How to feel the joy of sales without the looming fear of risk exposure
From attracting talent to adding members, “closing the deal” is often a battle between requirements and compliance.
At Bunker, we’ve spent the past 18 months understanding how insurance plays a role in industries that require it as part of normal operating procedure. What we’ve found is that business insurance is a requirement to formalize relationships in many industries, including contingent workforce, franchising and property leasing, among others. We've also found that those requirements are very painful for everyone involved.
For example, in real estate, when a commercial landlord has a vacant property, they are losing money every month the property sits without a tenant. When a tenant prospect comes along, part of the lease agreement includes, at a minimum, general liability insurance. More often than not, when the tenant prospect is a small business, the prospect does not have the levels of insurance required in the lease, if any insurance at all.
We’ve also seen this in the growing contingent workforce industry. An enterprise has a looming project deadline and reaches out to contract workers for assistance. As part of the enterprises’ independent contractor program, they require contractors to have their own insurance. And again, the overwhelming majority (70-90%) do not have the levels of insurance required, if any insurance at all.
We consolidated our many discussions into a few main barriers that halt compliance from becoming embedded in business relationships:
- Legacy Requirements: Insurance requirements, even those for small businesses and independent contractors, are often carried over from out-dated procurement policies. This results in unrealistic requirements that are out of balance to the potential exposure for the prospective contractor/tenant/SMB.
- Confusing & Aged Content: Let’s face it, insurance is confusing. From overlapping policies and additional language (can you say “waiver of subrogation”?) to the lack of consistency between document language, the actual requirements alone are enough to bury a person in Google searches for days. Add the never-ending PDFs and you have a recipe for frustration. Somewhere an insurance agent is standing by their fax machine smoking a cigarette just waiting for a customer application :).
- Cumbersome Processes: Any kind of business relationship has layers, and with layers come emails. When we add “confusing and aged content” with emails the outcome is never “fast” or “easy”.
- Deniable Risk: Like the insurance industry in general, risk does not equal incident. The joy of an immediate sale outweighs the pain of unforeseen incidents.
So, what is the landlord or project manager to do? Should they throw down the hammer and enforce the requirements, despite the possible ramification of scaring away the tenant/contractor prospect? Do they reduce the requirements to a level the prospect might already have? Do they ignore the requirements all together to ensure the sale?
What You Can Do Now
You can make legacy requirements a thing of the past. Bring together your HR Managed Service Provider (MSP), Contingent Staffing Manager, and/or Risk Management team to compare legacy requirements with current and future hiring/leasing strategies. Through this exercise, come out the other end with revised requirement segments. For example, these could be based on project size (large, medium or small vendor/contractor/tenant) or based on industry (IT, project management, marketing, etc.). Do not be afraid to drill too deep and customize requirements within a segment, like IT Architecture vs. IT Front End Development. Tools, like Bunker, can make management of these simple - minutes versus days or weeks.
How Bunker Helps
Bunker is attacking the cumbersome processes and aged content challenges to simplify communication and quicken the path to compliance for both parties. As a free tool for enterprises and contingent staffing professionals, setting up sharable requirements takes minutes, viewing compliant vendors/contractors/tenants is straightforward, getting alerts for expiring insurance is automatic and, most importantly, there are no more email chains. By attacking these existing barriers, we make the insurance process easier for everyone involved, compliance becomes embedded in the relationship.
By revising legacy requirements and creating a more transparent path to compliance, we can remove insurance as a barrier, and still feel the joy of sales without the looming fear of risk exposure.