Running Your Agency By Design, Not Default

agency leader planning at a desk

At a recent weekly accountability meeting, our team was discussing the major changes and challenges the past year had brought not only to our organization, but also to the agencies and individuals we serve. I was complimenting the team on how every member had raised their game by finding new ways to enhance the value we provide our clients and Sitkins Network members. One of the most significant is the continued development and expansion of our virtual programs. The response has been fantastic.

During the meeting, Janey Cahill, our chief operating officer, commented, “Complacency doesn’t live here.” What an outstanding observation! She’s absolutely right. The more I thought about it, the more I realized that a lot of agencies are complacent. Is yours one of them? Are you running your agency by design or default?

Design is all about establishing and executing your agency’s way of doing business. This means your agency has clearly defined its mission statement, vision statement, critical success factors, and key performance indicators. You have specific processes for retaining and obtaining ideal clients and a financial model that drives decision making.

In his book, The Motive, author Patrick Lencioni redefines CEO and CRO. Instead of chief executive officer and chief revenue officer, Lencioni says that in the highest performing businesses, the CEO is actually the chief execution officer and the CRO is really the chief reminding officer.

In a “designed agency,” these two leaders clarify the agency’s direction. They know where the organization is today, where it’s going, and how it will get there. They realize that there will be retention issues and revenue challenges, but they’re working diligently to get ahead of them. In preparing now for how they’ll deal with them going forward, they’re operating by design rather than by default; they’re not just waiting to see what happens.

First and foremost, they are intentionally right-sizing their agencies. They’re no longer allowing themselves to be over-staffed or under-incomed. All too often we hear, “I know we’re over-staffed, but we’re doing it for growth.” That’s fine, but where’s the growth going to come from, particularly in the post-pandemic world? You can’t rely on the old way of selling (look, copy, quote and pray) or market strictly according to the digital alerts on your computer or cell phone.

Looking ahead, you’ll need to focus on revenue per employee and, more importantly, spread per employee to achieve meaningful growth. If your revenue per employee is less than $200,000, you are over-staffed and should consider right-sizing your team. Moving forward, increased productivity is a must.

You also have to look at right-sizing your revenue per relationship (average customer size). The size of your agency and the size of your producers’ books of business will always be driven by average revenue per relationship. What’s yours? Remember, you can’t be a million-dollar producer by writing $1,000 accounts!

Design also includes understanding and actually using “The Power of 80/20.” Yes, I know you’ve heard it all before, so I’m not going to reiterate, but what have you done with it? At a minimum, you should never allow profitable accounts to subsidize unprofitable ones. It’s that simple!

Unfortunately, default is far more common than design. Why? Because ours is a great business. Even if you don’t do much of what I preach, you can still be semi-successful. However, you won’t have long-term financial freedom and, in fact, you already may be facing financial challenges that in the past you never imagined possible.

One of my favorite quotes by Warren Buffett is, “Only when the tide goes out do you discover who’s been swimming naked.” Well, based on what I’ve seen, I believe that way too many agencies and producers have been swimming naked, and the tide is going to be out for a long time!

The problem is, the naked swimmers (default agencies) are clinging to the past—to the old way of doing business. They blindly believe that “this too shall pass.” Well, they’re right; eventually this will pass. But the question remains: How will you emerge from this year? What will be the impact on your agency and its book of business, and what are you doing about it?

On the positive side, I’ve seen that our highest performing agencies, those run by design, are actually doing great. A while ago, I wrote an article, “The Gateway to the Next Level.” In it, I stressed our DLX2 Model (Deep Learning Experience and Execution). This brings me to the Next Level of DLX2: The DEEP Model.

Going DEEP means Delivering Excellence in Every Process. Rather than waiting around to see what will happen and operating without a plan, those agencies with their “design” in place have transitioned to a new model, a new norm. They have discovered some great new approaches and they’re doing really well.

Instead of going shallow and chasing a million different things (commonly known as the trivial many), it’s time to go DEEP. Take a good hard look at your most important processes (the vital few). This includes examining your approach to:

  • New Business
  • Continuations
  • Pipeline Development
  • Relationship Management
  • Technology Utilization

Are you willing to go DEEP? Do you really have a choice? Now as the post-pandemic tide comes back in, I think we’ll see two distinctly different types of agencies and producers: pretenders and performers.

The pretenders can’t wait to get back to the good old days. The reality is, the old days are simply that—old! The pretenders’ primary strategy is hope (as in, “I sure hope everything works out okay.”).

The performers take action. They have a chief execution officer and a chief reminding officer. They implement the plans they put in place. They take the lessons they’ve learned from the COVID-19 crisis and move forward. They don’t let negative history repeat itself. The performers hold themselves to a deeper level. They live by the motto: Complacency Doesn’t Live Here!

Will complacency live at your office? As always, it’s your choice.

The author

Roger Sitkins is the CEO of Sitkins Group, Inc., and developer of The Sitkins Network and The Better Way Agency program. Roger began his career by working in his parents’ insurance agency in Wyandotte, Michigan, and after nearly 40 years has truly become an icon in the industry. He has trained and mentored thousands of insurance professionals. Producers, CEOs, and sales managers with diverse levels of experience have benefited tremendously from his training and leadership.

Recognized as the nation’s top insurance agency results coach and renowned leader for improvement, he believes that if you improve the life of one person, you improve the world. To learn more, visit


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