---

---

Insurance Industry News from ProgramBusiness.com

Strategies to Increase ProfitsIt has been my privilege to work with many highly successful insurance companies and agencies. My goal has been to assist them in achieving higher levels of profitability through higher sales, customer and employee loyalty, and retention. However, in many of these organizations, I've discovered that in spite of an apparent desire to achieve higher levels of profitability, management remains blinded to the dire need and urgency for it to change. Management literally cannot see the compelling need to change from the ways that allowed the organization to be successful. These are smart, astute and knowledgeable people. They know and understand their businesses inside and outside. However, they suffer from a phenomenon called the Icarus Paradox. As an illustration of the Icarus Paradoz, a study in Business Week reported: "Two years after In Search of Excellence reported on 43 of the 'best run' companies in America, 14 of them were in financial trouble. After five years, 29 of them were in financial trouble and only 14 of them were financially solvent. The reason--failure to react and respond to change." The Icarus Paradox gets its name from a character in Greek mythology. Icarus was the son of Daedalus. Daedalus had been imprisoned by King Minos of Crete within the walls of his own invention, the Labyrinth. Refusing to be held captive, Daedalus made two pairs of wings by attaching feathers to a wooden frame with wax. Giving one pair to his son Icarus, Daedalus cautioned him that flying too near the sun would cause the wax to melt. But Icarus, ecstatic about his ability to fly, forgot his father's warning. He lost his gift. The sun softened the wax; the feathers came loose; and Icarus plunged to his death in the sea. Putting this in the context of today's business environment, the more successful a company, the more it is blinded to the need and urgency for change. Many companies move into new marketplaces assuming that their past successes will continue to be fruitful. So a company will continue to repeat what has made it successful until the forces and opportunities of change have passed it by. It is human nature to repeat what has worked well in the past and to continue to rely on past successes. Paradoxically, however, the seeds for an equal or greater failure lie in that very success. Remember when these companies were the company? Wang, U.S. Steel, Greyhound, New York Stock Exchange, Xerox, Digital, IBM, Zenith, GM, Kodak, AT&T and Apple? They kept doing what had made them successful, but they were blinded to the changes in the market and thus were left in the wake of those changes. The insurance industry has never before been in the throes of the unrelenting and increasingly rapid pace of change that it is today. What follows are a few of the new marketplace realities. Study them well or your organization may wind up like Icarus. 1. Time is a very precious commodity. No one has more free and leisure time today than five years ago. Customers are not very forgiving when you waste their time, especially when you consider that some other industries can meet and others can exceed customer time expectations. Yet the insurance industry continues to be remarkably slow. Because customers are willing to pay extra for speed, the fast companies are winning. Some time absolutes: * Eliminate or minimize the need for your customers to spend part of their shrinking time to address a concern that your company should have foreseen. Design all of your policies and procedures with an eye to minimize your customers' time investment. * Empower--and enable--the first person who answers the telephone to answer questions so that customers do not have to be transferred to another person. * Hire only educated, trained and knowledgeable individuals. * Record accurate customer information and preferences the first tim
Click for the whole story...

Copyright © 2011, Neilson Marketing Services - Licensed to MHB Insurance