The danger of insulating your executives from your business partners

As carriers / agencies / brokers get larger, they get more stratified, and the people at the top, who carry most of the decision-making power, become increasingly separated from their company’s key relationships. Someone else is handling that work now. And don’t worry boss, we’ve got it, you can go work on other things.

And for the most part, that’s how things proceed. And that’s how things deteriorate. Yeah yeah, we know: in a big company, you must hire good people, empower them, and trust them. We believe that too. But if your senior people are not getting good qualitative insights (and here, we think qualitative is actually harder than quantitative) then it’s like strangling the blood supply to the brain. The organization ceases to be high-functioning, and declines into a vegetative state.

You know this has occurred when the management team seems cloistered, incestuous, and far-removed from the people doing the work. They consistently draw all the wrong conclusions about what is going on about their company, and they have no data suggesting they are wrong.

When we talk about promoting relationships with Risk/R, we very much hope that executive teams will use it to bubble up things like “tone,” “tradeoffs,” “responsiveness,” and other qualitative elements, which will trigger higher-level responses than the organization is currently able to generate. After all, what are executives there for? They are getting paid because of their experience and their superior insights. Don’t let them get cut off from the raw material they need to be effective.