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Case Study
InsureMe of Englewood, Colorado: A Model of Employee Ownership
By Emily Meyertholen, Beyster Institute Staff
When one of our employee ownership consulting clients does well, we get excited. So when we heard about the flurry of recognition being received by InsureMe, a leading insurance services marketing company based in Englewood, Colorado, we just had to check in with them to catch up.
Here’s a summary of the praise InsureMe has received in just the past few years for its exceptional workplace practices:
- Named the 19th Best Small Business to Work for in America by the Great Places to Work Institute in 2006
- Named the 2nd Best Place to Work in Denver by the Denver Business Journal in 2006 (for medium-size companies with 50-250 employees)
- Received the Spirit of Hope award by the Mile High United Way for its level of Corporate Contributions in 2005
- Ranked 4th among organizations with 2,000 or fewer employees for in-house leadership programs by Leadership Magazine in 2006
- Placed in the top 25 places to work for working mothers in 2005 by Working Mother Magazine
How does a company garner this type of attention? In speaking with founder, president and CEO Tim McTavish, we learned that when InsureMe approached the Beyster Institute in 2005 to learn more about employee ownership, it was only a part of a larger effort to, according to Tim, “create an environment in which ‘love’ (treating others as we would want to be treated) would dictate everything we did.”
“I started reading about great companies and got inspired by what they did,” says Tim, who started the company out of his condo in the Denver suburbs in 1993. InsureMe now has 70 employee-owners. “I wanted to create an environment which I could be proud to be associated with… I surrounded myself with a few key leaders who also shared the vision for building a great place to work. Having the key management team on board made all the difference.”
It all started when Tim read “The Great Game of Business” by Jack Stack, which illustrates how open-book management (a great accompaniment to employee ownership) can enlighten and equip employees to help build thriving companies and rewarding careers. “It made so much sense,” says Tim. “I was confident that with the right education and incentives we could grow the business much more rapidly—having employees actively engaged in the success of the business.”
In March of 2005 at the Great Game of Business conference, Tim heard a presentation on employee ownership by Martin Staubus, Director of Consulting for the Beyster Institute. Shortly afterward, he engaged the Beyster Institute in helping to establish an ESOP. Martin provided guidance in determining the company’s employee ownership path.
InsureMe’s abundance of employee benefits, incentives and ownership opportunities is remarkable. The company has implemented three financially based incentives: A quarterly cash bonus as part of a profit-sharing formula, an ESOP which is also funded based on an annual profit sharing formula, and the option for employees to purchase restricted stock directly from the company. The programs are broad-based and apply to every employee, but are distributed based on their relative wages.
In addition to its significant employee ownership programs, InsureMe provides a 401k plan that matches employee contributions up to five percent of compensation, excellent health insurance coverage for employees and their families, a sabbatical benefit of six weeks extra vacation every six years, educational reimbursement, over three weeks of vacation per year, eight paid holidays, charitable matching on dollars donated to charity, and more.
So, is “loving” employees this much compatible with a successful business? InsureMe’s results speak for themselves. Since implementing a more ownership-focused culture with effective ownership education, InsureMe has seen turnover reduce from over 50 percent to less than 10 percent. Employees are focused on the right things and hold each other accountable. The bottom line: InsureMe stock price has gone up about six fold in just two years.
“Employee ownership has been very positive for our company,” says Tim. “In order for it to be successful, though, it has to come with education. Employees have to understand what drives the value of the company (and their stock), how the ESOP gets funded annually, how to understand the key drivers in our business, and what it means for them personally… We see our ESOP and individual stock purchase program as part of our long-term strategy for growth.”
To keep employees informed of their company’s performance, a daily snapshot of key business drivers is shared via email each day. Additionally, the CFO provides a detailed review of the financial situation to all employees during a quarterly company-wide meeting.
"As co-owners of the company, employees provide the best service for our customers, increase our revenues, control expenses and keep a watchful eye on the competition," says Tim.
The traditional business world may be skeptical about the returns that can be gained from building a high-performance employee ownership culture. But leaders like Tim McTavish have shown just how great the results can be. Like so many other visionary leaders who have implemented employee ownership, Tim has demonstrated that there need not be a trade-off between bottom-line business results and a commitment to creating a path to better, richer lives for the people in the business. To the contrary, helping employees become capable and productive employee-owners will pay off in business results.
©2007. The Beyster Institute and its authors and their entities. All rights reserved.
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