Agency Financial Management
Take the initiative and dig deep into three elements of your business
If you want true growth and a high-performing business, you can’t afford to exhale and rely only on a boost in rates and a favorable economy to meet your goals. Are you putting a strategic growth plan into action for 2018? If you want to see results, it’s time to take initiative and dig deep into three important elements of your business: talent, product and revenue.
Talent
If you are waiting on revenue growth before focusing on growing your talent pool, your priorities may be out of line. In order to stay ahead of the competition, spending time on developing high-performing employees and recruiting top talent is essential.
While providing outstanding service is always imperative, in the case of some products, excellent service and attention to detail may be the only variables that can differentiate you from the competition … .
Start assessing your management team and staff; rank each of them on characteristics such as reliability, ability to assume new responsibilities, being self-directed, client service, etc. Clearly define the needs of your evolving company. This high-level evaluation will allow you to develop an action plan for each existing individual—whether that involves additional training, mentoring, or replacing. Analyzing your staff and considering their growth potential, given your strategy and goals, will get you on the right track.
Next, determine if there are any talent needs to achieve your goal. This process will allow you to see roles that need to be filled by hiring new talent. Don’t hesitate. Start posting job listings, inquire within your network, and start interviewing. It may take a while to find the perfect candidate; however, it is better to go about this process systematically so you can truly find the right person for the job, rather than to be in a situation requiring you to rush to make an offer, only to learn after the fact that you have made a wrong, and often costly, decision.
Keep in mind that you do not have to wait until there is a gap that needs filled to start looking for potential candidates. Be proactive. Always have an eye out for people who will fit well within your organization. Through ongoing networking, you can build a pool of prospects you can reach out to when the time is right. Look beyond the normal avenues for new talent. That outgoing, detail-oriented barista—the one who knows her customers by name and keeps everything running smoothly during the morning rush—might just be your next great hire. There are certain skills that cannot be taught. Don’t miss out on a potentially great candidate because you didn’t think outside of the traditional recruitment box.
Once you have your team in place with clearly defined roles, take things a step further and assess any generational differences that may exist within your business. It’s no secret that when multigenerational employees work together, conflicts can occur over issues such as management and operational styles, the use of technology and overall decision making. To create a positive and effective intergenerational workforce, first understand, then create a work environment that is flexible, suiting all needs, preferences and values as well as possible. Create opportunities for different generations to work together so they can overcome their initial stereotypes, gain respect for one another and, in the process, learn valuable skills from each other.
As I often say, at the end of the day your most valuable business assets leave the office. Trying to recruit, hire and train for constant turnover is a bad business model. Successful business owners know this and plan accordingly.
Products
While considering how you can maximize the time and abilities of your current staff, consider how you may also diversify your product offerings—potentially adding coverages by growing complementary products for cyber, energy, employee benefits and other categories with continuously growing demand. Gather research on needed coverages and products. Compile this information and ascertain whether it makes sense to expand into these areas. Assess the competition. Are there gaps in their product offerings where you can fill a need for their clients and possibly some of your own? Be selective. Too many options can do more harm than good.
You may also want to consider expanding with specialty writers that provide coverage for risks that either fall outside what standard insurance carriers underwrite or that don’t fit into your current core product offerings. While market penetration and expansion should be key objectives, due diligence is a must when exploring these new avenues for growth.
In short, taking on new products could be the perfect opportunity for employee and business growth alike.
Revenue
Increasing your revenue will require strategic planning and execution. Start your plan with the “low-hanging fruit” by ensuring that existing policies are always renewed. If you are seeing higher-than-expected drop-off rates, you need to dig deep into your data to understand why and remediate. Next, look to increase revenue by leveraging your current client base. Strategically identify both new and existing products that might be a fit for each client. Finally, purposefully target and attract new customers with a combination of your new and existing products. Layer a great client experience on top of these revenue-increasing activities for the most impact.
While providing outstanding service is always imperative, in the case of some products, excellent service and attention to detail may be the only variables that can differentiate you from the competition and, thus, allow you to retain and grow current clients as well as attract new customers.
And this brings us back to the importance of talent.
As you look to create sustainable growth that outperforms your competitors in 2018, invest in your greatest asset—your staff. Take charge of diversifying your product offerings. And finally, create and execute a solid plan that will result in increased revenues. Will 2018 be your year?
The author
Rick Dennen is president and CEO of Oak Street Funding, which provides commission-based lending for insurance agents who need capital to buy, build or sell their agency. Dennen is a licensed agent in the state of Indiana for Life, Accident & Health products and a licensed Certified Public Accountant in the state of Indiana. In addition, he holds an MBA in finance and is an instructor of venture capital and entrepreneurial finance at the Indiana University Kelley School of Business. He can be reached at rick.dennen@oakstreetfunding.com.
