A Matter of Percentages…

When I pulled up to my boss Fred Wilson’s house, the street was already filled with cars. This was the day of Fred’s annual “pool-and-barbecue-bash”, when he invited some of his insurance industry friends, associates and customers for an afternoon of great food, lavish refreshments and good-natured fun. Fred was the manager of our company’s downtown branch-office and was blessed with a wife who happens to be a gourmet cook. Her ribs, shish kebobs and steaks were always superb and once again – for the fourteenth or fifteenth time I knew I would eat far too much. I came laden with four giant baskets of fresh strawberries as my contribution to the dessert table. As Fred’s senior marketing representative, I personally knew many of the guests in attendance.

The back patio was well filled when I walked around: some senior staff from our office, a dozen brokers, some adjusters, two or three representatives from our industry associations, a lawyer or two, plus a few outside suppliers who serviced the insurance industry. I sat down at a picnic table with Bob Davies, co-owner of a prosperous midtown brokerage. Joanne, with her partner Shirley ran a successful agency in the suburbs, was with him, along with Al, who operated a mid-size brokerage in a small town some 160 kilometers from the city.

“Greetings, all!” I said. “Are we – like the industry to which we all belong – going to show some restraint today?” Joanne responded to my comment with a laugh, “most unlikely on both counts, Dave! I’ve already forgotten how badly I went off the rails last year, just like the rest of us in this business of ours.” At this point there was a welcome interruption as Fred’s teenage sons lugged over a huge cooler filled with cold drinks. We all helped ourselves.

“Isn’t it a question of priorities?” Bob suggested. “The industry’s number one priority recently was to get back to profitability as quickly as possible. For companies, that triggered a broad range of actions from raising rates to cutting back on volume, dropping brokers and trimming staff. For a lot of brokers it meant remarketing chunks of business and looking for efficiencies within their operations.” Beside him, Al nodded. “We’ve all been through this phase before, haven’t we? Remember Pareto’s Principle: 20% of the people in the world own 80% of the wealth? Well, you can apply this principle to our industry; 20% of our business causes 80% of the problems and in the same vein, 20% of our staff do 80% of the work…”

“I know for sure that 20% of my staff cause 80% of my problems!” Joanne interjected and got a quick smile from Al. “That’s probably true for a lot of us, Joanne,” he replied. “All of which brings me to my point, which is: the application of common sense principles and practices is what we all need to concentrate on, whether we’re companies brokers, adjusters or whatever.”

I took a quick swig of my drink and pointed it at him. “Got a couple of common sense principles you’re willing to share?” Al gave me a quick nod. “Thought you’d never ask, Dave.” He leaned forward across the picnic table. “In my case it’s one simple question I ask myself several times a day. Now this question isn’t exactly rocket science, nor is it original because I inherited it from my dad, who started the business on his own many years ago, but it must have worked for him. Anyway, here’s the question I ask myself many times during my business day: ‘Is this what I have to do, and is this what I should be doing, at this time?’ I’ve lost count of the times I asked myself that basic question and realized that I had allowed myself to drift off course. For instance, you and your partner are discussing one particular account and all at once you realize the discussion has widened out into a general chat about a company’s tighter underwriting restrictions and the reasons for it. Then it slowly broadens into chatter about the various personalities within that company. But it’s just ‘jaw-beating’ and it pulls you away from the business at hand.”

“Oh, that’s so true!” Joanne spoke up. “When Shirley and I start drifting off topic like that, both of us usually realize it about the same time, so we shout out: ‘BORING!’ at each other and move on.” Then she held her hands up in front of her. “But now you get to hear the big efficiency question I keep asking myself. Actually, it’s a pretty old-fashioned one, but it works for me. ‘Am I keeping accurate track of how I really spend my working time’?” Pausing for a quick sip of her drink, she continued. “When I went to business school, one of the first lessons they instilled in us was that we should keep an accurate record of how we actually spend our working hours. They gave each of us an ‘activity log’, a sort of time-sheet divided up into 15-minute periods throughout each day of the week. You had to fill it out as you went each morning and afternoon, because even a day later your memory can be a poor guide to what you did with your time.”

“I’ll bet there were some surprises at how you spent the hours, eh?” I chipped in, and Joanne nodded. “There sure were, Dave! When I first started my business and looked at my own time-sheets I was horrified to see how much time I had frittered away in chatting with people in the office, opening mail, answering social calls on the phone and even making myself cups of coffee. Let’s face it, these are all ‘no-value’ activities. The only way you can curb them is to know you’re doing them. So that means asking yourself the one-hundred dollar question: how am I really spending my time?”

That brought an affirmative grunt from Bob Davies. “Good thinking, Joanne. We never get time back, do we?” Then he squeezed his eyes shut as he concentrated on a thought. “I remember a story I read. It said that in our lifetimes, we’ll all spend seven years in the bathroom, six years eating, five years waiting in various lines to be served, three years in meetings, two years playing telephone tag and six months waiting at red lights. Isn’t that enough to make you value time? But, the question I have for you all is to do with the effective use of time. Here it is. Do you spend the first 15 or 30 minutes of your day strategizing about your business and its long-term goals?” Bob let that sink in for a moment, then carried on. “It’s so easy to get to work and throw yourself right into it. It’s morning. You’re fresh, you feel good, you have lots of energy – but these are precisely the reasons you should focus on the big picture, not the ‘nuts-and-bolts’ details of any business day.” He chuckled. “My staff know my routine well. I’m to be left on my own behind a closed door for that first half-hour of every business day, while my mind is clear and fresh. They know not to disturb me and I use those 30 minutes to strategize, to see if our office is sticking to our long-term business plan.”

There was a short silence as we tucked into the food, then Bob Davies spoke again. “Just before I forget, I have another question. As a broker do you belong to any groups you can share ideas and problems with? I’m a member of an informal group of brokers in this general area. We meet once a month in someone’s office. We evaluate each other’s ideas, suggest solutions to common problems, offer guidance if asked, and we also trade the latest information and scuttlebutt about who’s doing what in our industry. There are eight of us currently. We take turns chairing the meeting and we sit down for lunch together after we finish business. It gives us all a comfy sounding-board and a source of free advice.”

I turned to Al, sitting across from me. Although normally a quiet and thoughtful person, I also knew him to be a student of business techniques and disciplines. “I’d be willing to bet you have another common sense question you put to yourself regularly, my friend.” Al put down his can of soda and gave me a quick nod. “Of course I do. My other question is: ‘what’s in it for me’?” We laughed together, then his face grew serious. “Just kidding, Dave. In fact I do have another question I throw at myself a lot. Before I tackle a task I ask myself, ‘is what I’m about to work on something that has been imposed on me, or have I inflicted it on myself?'” He looked around the table at us and shrugged his shoulders. “Every job we do drains away that priceless commodity: time. So you have to decide whether the job you’re facing is one you must do because you have no choice – in other words it’s your client, your account, your responsibility – or have you inflicted this job on yourself, because you failed to delegate, you weren’t organized, or perhaps you just feel more comfortable doing routine tasks.”

At that moment he was interrupted by a thunderous splash from the swimming pool. A second later the head of my boss Fred Wilson, emerged from the water. He was grinning. “All right!” he yelled, “no food unless you have a wet bathing suit!” That was our cue and a moment later we were all thrashing in the warm water of the pool, while Mrs. Wilson and their kids carried out heaping platefuls of barbecued meat, platters of vegetables, a huge tub of baked potatoes and my strawberries in a giant bowl. We quickly dried off, helped ourselves to the food and ranged around the picnic table, where we were joined by Fred. “Eat up, you vultures!” he said cheerfully. “I can’t eat this stuff for breakfast tomorrow. Now then, what’s the topic under discussion?”

I set down my fork. “We’ve been talking about common sense questions we should all ask ourselves as we go about our daily routine,” I said, “and we’ve had a few very good ones. Care to add to them?” My boss nodded. “I think I can throw in a couple of my own, if they haven’t already been suggested. The first one is a simple basic rule of managing. Do you waste time getting daily updates of routine activities or do you simply read a weekly summary of them?” He waggled a large sparerib in his hands. “It’s so easy to fall into the trap of listening to a staff member tell you what he or she has done that day. It’s comforting for them, because they need my approval and it can be comforting for me because I know routine matters are being properly handled.” He dropped the rib back on his plate. “But it’s a sneaky time-waster. Ask for all that routine activity on a summary-sheet. You can read it in 15 minutes and save yourself a few hours every week.”

Bob looked over at his friend. “What if some of those daily routine activities were missed? You wouldn’t hear about it until you read that weekly summary.” Fred smiled. “Good point, Bob. I’ve divided up routine activities into ‘important’ and ‘urgent’. Important means it’s a task which should be done some time during the day, but it’s not critical. Urgent means it has to be done at a specific time, without fail. My staff know that if one of those urgent routine tasks is missed then I have to be told at once.”

Al wiped his lips and pushed his plate to one side. “Okay, now what about that second question you ask yourself?” Fred swallowed a mouthful of potato salad and turned to him. “All right, here’s the second question I often ask myself. ‘Am I spending too much time with the congenial people in my office and less time with those who are quieter and tougher to talk to, but are probably more effective in their jobs.'” I could see Joanne nodding her head vigorously. “That’s a good question we should all ask ourselves,” she said. “You know, Shirley and I have a couple of CSRs in our office who can be tough to handle. They’re not talkers. They’re just not the social, chatty type and they can be downright argumentative if they feel they have an issue which isn’t being resolved properly…” I cut in, “I know the two CSRs you mention, Joanne,” as I mentally recalled some of my visits to her office. “They’re both very conscientious, serious workers. If they’re not getting the proper cooperation and service from our company end, they let me know about it in no uncertain terms!”

Joanne smiled at me. “They can give everyone a hard time, Dave. That’s just the way their personalities are. Like a lot of perfectionists, they’re actually tougher on themselves than they are on the people around them and the people they deal with. But these two are also my top producers. And although they can be hard to talk to, I usually learn something every time I do. With them, I get the facts straight from the shoulder. They tell me what’s really going on, not what they think I want to hear.” At that point I looked down at my plate, piled up with well-picked ribs, a steak bone and a tiny smear of potato salad. “Speaking of what we want to hear,” I said, looking at my boss Fred with a grin, “I want to hear you telling me to have some more, although I’m well stuffed already.”

Joanne gave us one of her booming trademark laughs. “Dave, you’re just like our industry. When we’re on to a good thing, we start getting greedy. We’re like drunks who keep falling off the wagon, getting back on again, then falling off. We can cope with anything, except moderation. But,” she said, grabbing my arm in hers, “my final question to you is this: why should you waddle up to that food table alone, when you can go with me?”