Welcome, everyone! We are delighted to have you on board for The Leader Show hosted by Louis Carter. Your presence here is a testament to your keen interest in learning and expanding your knowledge in the realm of leadership. Our guest today is Patrick Ryan, CEO of Ryan Specialty Group, a global insurance company that offers innovative solutions to insurance carriers, agents, and brokers with specialized needs.
In this episode, he discusses his values, professional journey, and the core principles that have shaped his leadership and the organization. So, without further ado, let’s jump in!
When asked to share his values as a leader. In response, Pat shares that his values are old-fashioned yet timeless. He mentions that he pursued a career in the insurance industry because of its entrepreneurial opportunities and the fact that it didn’t require any capital.
Additionally, Pat mentions that his core values include integrity, empowerment, self-optimization, and teamwork. He believes in sharing knowledge, opportunities, responsibilities, and equity with key people in the organization. He also emphasizes the importance of a client-centric approach, prioritizing clients’ needs above all else.
Throughout his career, Pat has been focused on innovation and flexibility, adapting to changes and anticipating shifts in the industry. He stresses the significance of learning from history, studying industry changes, and avoiding unintended consequences. While visions, strategies, and tactics may change, Pat asserts that core values should remain constant.
Next, Pat discusses the importance of values, empowerment, and listening in a professional service business such as the insurance industry. He emphasizes his company’s focus on recruiting, training, and retaining talent, which has resulted in a 97% retention rate.
Apart from that, Mr. Ryan highlights the importance of listening to both clients and team members and fostering a culture that constantly answers the “why” behind decisions and actions. He feels that this approach has contributed to the company’s growth, trust, and strong relationships with team members and clients.
Moving on, Lou asks Pat what it means to be an excellent leader. The latter responds by suggesting that an excellent leader is someone who is trusted, respected, and demonstrates strong character.
According to Pat, leaders must not only talk the talk but also walk the walk, ensuring that they embody the values they promote. He also emphasizes the importance of accepting one’s own imperfections and learning from mistakes.
Pat strongly believes that leaders should empower and enable others while also inspecting their work to ensure progress. Additionally, he advocates for owning one’s mistakes, admitting them, correcting them, and moving forward. In cases where employees struggle with integrity or interpersonal issues, Pat believes coaching can be employed to help them improve.
However, if they fail to adapt or continue to block progress, it may be necessary to let them go. That’s because adapting to change is crucial, and leaders must be able to manage it effectively within their teams.
Lastly, the speakers discuss how important it is for leaders to help others make choices and understand when they need to move on. Ryan emphasizes the importance of coaching and supporting employees through change, even if they might be resistant.
Lou agrees and notes Ryan’s insights and the valuable lessons he has shared in the podcast.
Thank you for listening!
Lou Carter : It's wonderful to be here today with Pat Ryan, CEO of Ryan's Specialty Group. Such a treat to be here with you today. Hi, Pat!
Patrick Ryan : Hello, Lou.
LC : I'm really looking forward to this and really understanding who you are, the leader is Pat Ryan, and what your values are and how that's been integrated into the fabric of Ryan's Specialty group and what it really means to be an excellent leader. So let's start with that. Tell me about the leader himself, Pat Ryan, what are your values? Who are you, Pat Ryan?
PR : Well, my values are quite old fashioned, but I think, timeless. And sometimes possibly even trite because, you know, the golden rule is woven within them. But I, when I got out of the university Ruth University, graduated, I wanted to be an entrepreneur. I knew that for most of my conscious life. And I chose the insurance industry because you could be an entrepreneur and build and build a business without capital. Cause I didn't have any capital by that human capital, and I had a lot of motivation.
So, in becoming an entrepreneur, I knew that I needed to be in a position to attract really quality people to join me, or, you know, the venture would be quite small. And so I really thought long and hard, hard about the values of what I wanted to have in a company.
And so we set a core set of values, and I founded a company, right, five years, five years after graduating that became a New York Stock Exchange company. And those values carried on to the creation of a second New York Stock Exchange company, and now a third in Ryan Specialty. So, the values were really quite simple. Insurance industry, which I chose because the limitations were all self imposed. But you could literally sell insurance 24/7, 365. But I didn't spend that much time, but I spent a lot of time. And so what I wanted to build an organization. And so I knew that in the insurance industry, trust was everything, because all you are doing is giving your word. And in those days, a piece of paper committing the insurance terms. And that integrity was absolutely critical. So, I think everybody who gets into business believes that integrity's a foundational value.
But in our industry, it's even more important because of what I just described. So it was built around integrity, but it was also built around the fact that I knew that I needed to build an organization of people who thought as builders, who wanted to build something of value with me. And so I set some principles because when I was just out working and in my earlier college working days, I always realized that I really needed to be empowered. I didn't like people telling me what to do, when to do it, how to do it, why to do it. I wanted to be empowered to be given the opportunity, be given the responsibility, and then be held accountable. And so I thought that's what people really need. So, empowerment was a value that I quickly brought into a foundational cultural value.
The secondly was the ability to put people in a position to help them self optimize, because this sounds terrible, but I was pretty good at selling insurance, but I knew that I had to train, recruit, train, and develop others to be able, the same thing I could do to really get into the multiplier effect of not having just myself, but people who could do what I did.
And so I knew that giving them an opportunity to self optimize. And so giving them developmental training you know, a continuing education program, but very importantly, sharing my vision with them. And I just intuitively knew that I couldn't get people to follow me unless they knew why they should follow me and what it was that they were following.
So, I was very clear in my mind to set the vision for what I felt was important in becoming an entrepreneur and getting people to buy into that vision.
But I knew very early on that empowering them to become what they were capable of being would give us that, that added opportunity for them personally. But for the company itself, you know, I was never a great athlete, but I was a good enough athlete to be on competitive teams and, and through high school and a little bit in the university.
And so I valued teamwork greatly, and I still do. And I think that, you know, a culture of teamwork where people work together. And over the years, I learned how important it was for people, you know, sort of rowing the boat in the same direction, at the same pace using that sports metaphor. And so I applied sports metaphors often to building our values. So teamwork was really important, and understanding the old cliche that there's no I in team, and that amazing what you can get achieved, accomplished if people don't care who gets credit for it.
So we set up a meritocracy to begin with, but also not hierarchical. I never liked bureaucratic situations, you know, having served a bit in the military you saw the strengths of the hierarchy, which also saw the weaknesses. And so I wanted to be a leader that did not act hierarchical, but was really working with people to help them become what they're capable of being, but having a vision that they could buy into and then rewarding them.
So, as an entrepreneur, I owned the whole company, but I knew that that wasn't the best thing for the future. So very early on, I believed in sharing equity with key people. So that was really important in the first company, became even more important in the second company, which was Aon, which is a large public company now.
But also I took that value proposition very seriously. So when I started Ryan's specialty, it was really all about attracting builders and sharing the equity with them. So you know, that that really worked in the sense of sharing. So I tried to share my knowledge, I tried to share the opportunity and and share and share the responsibility so that sharing, you know, carried over into our personal lives as, as to you know, philanthropy as we got prosperous enough to engage in philanthropy. So those were fundamental principles. I think a really very important further principle was this ability to adjust the vision with the strategy, have a solid foundation of cultural values, but a but a vision and, and strategies around that vision that would give us the opportunity to learn from mistakes, but also to learn, you know, from the past, studying the history of our industry, but also taking those forks in the road as a leader and doing audibles to stay true to the vision, but adjusting for the, the changes that come along the way.
And, you know, so at different points of time, we had to change the business model because competition got to a point where they were commoditizing what we were doing. And I never wanted to be in a commodity business. I always wanted to build a value proposition that people would pay appropriately for, but we could differentiate ourselves. So, the first idea was to differentiate ourselves and what others were doing, and we were able to do that.
And then as we expanded in scale to becoming, going from a local insurance broker to a regional insurance broker and to a national it was, there's a need for flexibility. And so I've always believed in the principle and value of flexibility so that you don't get rigid and get stuck in, well, this is how we do things. And, you know, we don't change, we change with the time we're flexible.
So that's been an important, important value of contributor to both my own personal rewards and building these businesses. But for those who joined me, so as we were building the enterprise and the culture, cultural value building it on teamwork, we attracted people, not necessarily great athletes, but people who participated in sport because we wanted people with a burning desire to win.
And I had a burning desire to win, but I realized that there was even a more important desire than winning, and that was the hatred of losing. And so we have a very competitive environment, and I've always had that, but we're always striving to serve our clients in an ever improving way by being flexible, by adjusting the change, having the courage to make the changes, but also remembering that the constant improvement of our value proposition to our clients sow woven into this creation of values, was that the most important thing that we could do is to build a continuing, evolving value proposition to our clients and for our clients.
And that we couldn't build the value of our company, the value for our teammates unless we were serving the client first. So we were client-centric, recognizing that our people were critical, but without the client, we don't need the people. And then without good people, shareholders can't prosper. And we were all shareholders. And so we wanted to put in sequence the client and keep that paramount in mind that our people and then the shareholder, because the shareholder of the investor is absolutely critical, but without the first two shareholders, don't get any value. So those are core values, Lou, that we set up the company and then continued that. So, after I retired from Aon I felt that I still needed the challenge, the intellectual challenge of keeping my mind active and creating and innovating a core value would been innovation, all along with empowerment.
So, always being innovative to adjust to these changes that I described. And so innovation has been a fundamental value and goal for us. And so as I started Ryan Specialty back in old time, my goal was to meet the changing needs of our industry. Now, I had enough experience that I could anticipate change, and I'd always pride in myself on anticipating change as a leader and having the courage to affect that change, to implement the change and get out ahead of change.
And so those were values that we carried on through the creation of these three companies and different stages. So when I take it now to Ryan Specialty, we did anticipate change. We got out ahead of it, and people say, oh, well now you're clairvoyant. You're visionary. Well, I'm not clairvoyant, but I do believe in vision. But I believe in learning from history and studying what, what the changes are and what that change in point A is gonna mean to point B and point C, and then avoiding the unintended consequences of that change.
So being very careful in thinking through how you adapt to this change. But recognizing change is an ally, it’s is not an adversary. Life is changing around us all the time, but your core values shouldn't change. And so your vision changes and adjusts. Your strategies have to change and adjust. Your tactics have to change and adjust, but your core values don't.
LC : That's excellent. And there's so much there that you have said, and I wanted to bring it to kind of the fabric of the company, right? How your values and your core values really have shown up into the fabric of the company. What you've seen, you mentioned your development programs, the way you recruit, train, and develop how you reward with sharing equity so many more principles and of your values. Where do you see it showing up and integrating into the very fabric of your culture and your company?
PR : Well, it shows up, it reflects itself in many ways. But we're a professional service business and a professional service today, all professional services. There is a lot of capital that's available to attract talent, to move talent. So talent moves rather quickly in our, in our field, our niche. And, but we keep 97% of talent, which is unheard of as a statistic in our industry because we're constantly working to make them productive.
We're constantly working to increase to help them increase their incomes, but also increase the value of their, of their involvement in our company, both psychically, professionally and financially. So, it's really manifested itself low in our recruiting and training program. So we're constantly recruiting experienced people to join our culture and our platform of, and our vision, and we've been quite successful at that.
But where we've really distinguished and differentiated ourselves is in attracting people right outta college who have a passion to win, way to lose, who are willing to work hard and are looking for professional satisfaction and financial reward. What was really gratifying and where it's manifested is that many of our top talent are in their late twenties and early thirties, mid thirties, forties. I'm the old timer. We have a few who are early sixties, and we have some in their fifties, but we have enormous percentage in their twenties, thirties, and forties.
And the psychic reward I get from that, Luke, is that they attribute our success and their success to the values and then the opportunity. But I've had people throughout my career say, you know, the reason I've stayed with you is because you've empowered me. You've empowered us. And I just know I went to Catholic grade school and we had the academics and we had what they call deportment.
And for eight years in grammar school, I got a D, which was obviously the next level up from failing, and takes corrections graciously and throw my father crazy. And he would say, why can't you take corrections graciously? I said, because I don't like it. And I live that myself. We correct people, but we do it in a way that's constructive.
We do it in a way that empowers them. And so to see these people just become great leaders in building their teams on the same core values and on these, all of these principles, and speaking of my father, a core value of our company from the beginning has been listening. I learned as a person selling from my dad that if you listen to the person, they're going to tell you what it is that they want them, that they want or need or what's bothering them about what you're offering.
And so he said to me, remember this, if God wants you to talk more than listen, he would've given you two mouths and one ear. So be a good listener. And so we've taught that to our people. Listen to your client. Listen to your people. Listen to your teammates. They will tell you what they need. The client will tell you what they need, and they'll tell you what they're unhappy with if you listen.
And if you apply that same principle to the people that you work with, they'll tell you. And so that gets the buy-in to be rowing the boat in the same direction at the same pace. But I've always believed that the greater question from what are we doing is why are we doing it? So our culture constantly answers the why, why this change? Why these rules? Why is it important for you to do this?
And the why, I just went through a budget meeting and we have to budget to expand our margin and we're growing rapidly. So I said, look at, we reinvest to grow, but we have to expand our margin. Why? Because that's the metrics that the public markets demand to show that you're willing to share the value of scale with the investor.
If you just keep reinvesting all the value of scale, you're not sharing it. So you can say to the investor, we want to invest for future growth, but he says, yeah, but I need something now. And they're right. They're entitled to that. So the why of margin expansion is to prove that we have a responsibility as leaders and as custodians of their capital to be constantly aware and driving increased value to them through the margin expansion. That doesn't have to be a lot.
And we believe in margin dollars as being very important. But there is a metric of effectiveness that you're constantly sharing the improvement. And so you know that listening, but then sharing the why. So I haven't been asked to talk to people about companies or institutions that they're involved in. And there just came in as new leaders, what would you do, Pat? I said, I'd walk around. Why are we doing it this way? And people will tell you, we try to tell those other people that it was wrong, but they wouldn't listen.
So, the why is a very important word in our company and the why to our clients. So that builds the trust. If the client says, this is what I need. We understand why they need it and why it's important to them and to, you know, people's needs are, they vary and they vary over time, and they vary as people age. So always understanding the why of of their needs has been critical. So we did manifest itself through all those important trigger words, but values that are reflected by that.
LC : So essential explaining the why behind what we need and accepting the truth behind them. So, so essential. Great, great learnings around that. And corrections [laugh] as well, which is a, sounds like a very important course. And one I'm sure you, you're now an expert at. And what I'm hearing, so let's go to that actually because you talked about what it means to be really an excellent leader. I'd like to hear from you, you know, what does it mean to be an excellent leader?
PR : Well, I think an excellent leader starts with the fact that he understands or she understands that people follow you because they believe in you and they trust you and they respect you. So if you lose those, you've lost your leadership. You're not a leader anymore. You may have the title, but you're not the leader.
And so character means a great, great deal. And I always say to our people, your people watch what you do much more than listen to what you say. I've had situations where leaders have said to me, I've told 'em, I've told 'em, I've told 'em. And I said, well, it's because they're watching you and you're not living this. It's not enough to say this is what you are, have to be and do. It's, are you doing it? So I've always said to myself, I'm not gonna ask people to do something I won't do again to.
So that's building the trust with people. For example, when you hire financial people, we don't take shortcuts. We don't paper over things. We address the issues. And so people know, and we have a principle in our company. It's an old cliche, but I passionately believe it, do the right thing. Cause it's the right thing to do, not because it's the political thing to do or the economic thing to do. That'll all follow. Cuz the right thing, it avoids the pitfall of mistakes. We all make mistakes. And I constantly tell our people, look at, we are all imperfect. We're all imperfect, so let's accept each other's imperfections. But let's always put people in a position where those imperfections can be minimized and their strengths can be optimized. So I know what I'm good at, Lou. I know what I'm not as good at and I know what I'm not very good at at all.
And so I [laugh] I don't do it. I'm not good at all, at all. I don't even try to do it. I partner with people who help me do that. And, but I don't feel lesser of myself. I don't think that I should ever think that I'm ever gonna be perfect, nor should anybody else. So when people can't accept that they made a mistake, I really work with them and say, look at, you can't learn from this mistake until you understand that everybody makes mistakes, even you. So let's talk about what you're learning from this. The most important thing about a mistake, it's an opportunity to learn and not repeat it. But often we repeat the mistakes in the past. I've repeated the mistakes in the past and I found that when I do, I said to myself, I violated a principle. You know, there's this old principle in order to expect you have to inspect.
As a leader, you don't want to micromanage, but you have to know what's going on. There was a point in my career when I was really busy, we were going very fast, very quickly, and these people talked me into empowering them to make the change. And I did. And they said, now, because you're so accessible, you can't just let people run at us and come in and appeal to you, plead with you to overrule us or change it.
I said, I promise I won't do that. So for a couple of months, I violated the principle of inspecting. I didn't really know what was going on.
Two months later, I had to make all kinds of traumatic changes or I could have corrected it had I known. And that wouldn't be micromanaging, that would be empowering people, enabling people, not to make that step. That was a pitfall.
So, I just use it as an illustration that's very common. And I've made a lot of mistakes in business. I try not to repeat 'em, but sometimes I find that I do. And I just say to myself, shape up, pal. Get your A game, up your game because you, you are imperfect. You make mistakes, but learn from 'em. But own up to them. Own them.
And a lot of people won't own their mistakes cause they think it's a sign of weakness. I believe in owning your mistake, admitting it, correcting it, and moving on. So we try not to say to people, well that's a terminable offense of failure. Now, if it's an integrity or not treating people right, so they're not treating people right, we'll give 'em a chance to change that. It's integrity issue, we won't.
So that's, that violates the trust and then that's terminable. But if people make mistakes on how they deal with others, you gotta coach 'em up. And then if they're, they don't accept the coaching, then they have to move on. Or if people are blockers on an idea of change, and that's very common. A lot of people who hate change, and I say to them, it's gonna change around you. So you can hate change, but you have to deal with it.
It's, it's happening. You can't control that. What you can control is how you adjust to the change. But if they continue to block after you've worn them, then the only responsible thing to do is to say, look at, you're not, you're not buying in. And so I really think you have to move on. So it's a decision that's critical to deal with blockers, coach them up, give 'em the opportunity, but they keep blocking.
You gotta have the courage to take 'em out and they're better off for it cause they're not happy cause they don't agree with you.
LC : That's right. And sometimes we have to share with others or help others make choices, right? And when it did, maybe moving on and perhaps they just aren't aware of that in their own, in their work. Right? And I think that's just a wonderful insight. All of your insights were wonderful there about helping people to get better to understand really, you know, when they are blockers to, to consider change, right? You might hate change, but you need to deal with it [laugh] and you sort of resisting people and coaching them up.
PR : Yeah. You don't have a choice.
LC : You don't have a choice. And, we'll help you with your choices. It's a really wonderful way of looking and coaching them in that way. And well, so important. I mean, everything you said is incredibly important. I've taken many pages here of notes. I could probably take many more pages of notes in my own learning today. Learn so much from you, pat, and the in, in our talks. It's just been incredible. I thank you so much.
PR : Well, thank you Lou. I really enjoyed visiting with you and having this opportunity and we're proud to be a very desirable place to work.
