Higher learning: what can brokers gain from an MBA?

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Higher learning: what can brokers gain from an MBA?

The IBAC/Laurentian launch highlights an educational choice.

Terri Goveia on October 26, 2010

When Harry Binks enrolled in an executive MBA program, he already had years of experience running an insurance brokerage under his belt. After 18 months of intense part-time study, he emerged with a newly minted degree and a fresh perspective on how to manage his business.

For Binks, president of Ottawa-based Binks Insurance Brokers Ltd, the MBA experience paid off in different ways, helping him spin off a brokerage specialty into a separate business and streamline his operations. With the Insurance Brokers Association of Canada (IBAC) launching an online MBA (and Honours Bachelor of Commerce) with Laurentian University this month, more brokers may ask themselves whether an MBA is right for them or their business.

Many appear to have an appetite for higher learning–findings from a 2008 IBAC survey revealed that 96% of brokers agreed that IBAC should pursue the Laurentian partnership for a broker-centric MBA, and 78% said they’d be inclined to do one themselves.

What should brokers keep in mind when deliberating a return to the classroom? Binks and other industry players assess key ways an MBA can pay off, and when another option might suffice.

1) A new set of tools

For many, the broad business focus of an MBA can offer a different set of business tools. And though a new degree doesn’t guarantee instant new revenue, the expertise that comes with it can be invaluable. “To get a lot of the expertise you find in a MBA, you’d normally have to hire it out,” says Binks.

2) Fine-tune business skills

Brokers already have a wide range of business skills, but a formal business program can help fine-tune them, says Sandra Parker, manager of professional development at the Insurance Brokers Association of Canada (IBAC).

Binks says the training “helped re-emphasize” the things that he already knew intuitively. He knew his way around a balance sheet, for example, but the MBA training changed the questions he had for his accountants. It also highlighted how he determined “the impact of doing something on one side would have on the other side of the balance sheet,” he says.

3) Teamwork and leadership

Much of the pay-off comes with better management skills. Brokers may not have full control over the numbers side of the business, “but you can manage the people, that lead to the numbers,” says Binks. “If you ignore your people, the numbers aren’t going to add up.”

The training also helps brokers keep a leadership role when dealing with other professionals, he says.

4) Taking business to another level

Brokers that aren’t part of a larger network may also benefit from strategic planning input from their classmates–who often take a teamwork approach to their own industry-specific issues–and from their professional advisors, Binks says.

It can also take the entire broker business to another level, notes Parker.

“It helps elevate the profession. The public will get to see that being a broker goes beyond selling,” she says.

5) New horizons

Binks, once the youngest broker in Ontario, was steeped in insurance training, and welcomed the opportunity to get a different perspective on his business.

A business program can offer “new ways of looking at moving from point A to point B,” says Brenda French, president of The French Group, a Toronto-based consultancy.

Diverse experience, expertise

That doesn’t mean an MBA is for everyone. Some may not have the time or spare resources for an advanced degree, and some may not need it, depending on their goals, says French.

“I don’t think everyone needs an MBA, but [brokerages] need diverse educational experience,” she says of the key strategic lessons that often come with a business degree. The degree is particularly useful for the larger, “mega brokerages” emerging on the scene, she says, noting, “as you get bigger, you need a bigger skill set.”

Other brokers may need a different kind of tool to achieve their next level, says Lorie Phair, an industry consultant and president of LePhair Associates Ltd. “Brokerages will have to do some serious navel gazing in order to determine what their organizations require and what will give the greatest return in growing their businesses and meeting the increasing needs and demands of their clientele,” she says.

That means looking at all possible investments, like advanced business training or sales and customer service training, she points out.

“Regardless, a brokerage that supports higher learning and is prepared to invest in their people may very well attract more young professionals anxious to further their careers. And, that’s good for business.”