The following is a guest post by Steve Anderson, the President of The Anderson Network, Inc.. Come see Steve as one of our featured speakers at this year’s InsurEXPO16!
For over 20 years the Independent Insurance Agents and Brokers of America (IIABA) and Reagan Consulting have been conducting a best practices study that benchmarks what makes some of the nation’s top independent agents and brokers successful. The Best Practices study helps agency owners and managers understand how their business operations perform and measure up to the top performing firms included in the study.
Every three years, insurance companies, state association affiliates, and other industry organizations are asked to nominate organizations for each of the studies revenue categories they believe to be among the best, more professional agencies in the industry. These nominated agencies are then invited to participate.
By studying the leading insurance agencies and brokers in the country, the IIABA hopes to provide member agents with meaningful performance benchmarks. They also look at business strategies that could be adopted or adapted for use in improving agency performance, thus enhancing overall agency value. The best practices study has been a valuable tool and resource for agencies as they look to improve the overall value of their organizations.
Even as valuable as the best practices study has been, there are some problems with how today’s organization use the information.
As stated above, only agencies nominated by an insurance company or state Association are included in the study. That may mean that some organizations that are testing and experimenting new ideas and ways of selling, servicing, and managing their agencies might get overlooked. In 2010, more than 1,200 independent agencies were recommended to take part in the study. However, only 224 agencies qualified to be included. To be chosen, the agency had to be among the top-performing agencies in one of the six revenue categories.
Another problem with the best practices study is that it looks at historical information. In the past, this has been fine, as the only way to determine success was to look at past practices and performance. However, changes are happening faster today than ever. Perhaps a better measure of success and help to other agencies is what is being done today to impact the organization’s future tomorrow.
Going Beyond Best Practices helps agencies to not only look at the past, but also look toward the future and learn from other agencies as they test, experiment, fail, learn more, and get better at operating their agencies.
Consumers today are changing fast. Their expectations of an excellent customer experience are changing even more quickly. Successful agencies that are looking toward the future will be adapting and changing as fast or faster than the consumers that they serve. So what does it mean to “go beyond best practices?”
Look to the past when appropriate: past performance can be an indicator of success in the future. I am not suggesting that we throw out all historical information. I am suggesting we look at it differently.
Encourage innovation: going beyond best practices is creating a culture in your agency that encourages experimentation and innovation. It is a culture that embraces fast failure, so you can learn what to do better next time.
Become a technology company: you might assume I would add this to any thoughts that I might have. An agency CEO, who brought me into the organization to review their efficiency and effectiveness said he felt his insurance organization needed to be a technology company that happens to sell insurance, not an insurance agency that happened to use technology.
There is a world of difference in those two thoughts. Online access, content marketing, campaign management, marketing automation, mobility, mobile apps, and any other cool tool gadget or gizmo that you can name are all part of what is expected by consumers today. Is your agency truly adding value to the insurance transaction? Alternatively, are you simply one more agency that does a “me to” type of process?
Not being satisfied with the top 25%: Going beyond best practices means you are not happy with being included in the top 25% of agencies in the country. It means you strive to be in the top 1% and are an insurance organization that other companies look to the find out what’s working and what’s not.
To become a beyond best practice agency there are seven areas your agency should focus on in the coming months and years. There are:
Focus 1: Building Prospect and Client Relationships – you are in the business to protect individuals and businesses financial future against the unforeseen. It is vital to creating a process to identify quality prospects. It is even more important to create a process to make sure that you continuously built better relationships with your existing clients.
Focus 2: Create Unique Market Position — why would someone do business with your agency and not the one down the street? This is a simple question and the way you answer it will gauge how you are viewed in the marketplace. Are you just like every other agency? Or, do you have a unique ability and position
Focus 3: Create Operational Efficiency — transactions have to be completed. Beyond best practices agencies seek to have those transactions completed in the most efficient way possible.
Focus 4: Create Proprietary Processes — what programs and processes can you create that are unique to your agency.
Focus 5: Technology Driven Advantage — as mentioned above your agency should be a technology organization that happens to sell insurance. Being willing to explore and experiment with emerging technologies is essential to understanding how to go beyond best practices and set the standard for others.
Focus 6: Build Unique Carrier Relationships — your carrier partners are vital to your success. What are you doing to create unique relationships with them? What can you do to create an unfair advantage for your agency over others that represent a carrier?
Focus 7: Create an All-Star Team — agencies are in the people business. You can no longer afford not have All-Star players on your team. This means tough decisions need to be made when someone does not measure up. It also means being able to recognize top talent and rewarding them for their work and effort.
This is truly an exciting time within the industry. Opportunities abound. So many agencies are complacent that an agency that goes beyond best practices can quickly pick off clients.
Are you willing to remain a traditional agency and read the best practices study to see where you fit?
I hope you are part of an agency that wants to go beyond best practices and create the standard that other organizations follow. I am here to help you innovate so that you can serve the public as well tomorrow as you have in the past.
President, The Anderson Network, Inc.
Steve has been a licensed independent agent for over 30 years. Having worked as a manager and producer in two agencies, he has a practical understanding of agency operations, marketing and sales management, and how to use technology to more effectively manage and grow an agency. He is editor of The Anderson Agency Report (TAAR) and writes regularly for Rough Notes Magazine. Steve is also Dean of the Technology Department for the IIABA Virtual University and a member of the national faculty for the Society of CIC.