Conventional wisdom can only take you so far. Following the generally accepted way of doing things gives your business an opportunity to achieve the same general levels of performance as other similar businesses. What it doesn’t do is give you an opportunity to outpace the competition. To take your business to the next level, you need to find a different approach, reinvent yourself and execute on your new direction. Harvard Business Review recently did a great piece on how Amazon.com has done this in the retail sphere, and this is precisely what we’ve been working on doing here at Tolman & Wiker with our focus on risk management rather than simply selling insurance.
Lessons from Amazon
Amazon.com’s CEO Jeff Bezos is one of the best examples of how a business leader can buck the conventional wisdom to grow his business to a new level. While many of his innovations are unique to Amazon, they serve as examples of how you can think differently. Here are some highlights:
Focus on the big picture.
While many companies execute on the level of meeting a sales quota, fulfilling a contract or hitting a quarterly profit estimate, Bezos exhorts his employees to always think about the big picture. He focuses on world domination.
Be available in the right way.
One example of this is the way that Bezos sometimes launched products. Instead of having a large and flashy show, he sits down with small groups of reporters to give them personal attention and create a sense that they are important to him.
Know that the truth changes.
Once, the right way to get from point A to point B was to use a horse and buggy. Bezos understands that what is right today might not be tomorrow. A great example is Amazon’s recent decision to hire the US Postal Service to deliver packages on Sundays and the recent announcement that the company is working on drone delivery for packages.
Instead of running meetings with a PowerPoint, many Amazon meetings start by having every attendee silently read a detailed memo covering the topic.
The other principle that many companies have learned as they’ve tried to implement Bezos-style management tools is that they aren’t Amazon.com. With this in mind, the idea behind bucking the conventional wisdom isn’t to do what Amazon does – it’s to buck the norms that drive your industry so that you can find your own path to success.
Insurance vs. Risk Management
Historically, insurance agents have done one thing — sell insurance to businesses and consumers. Those insurance products serve as risk management tools for the companies that buy them by allowing them to take on the small negative of having to pay premiums while giving up the potentially large negative impacts of being victim to an uninsured event.
To some extent, this model is breaking down. As the risks that businesses deal with get more and more expensive to mitigate, insurance premiums also have to go up. In recognition of this, insurance companies are starting to become more strategic in how they price their policies. Companies that have a risk management regimen in place don’t just benefit from a lower rate of claims, they are also eligible for lower insurance premiums.
As we looked at this reality, we saw that the traditional insurance brokerage model was rapidly becoming obsolete. As such, we took our insurance underwriting expertise and repurposed it into not just selling policies but into also helping companies manage their exposure. Before we sell a policy to you, our risk management experts work with you to reduce your risks and – hopefully – prevent them from occurring. It’s a different way to approach the insurance business, but our clients are reaping the benefits of it.
Image credit: Matt Gibson / Shutterstock.com
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