04 May How Does an E&O Culture Look?
As many of you know, I often use the phrase “E&O culture” in my discussions with agencies and my various articles, webinars, blog postings, etc. It is one of my favorite expressions. Recently while working with one of the new E&O Plus agencies, I was asked, “How does an E&O culture look?” I’m not sure anyone had ever asked me that question. After I provided my explanation, which I will further elaborate on in just a minute, I realized there is no actual definition of this phrase. It made me think of a famous remark by Supreme Court Justice Potter Stewart in 1964: “I can’t define it, but I know it when I see it.” Admittingly, Justice Stewart was not talking about E&O culture (he made his comment on an entirely different subject). But the phrase still applies.
So, how does an E&O culture look and feel?
First, for an agency to have a strong E&O culture (or any E&O culture at all), a strong commitment from senior management is required. They need to demonstrate in their words and actions that they will not tolerate anything short of a solid E&O culture. A discussion and assessment of the agency’s E&O culture should be part of board meetings with a review of various issues, including audit results, as part of the agenda. When the agency holds all staff meetings, reference to critical E&O issues and best practices lets all staff know the seriousness and value the agency puts on this issue.
How would your agency answer this question: Does your agency want growth, or do they want a strong E&O culture?
Hopefully, they want both. In my years in the business, I have had some staff (primarily at the producer level) comment that growth is No. 1 and always will be. Hopefully, they don’t mean that as long as you grow, adherence to various E&O best practices is not that important. From my perspective, growth without a strong E&O culture is a formula for disaster.
For an agency to have a strong E&O culture, it requires all staff to be aware of the issues, the reasoning behind the issues, and acknowledge that E&O must be a respected cornerstone of the agency. I correlate an E&O culture with ethics, which is defined as “moral principles that govern a person’s behavior or the conducting of an activity.”
When a staff member deals with a specific situation, such as a producer assessing the exposures of a client, the producer knows the importance and value of an exposure analysis checklist. It is an integral part of the agency and a reason for its success. In fact, using an exposure analysis checklist almost guarantees more business.
Another key issue that helps define a strong E&O culture is the presence of a solid auditing process. Virtually every agency will say, “we have good people; they know what they are supposed to do.” While I strongly agree with that position (not 100 percent, but close), my question is, do they actually always do what they are supposed to? This is why auditing is so important. It helps evaluate the degree to which the agency’s expectations are being adhered.
I want to say that a strong E&O culture is “in the air,” and everyone lives and breathes it. I know that sounds a little philosophical, but in actuality, it is not far from the goal every agency should have: people doing their jobs and knowing that means adhering to, without fail, a myriad of E&O best practices.
How does your agency define success? Hopefully, a strong E&O culture is part of that definition.