals as well as solve risk management challenges.
“I think the big thing is clients are looking for the insurance community to partner more effectively and particularly partner with majority brokerage firms and minority and women-owned firms,” says Waller. “The better those partnerships become, the more meaningful and successful insurance companies will be in meeting their clients’ needs.”