Take 10: Reducing risk is Murray and MacDonald’s mission

Jan. 28--BOURNE -- Looking for a more entrepreneurial endeavor than working for General Motors, Douglas MacDonald took Charles Murray up on his offer to jump into the insurance business.

Thirty-five years later, MacDonald has twice bought the business -- once from Murray and his son, Steven, the other from Cape Cod Bank and Trust -- and sharpened Murray and MacDonald Insurance Services' mission for its commercial and individual clients.

"I wanted to do something different, and I wanted to be able to differentiate myself from what other agencies are doing," he said. "Some other organizations train everyone to look at price; my focus was on risk identification and mitigation."

MacDonald was made a principal in the insurance firm in 1987, then bought out Steven Murray's interest in 1995, and Charles Murray's two years later. In 1999, Cape Cod Bank and Trust approached him about buying a controlling share in the company to allow the bank to expand its portfolio. MacDonald agreed, but bought back the 51 percent stake four years later after Cape Cod Bank and Trust was, itself, acquired.

By that point, the bank had Murray and MacDonald's marketing and customer database integrated into its systems, complicating the firm's transition back to an independent company.

"A lot of people didn't think I'd be able to overcome that," he said.

But he did -- and like the Murrays before him, MacDonald made the business a family affair. Two of his children, Peter and Sara, have since joined the firm in leadership role.

What is the most important thing your business does? Helping clients reduce risk, and we help put people's lives back together. In general, the insurance industry, if you think about it, is responsible for facilitating commerce in America. Banks wouldn't lend money if they couldn't have their assets protected.

How long have you been in business? The agency was formed in 1971; I joined the firm in 1983 and purchased it in 1997.

What did you do before? I worked at General Motors at their Framingham assembly division in the finance department.

How big is your staff? Twenty-two employees and two locations.

How has the market changed since your business started? In Massachusetts, we've had to deal with the deregulation of the automobile marketplace, we've had to deal with coastal zones -- wind underwriting has adversely affected the cost of insurance and the cost of deductibles. On the commercial side, there's been a huge merger and acquisition throughout the industry. That intensifies competition.

What are your plans for your business' future? I created a stockholder's agreement to create the opportunity for people who are young who want to buy into the business to come in and have the opportunity to have their own business on Cape Cod. I've had a few people buy in at small percentage, and I've opened it up to others who have expressed interest; I'm actually using it as a recruiting tool, if someone wants to come in and have the opportunity to be an owner in a business and work hard.

What's your most memorable moment with this business? In the 1990s, Commerce Insurance came out with discounted insurance policies if you had AAA. We started losing business, so I went to my insurance companies with an idea to form a group auto program that could compete against that. At the time, one of my clients was a nonprofit; people could join that organization and get a discount on their auto policy. That nonprofit raised over $1 million just from the memberships. They had to hire someone to open the envelopes.

What advice do you have for someone starting out in business? Get good advice; get involved with a coaching program to help you identify best practices in your niche. Have a very positive, can-do attitude. Avoid listening to naysayers. Focus on results as opposed to the busyness of activities. Write your goals down, and review them every day and remind yourself why you are doing what you're doing.

What's the biggest challenge about having a business on Cape Cod? You want to figure out the best way to obtain and retain ideal clients, and you're always having to deal with new competition.

What's the best thing about having a business on Cape Cod? I learn so much about every other business that is out there. When I go into a manufacturing firm or a law office, you find out all the details about the businesses and the challenges you face.

-- Follow Sean F. Driscoll on Twitter: @seanfdriscoll.

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