Have you ever fallen prey to the Easy Answer? I sure have.


Easy Answer

New Business Production
New business is off. “Buy more leads.”
New business is WAY off. “Cut rates.”
New business is STILL way off. “Pay producers an extra $10 for every new application.”
Renewal Retention
Retention is down. “Write more new business.”
Retention is WAY down. “Contact customers before renewal.”
Retention is STILL way down. “Raise commission to producers.”
Profit Margin
Margin is shrinking. “Make up for it with greater volume; write more new business.”
Margin is shrinking FASTER. “Cut expenses.”
Margin is STILL shrinking. “Reduce Commission to producers.”
Claim Results
Loss Ratio is climbing. “Tighten the guidelines.”
Loss Ratio is climbing FASTER. “Raise rates.”
Loss Ratio is STILL climbing. “Terminate the agents with bad results.”
Backlog is growing. “Authorize overtime.”
Backlog is growing FASTER. “Mandatory overtime.”
Backlog is STILL growing. “Hire some know-nothing temps.”

If any of these situations sound familiar, and you have lived to tell the tale, you probably realize the Easy Answer rarely leads to a full and final resolution. Truth is, the real world is complex and the simple solutions are too easily undone. Competitors, vendors, customers, employees all respond to your actions in their own way to protect their own interests.

There is one response that will always lead you to a better outcome. Whenever the proposed action is the Easy Answer, ask this one question—as many times as necessary—until the proposal makes sense, “And then what?” Think through the marketplace responses that will work to undo the good you intend by taking the easy steps. What will you do then? And after that? And again, after that?

If you don’t get to a satisfactory resolution after you work through all the foreseeable responses, start over with a new initial proposed action (not the Easy Answer). Put your thinking cap on. You can do this.

Best of luck!


Dave Lacefield shares lessons learned in 40+ years working in the business world. His struggles and successes as a stockbroker, insurance agent, actuary, president of a Texas MGA, and CEO of a publicly-traded insurance company have informed him on a wide range of issues and circumstances confronting business leaders, and leaders-to-be. Dave’s views are his own and do not represent the positions of his employer or any affiliated entities.