Dwight David Eisenhower, November, 1957
Like many middle-aged former “jock” wannabes, Larry, the insurance agent, did not want to go to his doctor. His wife forced him. His post-football game drinks with the rest of the former jocks in the years after college turned into more drinking than playing over time as careers, marriages and families took precedence and Larry, like many of his peers, became paunchy and out of shape. Larry just turned 50 and the doctor confirmed that his health was in the “50’s decline” and he had to do something or it would affect his lifespan. After starting the regimen of cholesterol and blood pressure meds and watching his kids grown into late teens and far exceeding Larry in their normal activity levels, Larry decided to go on a diet and exercise regimen. His wife took Larry to her life coach and nutritionist (against Larry’s fervent wishes) who told Larry at the first visit, that if Larry did what the coach asked, his visits would be FREE. And, if not, he would sign a contract for double the cost of the weekly visits. Larry had to sign a one-year binding contract agreeing to those terms.
The Coach had a sign on his wall quoting President Eisenhower (the title of this article). This is what he told Larry:
- Get a dog – a young dog – and walk him at least three times/day, at least a quarter mile each.
- Join Weight Watchers and get and learn their App. Adhere to the personalized program designed for you to eat less calories than you burn every day. You can eat anything, but either lower your intake or burn more calories than you ingest daily.
- Visit me once each week with records of your walks and all of food vs. activity results
- –OR drop off a check for double what your wife pays.
One year later (after slipping and having to pay the coach no less than six times), Larry was down 30 pounds, was taken off both the cholesterol and blood pressure meds and brought his dog with him to work and to the visits with the coach. That’s when the coach explained the sign behind his desk.
“Larry, Ike learned during his military career that the habit and discipline of Planning was far more important than the Plan, itself. The Plan will be changed the moment you go into battle and all of the possible alternatives react to each other to alter the Plan. However, the discipline you learn and the more you learn about your abilities, capabilities and human and other assets are beyond value. That discipline allows you to react to life’s changes in ways that are synergistic allowing you to create solutions and alternatives that are greater than the sum of their parts. Those folks who don’t have the psyche and personality to “walk the dog” and “consume less than they exert” will fall by the wayside and neither I nor anyone else can help them. Keep walking the dog and consciously eat less calories than you exert and you have a better chance of living a long and healthy life. Sounds simple? It’s not. It requires PLANNING.”
Every year for the past 35 or so someone will ask me why I am so insistent on my client agencies conducting Strategic Plans. By now everyone knows that I’ve planned for several insurance companies and literally hundreds of insurance agencies. Frankly, I prefer agency planning because most agency owners are much more responsive and flexible to ever-changing plans than relatively huge insurance companies.
However, the professional Planners at insurance companies are experienced and they “get it” – the Plan is a moving target but the planning process, managed properly, can react to ever-changing conditions to flex the Plan to reality.
Case in point is the Pandemic. Those businesses with a Plan, monitored and changed as conditions change, have reacted much quicker to conditions as they changed and still kept their “eye on the ball” from the standpoint of achieving the best results possible in reaction to the changing environment.
I have failed miserably in my quest to convince all of my clients to conduct Strategic and Tactical Plans. Only about 20% create and implement Plans and many of those concentrate on the wrong objectives, dollars and cents, instead of on the correct goals, maximizing the use of agency assets in response to constant change.
We should be concentrating on DOLLARS AND SENSE, not on DOLLARS AND CENTS.
You see, those who live by Strategic Plans find that the value of those plans is in the reaction that they implement as conditions and the environment changes. You may target a 10% growth and 15% pre-tax profit, but the world around you changes constantly and you may have to flex to achieve either target by changing your short term or long term strategies. Moreover, you may find that the goals are actually flexible and that the world around you causes you to change types or lines of business and that growth and profit may not be the proper goals after all.
You have no way of knowing whether the Plan is solid or flexible unless you adopt the Planning Process as the way to operate your business.
Our largest client is in excess of $20 Million revenue. When we began consulting with them, they were about $2 Million and were thrilled to be at that level. When they began the process of Strategic Planning, they expected to prove how good they already had become. They soon recognized that they had much stronger human assets than represented by a $2 Million agency and that they were missing resources and assets that were critical to achieve what the owners of the business wanted to become. Suddenly the $2 Million mark just became their starting point and a measuring stick and the planning process involved new products, new territories and required new talent to implement what was needed several years in the future.
We are happy to state that the agency has achieved its goal EVERY YEAR. Why and How? SIMPLE, the annual plan became the first projection and those projections changed on a quarterly basis until they became expert in projecting annual results based on the strategies that they implemented every year. Of course, the final projection was never the same as the original budget – but that was expected because staff and management comes and goes, the economy changes constantly as do the cast of carriers and accounts are won and lost based on conditions that cannot be accurately assessed. And then, weather events, large losses and pandemics change conditions, as well.
What it took that client over five years to figure out is that the value in Planning is the on-going process, not the momentary target that will change numerous times during the year. Management learns how to evaluate and react to changing conditions to manage the business to its very best results when they know the metrics important to the Company and the long-term goals of the owners.
Selling and retaining policies and customers are simply the daily battles in the war. Acquisitions and mergers are strategic events that move the battle lines. Your job is to determine what defines victory and how to get there. Is victory a comfortable retirement? Is it transitioning the business from one generation to another? Is it constantly growing larger? Even those definitions will change (the reason we evaluate and change our Mission and Vision Statements every year at the Plan’s start) as the cast of characters mature and change.
We are as convinced as ever of the importance of having a Strategic and Tactical Plan supporting and supported by a budget with Annual Objectives, Quarterly Action Plans and Monthly Benchmarks managed by one or more key players in the agency. Not only will the management team hone their insurance skills, but they will become professional managers and will cause the agency to grow, profit and be worth much more than their competitors.
If you are read to stop “flying by the seat of your pants” and step into the planning process. Call me (Al Diamond) at 856 779 2430 (al@agencyconsulting.com ) www.agencyconsulting.com and we’ll have a conversation about starting you on the planning cycle. Planning doesn’t require a big company or many people – it does require a commitment to the only consistent thing in our lives – CHANGE.