“The competitor to be feared is one who never bothers about you at all, but who goes on making his own business better all the time.” - Henry Ford

That has long been one of our favorite quotes. It's time that we're honest with ourselves, decide what it will take to make our businesses stronger, and commit to getting it done. For too many in our industry, our businesses have been built on a commoditized platform.

The commoditized approach I refer to is the model of providing quotes, promising great service, and teasing with an ever-expanding list of "value-added" services. The more a business slips into commoditization, the more mediocre its value becomes.

You may be thinking that you aren’t a commodity. But look at what you have to offer from the buyer's perspective. If it’s seen as interchangeable from your competition with no noticeable difference in quality, you've slipped into the commodity category.

Admittedly, the financial reward for mediocrity in this industry has been excessively high in the past. However, feared competitors understand those days are over. They also understand the absolute need to focus on regular, daily improvement to their business and the areas they must improve.

Whom do you serve?

Feared competitors relentlessly focus on one aspect of their business above all others – whose interests they must serve. With that clarity, they ensure their economic engine supports a business model built on serving the right audience.

When I ask any agency "Whose interests do you serve?" without hesitation and with great passion and convictions, they'll claim, "We serve the needs of our clients." But when you study their economic engine, you'll see that can't possibly be the case.

Way too often, agencies depend on the carrier's insurance product as the sole deliverable they take to their clients. It’s the only product for which they get paid, making it the sole source of fuel for their economic engine.

Because agencies depend on someone else’s product, they have no clear value proposition of their own. And with no clear value proposition to offer clients, the strongest connection most agencies have is the relationship individual producers have with the clients. And because of that, agencies tend to build their business around the role of the producer.

Stop and think

Everything in the agency exists with the producers in mind:

  • The compensation structure
  • The additional staff that gets hired to support the producers
  • The leadership team

You would think if there were anything inside the agency that solely existed for the client's benefit, it would be the value-added services, but even that's not the case. If it were, agencies would make sure those value-added services get used. 

But we know they often don't.

The fact is that those value-added services are simply a tool to make it easier for producers to do their job of selling. And here's where that producer-centric model becomes even more dangerous.

That entire producer-centric agency exists to serve the needs of the carrier. Because in addition to not controlling what they deliver to their client, they don't control their revenue stream.

As the saying goes, "If you want to know whom you serve, follow the money." And the money always leads back to the carriers down that commission trail. The harsh reality is that most agencies, based on how they've allowed their economic engine to evolve, exist to serve the carrier's needs by being their distribution system.

There’s WAY too much on the line

Feared competitors understand how dangerous it is to depend on somebody else's product to serve their needs.

Businesses get built in one of two ways, and the most common way is to depend on somebody else's product to serve your needs. But that approach can only work until one of three inevitables happen. Either a better product comes along, somebody offers the same product at a cheaper price, or the ability to distribute that product is taken away.

Once any of those three things happen, the business goes into panic mode. It goes out looking for a new product to sell, and then they have to start looking for people to buy that product. It's a very exhausting, very unpredictable way to grow a business.

Instead of depending on a product to serve their needs, feared competitors are committed to serving the needs of their clients. They go out, sit down with those clients, and have meaningful business-level discussions. They ask the tough questions to figure out what the client needs to be more successful at what they do.

With that information, they commit to either developing or simply finding solutions to meet those needs. And over the life of the client relationship, they keep having those conversations and asking the tough questions. They know if they do that, that client will tell them at every step of the way exactly what it is that they will buy from them if they're able to bring it to them. It's a much more rewarding and predictable way to grow the business.

As a result of taking this approach, feared competitors can take control of what they deliver and how they get paid. They have created and own their value proposition. And with that kind of control, control over what they provide and how they get paid, comes confidence.

Confidence to put the client in the middle of everything.

Client-centric is a must

When you look at the structure of a feared competitor agency, it's not the producer that sits in the middle; it's the client. In this type of agency, everybody on the team exists to serve their client's needs, whether it's the sales team, the traditional service team, or the leadership team. Everybody operates with the best interest of that client in mind.

In this type of agency, all the resources they procure, whether an insurance solution, a technology solution, or any other value-added service, are looked at for what they are. They are resources to be utilized to address the clients' needs as they're identified.

But feared competitors can only put the client in the middle where they belong because they have done the hard work. They've committed to the hard work necessary to control what they deliver and how they get paid.


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