The Lid on Your Insurance Agency’s Effectiveness

Leadership is a process of social influence, which maximizes the efforts of others, towards the achievement of a goal. Kevin Kruse– CEO of LEADx

One of my favorite and most challenging concepts I enjoy teaching insurance agency leaders is “The Law of the Lid.”

“The Law of the Lid” comes directly from the number one leadership expert in the world, from his number one leadership book, and just happens to be the first law in this book. The book is the “21 Irrefutable Laws of Leadership” and the author is John C. Maxwell.

The law of lid is simply this:

I love teaching the law of the lid with insurance agency leaders because it illustrates that by raising their leadership ability they can multiply their agency’s results. At the same time, it creates a challenge because understanding this law means that you must also acknowledge that you as the leader are often your own problem and your own solution.

I work with many successful insurance agencies that have come to realize that they are only achieving a small part of their true potential. That’s because personal success without leadership ability brings only limited effectiveness.

Every agency gets stuck from time to time. It doesn’t matter the size of your book of business. You can get stuck at $1,000,000, $10,000,000 or even $100,000,000.

Every organization reaches their lid at various times. The key is to having the awareness to understand when you have hit your lid so that you can look at ways to improve your leadership.

When most organizations are stuck they focus only on ways to work harder and dedicate themselves to success. While this is a noble pursuit, at some point, you will run out of time and energy for only a small level of return.

However, if you focus on increasing your leadership ability (people skills, planning and strategic thinking, vision) you will begin to increase your results rapidly. That’s because when you understand and apply leadership skills to your insurance agency, you will so realize that it has a multiplying effect.

In 1989, I watched my favorite basketball team, the Chicago Bulls lose to the Detroit Pistons in the Eastern Conference Finals. Even after this disappointing loss, most people believed the Bulls were still a rising team as they had one of the most exciting and talented players in the entire league, Michael Jordan.

However, after this season, the ownership of the Bulls did a very surprising thing and fired their energetic young head coach Doug Collins. Doug Collins appeared to be well liked by the fans and his players, but others felt that for the Bulls to take the next level, they would need a different kind of leader. The organization felt that the Bulls were reaching their lid with this coach.

While we will never know if the Bulls would have ultimately won a championship (or more) with Doug Collins as the coach, we do know that their next head coach Phil Jackson successfully guided the Bulls to six NBA championships from 1991–1998.

Does this mean that if your agency is stuck you must fire the leader? Of course not. All of us have the ability to raise our leadership lid. While I do believe that we have differing levels of natural leadership ability, I also believe leadership is a learnable skill and like all skills, you can improve.

While there is nothing wrong with working harder and longer to increase your results….

Remember, raising your leadership lid doesn’t just improve your results, it multiplies your results. As your agency continues to grow the need to increase your leadership lid becomes more important.

As John Maxwell states, “The higher you climb, the more you need leadership. The greater the impact you want to make, the greater your influence needs to be.”

Understanding the law of the lid is what separates average insurance agencies from high achieving insurance agencies. It also requires you to be open and willing to make changes that will challenge you. The good news is that these changes will also grow you and your organization.

Think of some of your major goals that you want to accomplish in the next year. How many of these goals will require the participation or cooperation of other people? How would raising your leadership lid impact your effectiveness?

Regardless of your title or position, your ability to lead yourself and others is the lid the will determine your level of effectiveness for your insurance agency. What areas do you need to improve? When will you start?

Please note: I reserve the right to delete comments that are offensive or off-topic.