Episode 340: You May Not Have a People Problem

Welcome to the Scale Your Insurance Agency Podcast. This podcast will give you all of the tools to scale your insurance agency and live life on your own terms. Wherever you are today, if you're stuck or well on your way to the success you desire with the right people, processes, and promotions in place, you will be unstoppable. And now I'd like to introduce your host, Mike Stromzo.

Hey everybody, welcome back or welcome to the Scale Your Insurance Agency Podcast. Hey, have you heard? Have you heard about the latest automation technology powered by AI? Of course you have. And you probably invested in some of it. And I'll bet you that some of it is what we call shelf help. In other words, it's sitting on a shelf inside a computer, I know, and not doing anything. Maybe it's causing more chaos to your operations. Is that because there's no documented processes and workflows supporting the implementation of that automation of technology? What I want to speak with you today about is the fact that inside every agency, there is two kinds of work being done: machine work and human work. And what needs to happen in agencies today is that agencies need to be redesigned. So that the way that machine work and the way the human work is actually done delivers the right desired outcome or result. Because when technology does the work of machines, people finally get to do the work of humans. So let's get into the weeds a little bit on this subject. I'm excited about this. I'm doing a lot of talks out there in the industry about this exact subject. Trying to help people reset their mindset, reset their operations, and do the right work and put the right work in the right place to get the right work in the right hands. Because in many situations, the wrong work, the right work is still being done by the wrong people. And that's where the redesign comes in. So every agent, every agency, every independent insurance agency is doing two kinds of work: machine work and human work. So what exactly is machine work? Machine work is rules-based, structured activity that has a predictable outcome. Machine work is a repetitive, rules-based activity that has a predictable outcome. You know, things like data entry, downloads, quoting, document management, routine and renewal preparation, remarketing workflows, updating systems, moving information from one place to another, and just general repetitive follow-up. Everything related to all of that is machine work. Human work requires something different. It requires critical thinking, judgment, empathy, might be part of a relationship, historical knowledge, collaboration, advice, leadership, and trust. Do you know? Have you ever thought about that? What about your team? What percentage of their day is spent doing machine work? Your humans within the agency, your live people, would it be in the office or remote, what percentage of their time is doing machine work? Because that's the way it's always been done. So that's the way we do it. See, that thinking is what needs to be redesigned. Because continuing to do the same thing you've always done is going to get you one thing, the same results you've always gotten. The future agencies that are gro that win, the agencies that win in the future, it's not humans versus machines. It's machines doing machine work so humans can become more valuable and create greater impact to do the work that creates that impact, to build relationships, to build trust, to build depth. You see, I've identified that way too many people in agencies are doing too much work that's beneath their capacity. And so let's think about that and dig into that for just a minute. It's situations where highly trained, licensed insurance professionals are spending hours and hours renaming documents, manipulating spreadsheets, moving information between systems, performing repetitive administrative tasks simply because that's the way we've always done it. Hours and hours and hours, these highly skilled, licensed insurance professionals spend doing this stuff. The work isn't beneath the organization. It's just beneath the capacity and ability of your best people. The goal isn't to have them spending their energy and talent every single day doing machine work. It's to push it down to the lowest level. And it's all about who you're assigning to do that work. The burden this places on future agencies and current agencies as well, there's a tremendous cost to that. How many people within your organization, those highly skilled, licensed insurance professionals that are doing machine work? What's the value per hour of them doing that machine work? Versus the opportunity of pushing it down to the lowest level, might be a processor type person, also known as a VA in many circles, a bot, or a piece of technology, a machine. And I've seen many different types of machines and agencies. Which one is gonna be the one for you? The right fit. So your goal is not to ask whether the work needs to be done. We need to ask, does this work need to be done by this person? That's the question. It's not does this work need to be done? The question is, does the work need to be done by this person? That's the question. So start thinking about that from a capacity standpoint. Because you want to make sure the right work is in the right hands. Let's get down to design, redesigning your agency. You see, when agencies become overwhelmed, the natural reaction is, we need another person. We need to hire more people. No. What we need is a different design. But let's talk about capacity for just a minute. Do we actually need more capacity? And have we designed the work correctly? Because let's say you decide to hire another person without redesigning your work and your agency. You're simply hiring another human to perform more machine work. If you hire another team member before redesigning your agency and your work, you're simply hiring another human to perform more machine work. So I encourage you, before adding more payroll, examine the workflow. Eliminate, automate, delegate, humanize. Think about that formula. Eliminate, automate, delegate, humanize. Or the AI forward thinking agency thinks first, can this be automated before they even think about hiring another person? Can this be automated? Or can technology handle this? That's their first thought. That's what the forward thinking agencies are doing in today's environment. Or, a la Elon Musk, can it be eliminated totally? I'm not supporting Musk and anything that he says or stands for. I'm simply supporting the fact that he is a master at efficiency. Can we eliminate it entirely? Can technology automate it? Can it be delegated or empowered differently? And which portions generally require human touch? All things to think about, all things to consider. Because the goal is not to automate a bad process. And don't hire another human to compensate for one. Don't automate a bad process. And by all means, don't hire another human to compensate for one. A bad process is a bad process that needs to be fixed and repaired first. Because if you keep stacking automation and technology on top of bad processes and workflows, you're just going to create more chaos. There's a very, very important distinction. Because people hear automation and immediately think about headcount reduction. There's an important distinction that I want you to be thinking about because they think automation technology, headcount reduction, more net to the bottom line. Sometimes that's narrow thinking. What I want you to think it be thinking about is what happens when you return five to ten hours a week to a great account manager? Back to those highly skilled, licensed insurance professionals who are doing too much processing or machine work that they shouldn't be doing. So what happens when you free up five to ten hours a week of their time? Here's some things that they can do with their free time. They can conduct proactive account reviews, they can call, yes, phone call important clients, they can identify coverage gaps, they can have better renewal and relationship continuation conversations. They can collaborate with producers, they can ask for referrals, they can strengthen relationships, they can actually think because their capacity will be free to a question for you to really think about in this context. If technology and automation gave every person on your team 20% of their week back, what would you intentionally have them do with that time? What would you intentionally have them do with that time? I'm thinking of multiple things that agencies that I work with have done with that time. Specifically three things. And this is a five plus million, five million plus revenue agency that I've done work with that implemented a machine-driven AI-powered intelligence system in their agency. And it freed up over seven thousand five hundred hours for that agency. Over three hundred thousand dollars in payroll capacity. What did they do? One, they strengthened their existing relationships with their clients, their relationship continuation activity, they built up their relationship, they earned more referrals, they rebuilt their marketing systems, they responded to unsold quotes, and they moved to increase their retention. Their goal was to increase their retention by 4%. And over a 10-year period, that 4% retention increase would result in over $8 million in additional revenue over a 10-year period. That's what they're doing with their time. They're not eliminating people, they're reinvesting it in a different way. They're reinvesting that time into their people so the people can do the work of people in retention and relationships. Two, they reinvested that time into their marketing, to strengthen their referral program, to strengthen their referral relationships, to strengthen everything that they're doing as far as their sales process. They're reinvesting in it all. And lastly, they're reinvesting in their people, in team training, and creating leaders for the future, to really give their team a greater ability to close more business, to have greater confidence and everything else, and to build leaders of the future. That's what they're doing with their time. They're not eliminating people, they're redesigning the agency to be a more scalable model. That's what they're doing. And that's what you can do as well. So if technology gave every person on your team 20% of their week back, what would you intentionally have them do with that time? Truly? That's a leadership question, not a technology question. Because the greatest return on automation isn't eliminating people, like I just said. It's elevating people. Elevating people to relationships over processing. Next point for you. Don't add technology. Redesign the agency. Redesign the agency first. At some point, yes, automation and technology make sense, but make sure you redesign the agency first. Got off the phone with an agent this morning who tried to update the agency first via technology. This all new, systematic way. And after a period, almost a couple of years, they experienced a big, big lesson. We never lose. We either win or we learn. They learned. They learned an S ton from that big lesson. Now they're back to redesigning the agency. They've completely redesigned the agency. Hired eight people within a 90-day period. Good for them. We helped them. You know, get back to redesign. Because when you redesign the agency in the right way, then you can add technology. Then it brings everything together. You see, buying a piece of automation or technology doesn't transform an agency. The statement, we're using AI, doesn't transform anything. The key? Leadership must intentionally make a decision to redesign how work gets done. Leadership must intentionally redesign how work gets done. They've got to take the machine work, the repetitive recurring activities inside the agency, and identify which is machine work, which is human work, what does it do today, and what should it be doing tomorrow and in the future. Then build the future processes and workflows based on where you want to be in the future. Because, as I'm sure you've heard before, but I'll say it again: that future agency that you're building is how you need to operate today. You need to build that future agency and everything that looks like its design and everything else, and do your best to start operating as that future agency today. Because that past agency that you built, if you keep operating like that past agency that you built, you're going to get the same old thing that you've always been getting. The definition of scaling is design the future agency that you want to be and start operating like that agency today. Learn from the past. You've learned from the past, you've done great stuff. Well done. Well done on everything you've achieved. Take that, design the future agency, and start operating like that agency in the present. Build the future starting today. You can add AI, you can add automation, you can add another AMS, you can change AMS, you can add another CRM, you can add three more employees. But in many situations, you're gonna have the same underlying issues. Because in many cases, the wrong work will still sit in the wrong hands. Stop paying humans to do machine work. Stop paying humans to do machine work. Can this be automated? Can automation and technology Technology and our future agency began to do these things. Question for you Do you have a capacity problem? Or do you have a design problem? Do you have a capacity problem? Or do you have a design problem? Because remember this. When technology does the work of machines, people finally get to do the work of humans. Let me ask you a question. If I walked into your agency tomorrow and watched every person for an entire day, how much of their time would be spent doing work the technology could already be doing for them? If I walked into your agency tomorrow and watched every person work for the entire day, how much of their time would I see being spent doing work that technology could already do for them? The goal is not to go by the technology. The goal is to identify the work first. Because technology is not the problem. The objective and the issue is you're in need of an agency redesign and the way work is distributed. Because the goal is to create an agency where machines do machine work so your people are finally free to do the work that only humans can do. Now, it's a deep subject, and there's a lot to it. But I also know there's a lot of great agencies that are redesigning themselves from the inside out and allowing work to be reassigned and how work is done within the agencies. And I'll wrap this up with an agency that did the identification work. Part of the way they identified what was work was going to be done, they started with our client segmentation, or in some areas of the country it's called tiering. So they had their clients broken down in a way we in our agency, we started this a lot of years ago. AAA, double A, and single A is how we broke it down. So they took their AAA clients, their A clients, and their single A clients. They identified that 91% of their revenue, 91% of their revenue was from 50% of their clients. 50, 5-0. And they identified that 83% of their revenue was from just 25% of their clients. 83%. We've created a separate unit where a processing team backed by machine work is going to handle all of that 9%. We're not going to let the 9% interact with our highly skilled, licensed team members because they're doing great work with our top clients. That's the way they started. They identified it first. And that's the goal. Identify where work is being done in your agency. And I'll sit it, I'm not going to suggest that it's going to happen overnight. It's not. It's going to take some time. But you have an incredible, amazing opportunity before you right now. Q4 is upon us right now. So take Q4 and go through the identification process. Which work being done in your agency is machine work and which work in your agency is human work. And document. Document which items that are being done in your agency are machine work and which items are human work. And do your very, very best to take that machine work away from your highly skilled, licensed insurance professionals that are doing the machine work every single day. Is it possible right now? Maybe yes, maybe no. But at least start thinking about it. Because if you don't start thinking about it now, somebody else already is, and they're already doing it, guaranteed. The future is upon us right now. Take control of your future. What do you have to lose? You have nothing to lose and everything to gain. Because remember, when technology does the work of machines, people finally get to do the work of humans. Let's redesign the way human work is done in the independent insurance agency system. If you'd like to discuss that, happy to jump on a UPP scaling session with you. The link is somewhere around the show notes. And if you got great value out of this podcast, thank you for showing up, most importantly. But secondly, share it. Share it with somebody else that you care about, another agent, anybody in the industry. Fantastic. Or just send them to scaleyourinsurance agency.com. ScaleYourInsuranceAgency.com. And I'll see you on the next episode. But remember, until then, only action is going to get you to where you truly want to go. And to help that will, that's the only thing. Action is the only thing that's going to help you reach your full potential. And that's what we want for you.

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