5. Mission Driven with McKeel Hagerty

McKeel Hagerty, CEO of specialty insurer, Hagerty Group, talks purpose and blind spots. We discover how a worthy mission activated him and contributed to exponential growth. With wild success comes blind spots for HiPER Leaders. McKeel shares the systems he puts in place to make sure blind spots don’t go unchecked. For more information about the Hagerty Group, please go to www.hagerty.com. To learn more about taking your organization from the new normal to the new exceptional visit www.hipersolutions.com.

Transcript

David Morris  00:10

Welcome back to HiPER leadership. My name is David Morris, CEO and founder of HiPER solutions and your host for the HiPER leadership podcast. In this series on HiPER leadership, we've set out to define the key attributes of a HiPER leader so that you, our listeners, can more quickly identify your next game changing leader. With this in mind, I have the great pleasure of introducing you to McKeel Hagerty, President and CEO Hagerty group and former chairman of Young Presidents Organization, YPO. Today with McKeel, we explore how he was activated by the worthy mission of transforming the family business when confronted with the threat of being put out of business. Like many HiPER leaders, McKeel has been relentlessly focused on achieving the mission he was tapped to deliver. Because they are moving so fast, HiPERs can often forget to check their mirrors. As a result, they tend to develop blind spots because their eyes are so focused on the prize. In McKeel's case, the blind spot led him to develop a mission that drove breakthrough success. McKeel, like other examplar HiPERs, has taken some pretty significant steps to reduce the risk of developing blind spots. McKeel will share with us how he's created effective systems for keeping those blind spots in check. How long ago was it, McKeel, a few years?

McKeel Hagerty  01:41

Oh, yeah, well, four or five now, I think.

David Morris  01:43

Yeah, and it's been really a fun journey. As some of you probably know, McKeel is CEO of Hagerty, an organization that insures over 1.6 million vehicles, 10,000 boats and 25,000 motorcycles, but far more important than that, they are on a mission to to save driving which we're going to learn more about. So, as we jump in, let's keep in mind HiPER leaders are absolutely critical for investors, owners and executive sponsors, wherever they're driving breakthrough change, and McKeel from the moment I met him really stood out as one. So welcome, McKeel.

McKeel Hagerty  02:18

Thank you. It's a pleasure to be here.

David Morris  02:20

You know, McKeel, just going back a little bit on on your success. I mean, you know, like a lot of CEOs, you've had a nice path of growth, 17% a year after year CAGR. But what I was most intrigued by was when we really look into where the real breakthrough change started happening. Maybe you could give a little background of what prompted you first to get involved in the business, the size of it back in ‘95 and then sort of what's happened over the years and then we're going to unpack a little bit more about one of the traits we’re most intrigued by.

McKeel Hagerty  02:53

Oh, thank you. Um, as we've chatted about before, I'm not, I'm not a huge fan of talking about successes. For now, I'll humor you and we'll go with it. This was a family company. It was originally started by my mom and dad back in the early 80s, as a specialty in boat insurance business. It evolved into the automotive space in the early 1990s when I was getting out of college and into grad school and, and I really thought I was gonna have a life of academia, PhD, [I] wanted my PhD in philosophy terribly badly. I just thought that was going to be my life. But, you know, still worked in the business a little bit. My mom needed the help. In 1995, she was really running the business, my dad was semi-retired, and [I] decided to put my education on pause and move back to kind of take things over nominally, when we were about 35 employees and, you know, single digit millions in revenue. And what I what I remark about it, it was really the it was the year that my education ended and my real learning began. So yeah, when I when I kind of took over, came back in 1995, it was actually the businesses was not in great shape financially, I didn't quite realize that; I was a philosophy student, as I mentioned, not a finance guy. But I realized there was a lot more there, a lot of potential in this, much bigger market that was being addressed, many more sophisticated marketing things that could be done, and branding opportunities to make it not about insurance, but just to make it about the love of cars, because we are in the in the collector vehicle space.

David Morris  04:21

You know, it's one of the things about identifying HiPER leaders that we have found is very tricky is it's not obvious at the surface level. They don't have a particular personality trait. It's not a particular pedigree, not a particular career track. It really gets at a deep motivational level. And what inspired me most was when we were in Singapore, doing the YPO presentation together and [who?] called you out on what activated you most, what was the thing? Because that's what happens with HiPERs, you see it when, all of a sudden, there’s a mission that matters. And it was something that happened in 2016 with you that took that 17% CAGR per year to a whole different level.

McKeel Hagerty  05:08

I was. I mean, it was a combination of things really, but but one story that that is a good one. You know, we had been at this really steady growth, you know, we're 500 employees or 600 employees, whatever it was at the time. And I knew we were still on this path, [a] steady march up, you know, Jim Collins, 20-mile march, just steady double-digit growth. So, I would at this point, I'm YPO Chairman, you know, made it all the way up through the ranks. I'm chairman of the global organization and now only dedicating about 40% of my time to the business. So, I was struggling, traveling all over the world having a great time learning in YPO. But I kind of felt like I left my business undefended, other than you know, I'd send core ideas back, I dial into the key meetings, I've really tight rhythms about when I would engage. So, we were at our global conference, and we had a speaker up on stage who is a technologist, very successful person, talking about the future of autonomous vehicles, and specifically how cities would be transformed as vehicles, owner-driven vehicles kind of left cities and they became more autonomous. And I'm, I became fascinated through the years with how, you know, urban planning affects cities. So, I was interested in his story, intellectually, but you know, I just figured, okay, well, he's kind of a car guy, I'll go talk to him, I gave him my business card. And he looked at me saw that I was in the car space. And he said, looked me straight in the eye and said, “I'm so sorry, I'm going to put you out of business.” And he actually grabbed my elbow and said, “No, seriously, you have to find something else to do. I'm putting you out of business.” And of course, I you know, I don't know how your mother taught you to treat strangers, but I'm thinking, “What a jerk.” But what bothered me the most was here, I had this great business. I think I know it well. I think I understood the data, the total addressable market. I knew we were going. I knew how we were going to capitalize it. I knew our plans, but I didn't have an answer to that story. I didn't have, and this was a new story: autonomous vehicles. I needed to change the way I was working and then we reintroduced this idea of purpose. And our purpose really was to save driving for future generations. Now this is not commuting. This is not sitting in traffic on the 405, this is driving. The pleasure of driving on an open road, ideal in a really fun car. And that we believe there's a there's going to be room for it, long into the future, just like horses are alive and well in a $50 billion business in the United States, even though they're not used for daily transportation. So, becoming a purpose-driven organization, where it could galvanize our now 1300 employees and you know, continuing to grow in that high teens sort of range, doubling every 2-3 years. It's this purpose and they all talk about it, you know, this aha moment that just put us on the next S-curve. So, another just great realization and something that makes me feel not just happy, but very fulfilled.

David Morris  07:50

Yeah, what was so inspiring about that story, it would be very natural, at that size of your company, to do it what a lot of CEOs would and say, “Hey, our goal is just to increase revenues even more.” or “Our goal is to get acquired,” or “Our goal is to go raise some private equity.” And, the reality of the situation is you achieved a growth spurt over those next few years. Far greater, I think, than if you were to just put any regular goal out there. You put the mission that activates the HiPER, and it's almost like the byproduct of the whole thing. Was it receiving the type of investment that you did in 2019? I mean, is it fair to say you weren't even thinking about that, that just sort of came along with it?

McKeel Hagerty  08:30

Well, that's true. My methodology for planning is: Can we envision wild success, and what that would look like? And then we, and then we back to the present. I don't build strategic plans or any plan incrementally, I mean, except for a very, very short term. And so, it's always been, now that I had a purpose and I actually could think about ourselves, even doing things outside of our industry, with this level of purpose. It allowed me to have a much bigger perspective and truly, this thing was never meant to be, you know, build and flip. It was never meant to be, you know, just go, you know, raise a bunch of money kind of approach. And I didn't want to watch. I didn't want to sit there on the sidelines and watch somebody dismantle what I was preparing to build.

David Morris  09:11

Not dissimilar to other HiPERs. It's the mission that activates them. It's the mission, it has to be worthy, otherwise, there's no reason to pursue it. The area that I want to spend the remaining time today with you, McKeel, is you have all the attributes of the HiPER; there's one attribute in particular, though, that you're operating completely off the charts on. And as we think about investors, owners, and executive sponsors that are choosing CEOs to be able to fundamentally transform their business, one of the things I'm very intrigued by with you is how you talk about cultivating blind spots that, as a HiPER, you know, the strengths of yours become your greatest challenges and how you've had to put systems into place literally to pick up on what the blind spots are. See, where regular leaders are about growth mindset, they go to some sessions, they go learn, but you've actually put a number of interesting protocols in place to really turbocharge that. [I would] love to hear a little bit more about this cultivating of blind spots.

McKeel Hagerty  10:14 

I always work on my strengths, because otherwise you're just constantly working on a bunch of weaknesses. But, blind spots are different because your blind spots come from where your strengths are, you know, your your, your strengths will tend to, they will tend to blot out visibility and you know, Danny Kahneman’s Thinking Fast and Thinking Slow, you start to rely more and more on your fast thinking. Because why? Because a high-performing person often wins a little bit more than everybody else, and you can learn to rely on it too much. There's an old saying, and I'm not an aviator, but I like airplanes. I like all things mechanical, is they used to say the most dangerous pilots ever were 1000-hour pilots and 10,000 hour pilots because it was some, there's something there where they just thought “I got this.” “I got this, I'm good.” And that's very often it's shortly after those kind of milestones of success when little incidents start creeping into their career. You know, our blind spots tend to come out of a too heavy of a reliance on our intuitive modes of thought. But yet, it's, it's, I believe the best leaders’ ability to make decisions without having all available data is what makes them really good. So, if you think about again, just like from the outside, that you almost have this perfect potential storm for disaster, where you've got very successful people, highly reliant on intuition and fast thinking, and they're mostly right on it, then you should be able to start noticing mid-career, mid-later career, that the biggest opportunities for failure of those leaders is going to come about that and when they're absolutely at the top of their game, so it was a little bit of a mental model. Like, if that's the case, and I fit into any of that, then I had to be honest, brutally be honest with myself in understanding that I have a bunch of blind spots and I need to understand them better than I ever could before. Because it it otherwise, you know, I was going to leave you know, my business, my family, my reputation open to, to greater damage. So, I know it's a, it's a strange way to approach it because I'm a believer, yes cultivate your strengths. You know, Marcus Buckingham, don't work on your weaknesses, work on your strengths, but recognize those strengths are going to be likely where your failure comes from. 

David Morris  12:32

And so, as we think about the blind spots specifically, just some of the tactics that you use, to surface them, and then things you've put into place to make sure they don't keep repeating. What is the one that like, is just been trickiest for you to overcome, but you really came up with some good tactics around it?

McKeel Hagerty  12:52

I guess things that we need to think about as we relate to the people around us, understanding how people talk about you and listening through the words to what is you know, the music behind the words and understanding where it comes from. I mean, I'm a believer, for example, that I knew through my career, that I was going to have to build lots of networks of people to get me where I needed to go. So, areas of trust, for example, become challenging. And I knew that, you know, if you can't rely on totally deep, explicit trust, what do you rely on that will find your blind spots? Well, flattery is how people get to you, right? You're going to trust; you're gonna get burned. So, I always I'm very, very sensitive to any kind of praise about anything I do. Because I'm, for example, I'm hypersensitive to the fact that they're flattering me, even if they believe what I do is something that's really solid. So, I believe there are two meta skills to high performing leaders and that one is the ability to learn a little bit faster, a little bit deeper than anybody else. It's a skill that I've cultivated very carefully between my methodology of note-taking and memory skills, and practices and things that I do. And then high levels of communication skill. So, I work diligently on my speech making my right on my written communication and on you know, other things that I do. Well, when I get too many flattering comments around either of those, I'm highly suspicious of whether I'm developing a blind, I'm becoming too overly reliant on either one of those skills to carry the day. So, one, beware of flattery. And that sounds a little bit strange, openly cultivating different types of coaching relationships than I've ever found in the past. And in particular, I don't I'm not a big fan of generalized you know, executive coaches. I'm much more of a believer in getting more granular when it comes to your coaching teams. You know, you think of a LeBron James. I mean, I think I heard he, you know, had something like 10 individual, you know, coaching or people kind of in a coaching practice around him when he's been at the height of his game, from nutrition to psychology to stretching, not just a general fitness coach. So for me, going really granular with the type of feedback I was interested in receiving and then seeing where patterns crossed between those people has been, you know, just an absolute godsend not just in helping me along my you know the journey, but in helping to further identify those blind spots because I am, I'm at the perfect point in my career to experience a catastrophic failure due to the blind spots created by my success.

David Morris  15:26

That's a really, really a terrific example and, you know, just keeps coming back to the fact that our greatest strengths are our greatest weaknesses. And HiPER leaders are all about winning and if the mission matters, they'll do whatever it takes to win and those greatest strengths are also going to be their greatest weaknesses. Any remaining thoughts on this McKeel?

McKeel Hagerty  15:49

So, I think self-correction is it. I think asking you know, thinking is discursive and by being discursive, what it means is is people who have a high quality of thought are able to consider their own thoughts along the way, they don't just blurt them out. And so, you know, understanding well, that when you're trying to find the right kind of leader, trying to find a HiPER leader in this situation, they have to have a self-awareness to be able to describe the strength of their own thinking, or the weakness in their own thinking and that, it goes back to blind spots. It goes back to the quality of their decision making, you know, not just on the results, because everybody gets so hung up in the results, when very often the results just, they happen because of something happening in the world. But you still have to be able to go back and say, “Tell me the, tell me the decision process you went through to create this.” And so that that and that's really where the magic happens. So discursive thinking, you know, an awareness of how they think, and ultimately, not only where their strengths of their arguments are but their blind spots, I think is a real Hallmark for the highest quality leaders today.

David Morris  17:00

Well, McKeel, thank you. And I am so inspired and have no doubt that in this next normal we're going through right now, there is going to be a new mission that activates you to take the organization and society to even greater heights. And thank you so much for your passion around the HiPER movement and really for helping to craft it with us. Thank you.

McKeel Hagerty  17:23

Well, thank you. It's a pleasure, pleasure for you to, you know, think highly of the work that we're doing and I'm just terribly impressed by the HiPER model and the work you're doing for leadership everywhere.

David Morris  17:35

Thank you, McKeel. To our HiPER leadership listeners, this would not be possible without you. If you haven't done so already, please subscribe to the HiPER leadership podcast on Apple podcasts or Spotify. If you like what you hear, please share and leave us a comment. Additionally, to find out more about HiPER leaders and how HiPER solutions can help accelerate your next big change effort, please go to hipersolutions.com and follow our company page on LinkedIn.