You all know that we are strong proponents of growing agencies by adopting and nurturing professional Relationship Managers (Producers) as well as by acquisition. The foundations of most agencies are strongest when built on strong customer connections built through individual long-term relationships between the client and the agency. Agencies built only on acquisitions have to work harder to convert acquired accounts into relationship-based clients and most fail to do so. Acquiring agencies purchase hundreds or thousands of customers hoping that the clients will stay, but most don’t have the time or personnel to ‘make friends’ with each of their new clients.
Every agency that we encourage to get more producers expresses their frustrations over their inability to do so. They tell me, “We’d love to have more producers, but the few we can find are re-treads that don’t produce!”
Unfortunately, the reality of our generation is that we trained our producers into being price-quoters instead of relationship-builders and, once they generated sufficient numbers of clients to sponsor their lifestyles, they basically went “RIP” (Retired In Place). Worse yet, when they wore out their welcome in the agencies who sponsored them to grow the books of business, they simply move to another agency, taking as many of the clients from their prior agency as they can, immediately if they have no non-compete or after their non-compete period if the original agency wasn’t smart enough to form new personal relationships with the producer’s clients.
Some of these producers became ‘Gypsy Producers,’ moving from one agency to another, spending a few years moving their business and then leaving again when their new employer realized that they were only babysitting the same group of clients everywhere they went.
We have several ways of addressing the issues of non-producer producers in an agency and invite your calls to discuss them. In this article, however, we’d like to introduce some of you to a way of creating a new cadre of producers who break the price-quoter mold and generate a continuous and constantly growing book of business on behalf of your agency by building relationships and expanding their horizons every year.
Some agents have found these sales professionals in other industries and have converted them into the insurance industry. We encourage you to seek sales professionals from your target markets for this purpose. NOT having an insurance background can sometimes be a plus to creating a sales machine in your agency. However, the surest way of creating the type of salespeople that you would like to have in your agency is by developing them yourself.
Rolling Your Own
The development of a Relationship Manager is necessarily slow and progressive. But if you recruit young talent from a pool that is replenished every year, the cost is moderated (compared to hiring either an experienced insurance or sales professional.) The “pool” that we’re talking about is the colleges and high schools that graduate thousands of youngsters every year into a difficult economy for jobs.
We, in the insurance agency industry, can become a ready source of new jobs for some of each year’s graduating class IF we’re ready to train and manage these young minds into the kind of insurance professional about whom we dream.
Agency Consulting Group, Inc. has helped agents recruit and manage young people into responsible insurance positions for over 30 years. We do so quietly and effectively and our methodology can be replicated anywhere.
Step One: College and High School Recruitment
Many college seniors have no idea of what they are going to do after graduation. They see high unemployment statistics looming over them and they are ‘empty vessels’ awaiting some opportunity. High school seniors who don’t have college aspirations may also be prime candidates for a business that can take advantage of their existing relationships and familiarity with their friends and neighbors.
Unfortunately, the insurance industry ranks relatively low in the views of many youngsters. We are somewhere between used car dealers and retail sales because of a tarnished image of us as simply price manipulators.
Agency Consulting Group, Inc. can do what individual agencies can’t accomplish on their own. We are sponsored by groups of agencies to recruit local colleges and high schools to identify strong potential agency employee candidates and we send them to the sponsoring agencies to interview for the candidate’s final decision on career selection. Our costs are spread over all of the agencies in the group.
We spend a great deal of time with seniors explaining that the insurance industry is a way of helping people protect themselves, their families, their assets and their investments. Once we convince people that our role is to advise and protect, they become less concerned with the “sales rap” that we have lived under for so long. We do this through informative programs at college campuses and high schools during their recruitment period for seniors. We are teaching these young people what our industry CAN BE instead of their perception of our business.
We interview seniors with very directed questions that identify personality characteristics that would fit our business and we give them an assessment that will tell us whether they have the thinking style (verbal and numerical skills), the behavioral traits (energy, assertiveness, sociability and manageability, attitude, etc) to be successful in a role in an agency.
The youngsters that we find fit the mold of a potential insurance professional are sent to each of the sponsoring agencies for their interview. Eventually, one or several agencies make offers and the youngster selects the employer of his/her choice.
Step Two: Training
Training must be individualized by the agency to fit the specific agency’s model and needs to be continuous for at least three years. Personal lines agencies will evolve a different training schedule than commercial lines or L&H agencies. Even though we are taking raw talent who have been identified as having the characteristics required to be successful in the insurance business, their success depends of the level of training and mentorship that they get as they build their skills and their management through the process (see Step Three, below.)
A key to the success of the program is the ability of the participating agencies to take the time to train and mentor their employees. Many small agencies simply don’t have the time or personnel to provide either training or mentorship. Even larger agencies must have a commitment to training and/or mentorship for the program to work for them.
Training can be outsourced depending on the agency’s geographic locale and the availability of strong Associations and other training mechanisms for insurance and sales-related information. Mentorship cannot be effectively outsourced. The agency owner, sales manager or key employee must have a regular schedule of intervention with these new employees over a several year period to assure the nurturing and success of the employee. If an agency does not acknowledge that it is THE AGENCY’S RESPONSIBILITY to make the employee successful, this program will not work for that agency.
The key to both training and mentorship is that they happen regularly and progressively. Every employee progresses at a different pace so a single template is not appropriate. But a steady approach that pays attention to the employees and shows the employees that they are both valued and responsible for their progression through the components of their role in the agency will build strong relationship managers instead of glorified clerks.
Step Three: Management
Agency Consulting Group, Inc. can either provide the tools for managing the new employee’s activity or we can act as the employee’s virtual manager for the initial year of service. We have found that activity is a more effective measure of progress than sales results. Sales results in successful producers is a progressive gauge of success that will eventually sponsor that person’s compensation. However, while sales techniques can be taught and insurance knowledge comes with time and experience, steady, high levels of activity give an employee a feeling of worth and value and will build the habits that will keep them productive for many years.
Our management devices lets the employee know what level of activities are required and measures those levels of activities on a daily, weekly and monthly basis through the employees, themselves. Neither we nor the agent is supposed to be a monitor or policeman. If either are needed, the employee has already failed. The employee will show you (and us) his/her level of activity (and results) on an on-going basis.
If Agency Consulting Group, Inc. is the manager, the employee will send us the weekly reports and we will converse about the strengths and shortcomings to congratulate or take corrective action. If you manage the producer using our formats, you will perform the follow-up.
The activities define the levels needed to make the employee effective in the job. The results must follow or re-training will be required for either expertise or technique. Our self-terminating contract will allow the employee to depart from the agency by his own volition if the employee can’t manage to accomplish the activity levels that both the agency and the employee have deemed appropriate to achieve the production levels in support of the employee’s compensation level.
Working within the agency system for over 40 years, we have identified the characteristics of agencies that would be successful with new producers recruited in this fashion – and those who would not.
The successful agency would already have a mentorship mentality (everyone works together and helps one another).
The successful agency would be willing to sponsor a new employee for a period of one to three years before that person became fully self-sufficient. They think in the long term instead of only considering whether the employee pays his way in the short term.
The successful agency has already realized that relationships, not pricing is the most appropriate strategy for long term success and retention of clients.
The successful agency has the ability (time and personnel) to train and mentor employees. Training can be outsourced.
If your agency has these characteristics, you should consider the Producer Recruitment Program as a method of evolving new, young, growth-oriented producers and future owners within your agency.
The Producer Recruitment Program dovetails with the Asset Protection Model of Relationship Selling and the Producer Validation and Compensation Program to properly compensate producers for their activity and results.
Please call us at (800) 779- 2430 to further discuss the Producer Recruitment Program.