According to recent studies, fewer than 15% of independent insurance agencies practice effective true sales management. (Perhaps the key word is “effective,” as in “getting results.”) So if sales management is essentially nonexistent in independent agencies, how is it that we have producers with $1 million of commission income on their books of business? (We used to kiddingly say that until you get to $1 million of commission, you’re still a Producer-In-Training!)
For that matter, how can we have producers generating upwards of $150,000, $200,000, $250,000 or more of new revenue per year without sales management? (At this point, please don’t panic and stop reading, thinking that this doesn’t apply to you. The $1 million book and the annual new business amounts may, in your town, be considerably more or less in another market. It’s all relative to where you are and where you want to go.)
In the absence of dedicated sales management, many top producers thrive, thanks at least in part to self-discipline. According to Harvard University researchers, high achievers in all areas of life have the following four traits in common:
For a producer, these stats are fairly simple and comprised of gross commission income, net new commission and retention percentage.
These are the numbers that drive the outcome stats, such as the producer’s conversion rate, closing ratio, revenue per sale/new relationship and number of at-bats. If they improve in every one of these performance stats, their outcome stats automatically improve. So if I improve my conversion rate (my first appointments that move forward to second appointments), I’ll have better outcome stats. If I can improve my closing ratio (the percentage of people who say yes vs. those who say no), my outcome stats improve. They’ll also improve if I increase my revenue-per-sale by raising my minimum account size. Ultimately, if my quantity and quality of at-bats improve, my outcome stats improve. It’s pretty simple. Other than numbers, what else should producers be held accountable for? If the goals are solid—lofty but attainable—and the producers are ahead of goal, probably nothing. They’re giving you the results you want. Strategies & behaviors If producers are not ahead of goal and aren’t getting the desired results, then we need to closely examine the strategies and behaviors that are creating the numbers.
Join our mailing list to receive the latest agency tips, blogs and news from the Sitkins team.
Download the latest white paper from Roger Sitkins.