2018 Best Practices Study

As we revisit the origins and history of the Best Practices Study , it is remarkable to think back to the world in which we lived in 1993. Personal computers (PCs), connected networks, spreadsheets, the Internet, imaging and email were new and emerging technologies. Insurance agencies operated with primitive agency management systems, dial-up modems, dedicated word processors, proprietary insurance company terminals and typewriters. In 1993, there were no meaningful collections of relevant or reliable benchmarks in our industry, as there were no affordable or readily-accessible means by which data could be collected, processed and analyzed. Large-scale data analysis was the domain of large companies, with multi-million-dollar mainframe computers and dedicated teams of programmers and analysts. As a result, the benchmarks we relied upon in the independent agent and broker universe were, at best, simple and often based on anecdotal observations rather than hard data. This all changed in the late 1980s and early 1990s with the widespread adoption of personal computers by U.S. businesses. Mainstreet insurance agencies with PCs and spreadsheet software, could, for the first time, collect and share information electronically regarding their agency operations (using 5.25” 360K floppy disks!). Inexpensive database management software made it possible for Reagan Consulting to collect and analyze agency information in a way never before experienced. We were finally able to compile accurate operating and financial data from a large number of insurance agencies across the U.S. In doing so, we were able to report back to the industry on the best practices of the best-of-the- best agencies in America with granular precision and accuracy. Meaningful benchmark data became available to the industry for the first time.

The emergence of the Best Practices Study literally transformed the industry and the way it was managed. For the first time, agency owners and managers could:

• Accurately understand what was possible, having seen what the best-of-the-best were achieving

Benchmark your Agency

• Measure themselves against best-in-class agencies and identify their own performance gaps

Elevate Performance and Agency Value

Compare to Best Practices

• Manage their businesses to address and close those performance gaps

Process Improvement Cycle with Best Practices

This Process Improvement Cycle using Best Practices benchmarks was nothing short of revolutionary 25 years ago when the first Study was published. Step forward to 2018 – are benchmarking data still relevant and important to achieving operational and financial excellence and maximizing agency value? The answer is a resounding yes, and perhaps more so now than ever.

Implement Strategies to Close Gaps

Identify Performance Gaps

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