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Can the Military’s Way of Thinking Help Your Agency?

I have often threatened to write about what I think the military (the U. S. Navy in my case) does well that the corporate world, and specifically the insurance industry, could learn from to become better at what it does. Well, I am finally putting my experience where my mouth is, and I hope what I share provides some fresh insight to what you’re doing at your own organization.Military business strategy

By far, the agencies with whom we have worked that have the smoothest operations are those that are organized well to meet their objectives and have had a clear picture of where they are headed, what they want to accomplish, and what they need to do well day-to-day in order to reach their goals.

This is a clear parallel to the way that military operations and planning are structured. Without getting too deep into it, I will say that this can be broken out into three levels: Tactical, Operational, and Strategic.

Tactical. This is what you do on a daily basis, on the front lines, in a manner of speaking. Answering calls and emails, servicing accounts, and handling clients’ issues are good examples of Tactical work. The daily specifics of these tasks may be a little hard to predict, but I’m sure you have a good idea of the general volume of work you need to do on a daily basis. How well you train your staff and prepare for this type of work directly affects how you handle it and how quickly, competently, and effectively you get it all done.

Operational. This is the area of work that rises above the day-to-day activity — things that need to be done well on a longer-term basis, but are not necessarily a part of the immediate must-do tasks. Consider what an effective Personal Lines (or Commercial or Agency) Manager thinks about in performing his/her job or what the successful management team focuses on regarding the overall running of the agency. These are Operational concerns. A specific example of this level of work is the renewal workflow, which should be a continuous and planned exercise in which account reviews, re-marketing, and client conversations take place, but not necessarily on a daily basis.

Strategic. This is the long-term goal that the organization as a whole (whether the nation, the Navy or your agency) is driving toward. It sets a direction, and ideally everything that is done at the Tactical and Operational levels leads to the Strategic goals of the agency. If you are focused on becoming the largest agency in your town or the best employer with the best client service in the area, these are the Strategic goals you’re working toward.

(By the way, BHBCoVisioningSM is our way of guiding clients so they can effectively look at their agency, and its direction, at Strategic and Operational levels.)

Usually, those agencies that find themselves constantly working on the Tactical (daily) tasks and not getting out ahead to think about the Operational or Strategic level will have a difficult time growing and reaching their goals. Those that are able to focus on and manage to all three levels will be the most successful.

So, where does your agency fall in this spectrum?
JHH

by Jason  | 

Sales Management at the Independent Agency

This blog entry is excerpted from the March 2011 Burke Ink, which can be found in its entirety in the Articles section of our site (../Articles).


Virtually all independent agencies need, and really benefit from, effective sales management.  Few of them, however, will get that by naming a single sales manager.

To sharpen their sales-management performance, most agencies will need first to view the function as having two main parts:  Sales Admin and Sales Leadership.

The most important duty in the Sales Admin part of the function is information production.  Information about the activity and results of new and veteran producers; new and lost business; hit ratios; business mix; retention rates; carrier placements; carrier programs and specialties; marketplace and competitor intelligence; and more.

We’ve seen a lot of so-called sales management conducted with really thin data and faulty assumptions.  Most of our client agency principals are capable of making good decisions for their firms if they have good information.  But there is reason to be concerned about faulty management decisions (or lack of decisions) caused by lousy information and bad assumptions.  Think of how crazy most agency principals would get if you took away their phone or their car!  Well, to someone with sales-management responsibility, their info should be just as important.  It’s an attitude thing.  And where that attitude is lacking, it’s usually explained by a legacy of not having good data and just not expecting to have it.  (This is intertwined with a decades-long habit of accepting the standard menu of reports generated by the dominant vendors of agency management systems — another story.)

The Sales Leadership part of the sales-management function has a few sub-parts:

  • Setting direction — elementary but critical.
  • Setting standards — for activity, results, and conduct.
  • Exhibiting versatility — knowing who needs what (like mentoring for some, technical help for others, and a kick in the pants for still others).
  • Fostering teamwork — particularly between sales and service.

Most agencies do not have, and should not seek, a single person who can do both the Admin and Leadership pieces.  For one thing, there is usually not enough time in the day, but also those skills don’t usually reside in the same human body.

You need to embrace the idea that sales management in the independent agency is a team sport.

For the Sales Admin piece, someone in the agency, preferably not a principal with a large book of business, has to own the function of providing good and timely sales-management information to the sales leader(s) and producers.  He/she does not decide on the content alone.  That’s developed over time in conjunction with the sales leaders and some consulting help.  And it will take time to get it right because it requires a change of attitude and a change of expectations. 

Who performs this function will differ with agency size and make-up.  Ideally, it’s not the bookkeeper or the IT person, but instead an insurance type who relates well with producers and “gets it” in terms of the agency’s sales and service culture.  The Sales Admin job will typically not be a full-time job. 

The Sales Leadership piece can be a team sport within a team sport.  In larger organizations there can be a producer council, designated mentors, new-producer coordinators, and a variety of players.  In smaller firms Leadership might be shared by a couple players.  If you are seeking our input on who should be the capo di tutti capi (the boss of all bosses), it would be an agency principal (i.e., an owner) with demonstrated success and credibility in insurance sales.

Compensation, you ask?  Incentive compensation is usually part of the picture too.  We have a lot of experience on that score.  But it works only if it accompanies good management (Leadership and Admin).  It cannot replace it. — BHB

by Brian  |