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Insurers: “Improve Your Path” January 1, 2010

Posted by bernardrosauer in Customer, Human Capital, Process, Uncategorized.
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There’s no shortage of competition in the insurance industry.  Indeed there is so much of it that insurance products and services are perceived as commodities by many, if not most, consumers.  Can you name one insurer who, if it disappeared, wouldn’t be replaced by the competition within nano-seconds?   Exactly.   So, the question is….what are you doing to be remarkable and thrive over the long-term?

Few insurers have been able to break the mold and stand out in a way that has resulted in extraordinary new growth.  The sales tactic that worked will not be the same things that lead to customer retention, loyalty and long-term profitability.    

It was  Einstein who said that the definition of insanity is “doing the same thing over and over again and expecting different results.”   Having been in a great position to observe the way many insurance organizations operate over the past 2 decades I can say that while most leaders understand what Einstein meant, many smart executives find it difficult to execute against a strategy for doing anything much different from the way they are doing things last year.   The problem, I believe, is that too many equate change with switching paths when there’s more to be gained, in most cases, by improving paths…. becoming more engaged with existing customers, processes (yes, engage with a process!) and employees and treating them all in ways that will beget loyalty which leads to organic growth. 

Large companies sometimes argue that because of their size they are unable to move as briskly as they would like and envy smaller companies.  At the same time, smaller companies complain that they don’t have the same access to capital that larger companies have and it is keeping them from being as innovative as they want to be.   My take?  Einstein didn’t rely on excuses and neither do strong business leaders. 

To significantly improve results over the long-term, the companies who win will be the ones with the deepest view and understanding about their 1. customers, 2. processes and 3. employees.  Once that view is obtained and shared throughout the organization, alignment takes place, waste is abandoned and customers feel special and recommend the company to friends, family members and colleagues.   

The average insurer is on the right path but they are spending too much time thinking about the destination and not enough time tending to the path.   Just remember that there are specific measures you can take to begin improving that path and increase your ability to win over the long term.   Anyone who doesn’t improve it will follow those that do.  Success in the insurance industry won’t depend as much on size as much as it will depend on knowledge of customers and the will to execute improvements that benefit them.  It is too often we talk about reaching goals or a vision without adequately addressing the path that will take us there.

Here are some perspectives from thought (and action) leaders that you will find interesting.  I hope they will help you improve your path.  Enjoy!

Net Promoter Score®: A Primer                                                        http://tinyurl.com/yfv5qln                                                                                                                                           Companies are turning to the Net Promoter Score for a better read on what customers really think.   This link to Bain & Company’s website will lead you to a short article and a valuable 4 minute video of Rob Markey, a Partner at Bain and Company, describing the Net Promoter Score process.   This is especially helpful to anyone who hasn’t read “The Ultimate Question” byFred Reichheld or heard of the Net Promoter Score (NPS), which is a radically simple way of viewing your customers and becoming a great ‘starting point’ for many companies around the globe to begin ‘improving the path’.  Disclosure statement:  Many of you may already know this, but after 20 + years working within insurance operations and then spending some time on my own as a consultant, I approached SATMETRIX, co-founder of  NPS with Bain and Fred Reichheld and am now happy to be working with them on NPS and matters of insurance globally.  

Willis’ Plumeri discussed ‘The Big Picture” in Beyond the Boardroom  http://tinyurl.com/ygyq4mk                                                                                                                                         This interview of Joe Plumeri by Loews Chairman and CEO John Tisch is about 23 minutes long.  The first portion of the video (approx 6 minutes) covers the Plumeri’s background, upbringing, etc.  The second part shows his optimism about the future and his company’s path for strengthening its position in both the US and global market.   Whether one agrees with him or not, Plumeri’s perspective is insightful to anyone in the risk business.  Enjoy!

Google CEO Eric Schmidt on the economy and the future.                 http://tinyurl.com/yk6chek
This 55 minute interview of Google’s President and CEO from The Aspen Ideas Festival gives us a perspective from a relatively new,  large technology company leader.   I like the interview, in particular, because he discusses the value of a historic perspective and information.  Can you innovate your way out of a recession?  That question and questions about making decisions on end-user benefit, something we can relate well to as insurance professionals, are discussed in this great interview.      

17 Minutes of Seth Godin on ‘Tribes”   http://tinyurl.com/yjmu2qm                                                                                                                                           In this video, Godin talks about leading change and why bombarding the general public with advertizing will eventually give way to approaching specific markets with specific messages on a micro level.    If you care about the power of word of mouth and the future of penetrating ‘tribes’ of people with your message, this is a must watch.

Bo Burlingham author of ‘Small Giants’                                                            http://tinyurl.com/yjnh4qx                                                                                                                                                In his book Small Giants, Burlingham reviews 7 business leaders who made a decision not to grow for growth’s sake.  While this vid. is 3 years old, the message is more pertinent today then ever.         In this authors@google video, he  talks about what some of those companies have in common, their definitions of success, and profitable growth for the long-term.  As companies struggle to do the same, we see that leadership and culture aren’t things we can read about and then just execute on.  Caring means a lot.  Communication means a lot.  “Everything truly matters”.  

I bought Small Giants for myself this past Christmas and am really enjoying the book.  It’s a great read for leaders of any company regardless of size.

Lastly, please forward this blog link to your contacts in the insurance industry.  I spend a lot of time combing the internet for useful material and want it to reach as many people as possible. 

Until next time, 

Bernie Rosauer

 

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