A variable life insurance plan (VLIP) combines investment and insurance, just like an unit-linked insurance plan (ULIP). Variable life insurance schemes offer flexibility in the proportion of mortality and savings components.
These plans also offer more transparency, simplicity, quick liquidity, guaranteed minimum returns, transparent charges and ample risk cover. This type of life insurance allows you to participate in several investment options simultaneously targeting your premiums to separate accounts.
Generally, the optional investment funds include stocks, bonds, money market funds, equity funds, or a combination of them all. Variable Life Insurance allows you to switch from one sub-account to another.
You can also apply the interest earned on these investments toward the premium, reducing the amount you pay. In a departure from the ULIPs, the returns are declared by insurance companies annually and are not linked to the stock market.
One part of the premium is allocated to buy life insurance. The balance is invested in bonds or equities. The premium amount cannot be altered in the course of the policy, but the death benefit and savings element can be reviewed and altered as the policyholder's circumstances change.
You can increase your insurance protection and decrease the investment component, or vice versa. Another feature of this plan is that it does not get automatically cancelled if the policyholder fails to pay the premiums as long as the premiums paid till date meet policy requirements. Under the plans, the premiums paid by the holder, after deduction of charges, will be credited to the account maintained separately for each policyholder.
If all due premiums are paid, the amount held in the policyholder's account will earn an annual interest which will be guaranteed for the entire policy term. In addition to this guaranteed return, if all due premiums are paid, the individual policyholder's account may earn an additional return depending upon the experience under the plan.
There is an option to pay additional (top-up) premiums without any increase in risk cover to the extent of total basic premiums paid under the policy. The premiums can be paid regularly at yearly, half-yearly, quarterly or monthly (through ECS mode only) intervals over the term of the policy. The sum assured ranges from 10 to 30 times the annualised premium, depending on age of entry.
There are two types of variable life insurance plans - participating and non-participating. Participating plans offer a guaranteed return, while nonparticipating plans offer an annual bonus at the end of each financial year in addition to guaranteed returns.
The minimum sum assured is Rs 50,000 or 10 times the annualised premium, whichever is higher for entry at the age below 45 years. After that age, the maximum is Rs 50,000 or seven times the annualised premium.
Top-up premium is allowed throughout the term. In case the insured decides to increase his contribution through a onetime top-up, a maximum of up to three percent charges may be deducted from the top-up. The product also provides for loans up to 60 percent of the balance at a specific rate of interest.
Monday, February 28, 2011
Tuesday, February 22, 2011
Effective Agents
Marketers need to go back to basics when it comes to selling life insurance in these changing times. Over more than a decade since the category came into its own, many brands have come to spell life insurance only as
i-n-v-e-s-t-m-e-n-t.
But for a business that is all about mitigating life’s risks to meet life’s needs, it seems to have forgotten its own foundations in evolving, in marketing itself. Today, especially in the new regulatory environment, the most important lesson for the life insurance category is probably to go back to its basics. Sometimes it is worth remembering that the more things change, the more they remain the same. It’s undeniably true of life insurance marketing and its role in today’s changing times.
Here’s how:
Insurance marketing tenet 1: Life may change, life insurance shouldn’t. From the heady, economic-high days of the early 2000s to the speed bump of 2009 and the subsequent recovery in 2010, life in India has witnessed multiple milestones from unrestrained optimism to caution to now a cautious optimism. What’s clear — and history has taught us this elsewhere many times — is that such cycles are not new, and demand that planning for security now is as important as planning for growth tomorrow.
But for a business that is all about mitigating life’s risks to meet life’s needs, it seems to have forgotten its own foundations in evolving, in marketing itself. Today, especially in the new regulatory environment, the most important lesson for the life insurance category is probably to go back to its basics. Sometimes it is worth remembering that the more things change, the more they remain the same. It’s undeniably true of life insurance marketing and its role in today’s changing times.
Here’s how:
Insurance marketing tenet 1: Life may change, life insurance shouldn’t. From the heady, economic-high days of the early 2000s to the speed bump of 2009 and the subsequent recovery in 2010, life in India has witnessed multiple milestones from unrestrained optimism to caution to now a cautious optimism. What’s clear — and history has taught us this elsewhere many times — is that such cycles are not new, and demand that planning for security now is as important as planning for growth tomorrow.
Or vice versa. It highlights the fact that life insurance spells not one but three things:
(1) s-a-v-i-n-g-s
(2) p-r-o-t-e-c-t-i-o-n
(3) i-n-v-e-s-t-m-e-n-t.
It is what customers need at all times, whether they know enough to ask for it by themselves or not. Which leads us to the next tenet.
Insurance marketing tenet 2: The more they know, the more you grow. History, a lot of times, does not repeat itself. Which is why there is a new generation of customers created almost every year that needs continuous education on how insurance enables multiple milestones in their lives. In evolving beyond their own inception stages, brands can tend to forget that just because they are a decade (or more) old, it doesn’t automatically signal that customer education is redundant. On the contrary, even older generations don’t have all the knowledge that enables them to see that insurance is a facilitator of education, sustained good health, marriage, protection after death, and every step in between.
In such a scenario, and in a category that is fairly young in India, there is no legacy of knowledge that is passed on from one generation to another among customers. It becomes imperative for marketing, therefore, to ensure that brands borrow a leaf from the medical fraternity’s book, and institute a continuing insurance education initiative — for themselves (that is, their employees and agents) and, more importantly, for their customers and prospects. If the category is to help the customer see the merits of long-term savings and protection, then a long-term investment to educate them about their specific needs and options is crucial for brands.
Insurance marketing tenet 3: Mine the gold you have within reach
Unlike many other categories, life insurance — or the actuarial business, more broadly — is based on solid business analytics. An understanding of customers, prospects and their specific needs is within the grasp of each insurance company. While the business runs and evolves on these analytics, marketing doesn’t always mine them to enhance the business. Instead of educated guesses and anecdotal reports from the field, marketing has the tools readily available to enable and enhance the entire spectrum of business decisions: from new product development to identifying key customer segments; from strategy course correction to identifying new geographies.
Most importantly, business analytics can help predict overall market and consumption trends, identify gaps in customer need satisfaction, and help streamline customer education efforts. In turn, these can lead to robust lead management, high persistency yields and increased loyalty and referrals. Additionally, a direct line of communication can be established with customers — to educate them more credibly, and in a reassuring manner, about the cyclical nature of events, and the need for longer-term planning and protection as a means to meet their life goals.
Insurance marketing tenet 4: The opportunity to become agents of change. Multiple social forces have collided to create both the biggest opportunity and challenge for the insurance industry. On the one hand, rapid nuclearsation of families has meant that the traditional advisors and preservers of wisdom are no longer as easily accessible as in the past to most families. On the other hand, a burgeoning middle class has meant a seemingly limitless market opportunity that only needs to be sold to. While insurance companies have energetically pursued the latter, they have missed seeing the opportunity in the former, with the result that insurance agents are seen merely as pesky agents of sale. In reality, this is the best time to fill the gap and create trustworthy advisors who can demonstrate they have nothing but customers’ long-term security and prosperity in heart.
Marketing can play a crucial role in enabling this transformation by systematically training field staff on how to become agents of change. By investing in a strategic communications programme that will change the agent mindset first, marketing can play a strategic role in facilitating customer education about the importance of a buying life insurance with a long-term perspective. By bringing together these two stakeholders, life insurance companies can go from being faceless entities to actually investing the face of the company, namely, the agents with the power and the credibility to become true partners to customers in creating and ensuring the best possible futures for themselves and their families.
Insurance marketing tenet 2: The more they know, the more you grow. History, a lot of times, does not repeat itself. Which is why there is a new generation of customers created almost every year that needs continuous education on how insurance enables multiple milestones in their lives. In evolving beyond their own inception stages, brands can tend to forget that just because they are a decade (or more) old, it doesn’t automatically signal that customer education is redundant. On the contrary, even older generations don’t have all the knowledge that enables them to see that insurance is a facilitator of education, sustained good health, marriage, protection after death, and every step in between.
In such a scenario, and in a category that is fairly young in India, there is no legacy of knowledge that is passed on from one generation to another among customers. It becomes imperative for marketing, therefore, to ensure that brands borrow a leaf from the medical fraternity’s book, and institute a continuing insurance education initiative — for themselves (that is, their employees and agents) and, more importantly, for their customers and prospects. If the category is to help the customer see the merits of long-term savings and protection, then a long-term investment to educate them about their specific needs and options is crucial for brands.
Insurance marketing tenet 3: Mine the gold you have within reach
Unlike many other categories, life insurance — or the actuarial business, more broadly — is based on solid business analytics. An understanding of customers, prospects and their specific needs is within the grasp of each insurance company. While the business runs and evolves on these analytics, marketing doesn’t always mine them to enhance the business. Instead of educated guesses and anecdotal reports from the field, marketing has the tools readily available to enable and enhance the entire spectrum of business decisions: from new product development to identifying key customer segments; from strategy course correction to identifying new geographies.
Most importantly, business analytics can help predict overall market and consumption trends, identify gaps in customer need satisfaction, and help streamline customer education efforts. In turn, these can lead to robust lead management, high persistency yields and increased loyalty and referrals. Additionally, a direct line of communication can be established with customers — to educate them more credibly, and in a reassuring manner, about the cyclical nature of events, and the need for longer-term planning and protection as a means to meet their life goals.
Insurance marketing tenet 4: The opportunity to become agents of change. Multiple social forces have collided to create both the biggest opportunity and challenge for the insurance industry. On the one hand, rapid nuclearsation of families has meant that the traditional advisors and preservers of wisdom are no longer as easily accessible as in the past to most families. On the other hand, a burgeoning middle class has meant a seemingly limitless market opportunity that only needs to be sold to. While insurance companies have energetically pursued the latter, they have missed seeing the opportunity in the former, with the result that insurance agents are seen merely as pesky agents of sale. In reality, this is the best time to fill the gap and create trustworthy advisors who can demonstrate they have nothing but customers’ long-term security and prosperity in heart.
Marketing can play a crucial role in enabling this transformation by systematically training field staff on how to become agents of change. By investing in a strategic communications programme that will change the agent mindset first, marketing can play a strategic role in facilitating customer education about the importance of a buying life insurance with a long-term perspective. By bringing together these two stakeholders, life insurance companies can go from being faceless entities to actually investing the face of the company, namely, the agents with the power and the credibility to become true partners to customers in creating and ensuring the best possible futures for themselves and their families.
Saturday, February 12, 2011
OMG - Tyrant!!!!
Whether on the world stage or within organizations, tyrants are motivated by their personal drive for self-preservation. This is at the cost of progress, open discussion and the well-being of the jurisdictions or institutions that they run.
Generally tyrannical rule is short sighted and based on fear. Although there may seem to be an illusion of stability under ironfisted leadership, in reality these structures are generally unsound and can’t withstand the inevitable dynamic of change.
As we see world events unfold in recent weeks, organizations and their boards of directors can learn some valuable lessons on the cost of tolerating dictatorial style leadership by their CEO’s or senior managers.
A tyrannical leader fears criticism or dissent and will shut down vehicles that facilitate the flow of ideas, whether this is a ‘kill switch’ of the internet, or halting regular and open staff meetings.
Thus progress, creativity, entrepreneurship and the vital early warning of potential problems, that act as a corrective feedback loop for any system, are thwarted.
Processes and tools within a system under this type of governance tend to go unmaintained, as change is something tyrants like to avoid rather than embrace. People farther down the hierarchy are fearful of raising red flags or making suggestions for improvements. As a result processes stagnate and tools become out-of-date.
Tyrants will try to hold onto power at any cost and are interested in their own well-being rather than those that they lead. Thus their decisions are highly suspect especially if they feel some threat to their personal authority.
As with a totalitarian regime, an organization tainted by a tyrannical CEO, has compromised the integrity of its internal resources, such as the HR department or the Finance Department. As these are part of the intimidating culture they often colluded with it rather than fulfilling a role of checks and balances to ensure fairness, transparency and integrity.
The younger generation, accustomed to a free flow of ideas in university and through social media, expect to have enlightened wise and intelligent leaders in the workplace. They don’t tolerate the iron rule and will quickly leave an organization where people are expected to be submissive rather than innovative.
Once a tyrant always a tyrant. These people cannot change through coaching, advice or warnings. They have a deep-seated fear of losing control over others and cannot reform or be trusted to change their ways. The only effective way to deal with a tyrant is to remove him/her from a position of power.
Organizations that have been run by a tyrant-style CEO are much more likely to see history repeat itself. The culture of the organization imprints with all the ills that a tyrant imposes on it, including fearfulness, low morale, high turnover, mediocre leadership and lack of real accountability at all levels.
Even if steps are taken to remove an ironfisted leader, very often the successive incumbent ends up being a tyrant as well. This is because the board of directors unconsciously chooses a person of the same ilk, and because they as board members neglect to conduct an evaluation of their own governance style, processes and values that have led them to tolerate a tyrant in the first place.
Generally tyrannical rule is short sighted and based on fear. Although there may seem to be an illusion of stability under ironfisted leadership, in reality these structures are generally unsound and can’t withstand the inevitable dynamic of change.
As we see world events unfold in recent weeks, organizations and their boards of directors can learn some valuable lessons on the cost of tolerating dictatorial style leadership by their CEO’s or senior managers.
A tyrannical leader fears criticism or dissent and will shut down vehicles that facilitate the flow of ideas, whether this is a ‘kill switch’ of the internet, or halting regular and open staff meetings.
Thus progress, creativity, entrepreneurship and the vital early warning of potential problems, that act as a corrective feedback loop for any system, are thwarted.
Processes and tools within a system under this type of governance tend to go unmaintained, as change is something tyrants like to avoid rather than embrace. People farther down the hierarchy are fearful of raising red flags or making suggestions for improvements. As a result processes stagnate and tools become out-of-date.
Tyrants will try to hold onto power at any cost and are interested in their own well-being rather than those that they lead. Thus their decisions are highly suspect especially if they feel some threat to their personal authority.
As with a totalitarian regime, an organization tainted by a tyrannical CEO, has compromised the integrity of its internal resources, such as the HR department or the Finance Department. As these are part of the intimidating culture they often colluded with it rather than fulfilling a role of checks and balances to ensure fairness, transparency and integrity.
The younger generation, accustomed to a free flow of ideas in university and through social media, expect to have enlightened wise and intelligent leaders in the workplace. They don’t tolerate the iron rule and will quickly leave an organization where people are expected to be submissive rather than innovative.
Once a tyrant always a tyrant. These people cannot change through coaching, advice or warnings. They have a deep-seated fear of losing control over others and cannot reform or be trusted to change their ways. The only effective way to deal with a tyrant is to remove him/her from a position of power.
Organizations that have been run by a tyrant-style CEO are much more likely to see history repeat itself. The culture of the organization imprints with all the ills that a tyrant imposes on it, including fearfulness, low morale, high turnover, mediocre leadership and lack of real accountability at all levels.
Even if steps are taken to remove an ironfisted leader, very often the successive incumbent ends up being a tyrant as well. This is because the board of directors unconsciously chooses a person of the same ilk, and because they as board members neglect to conduct an evaluation of their own governance style, processes and values that have led them to tolerate a tyrant in the first place.
Unit-linked Vs Mutual Fund
Everyone seems to agree that U.K. Sinha, who will take over from C.B. Bhave as chairman of the Securities and Exchange Board of India (Sebi) on 17 February, is the right man for the job. As chairman of the Unit Trust of India Asset Management Company, he is a man of the markets. And together with his stints as joint secretary in the ministry of finance, he brings reformist bureaucratic experience to the job of a market regulator. No need to check that resumé again.
The timing of his appointment as Sebi chairman seems fortuitous for a mutual fund industry that is in severe trouble; it has not been very successful at attracting fresh capital while struggling with higher redemption pressure at the same time. Mutual funds are also facing competitive challenges from the insurance companies who do not have to worry about ‘no load’ offerings in selling unit-linked insurance plans, or Ulips.
To be fair, insurance companies and mutual funds have faced allegations of mis-selling when it comes to Ulips. It all boils down to who pays for distribution. Life insurance companies selling Ulips — which compete with mutual fund products — have much greater freedom on passing on distribution costs to the investors while mutual funds are restricted from doing so. Since both kinds of products have to be heavily sold, costs and selling expenses matter.
Mutual fund company chiefs say that the manufacturers of mutual fund products (the asset management companies), and the products (mutual fund schemes) themselves are tightly regulated, but distributors and agents are not at all. Incentive structures and fee commissions play a big part on how distributors behave.
That could well be Sinha’s first challenge: setting up a regulatory framework for distributors so that there is no mis-selling, and evening the playing field for mutual funds vis-à-vis life insurance firms, even banks. If Sebi under Bhave could enforce investor protection by imposing no-load rules, the same argument (investor protection) could be used for setting rules for distributors of financial products, say industry officials.
Then, there is the question of corporate governance. Different elements of this issue — from board composition through mergers and acquisitions to financial instruments — fall under the purview of different regulators that stretch from the Ministry of Corporate Affairs and the Company Law Board (CLB) to Sebi. It cuts across disclosure in financial statements (and the accounting profession) to reporting standards.
Sebi seems ideally positioned to take the lead in corporate surveillance. It already looks at company promoters in a number of ways. It could frame rules seeking quarterly reporting on cash flows, voting patterns in company boards on critical matters (particularly the promoters). In Indian companies, say experts, corporate governance is not about ownership versus management, but majority versus minority. And here, the investor protection imperative gives Sebi the rationale to take this task on.
The third, and by far the toughest challenge, pertains to the regulation of asset management companies (AMCs), a business that Sinha is intimately knowledgeable about. Sebi’s current purview extends to the regulation of products; as markets get more sophisticated, it will be necessary to separate the products or mutual fund schemes from function, or asset management companies, akin to separating the horizontal from the vertical.
Soon, along with life insurance companies and their AMCs, there will be pension funds and their AMCs, and the advisory. In the more developed markets such as the US, for instance, AMCs of all stripes and colours are regulated under the Investment Act of 1940. We are fast approaching the point where regulation of that kind will become necessary. It is time for our markets to grow up.
The timing of his appointment as Sebi chairman seems fortuitous for a mutual fund industry that is in severe trouble; it has not been very successful at attracting fresh capital while struggling with higher redemption pressure at the same time. Mutual funds are also facing competitive challenges from the insurance companies who do not have to worry about ‘no load’ offerings in selling unit-linked insurance plans, or Ulips.
To be fair, insurance companies and mutual funds have faced allegations of mis-selling when it comes to Ulips. It all boils down to who pays for distribution. Life insurance companies selling Ulips — which compete with mutual fund products — have much greater freedom on passing on distribution costs to the investors while mutual funds are restricted from doing so. Since both kinds of products have to be heavily sold, costs and selling expenses matter.
Mutual fund company chiefs say that the manufacturers of mutual fund products (the asset management companies), and the products (mutual fund schemes) themselves are tightly regulated, but distributors and agents are not at all. Incentive structures and fee commissions play a big part on how distributors behave.
That could well be Sinha’s first challenge: setting up a regulatory framework for distributors so that there is no mis-selling, and evening the playing field for mutual funds vis-à-vis life insurance firms, even banks. If Sebi under Bhave could enforce investor protection by imposing no-load rules, the same argument (investor protection) could be used for setting rules for distributors of financial products, say industry officials.
Then, there is the question of corporate governance. Different elements of this issue — from board composition through mergers and acquisitions to financial instruments — fall under the purview of different regulators that stretch from the Ministry of Corporate Affairs and the Company Law Board (CLB) to Sebi. It cuts across disclosure in financial statements (and the accounting profession) to reporting standards.
Sebi seems ideally positioned to take the lead in corporate surveillance. It already looks at company promoters in a number of ways. It could frame rules seeking quarterly reporting on cash flows, voting patterns in company boards on critical matters (particularly the promoters). In Indian companies, say experts, corporate governance is not about ownership versus management, but majority versus minority. And here, the investor protection imperative gives Sebi the rationale to take this task on.
The third, and by far the toughest challenge, pertains to the regulation of asset management companies (AMCs), a business that Sinha is intimately knowledgeable about. Sebi’s current purview extends to the regulation of products; as markets get more sophisticated, it will be necessary to separate the products or mutual fund schemes from function, or asset management companies, akin to separating the horizontal from the vertical.
Soon, along with life insurance companies and their AMCs, there will be pension funds and their AMCs, and the advisory. In the more developed markets such as the US, for instance, AMCs of all stripes and colours are regulated under the Investment Act of 1940. We are fast approaching the point where regulation of that kind will become necessary. It is time for our markets to grow up.
Sunday, February 6, 2011
Give Up Good For Great
Leadership quotes by famous people are usually about the qualities it takes to be a good leader. But every quote is slightly different; each summarizes a distinctive leadership quality or trait, perhaps the quality that resonated most with the person who stated it.
It's an age old question, "What does it take to be a good leader?" For centuries, politicians, business leaders, writers, philosophers and pundits have tried to define the qualities of a good leader. In fact, nearly every United States president has offered a definition or an insightful quote about leadership. While many great leadership quotes are taken from the battlefield or a famous political speech, they often seamlessly transfer into other areas of leadership: business, sports or even the day-to-day routine of raising a family and operating a household.
Here are 5 top leadership quotes by famous people, with suggestions on how to use them in your everyday life:
1. "Leadership and learning are indispensable to each other." John F. Kennedy
This quote was taken from JFK's speech prepared for delivery in Dallas on the day of his assassination, November 22, 1963. One of the most important qualities of a great leader (if not the most important) is to never stop learning. You might have all the qualities that make up a good leader in the business world, but your surroundings are constantly changing.
Factors like new technology, downsizing and fluctuating markets all play a role in challenging your leadership skills. Never become complacent.
Take the initiative to learn something new each week. Do you know what each person on your staff does and how it plays a role in your organization? Make sure you read trade magazines and stay in touch with other business executives; the moment you stop learning is when you become less of a leader and more of a follower.
2. "A good leader takes a little more share of the blame, a little less than his share of credit." Arnold Glasow
After the Great Depression, American businessman and humorist Arnold Glasow started his own company that marketed a humor magazine to businesses. He recognized that strong business leaders needed to have accountability for both the positive and negative results that occur under their direction.
Additionally, good leaders need to know when to recognize others who helped the company achieve success; stepping out of the spotlight in good times, and stepping into the spotlight in bad times, shows strength, courage and humility.
3. "Leadership: the art of getting someone else to do something you want done because he wants to do it." Dwight D. Eisenhower
Dwight D. Eisenhower knew that in order to be a great leader, one of the greatest qualities needed was the power to motivate others. Knowing the right tools and techniques (and possessing a certain level of charm and charisma), is key to motivating others. But the idea is to not only motivate people to do what you want them to do; you need to reach them in a way so that they actually want to do what you're asking them to do (not just because you're telling them to do it).
Validate your team's strengths; make them feel like you're relying on their skills and experience to get the job done. People often rise to the occasion when given the opportunity, so give your staff the chance to demonstrate their strengths.
4. "The ultimate measure of a man is not where he stands in moments of comfort and convenience, but where he stands at times of challenge and controversy." Martin Luther King Jr.
Just as you want your team to rise to the occasion and prove their worth, you'll often need to prove your worth. It's easy to coast during good times, but are you prepared for controversy or debilitating set-backs?
During bad times, others will rely on you for guidance, strength and reassurance. Make sure you have a disaster game plan readily accessible. Be prepared for the worst - just as you have mapped out future goals and accomplishments, you need to create an outline of emergency situations and how you'll respond.
5. "Don't be afraid to give up the good to go for the great." John D. Rockefeller
As one of America's most successful businessmen and philanthropists, John D. Rockefeller should know about aiming high. While reaching goals and celebrating success is rewarding, don't ever be too content.
Be willing to take risks; you never know what is possible to achieve if you don't put yourself out there. The sign of a great leader is one who has enough confidence to leave the known for the unknown. Map out a strategy and go for what you truly want. However lofty, you'll never know if your goals are achievable unless you try.
It's an age old question, "What does it take to be a good leader?" For centuries, politicians, business leaders, writers, philosophers and pundits have tried to define the qualities of a good leader. In fact, nearly every United States president has offered a definition or an insightful quote about leadership. While many great leadership quotes are taken from the battlefield or a famous political speech, they often seamlessly transfer into other areas of leadership: business, sports or even the day-to-day routine of raising a family and operating a household.
Here are 5 top leadership quotes by famous people, with suggestions on how to use them in your everyday life:
1. "Leadership and learning are indispensable to each other." John F. Kennedy
This quote was taken from JFK's speech prepared for delivery in Dallas on the day of his assassination, November 22, 1963. One of the most important qualities of a great leader (if not the most important) is to never stop learning. You might have all the qualities that make up a good leader in the business world, but your surroundings are constantly changing.
Factors like new technology, downsizing and fluctuating markets all play a role in challenging your leadership skills. Never become complacent.
Take the initiative to learn something new each week. Do you know what each person on your staff does and how it plays a role in your organization? Make sure you read trade magazines and stay in touch with other business executives; the moment you stop learning is when you become less of a leader and more of a follower.
2. "A good leader takes a little more share of the blame, a little less than his share of credit." Arnold Glasow
After the Great Depression, American businessman and humorist Arnold Glasow started his own company that marketed a humor magazine to businesses. He recognized that strong business leaders needed to have accountability for both the positive and negative results that occur under their direction.
Additionally, good leaders need to know when to recognize others who helped the company achieve success; stepping out of the spotlight in good times, and stepping into the spotlight in bad times, shows strength, courage and humility.
3. "Leadership: the art of getting someone else to do something you want done because he wants to do it." Dwight D. Eisenhower
Dwight D. Eisenhower knew that in order to be a great leader, one of the greatest qualities needed was the power to motivate others. Knowing the right tools and techniques (and possessing a certain level of charm and charisma), is key to motivating others. But the idea is to not only motivate people to do what you want them to do; you need to reach them in a way so that they actually want to do what you're asking them to do (not just because you're telling them to do it).
Validate your team's strengths; make them feel like you're relying on their skills and experience to get the job done. People often rise to the occasion when given the opportunity, so give your staff the chance to demonstrate their strengths.
4. "The ultimate measure of a man is not where he stands in moments of comfort and convenience, but where he stands at times of challenge and controversy." Martin Luther King Jr.
Just as you want your team to rise to the occasion and prove their worth, you'll often need to prove your worth. It's easy to coast during good times, but are you prepared for controversy or debilitating set-backs?
During bad times, others will rely on you for guidance, strength and reassurance. Make sure you have a disaster game plan readily accessible. Be prepared for the worst - just as you have mapped out future goals and accomplishments, you need to create an outline of emergency situations and how you'll respond.
5. "Don't be afraid to give up the good to go for the great." John D. Rockefeller
As one of America's most successful businessmen and philanthropists, John D. Rockefeller should know about aiming high. While reaching goals and celebrating success is rewarding, don't ever be too content.
Be willing to take risks; you never know what is possible to achieve if you don't put yourself out there. The sign of a great leader is one who has enough confidence to leave the known for the unknown. Map out a strategy and go for what you truly want. However lofty, you'll never know if your goals are achievable unless you try.
Building High Performance Team
There’s something not quite right at work. Your colleagues are generally a good bunch and work gets done, but yet you’re in early, leave late and a full lunch break is a distant memory.
Chances are you’ve been down-sized or re-engineered so radically there’s zero tolerance for mishaps or delays, and you extend your work day to pick up the slack. What you really need is some help on building a high performance team, to regain that work-life balance we all yearn for.
Step 1 - Master your own destiny
Realise you don’t have to be the “boss” to build a high performance team. It’s easy to let average performance slip by just because you’re not in charge. Always remember - it’s your life that is being frittered away by all those extra hours at work, so take control of your work-life and be your own boss, managing your own team.
Step 2 - Put your eggs in one basket
Chances are you’re a member or leader of many teams at work. Think about which teams work well and which could do with some care and attention. Do you need to improve all your teams or is it just one? Start small and invest your efforts in improving the team that will make the biggest difference to your working life. As they say, Rome wasn’t built in a day.
Step 3 - If you don’t know it’s broke, how can you fix it?
Regardless of how established the team is, invite constructive feedback about the team's performance. In the classic “Forming, Storming, Norming and Performing” team building model, the Storming part is about disagreement, dissent and dissatisfaction. Ask the team’s customers what they think. Ask the team what they think about themselves as a group and individually. Learn to recognise the team’s strengths, discuss where performance gaps exist and plan to close them.
Step 4 - Proper practice prevents poor performance
Footballers spend 95% of their time practicing for the big game. How much time do you and your team invest in practicing basic skills and team work? Even if you spend 1 hour in an effective team meeting, planning who’s doing what and when, it’s still less than 3% of your working week. Building and maintaining a high performance team doesn’t have to be expensive or time consuming, when you build it into your regular work-life.
Step 5 - A stitch in time
Keep going. Get your priority team functioning well and establish a team-maintenance regime. Then think about the other teams in your life. What is it about the more productive teams that you could replicate in the less effective teams? Behaviour breeds behaviour, and as you develop a reputation for being an effective team leader or member, you’ll be pleasantly surprised how much easier it is to make improvements elsewhere.
As my grandmother said, don’t have a wish-bone where your back-bone should be! High performance teams are not conjured from thin air – they are a direct result of thought, plans and action. Follow these five simple steps for building high performance teams and enjoy longer lunch breaks again.
Chances are you’ve been down-sized or re-engineered so radically there’s zero tolerance for mishaps or delays, and you extend your work day to pick up the slack. What you really need is some help on building a high performance team, to regain that work-life balance we all yearn for.
Step 1 - Master your own destiny
Realise you don’t have to be the “boss” to build a high performance team. It’s easy to let average performance slip by just because you’re not in charge. Always remember - it’s your life that is being frittered away by all those extra hours at work, so take control of your work-life and be your own boss, managing your own team.
Step 2 - Put your eggs in one basket
Chances are you’re a member or leader of many teams at work. Think about which teams work well and which could do with some care and attention. Do you need to improve all your teams or is it just one? Start small and invest your efforts in improving the team that will make the biggest difference to your working life. As they say, Rome wasn’t built in a day.
Step 3 - If you don’t know it’s broke, how can you fix it?
Regardless of how established the team is, invite constructive feedback about the team's performance. In the classic “Forming, Storming, Norming and Performing” team building model, the Storming part is about disagreement, dissent and dissatisfaction. Ask the team’s customers what they think. Ask the team what they think about themselves as a group and individually. Learn to recognise the team’s strengths, discuss where performance gaps exist and plan to close them.
Step 4 - Proper practice prevents poor performance
Footballers spend 95% of their time practicing for the big game. How much time do you and your team invest in practicing basic skills and team work? Even if you spend 1 hour in an effective team meeting, planning who’s doing what and when, it’s still less than 3% of your working week. Building and maintaining a high performance team doesn’t have to be expensive or time consuming, when you build it into your regular work-life.
Step 5 - A stitch in time
Keep going. Get your priority team functioning well and establish a team-maintenance regime. Then think about the other teams in your life. What is it about the more productive teams that you could replicate in the less effective teams? Behaviour breeds behaviour, and as you develop a reputation for being an effective team leader or member, you’ll be pleasantly surprised how much easier it is to make improvements elsewhere.
As my grandmother said, don’t have a wish-bone where your back-bone should be! High performance teams are not conjured from thin air – they are a direct result of thought, plans and action. Follow these five simple steps for building high performance teams and enjoy longer lunch breaks again.
Friday, February 4, 2011
7 Habits
Habit 1: Be Passionate. Finding your passion is not only the key to happiness, but also the key to business success. As Steve Jobs once sai, “Your time is limited, so don’t waste it living someone else’s life. The only way to do great work is to love what you do. If you haven’t found it yet, keep looking. Don’t settle.” (Be Proactive)
Habit 2: Do Something. You don’t always know where it’s going to lead, but it’s always better to do something than to suffer analysis paralysis. Legendary oil-man an entrepreneur T. Boone Pickens has a way of quickly sizing up a situation, coming up with a plan, and acting. There’s no sitting around or endless analysis and debate. It seems to have worked for him. (Begin with the End in Mind)
Habit 3: Put First Things First, Second, and Third. Covey says prioritize, but I’ll take it one step further. Whoever said, “don’t sweat the small stuff,” was right, and I’ll add, “don’t do or even think about the small stuff.” Every successful innovative person I know jumps on hot opportunities and critical issues like they’re the only things that matter on god’s green Earth. (Put First Things First)
Habit 4: Think Win. Former New York Yankees owner George Steinbrenner may have been a world-class a-hole, but he was a remarkably rich and successful world-class a-hole who let nothing stand in the way of the only thing that ever really mattered to him, winning. Bill Gates, Larry Ellison - show me a successful entrepreneur and I’ll show you someone who puts winning first. (Think Win/Win)
Habit 5: Seek First to Understand, then to Innovate. The key to innovation is to first understand a big hairy problem that, to date, nobody’s been able to solve. Once you’ve got that, then, and only then, does it even begin to make sense to do something about it. Otherwise you’ll just end up with a great product nobody needs. (Seek First to Understand, then to be Understood)
Habit 6: Energize. With rare exception, successful innovators are high-energy people with a unique ability to stimulate and motivate others. That’s called leadership. Without it, you can have the most effective habits or the best ideas in the world, but nobody will ever know it, because nobody will care and nothing will actually get done. (Synergize)
Habit 7: Question the Status Quo. Andy Grove built semiconductor powerhouse Intel on several principles, two of which were “only the paranoid survive” and “constructive confrontation.” That means never rest on your laurels, continually challenge your own assumptions, and always question the status quo. That’s how Intel became a high-tech dynasty.
Habit 2: Do Something. You don’t always know where it’s going to lead, but it’s always better to do something than to suffer analysis paralysis. Legendary oil-man an entrepreneur T. Boone Pickens has a way of quickly sizing up a situation, coming up with a plan, and acting. There’s no sitting around or endless analysis and debate. It seems to have worked for him. (Begin with the End in Mind)
Habit 3: Put First Things First, Second, and Third. Covey says prioritize, but I’ll take it one step further. Whoever said, “don’t sweat the small stuff,” was right, and I’ll add, “don’t do or even think about the small stuff.” Every successful innovative person I know jumps on hot opportunities and critical issues like they’re the only things that matter on god’s green Earth. (Put First Things First)
Habit 4: Think Win. Former New York Yankees owner George Steinbrenner may have been a world-class a-hole, but he was a remarkably rich and successful world-class a-hole who let nothing stand in the way of the only thing that ever really mattered to him, winning. Bill Gates, Larry Ellison - show me a successful entrepreneur and I’ll show you someone who puts winning first. (Think Win/Win)
Habit 5: Seek First to Understand, then to Innovate. The key to innovation is to first understand a big hairy problem that, to date, nobody’s been able to solve. Once you’ve got that, then, and only then, does it even begin to make sense to do something about it. Otherwise you’ll just end up with a great product nobody needs. (Seek First to Understand, then to be Understood)
Habit 6: Energize. With rare exception, successful innovators are high-energy people with a unique ability to stimulate and motivate others. That’s called leadership. Without it, you can have the most effective habits or the best ideas in the world, but nobody will ever know it, because nobody will care and nothing will actually get done. (Synergize)
Habit 7: Question the Status Quo. Andy Grove built semiconductor powerhouse Intel on several principles, two of which were “only the paranoid survive” and “constructive confrontation.” That means never rest on your laurels, continually challenge your own assumptions, and always question the status quo. That’s how Intel became a high-tech dynasty.
Thursday, February 3, 2011
AIA AFG Takaful
Malaysian Islamic family insurer AIA AFG Takaful Bhd will more than double its workforce to 60 by year-end as it seeks a toehold in the world's second-largest sharia insurance market.
The insurer, is owned by the Malaysian unit of AIA and Alliance Bank , will add to its current headcount of 25 as it looks to become among Malaysia's top three family takaful providers within three years, its chief executive Wan Azman Wan Mamat said.
"The potential is that immediately a start-up company like AIA AFG Takaful will have access to a very strong distribution and that will be the differentiator for the company in terms of the growth potential," AIA Bhd chief executive Khor Hock Seng told reporters after officially launching the company.
Wan Azman said Etiqa Takaful, which is owned by Mayban Fortis, a joint-venture between Malaysia's largest lender Malayan Banking and financial group Fortis , is Malaysia's biggest Islamic family insurer with about 25 percent market share. Prudential is second with about 16-18 percent share.
"Increasingly bancassurance is going to play a major part of our business," said Alliance Financial Group's group chief executive Sng Seow Wah.
"With this tie-up, I hope to be able to extend beyond the takaful business with AIA to do other bancassurance products which will extend to businesses."
The Islamic insurance industry's growth has been held back by a shortage of sharia-compliant instruments that insurers can invest in and some doubts about whether takaful really complies with Islamic guidelines.
The takaful penetration rate in mostly Muslim Malaysia was only 10.9 percent in September 2010. The Southeast Asian country has the world's second-largest takaful market and its total assets of $3.2 billion accounted for 26 percent of total global takaful assets in 2009, according to central bank estimates.
AIA AFG Takaful is one of four takaful companies that received licences from the Malaysian central bank late last year as the authorities look to accelerate the industry's growth.
Total takaful contributions could reach $7.7 billion a year by 2012, Ernst & Young has forecast. But global takaful contributions are less than 1 percent of the total insurance premium spend annually, industry lawyers Clyde & Co have said.
The insurer, is owned by the Malaysian unit of AIA and Alliance Bank , will add to its current headcount of 25 as it looks to become among Malaysia's top three family takaful providers within three years, its chief executive Wan Azman Wan Mamat said.
"The potential is that immediately a start-up company like AIA AFG Takaful will have access to a very strong distribution and that will be the differentiator for the company in terms of the growth potential," AIA Bhd chief executive Khor Hock Seng told reporters after officially launching the company.
Wan Azman said Etiqa Takaful, which is owned by Mayban Fortis, a joint-venture between Malaysia's largest lender Malayan Banking and financial group Fortis , is Malaysia's biggest Islamic family insurer with about 25 percent market share. Prudential is second with about 16-18 percent share.
"Increasingly bancassurance is going to play a major part of our business," said Alliance Financial Group's group chief executive Sng Seow Wah.
"With this tie-up, I hope to be able to extend beyond the takaful business with AIA to do other bancassurance products which will extend to businesses."
The Islamic insurance industry's growth has been held back by a shortage of sharia-compliant instruments that insurers can invest in and some doubts about whether takaful really complies with Islamic guidelines.
The takaful penetration rate in mostly Muslim Malaysia was only 10.9 percent in September 2010. The Southeast Asian country has the world's second-largest takaful market and its total assets of $3.2 billion accounted for 26 percent of total global takaful assets in 2009, according to central bank estimates.
AIA AFG Takaful is one of four takaful companies that received licences from the Malaysian central bank late last year as the authorities look to accelerate the industry's growth.
Total takaful contributions could reach $7.7 billion a year by 2012, Ernst & Young has forecast. But global takaful contributions are less than 1 percent of the total insurance premium spend annually, industry lawyers Clyde & Co have said.
Hong Leong Tokio Marine Takaful
Mitsui Sumitomo Insurance, a unit of Japan's largest property-casualty insurance firm MS&AD , said on Wednesday it may buy a stake in Malaysia's Hong Leong Tokio Marine Takaful to tap growing demand for Islamic insurance.
The move comes as its Japanese rival Tokio Marine & Nichido said it is considering selling its 35 percent stake in the Islamic insurer to Hong Leong to end its partnership over strategic differences. Tokio Marine & Nichido is a unit of Tokio Marine Holdings .
Mitsui is keen to buy that stake, which would build up its presence in Malaysia after its insurance alliance with Hong Leong Financial Group worth $480 million last year, a company spokesman said.
The deal could be worth about 1-3 billion yen ($37 million), a source with direct knowledge of the deal said. HLA Holdings Sdn Bhd, which is part of Hong Leong Financial Group, owns the remaining 65 percent of Hong Leong Tokio Marine Takaful, according to the Islamic insurer's website.
Tokio Marine is expected to sell its stake in Hong Leong Tokio Marine to the Malaysian shareholder which would then sell it on to Mitsui Sumitomo, both pending regulatory approval, a source said.
Japan's Nikkei newspaper had earlier reported that Tokio Marine was planning to exit its partnership in Hong Leong Tokio Marine due to differences in business strategy. While Tokio Marine wants to sell a broad lineup of life and non-life insurance, Hong Leong is keen to focus on savings-type policies, the paper said.
Mitsui Sumitomo has been looking to expand its overseas operations by forging tie-ups with peers in emerging markets as Japan's non-life insurance market shrinks.
Mitsui Sumitomo Insurance managing executive officer Masaaki Nishikata told Reuters in September that MS&AD Insurance was in talks to buy into several life insurers in Asia as it aims to tap the region's growing economies.
A unit of Tokio Marine halted talks with Malaysia's PacificMas to buy medical insurance provider Pacific Insurance Bhd last July.
The market for Islamic insurance, or takaful, is expected to grow in tandem with rising demand for ethical investments. Total takaful contributions could reach $7.7 billion a year by 2012, Ernst & Young has forecast. But global takaful contributions are less than 1 percent of the total insurance premium spend annually, industry lawyers Clyde & Co have said.
The move comes as its Japanese rival Tokio Marine & Nichido said it is considering selling its 35 percent stake in the Islamic insurer to Hong Leong to end its partnership over strategic differences. Tokio Marine & Nichido is a unit of Tokio Marine Holdings .
Mitsui is keen to buy that stake, which would build up its presence in Malaysia after its insurance alliance with Hong Leong Financial Group worth $480 million last year, a company spokesman said.
The deal could be worth about 1-3 billion yen ($37 million), a source with direct knowledge of the deal said. HLA Holdings Sdn Bhd, which is part of Hong Leong Financial Group, owns the remaining 65 percent of Hong Leong Tokio Marine Takaful, according to the Islamic insurer's website.
Tokio Marine is expected to sell its stake in Hong Leong Tokio Marine to the Malaysian shareholder which would then sell it on to Mitsui Sumitomo, both pending regulatory approval, a source said.
Japan's Nikkei newspaper had earlier reported that Tokio Marine was planning to exit its partnership in Hong Leong Tokio Marine due to differences in business strategy. While Tokio Marine wants to sell a broad lineup of life and non-life insurance, Hong Leong is keen to focus on savings-type policies, the paper said.
Mitsui Sumitomo has been looking to expand its overseas operations by forging tie-ups with peers in emerging markets as Japan's non-life insurance market shrinks.
Mitsui Sumitomo Insurance managing executive officer Masaaki Nishikata told Reuters in September that MS&AD Insurance was in talks to buy into several life insurers in Asia as it aims to tap the region's growing economies.
A unit of Tokio Marine halted talks with Malaysia's PacificMas to buy medical insurance provider Pacific Insurance Bhd last July.
The market for Islamic insurance, or takaful, is expected to grow in tandem with rising demand for ethical investments. Total takaful contributions could reach $7.7 billion a year by 2012, Ernst & Young has forecast. But global takaful contributions are less than 1 percent of the total insurance premium spend annually, industry lawyers Clyde & Co have said.
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