Stop Playing Defense

Impressions trump revenue. Insight wins hearts and minds. Data is the enabler of this new era of business. Let’s challenge our assumptions and long-standing beliefs about our industry and business in general. 

With all our talk about technology (it’s the subject of this column, after all), it’s easy to think tech is the holy grail of business evolution. It’s not. Technology is a tool in the belt of every successful leader. As with any other tool, you have to understand its purpose and learn how to use it before you can achieve competency.

The next tool we need to focus on is people. To be clear, we aren’t just talking about your employees, though they’re critical to success, of course. We’re talking instead about a group of far more important people who generally receive the least amount of thought when firms are devising and adjusting their strategic plans. We’re talking, of course, about the insured—your customers.

As brokers, we have a problem. It’s not insurmountable, but we need to identify it before we can solve it. Right now, we’re losing touch with our customers. Don’t get defensive—this isn’t personal. Clearly your producers and account managers are servicing your customers. But we’re talking about something different.

The way we interact as a society has shifted fundamentally. Humans have an innate need for connectedness. Social media was developed both as a response to and an enabler of this desire to connect. My firm has a Facebook page. We’re on LinkedIn, and I tweet from time to time. So we’re already on social media—problem solved, right? Not really. Remember, technology is just a tool. Interpersonal connections are far more than an occasional tweet about the latest cyber breach.

The social generation operates in a state of “truth.” It has no tolerance for lip service. To interact with the social generation, you have to embody the social generation. Nobody wants to read your random tweets. Everybody wants to interact with your message.

Has your firm developed a plan to communicate and participate on social forums? Do your account managers and brokers have not only the freedom but the direction to discuss relevant risk topics in public? Scary, right? I can imagine your E&O risk alarms going off right about now, but let’s get real here. Your employees, your customers and your prospects already exist in this world outside of their professional lives. You probably do too. You have the tools and the talent. What you probably don’t have is a plan and an executable direction. 

This leads us to the second rule of the new economy: If you don’t feel more connected to your customers, they don’t feel more connected to you. (For more on the first rule of the new economy—impressions are more important than revenue—see the January/February issue.)

You know this. It isn’t rocket science. It’s just not a rule we typically apply to business. If you’re in a personal relationship in which one person provides all the energy and substance while the other remains disengaged, you aren’t actually in a relationship at all. If your goal is to make customers and prospects feel connected to your firm without you becoming more connected to them, you are destined to fail.

Service Is Central

Why is this important? We operate in an industry with enormous sensitivity to price. In fact, there is so much discussion and analysis on the soft market that it’s limiting our ability to adapt. When we focus too much on the soft market, we develop a rigid dependence on the elusive and magical hard market. If we can just hunker down and play defense during the soft market, the hard market will eventually arrive, like a vanquishing knight, to wash us in prosperity.

A wiser course of action would be to accept that the “soft market” is really just “the market” and to find alternative ways to create pricing insulation.

So how do you do that in 2015? You interact with customers and prospects in the way they want to interact. Cabs are cheaper than Uber, but Uber interacts with me in the way I want to interact. Subscription cloud-based software costs far more over time, but I prefer working without being tethered to my desk, so the pricing becomes irrelevant. People will always pay more for better service.

We are a service industry. We should be the industry on the leading edge of innovation in service and connectedness, yet we are decades behind. We have to stop playing defense.

What does playing defense mean in our industry? We cope with our lot in life. We compete on price. We use systems that only marginally meet our needs because that’s what’s available. We consolidate reports manually. We rely on our people to jump over whatever hurdles exist between the legacy way of brokering business and the rest of the world. When we choose to play defense, we stop evolving.

The gap between the way we do business and the way our customers do business widens, making a true recovery even harder. Nearly every agency is playing defense, and ultimately we’ve become pretty efficient at being inefficient. Here’s the problem: This isn’t sustainable because nobody really wants to work this way.

Absolute Torture

From the $5 million Main Street firm to the $20 billion global behemoth, every agency works mostly the same way. Small teams are the stewards of the insured. Each team has to find ways around processes and systems that create as many problems as they solve. Lacking a holistic philosophy, architecture and approach to doing business, most firms have no real chance of connecting to their customers and prospects in a more meaningful way. So what type of experience are we offering the talent we so desperately want to attract? We’ve talked about customer experience. What about colleague experience?

The idea of sitting in a beige cubicle in a sea of beige cubicles typing the same information repeatedly into archaic systems is absolute torture. In many agencies, access to social media or other outlets is locked down. The first month of employment is filled with indoctrination of processes that differ from client to client with no apparent rhyme or reason. Does it really have to be this way?

We all understand these problems, and we see their effects in our agencies. Nobody is simply ignoring this problem. We offer generous pay and benefit packages. We put thought and effort into building community within our firms. Unfortunately this isn’t enough because the underlying issue is much bigger than just the way we treat our employees. To create an improved colleague experience we have to fundamentally change the way we do business. In fact, focusing our efforts on customer experience will naturally create an improved colleague experience.

There’s quite a bit of focus in industry media on millennials. I can understand the interest, but I think there’s a lot left on the table. I’m solidly Generation X. I have vivid and strong connections to the 1970s and beyond. I’ve lived through the entirety of advances in personal computers, networks and connectivity—as have the baby boomers. While humans are creatures of habit, I can’t imagine too many of us want to work in the way we did at the beginning of our careers. Outside of work we all use smartphones, tablets, high-speed Internet, social media and every other personal tech advance. So this isn’t a millennial issue. It’s an everyone issue.

How do you retool your agency to focus on customer experience? How do you develop an environment that attracts a different pool of talent while improving the experience of your colleagues? The answer lies with the next tool in the agency toolbox, but we’re not there yet.  Think about people for a while. Think about the ways you personally want to interact with the world.

We’ll continue the discussion next month.