Brokerage Ops the September 2013 issue

Upstream Investing

If salmon would stay put upstream, they could do their business in greater safety and with less effort.
By Phil Basso Posted on September 1, 2013

But back to salmon. We’ve all seen documentaries about how they swim upstream to spawn…and then die. They not only have to push through strong, cold currents, but they also fall prey to lurking bears, that generally take their salmon without the bagel. I find myself thinking how much better their life would be if salmon just lived upstream and stayed there. 

Some brokerage firms, unfortunately, also try to swim upstream. They’re confronted with crises and challenges that feel like a swift current, or maybe the shadow of a hungry bear:

  • Perceived threats in their competitive or regulatory environment
  • A technological environment that evolves faster than they can grasp
  • Higher staff turnover and lower staff performance levels than envisioned
  • A workplace that is more stressful and less innovative than collaborative.

Waiting for business and organizational issues to become serious challenges is like drifting downstream and suddenly finding yourself with too little time and not enough energy to get back to where you started.

We know there are quite a few “upstream” strategic initiatives taking place in our field, such as mastering cyber security and related risk management, developing employee benefits exchanges, improving prospecting and pipeline management techniques, and establishing virtual client service platforms that enable brokers to spend more time in client data analysis and advisory activities. Initiatives like these represent efforts to make savvy upstream investments rather than downstream responses that cost more and return less.

Organizations can invest upstream in their capacity to improve and innovate through a variety of means, such as staff retention and succession planning. Waiting for exit interview data to reveal turnover problems or waiting for a talent vacuum at the top—that’s downstream investing. Attracting talented people to your employment brand and then making good on the brand through a range of ongoing organizational improvement efforts—that’s upstream investing. Waiting for performance problems to arise and reacting with corrective action and remedial training remedies—that’s downstream investing. Pulling back from the tasks of the day and establishing teams to improve programs in areas such as time and stress management, supervision and coaching, and internal communication—that’s upstream investing. 

You might be saying, “This sounds like more planning, and many of our plans don’t go anywhere.”

Let’s not throw out the caviar with the stagnant water. It’s true that, when strategic plans and other plans are prepared by a small number of senior or specialized staff with the plan development itself viewed as the main objective, the plans tend to be too complex and too brittle, and they generally collect dust.

To create a dynamic “playbook” or “road map” that can be used for continual reference, firms need to invite input and participation from a broad range of those whose expertise and buy-in are needed to make plans work. They also must anticipate implementation barriers and build in strategies and initiatives to address them. The Council is developing planning and change management tools to help you make this shift if need be.  

Anticipate implementation barriers and build in strategies and initiatives to address them.

I suppose salmon find themselves downstream because of their natural instincts. Within our firms, it may be cultural. Managing from crisis to crisis can be both addictive and a self-fulfilling prophecy. At times we each have a default tendency to shun the big picture and avoid the proactive stance and, instead, wait until our adrenaline surges to move forward on the things we should already be doing. While distress purchases, such as legal support for a heated dispute or major medical intervention for a serious injury or illness, are vastly more expensive than prevention and early detection efforts, we are largely a society that waits until things are at crisis stage before acting decisively. We hold our surgeons, soldiers, police and judges in higher esteem than our teachers, fitness instructors, diplomats, and mentors. We love problem solvers. But what about problem preventers?

Ours is an industry that’s fundamentally about risk management: preventing and reducing avoidable downstream traumas. We help our clients spend more of their energy in proactive efforts to grow and evolve, managing the risks they can envision through innovations in safety, health, cyber security, partnerships, community building and the like. Our destiny and natural instincts as brokers are to be in the upstream investment business. And if we’re to be effective agents for upstream investment with our clients, this must also be true within our own firms.

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