THE AGENCY ownership life-span includes three phases: acquiring the agency, operating and growing it, and selling or perpetuating it at retirement. Each phase brings its own challenges and rewards. About once a year, I encourage readers of this column to engage in creative brooding–thinking about their agencies' present phase and planning for the next one.

My most recent bout of creative brooding was prompted by the arrival of New York State Insurance Department personnel for an onsite examination of a self-insured health-care plan our agency manages as a fee-for-service contractor. In our state, insurance companies are subject to such onsite visits every five years, and examinations can take up to a year to complete, although ours was scheduled to last only one month. Earlier we had met with department representatives in Albany and also had participated in a virtual meeting with representatives from the department's New York City bureau via two-way video conferencing. When the examination team arrived at our office, they outlined the process and gave us a long list of the documents they required, which amounted to about 800 pages of information spanning five years of operations. When we told the officials we would retrieve the information and deliver it to them within a few minutes, they clearly were shocked. Apparently, gathering such data normally takes about a week.

For the past five years, we have retained all our health-care plan records in a digital format, so we simply transferred the requested records to a data CD and handed it to them. Doing so took less than 10 minutes and saved us both time and money. Our staff didn't have to dig through five years' worth of paper files stored in filing cabinets, and we paid less to the insurance department, which charges us for the time its personnel spend with us.

The examiners often visit insurance companies whose home offices and permanent records are located in other states, but who conduct business in New York. They said ours was the first paperless office they had encountered, but I'm sure it won't be the last, as the trend to forego paper-based systems continues to grow. Still, the examiners' comments led me to ruminate over how far we've come during the Information Age and what lies ahead.

If you are an agency owner older than 50, “automation” probably entered your vocabulary when you were in your mid-thirties and involved a “batch accounting system,” and your business undoubtedly has changed considerably during the past 20 to 25 years. On the other hand, if you are under 30, it's likely that you've never used the word “automation.” You “keyboard” rather than “type,” and you've been surfing the Net since junior high school. An agency may employ people with varying perspectives on technology, and such disparity creates a challenge for agency owners trying to keep everyone in sync so the agency runs smoothly and efficiently.

Agencies that use their past achievements as operational benchmarks and try to preserve the old ways no doubt will make it through the next five years, but their ultimate survival and success will depend on how well they leverage technology to deliver high-quality services to increasingly tech-savvy customers.

In other industries, companies are doing just that. Airlines have improved service and lowered costs by allowing customers to book flights online, print their own boarding passes and check themselves in at airport kiosks. Wholesale club stores now offer checkout lanes at which shoppers can scan and bag their own purchases and pay with their choice of cash, debit card or credit card. Customers have come to expect such self-service options, which often allow them to save time while also helping vendors save money by reducing the number of customer-support personnel they must hire and train.

For a first-hand look at tomorrow's customers, visit a big-box electronics store such as Best Buy. For an aging baby boomer like me, it's a trip to Oz. On a recent visit, I saw teenagers playing 3-D video games on a variety of electronic devices and competing online against other gamers. Consumers could try out Internet phones or global positioning systems (GPS) and low-frequency broadcast system equipment that provide local information and directions to attractions for any destination, including small communities. Our next generation of customers inhabits this fast-paced, technology-driven world and expects instant delivery of goods and serves. If we want their business, we must meet that expectation.

In five years, regulators will have moved insurance licensing, oversight and evaluation to digital formats, and a paperless insurance agency delivering real-time transactions and high-tech services will be a minimum expectation rather than a leadership profile. Your father's agency, and those of generations past, simply will not exist. Working at home and writing accounts thousands of miles away will be not only a reality but also the norm.

So take time to creatively brood and imagine what your agency will look like in five, 10 and 20 years. Then formulate a plan to bring to life the vision of a healthy and prosperous future.

Special Reports /

Automation: Where Do You Want Technology to Take Your Agency?

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