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Bill, Bob and Alan Holman joined Meredith Moore and Dwayne Samples on Thursday, March 1, 2012, to discuss with Family Business Radio listeners the transition of their business to second generation owners. Holman and Company is an Alpharetta-based insurance brokerage and risk management firm, founded by the Holmans’ father in 1983.
Holman and Company gets its start
Penn Holman began his career in the insurance industry in 1963 as a direct sales representative for Liberty Mutual Insurance Company. In 1972, he joined a partner to form an independent company, Holman and deVarennes & Co. The partners parted ways in 1983, and Penn formed Holman and Company. He lost his accountant in the split, so he brought his wife in to handle the company’s books.
Though it started in Chamblee, Holman and Company has since moved to Alpharetta. The firm offers a full line of insurance products, from commercial to personal, ranging from employee benefits and casualty to homeowner and auto insurance.
Welcoming the brothers
Bill, Bob and Alan Holman don’t remember being involved in the family business as they were growing up; rather, they remember just a general awareness of what their father did. Like most children, they saw him as “dad,” coming in from work in the evenings, spending time together on the weekends.
One-by-one, the brothers graduated from high school, then went to the University of Georgia. Bill, the oldest of the four children (they also have a younger sister), wanted to become a stock broker. Black Monday hit in October of 1987, and he decided against the career. With his dad’s encouragement, he earned a degree in finance with no specific insurance classes. After graduating in 1990, he immediately joined Holman and Company, where Penn trained him in the insurance business. He started by making cold calls for personal insurance products. He made some customer calls with his father on commercial accounts, and gradually moved to focus more in that arena.
When middle brother Bob attended UGA, his father also encouraged him to earn a degree in a broader background, not specifically in risk management. Upon earning his finance degree in 1992, Bob went to work for Merrill Lynch at a new Jacksonville, Fla., mutual fund processing office. Within a year, he realized that wasn’t what he wanted to do for a career, and he joined the family business in 1993. Holman and Company had always been there as an option for him, but Bob says he wanted to try something outside first. His father encouraged him both to try something different and then, when he wasn’t completely satisfied there, to join Holman and Company. Like Bill, Bob started at the family business by making cold calls regarding personal insurance products.
Alan says he followed almost the same exact path, earning a finance degree from the University of Georgia. Upon his graduation, he worked two to three years in the accounting department of a Roswell company that owned several technical schools around the country. In 1996, his dad approached him with a sales opening at Holman and Company, pointing out Alan’s greater opportunity for growth there than in his accounting position.
As the brothers joined Holman and Company, each earned a small base salary and was expected to earn commissions through sales, though no specific goals were in place. Each was given general product training, and each was also trained by going along with the elder Mr. Holman as he made calls on customers. Bill and Bob started in personal insurance then moved to commercial. In Alan’s case, Mr. Holman had identified a niche industry – automotive risks – for Alan to focus on and build. While he worked in other areas, too, the niche gave Alan a jumpstart into the business.
Bill says the agency had about six or seven employees when he joined in 1990, including two or three producers in addition to his dad. The brothers agree that non-family members were given similar training and also made sales visits with their father, though they probably did not receive quite the same level of mentoring simply because of the nature of the relationships.
Meanwhile, the brothers say their sister had no interest in joining Holman and Company. They noted that she is in a completely different industry today and is very successful in her career.
Brothers, sons and business partners
Bill, Bob and Alan are close in age, all three born within a five year period. Now that they are also business partners, they are still close. They get together regularly at their parents’ home. At those times, their conversations generally center on casual topics rather than business.
Other than these family get-togethers, the brothers don’t generally socialize outside of work. They live in different neighborhoods, and each has his own family, friends and activities. They keep up with each other at the office, though they are often going in different directions. In fact, they admit to times when they won’t see one another for a few days, only to learn that the “missing” brother has gone out of town for work or vacation. They agree they work together well without getting in each others’ way.
Joining the staff at Holman and Company also gave them a different perspective on their father. The first big change for each brother was learning to call their father by his first name, something he asked them to do.
Penn Holman remains very involved in the company. In fact, though the brothers purchased most of the stock in the company just over a year ago, they say that Penn is still very involved with the business. Mrs. Holman, who had run the accounting aspect of the business since the doors opened in 1983, retired at the end of 2011. Replacing her with a non-family member was a key concern of the business. The company had always had an involved family member keeping an eye on the books, and finding the right person to take over the task was a primary focus. Once they found the replacement, she spent four months working alongside their mother to learn the job thoroughly.
Changes in the industry
The brothers report that the commercial insurance industry has experienced a buyers’ market for the last eight years or so, with customers expecting pricing to continue to fall. Recently, however, prices are starting to transition up, and the brothers say this means different types of conversations with customers. While the transition from buyers market may indicate a slight improvement in the economy, many of their clients are not feeling the improvement significantly yet and are discouraged by price increases. The Holmans differentiate themselves in the market through their extensive knowledge of the industry and the products. One way they have demonstrated their knowledge is through acquiring professional designations.
Changing roles, business practices
When the Holman brothers began working for their dad, there were no set sales goals or other means of governance in place. Over a decade ago, they began working with a consultant to bring an outside perspective to their business, help them set goals, and facilitate quarterly meetings among the four Holmans. While it’s different from the way things had been done in the past, the brothers say their dad supports the effort and recognizes that something needed to be done to help them organize and hold each other accountable. They say he saw the effort as neither good nor bad, just different.
At these quarterly meetings, the facilitator helps the owners to stay on track as they review budgets, set goals for the agency, assign tasks, and hold each other accountable. While each brother is responsible for his personal production, their additional roles in the company are now more defined. Bill focuses on the financial aspects of the business; Bob manages the office, IT and human resources functions; and Alan oversees sales and mentoring of sales staff. As for Penn, he still owns some stock, he maintains his clients, and he serves as a resource for others in the company. He has an office and is welcome in the business as long as he wishes to remain.
Holman and Company works with mid-market commercial businesses, many that are also family-owned. Like Holman and Company, many of them are welcoming their second and third generations, and owners will often ask questions related to family business transitions in the course of their business with the Holmans. The brothers believe that this commonality – the idea that many of the businesses they serve are mirror images of their own business – will help them keep these clients into the future.
As they look forward, the Holmans see growth and the addition of more sales team members who are not family members. As their dad gradually transitions out of the business, he brings another person with him on client meetings so clients will become accustomed to working with others in the company. Because the agency owns the policies that are written (not the individual sales person), the transition will be easier from a business standpoint when Penn leaves the company.
As far as bringing the next generation into the business, the brothers say it’s too early to tell. The oldest member of the third generation is only 13. Of course, the family business will be open to third generation members if it’s the career path they choose, and the brothers say they are more prepared to help the next generation enter the business because of their own experiences. For example, they will require that each family member work somewhere else first, something Bob and Alan did and Bill wishes he had done as well.
The Holmans’ Tips for Family Businesses
- Involve an objective third party in the transition to the next generation. Bill says the transition can be an emotional time, especially for the parents. An objective third party can hear all sides of the discussion and remove the emotional aspects.
- Communicate. Bob says it’s easy for each family member to fall into his own work, but the family needs to work as a team. Keeping the lines of communication open is key.
- Keep business problems in the business atmosphere. Alan says things are not always perfect, but business problems should not bleed into personal problems. That’s when business jeopardizes the family relationship.
Contact Our Guests:
Bill Holman
Bob Holman
Alan Holman
Holman and Company
3655 North Point Parkway
Suite 425
Alpharetta, GA 30005
Phone: 770.992.4760 or 800.229.2465
Website: www.holmanandcompany.com
