I CAN’T USE CAUGHTUP
UNTIL I GET CAUGHT UP

Tips for overcoming chronic backlog

By Mary Belka, CPCU, ARM, ARe, RPLU, CIC, and Cheryl Koch, CPCU, ARM, AAI, ACSR, AFIS

It’s become a familiar lament from harried, overwrought account managers: “How in the world can I learn to work in a different way when I’m already so far behind?” And yet, as the saying goes, if you always do what you’ve always done, you’ll always get what you’ve always gotten—which is further and further behind.

Backlog elements

Chronic backlog has become institutionalized in many independent agencies. But before we explore how to end it, we should also talk about what it is and how and why it took hold in our industry. Back-log can be defined as any item that remains in the agency unprocessed for more than five working days, including requests from clients, underwriters, producers, bookkeepers, and more, that must be reviewed for accuracy, handled, documented as appropriate, and attached to the automated client file. The components include the following:

• Items/requests retrieved from carrier websites and forwarded to account managers
• Emails and attachments to be handled
• Incoming mail, scanned and forwarded to the account manager
• Voicemail messages
• Activities to be followed up each day
• Expiration lists for upcoming renewals

Like houseguests and fish, backlog also begins to “smell” after a few days. Once an account manager has a long list of open, unworked items, it becomes impossible to prioritize work because everything appears to be critical. And when everything is critical, nothing gets done. It’s paralyzing and debilitating to contemplate a seemingly endless “stack of stuff” that needs to be done and realize there simply aren’t enough hours in the day to complete it all.

It’s human nature to put off what we don’t enjoy doing. That’s especially true
when we’re talking about projects that may consume a large portion of the day … .

Why we get behind

It’s human nature to put off what we don’t enjoy doing. That’s especially true when we’re talking about projects that may consume a large portion of the day, such as checking a complex policy, doing a premium breakdown, or dealing with a contract and the certificate and additional insured issues that often go along with it. We wait for that big block of time when we can tackle the project, but it never materializes.

A funny thing about backlog is that it begets backlog. Someone notices that they never received that policy or the premium breakdown or the certificate, and along come the follow-up calls and emails, simply adding to that endless to-do list that never seems to get “to-done.” No one wants it to be this way. We’d all love to complete every incoming task every day, but that’s not really how the account manager job works. It’s a series of ebbs and flows and the account manager doesn’t get to choose an equal number of incoming items every day.

Regardless how it happened, we can all agree on a few things about chronic backlog:

• It’s a psychological barrier for account managers. With too many things in the queue, many of which are critical, it can be overwhelming to even decide what to do next.
• It’s an errors and omissions (E&O) claim waiting to happen. Invariably, one of those critical items will get pushed aside or overlooked completely until the client tells us they’ve had a loss that may not be covered.
• It’s bad customer service—period. We tend to process items based on the “squeaky wheel gets the grease” system, rather than considering what task has been unprocessed the longest.

If work isn’t getting done, that’s a problem. We felt this same pain in our careers as account managers and, interestingly, both devised a system to eliminate backlog long before we’d even met! We called the system by different names, but the essence of it was the same—process work based on the nature of the task and when it was received in the agency, nothing else.

We don’t prioritize work based on who is the producer, the size of the revenue on the account or even who’s screaming the loudest. It’s first-come, first-served and it’s a simple system that will get an account manager caught up and keep them that way in the future. In fact, it’s so basic we now just call it CaughtUP™ (“UP” standing for Unprecedented Productivity). That’s right; not only is it possible to eliminate backlog, it’s remarkably easy and has never failed for anyone who is truly committed to making being behind a thing of the past. And you don’t have to be caught up to use CaughtUP; in fact, if you wait to get your desk current, you’ll likely only fall further behind and never even begin to implement the system.

While it’s not possible to share all of the details of this system in the confines of a magazine column, we can give you some of the basic ideas behind how and why it works.

Defining “critical”

The key to success is defining critical, but most agencies do not make it past this step—understanding that few items are critical by their very nature. Most account managers try to categorize too many items as “critical,” thereby creating an endless list of items that require immediate handling, which is an impossible task.

Critical means “must be handled by someone in the agency within a maximum of 24 hours.” Basically, it means that either the client or the agency could suffer a financial loss if the item is not completed within 24 hours. Avoiding “criticality creep” is the primary focus of becoming and staying caught up. The limited list includes:

• Adding coverage—deleting is not “critical” unless accompanied by adding coverage
• Binding coverage
• Certificate of Insurance
• Evidence of Insurance (when closing escrow immediately, but there are ways to train clients and improve procedures in order to avoid these situations in many cases)
• First report of claim or summons and complaint, or any legal claims documentation
• Bid bonds
• AOR/BOR (agency or broker of record) letters/emails received on existing accounts
• Items that are not critical, and which add to overall workload, driving down profitability, include:
• Email is simply a method of receiving and sending communication, not a “thing” in and of itself. Learning to move emails to workflow folders for handling is a big key to making this system work. Checking and managing email a maximum of twice in the morning and twice in the afternoon is the holy grail of becoming and remaining caught up.
• “Quoting” and remarketing. This is the bane of most account manager desks. This is a topic for an entire column! Agencies that control unnecessary renewal remarketing and “how much will it cost if I buy …” quoting situations, win the efficiency game hands down. Does it take discipline and gumption? Absolutely! Oh, but what a difference it can make, giving up the quoting addiction and stepping off that hamster wheel.
• Direct Notice of Cancellation (DNOC)for direct bill or premium financed policies in danger of cancellation dueto non-payment of premium. We have an appropriate procedure for eliminating this addiction completely if you’ve read our column over time. (Training of new and renewal clients required.)
• New business is sometimes an issue if timeframes are short. This should be kept very limited by appropriate sales and marketing procedures, including new business timelines for producers. Agencies requiring personal and small commercial lines account managers to handle new business call-in quoting in particular, but who have not yet set target market parameters, are creating a never-ending backlog mountain.
• Agency bill audits if handled properly. These are endorsements that can become “sticky wickets” if disputed, or when large additional premiums are involved. When handled properly, they are simply endorsements that may require extra procedural steps to resolve.
• “Money” endorsements and other agency bill items. If processed within the five-day timeframe, there is no need for expedited handling.

Individual inboxes and workflow folders

Setting up individual inboxes and workflow folders in a shared drive is something every agency can do. It makes it very simple for documents to be placed in the same format—digital—in one place from which account managers can work. Items retrieved from websites by receptionists (our preference); items received via email; and items received via snail mail and scanned, can all be dragged and dropped as they are received to the appropriate account manager inbox. From there, items are placed by the account manager in the appropriate workflow folder for handling at the appropriate time. Items received directly by the account manager can go straight to the appropriate workflow folder.

Standard workflow folders include the following (remember to keep it simple):

• A—critical
• B—Monday—quotes to check or handle
• C—Tuesday—endorsements to check
• D—Wednesday—policies to check
• E—Thursday—information received or requests for information to send
• F—Friday—ex-lists to manage and begin the renewal process

Working the CaughtUP system

Each day, account managers quickly categorize their work received in the shared drive between “critical” and “workflow.” The idea is to handle phone calls and “critical” items each day, plus items in the appropriate folder in date-received order from oldest to most current—religiously. Even if the file is not empty, the account manager proceeds to the next workflow folder the next day. Each category of folder is revisited the same day each week. Once a folder is empty, the account manager may choose to work another folder; it’s best to choose the one with the oldest items to process. As a bonus, managers can determine how far behind anyone is in a matter of minutes and can reallocate work as needed.

The authors

Mary M. Belka is owner and CEO of Eisenhart Consulting Group, Inc., providing management and operations consulting to the insurance industry. She also is an endorsed agency E&O auditor for Swiss Re/Westport. A graduate of the University of Nebraska, Mary holds the CPCU, ARM, ARe, RPLU, CIC, and CPIW designations.

Cheryl Koch is the owner of Agency Management Resource Group, providing training, education and consulting to producers, account managers and owners of independent agencies. She has a BA in Economics from UCLA and an MBA from Sacramento State University. She has also earned several insurance professional designations: CPCU, CIC, ARM, AAI, AAI-M, API, AIS, AAM, AIM, ARP, AINS, ACSR, AFIS, MLIS.