The Women of Hagerty: Women Execs have Created a Culture of Respect & Success

Nov. 3, 2004

There was time, not too long ago, when the only way a woman made it into the corporate boardroom was with a steno pad in her hand. As for the CEO office, female access was usually granted to deliver a cup of coffee.
Times have changed and during the past 30 years women have played a major role in shaping both the political and corporate worlds. With these changes have come new challenges. Now that women are opening their own doors to corporate advancement, the issues of equal pay, sexual harassment and single-working moms have entered in as well.
But imagine a corporate environment where pay is based on performance, not gender. Where negativity is replaced by empowerment and encouragement. Where advancement is based on ability, not brown-nosing. Where women hold the same number of executive positions as men.
Sounds like some unachievable corporate utopia? Guess again.
Try Traverse City-based Hagerty Insurance, a company that specializes in insurance for collectible cars and boats. A company where the CEO, COO, CFO, founder and vice president are all women.
For the five women who hold executive positions within Hagerty and the many other women in management and support positions at the company, the workplace doesn’t involve a battle of the sexes. “The Hagerty Culture,” as they like to refer to it, is about working together to help each other and to serve the customer.
“We don’t have the time or energy to think about it. The men of this company don’t have time for the good old boys club. If someone is like that, they won’t fit into our culture and they won’t last long here,” said Megan Madion, Hagerty’s chief operating officer. “This company has been built on hiring the best person for the job, not the best man or woman. We are not in competition with each other, we are a team and everyone is very supportive in this environment.”

THE BACKGROUND
When Frank and Louise Hagerty of the Old Mission Peninsula started Hagerty Marine Insurance 20 years ago, it was to fill a much-needed void in the collector boat world: lack of insurance.
The Hagertys had owned a general insurance agency in Traverse City and Frank was an avid collector of cars and boats. Yet he found it a challenge to insure his “toys.” When they sold their agency they ventured into insuring classic wooden boats. Frank focused his time on collecting and refinishing cars and boats while Louise emerged as the head of the company. Neither imagined Hagerty would grow to nearly 250 employees and become the industry leader.
“I remember having a conversation with Louise Hagerty one day about how big the company would become,” said Penny Sweeney, chief financial officer. “We looked at each other and thought maybe we would have 35 employees someday.”
Those visions came during the company’s humble beginnings when the operation was in the basement of the Hagerty’s home. It remained a “home-based business” for seven years before a brief move to the former CAP building on West Bay and eventually to the Grandview Professional Building across the street. The company moved to its current location the Rivers Edge Development in downtown Traverse City four years ago and, with visions of grandeur, they will need more space soon.
“Yes we definitely have visions of grandeur,” said Kim Hagerty, chief executive officer. “I see us doubling in size in the next five to seven years if current trends continue.”
As for the number of women in high-level executive positions, Louise Hagerty never planned it that way. Those who know her and work for her say her greatest ability has been to hire the best person for the job, and in the early days that meant hiring mostly women.
“We are heavily weighted towards female leadership. In the beginning I used to interview men but with this being such a fledgling thing the job didn’t seem big enough for most of the men coming through the door,” said Louise Hagerty. “I think to many of them it seemed like a secretarial job. Now we are pretty well balanced and I am quite proud of that.”

FLEXIBILITY A MUST
Carla Gernhofer, vice president of Hagerty’s Marine Division, was hired by Louise 16 years ago and recalls the flexibility that was required.
“Regardless of your job, everyone had to answer phones and do data entry. Being flexible was a must but that flexibility was extended back to me and the other employees,” said Gernhofer. “I was a single mother with young boys and I was afforded opportunities to leave work early to participate in their activities. When I was hired by the Hagerty’s they made me a part of their family and they became a part of mine.”
That family concept is something that Kim Hagerty believes has helped the company to grow so rapidly.
“We work very hard at being a ‘family business’ not a ‘family-owned business.’ As we continue to grow we try to maintain those core principles that were established when my mother started this 20 years ago,” she said. So what are those core values?
“I think the big one is integrity,” said Gernhofer. “It really is the central value that holds this company together from an employee as well as a customer perspective. Louise Hagerty’s name is gold in this industry because of how she has conducted herself.”
For each of the three non-family member executives the appeal of Hagerty was Louise.
“I liked the job I had at the time I met with Louise in 1988 to discuss with her what she should look for in regards to a computer/financial person,” said Penny Sweeney. “I told her ‘you need a person like me, but I am not available.’ She was persistent and convinced me to come to work for her and in 1989 I did.”
Megan Madion, a 1984 graduate of Traverse City High School, was living in fast-paced Chicago with no desires of returning to her hometown.
“I had been working for this company in Chicago where I was promised ownership, but I was young and dumb,” said Madion. “When the owner sold the company my shares were dissolved; she left with millions and I ended up with nothing. I came home crying to my mother who suggested that I go to lunch with her friend Louise Hagerty who owned a small insurance company.”
Madion recalls that she really didn’t want to go to lunch but finally agreed. The lunch consisted of Hagerty asking several marketing questions and eventually offering Madion a job.
“I told her no because I saw it as a ‘mom and pop’ operation and I was too cool for that,” said Madion. “Quite frankly the company just wasn’t ‘sexy’ enough for me. But I agreed to consult for them from Chicago and two years later I found myself back here, and 10 years later I am still here.”

THE NEXT LEVEL
Carla Gernhofer was working as a caterer for the Wine Shoppe at the Grand Traverse Resort in 1987 when she responded to a help wanted ad. She began working for the company part-time in early 1988 doing a little bit of everything.
“I had lived in several places over the years and had several jobs since entering the workforce in the early ‘70s,” said Gernhofer. “When I went to work for Louise I sensed something different right away. This has been by far the best work environment I have ever been in and why I have remained for 16 years.”
As for Kim Hagerty and her brother McKeel, who is the president of Hagerty, their return home was a result of timing. Kim had a successful law practice in Lake Tahoe specializing in real estate and business transactional work. She was commuting back and forth working for her mother as well as serving as the chair of the board of trustees for a college out west.
“You could say I had my feet in too many boats at one time,” said Kim. “I was spending a week a month here when the auto program was being added. In 1994 we had this big family meeting to discuss where we should go with Hagerty. My brother and I both agreed to come back home to take the company to the next level.”
For Kim Hagerty the decision to move back home was a relatively easy one.
“As I look back on it what I am doing now is so much more rewarding than fighting with judges and other lawyers. I was burned out on the adversarial aspect of my legal work,” said Hagerty. “Plus I had just adopted an orphaned Chinese infant and this is such a great place to raise children.”
Sibling rivalry never has been a part of the Hagerty vocabulary, so when it came time to decide who would be CEO and who would be president, arm wrestling was not necessary.
“McKeel and I have always been close, those are just titles, we co-lead this company together and draw off each other,” said Kim Hagerty. “We each have distinct areas of responsibility. This is a collaborative effort and by blending our talents we have made this work for everyone.”

MOTHER & DAUGHTER
Louise Hagerty feels that she would be remiss in not mentioning the contributions her daughter Tammy made in the early development of Hagerty.
“Tammy was the first to come and work for me,” said Louise. “She is a stay-at-home-mom now, but certainly played a crucial role in the development of Hagerty. She is a lot like her father and is a collector. She knew the technical aspects of boat and car engines and could speak to that as well as anyone.”
Family businesses come with several challenges and at Hagerty the biggest is not mixing family life with business life.
“We have had to make sure that not every family gathering or dinner evolves into a business meeting and having the family time be just that: family time; and during business time it is about the business and not matters of the family,” said Kim Hagerty.
She sees the values she was raised with in her family as being important to Hagerty’s business structure. The company preaches loyalty, respect, compassion and commitment from the top down.
“We expect a lot out of our employees and give a lot to them in return. We have a large family picnic in the summer for the employees and their families and a Christmas party along with several things in between.”
In the area of compensation, Sweeney sees Hagerty wages as being very competitive with what are offered in the big city.
“I think that is where there is real value to this community that Hagerty employs nearly 250 people with wages that allow for them to contribute to economics of this community,” said Sweeney. “The Hagertys have been very fair in sharing the financial success of the company with their employees. Pay scales are based on position and responsibilities not by gender.”

COMMUNITY COMMITMENT
Being committed to the community is important to Hagerty’s employees as well.
“We have a very generous group of employees, who give to those in need in our community,” said Kim Hagerty. “We encourage that by offering a paid time off program to employees who do volunteer work in the community.”
The company has also made a donation of $500,000 for the establishment of the Hagerty Professional Development Center at the new West Bay Campus of Northwestern Michigan College.
“It is nice to give something back to the community, especially some-thing that is consistent with what we do and that is providing opportunities at both the entry and professional level,” said Kim Hagerty. “With that gift we are promoting professional development for the community and we will all win by developing talent in our own backyard.”
Carla Gernhoffer sees that local talent as another core reason for Hagerty’s success.
“We have the friendliest customer service representatives in the business and we hear that all the time from our customers,” said Gernhofer. “It is very competitive out there and that certainly gives us an edge.”
Penney Sweeney is also impressed with the local talent pool.
“Not only have we hired a lot of great people from our own backyard, we continue to find more of them,” said Sweeney. “I think this area promotes a sense of friendliness and growing up here that rubs off on you.”
Employee retention at Hagerty is well above national averages and Louise Hagerty is proud of that fact.
“We have a very interesting culture here in that it is sort of self-policing. If you don’t rise to the level then you don’t want to stay,” said Hagerty. “We don’t lose many people. A friend who observed our operation told me that it is ‘casual but not sloppy’ here. That approach has worked for us and obviously our employees.
Sweeney notes that sometimes employees whose first jobs are with Hagerty venture out looking for greener pastures only to return asking for their old job back. She also sees that the company is growing so quickly that even new employees feel like they are coming in on the ground floor.
“I had someone who started with us last year who told me he felt like he was at the beginning of something,” said Penny Sweeney. “Especially in the car division where every year a new set of cars becomes part of the collectible world. We continue to look at new markets and new opportunities. In a way we are still just getting started.”
Hagerty insures nearly 500,000 collector cars, a total greater than that of all other specialty collector car insurance programs combined. The company is also the largest insurer of classic boats in the United States with more than 200,000 customers. It continues to be the fastest growing company in its field and is the industry model for success. To learn more about Hagerty or to have an opportunity to work for “The Fab Five,” visit www.hagerty.com.