Lincoln Financial Distributors, the distribution arm for the Lincoln family of financial services and insurance products, has cut 66 jobs, nearly half of which will be come from its wholesaling force. Last year, the firm consolidated the sales forces from all its products into a single unit, moving from product-based silos to channel-based silos.
"Its a very complex model and it would be a real surprise if, during the course of the early months or years, there werent a shakeout," said company spokesperson Tom Gariepy, adding, "There are overlaps and redundancies within the organization."
Approximately 10% of the wholesaling force, or 31 staff members, have been cut. Among those, Gariepy said, are three channel managers. The firm has also decided to merge four channels into two and has not yet decided the fate of a fifth.
Steve Long, head of the wirehouse/regional broker/dealer channel, has taken over the bank channel. Philip Holstein, the former bank channel manager, is now looking for other management opportunities within Lincoln.
Margaret Skinner, recently hired from John Hancock to run the independent planner and insurance channel, has taken over the marketing general agent channel. Greg Zabel, former manager of MGA, is looking for opportunities outside of Lincoln.
The corporate specialty markets channel, formerly managed by Stanley Brallier, is being run by Dan Hickey on an interim basis.
In addition to the 31 wholesalers, 35 non-wholesaling positions have been eliminated, a 25% reduction in support staff.
Despite the cuts, Lincoln continues to hire among its wholesalers, and some affected employees have been able to find positions elsewhere within the organization.
"Two people that were laid off have already found positions in another Lincoln subsidiary," said Gariepy.
The move follows a cut in June of this year that eliminated the role of chief marketing officer and 11 other marketing positions. After several months, Lincoln discovered that it was less efficient for the marketing communication function to operate within the distribution arm when those duties could easily be replicated elsewhere.
The series of layoffs may not surprise some industry observers, who have commented that it would take the distribution arm years to become profitable.
"The company hasnt made any statements about profitability," said Gariepy, who added that, because Lincoln is working with a new sales and profitability model, it will take some time for the firm to iron out the kinks.