What do you think is the biggest threat facing property/casualty insurers today?

Is it escalating claim volumes? Litigation? Higher reinsurance costs? Other industry-specific challenges?

The answer may stun you. It’s actually none of the above.

One of the top risks to P/C insurers can threaten any type of organization—namely, failure to implement and accomplish strategic goals.

Despite some improvement over the last couple of decades, strategy execution is still a significant problem. According to research from Bridges Business Consultancy provided in the book “Excellence in Execution: HOW to Implement your Strategy,” 90 percent of companies surveyed in 2002 reported that they failed to achieve at least 50 percent of objectives in the time allotted. Although this number had dropped to around 67 percent by 2016, this still represents a significant number of companies that fail to meet their strategic goals.

This carries a pretty hefty price tag. According to research from CEB (2014), also cited in “Excellence in Execution,” this failure results in a cost of up to 50 percent of an organization’s potential cumulative cash flow (CEB’s Executive Guidance for 2015). Other studies from the Project Management Institute show that for every $1 billion in investment, organizations lose roughly $100 million due to poor performance ($99 million per 2018 Pulse of the Profession study).

Outcomes like this can put a company in peril, especially in today’s world of acquisitions, technology improvements, eroding profit margins, market displacement and myriad other disruptions.

Of course, financial impacts are not the only ones. Missing goals can have a significant impact on morale. It can be discouraging to fall short of goals time and again, especially after you and your team have worked so hard all year long.

This begs the question: what can be done to ensure the company meets the strategic goals it has set?

This isn’t the first time I’ve explored the topic of implementation. One year ago, I outlined core components of successfully implementing a strategic plan, along with some common reasons why many fall short. One of those reasons cited—lack of agility—is where I want to focus today.

An increasingly vital skill P/C insurers must possess in this topsy-turvy world is the ability to adapt as conditions warrant.

What often happens is that the company develops so many strategic goals that it ends up strangling the company’s ability to be agile. This seemingly “ambitious” strategy really results in widespread frustration—from executives to frontline workers—when the goals aren’t met.

Therefore, in order to move forward, you may feel like you need to go backward by reducing the number of strategic goals your company sets. “Excellence in Execution” recommends the number of goals be reduced by at least half, but depending on the company’s size and experience with strategic planning and execution, it may be wise to cut this number to just one.

Besides agility, it’s inevitable that with so many goals, the company leadership will also identify a list of 50 or more projects that are needed to accomplish those goals. Unless you’re a company with 10,000 or more staff with decades of experience, it won’t take long to get bogged down and spread too thin.

So far, what has been described are only the symptoms. But what is the root cause? Why is having too many goals disastrous?

The fundamental reason why so many companies do not accomplish the goals they set boils down to a single word: multitasking. Emerging on the scene in the mid-1960s, multitasking was seen as a way to get more done in a limited about of time. This can manifest itself in a variety of forms, such as answering texts or emails during a meeting, or working on multiple projects or strategic goals at once.

It was first thought multitasking could be helpful, but more research in the last 10-20 years coupled with real-world experience has cast much doubt on that. For example, according to a study published in Psychonomic Bulletin & Review, (Watson, J.M., Strayer, D.L. “Supertaskers: Profiles in extraordinary multitasking ability,” Psychonomic Bulletin & Review 17, 479–485, 2010) only 2.5 percent of people are able to multitask effectively.

Writing in Forbes, Founder and CEO of FocusWise Curt Steinhorst elaborates on the drawbacks of multitasking when he explains: “Although it purports to increase efficiency, in most cases, multitasking merely increases busyness while eroding productivity. (A better name might be “multitaxing.”) It is the business equivalent of leaving a runner on second at the end of an inning. Baseball teams aren’t productive because they engage in feverish activity; they’re productive because they focus on bringing the runner home. Leaders need to make sure their companies do the same.”

One concept people often forget is that strategic goals and initiatives require not just physical capacity but mental as well. Juggling too many projects, or multitasking to accomplish a certain number of goals, can get too mentally taxing.

This ultimately is due to the fact that multitasking like this requires what is called context switching, a concept developed by Dr. Gerald Weinberg at the University of California-San Diego in the mid-1990s. The central premise of this theory is time is inevitably lost because of the recalibration the brain naturally undergoes from switching tasks or projects.

Executive coach Todd Herman, creator of the 90-Day Year, explains it like this in a video interview featured in Forbes. If there are two projects, it’s easy to think one can be worked on for four hours, or half the day, and the other one for the second half of the day. However, because of context switching, 20 percent of that time is lost.

With three projects, available time drops by 40 percent, meaning that in a 10-hour day, you’re losing four hours to context switching. When you stop yourself from focused effort, it takes approximately 12 minutes of concentrated work to get yourself back into this “flow state,” Herman explains in the interview.

Although Herman’s and others’ commentary on multitasking focuses mainly on individual effort, it is not hard to see why so many companies fall short of achieving their strategic goals. After all, all companies are made up of individuals striving toward the same goals.

Now, let’s be clear—I am not advocating a company to only have one goal or one strategic initiative at a time. That may make sense for some smaller companies with fewer resources. But having too many goals means more multitasking and context switching and nothing ever gets done.

“You are judged by what you do, not by what you think or intend to do,” Herman states in his interview. Said differently, it’s not the number of goals and amount of effort that you “put in” but instead “how we execute or how we perform that matters. All that happens on the field of play, the field of doing.”

Knowing just the right number of goals to maximize your company’s performance is partially found in understanding specific attributes of how you and your team work. Herman’s 90-Day Year has a free Performance Style Quiz to help you and your team do this. (Note: I have used 90-Day Year but have no referral arrangement with them.)

It may seem simple and mundane, but as I’ve witnessed working with companies in the P/C industry, streamlining the number of strategic goals can have positive impacts beyond improved finances and company growth. Frequently, major initiatives are completed about two-thirds through the year, which allows for additional, maybe dependent or secondary projects to get started, especially if they can be finished by the end of the calendar year.

In the end, as we discussed in the article on implementation published here in Carrier Management a year ago, you can have the most robust planning process that yields some impressive, ambitious goals. However, without good implementation on the back end, the goals and process for developing them won’t be worth much.

As Steve Jobs reportedly said, “To me, ideas are worth nothing unless executed. They are just a multiplier. Execution is worth millions.”

Don’t leave figurative—or maybe even literal—millions on the table by falling short of strategic goals due to excessive context switching and other pitfalls of multitasking.

Hone in on specific goals and projects that will really move the needle and go all-in to ensure those goals can be met. Bit by bit, your company will be stronger for it.