What beliefs and behaviors do you envision that would result in success?
If everything starts with your beliefs,
don’t you believe you should have a documented
business model that identifies the behaviors
and associated strategies that become your way of doing business?
By Roger Sitkins
Time and again, we have seen that beliefs drive behaviors and behaviors drive results. The independent insurance agencies we coach clearly understand this. By linking their beliefs and behaviors to the Best Version Possible (BVP) strategies and business model, they create predictable and guaranteed results.
As I’ve often noted, your Key Performance Indicators are the direct result of the behaviors and strategies that form the foundation for your business model. Keep in mind that your current business model is perfectly designed for you to achieve the results you are currently achieving.
Often, when agency owners start our BVP programs and hear my comment about their business model, they’ll tell me, “I don’t have a business model.” Yes, they do—their model is not to have a model. Once their producers start our ProducerFit program, they too will say, “I don’t have a formal business model.” Again, Sitkins coaches’ response: “Sure you do. Not having a business model is your business model!”
If everything starts with your beliefs, don’t you believe you should have a documented business model that identifies the behaviors and associated strategies that become your way of doing business?
Although winging it, confusing activity with results, being stuck in the Red Zone (Service Trap), having a dripping pipeline, doing a lot of practice quoting and unpaid consulting, writing every account no matter what size it is, doing almost zero preparation, and earning only a few referrals a year may not be a documented business model, it is the model that so many follow randomly.
The idea that beliefs drive behaviors and behaviors drive results begins with recognizing what you believe and what you want. What do you accept to be true? What are the results you want? The belief and the results should be one and the same.
Philosopher René Descartes famously asserted, “I think, therefore I am.” To a certain extent, I agree. I think that if your focus is for your agency to become its Best Version Possible, you must first envision success and then model the requisite behaviors that will make your vision a reality. However, without the right behaviors, even the strongest beliefs are unlikely to produce significant, positive results.
When you imagine your perfect agency, what beliefs and behaviors do you envision that would result in success?
- All employees would be focused on a common goal of obtaining and retaining ideal clients while appreciating, respecting, and trusting the different roles everyone plays.
- You would invest in your people. Because people are your agency’s greatest asset, finding and retaining them would be a priority. Regrettably, this is rarely the case. The average agency spends twice as much money on miscellaneous expenses than on the training and development of their people. This is the multi-million-dollar mistake that 98% of agencies don’t even know they are making. By perceiving training and development as an expense and not an investment, agencies are not coming close to maximizing their revenue per employee and spread per employee. This leads to a low operating profit that leaves hundreds of thousands of dollars on the table each year. Every $100,000 of unrealized profit is a loss of millions of dollars in agency value. If you’re one of my followers, you’ve heard this before, but what have you done about it?
- Your producers would be in the Green Zone 80% of the time. Accor- dingly, they would be focused on only four key activities: sales, relationship management, continuations, and pipeline building.
- Your agency would be utilizing the power of the 80/20 Rule, with 80% of revenue coming from 20% of clients. Further, you would employ The Ultimate Growth Strategy, which is to Round Out, Retain and Replicate the top 20% of your clients. Since you’re going to replicate some accounts, why not replicate the top 20% that represent 80% of your revenues? When this is executed in a disciplined fashion, producers can grow their books of business by 15% to 20% or more per year.
- You would have a Unique Selling Process (USP) that differentiates your agency from all other “me too” competitors. Your USP would be based on five key points of differentiation. You’d no longer do any practice quoting or unpaid consulting. You’d understand that the best day to lose the sale is the first day, so you’d super qualify every prospect.
- Your pipelines would be overflowing with more opportunities than time, and these opportunities would be with future ideal clients only. You would accomplish this by following the “every – every” strategy: every client from a targeted referral and a targeted referral from every client.
- Profitable accounts would not be subsidizing unprofitable accounts. After taking a hard look at your A, B, and C clients (A = top 5%, B = middle 15% and C = bottom 80%), you’d recognize that you’re losing money on 25% to 50% of your clients. An even easier approach, what if you lost the top 5% of your clients that are 50% of your revenues?
- Profitable producers would not have to subsidize unprofitable producers. First, you’d identify the percent of your producers who met or exceeded their goals over the last 12 months. You’d know that if they aren’t hitting their goals, there’s a very good chance they are not profitable for your agency!
- The financial part of your business model would call for an operating profit of 30%-plus. This does not include any investment or contingency income. Obviously, the only way you can earn a 30% profit is to limit your spending to 70%. OK, all together now… duh!
While these are not all of the behaviors you should be modeling, they provide a solid foundation for most agencies.
If there’s a disconnect between beliefs and actual results in your agency, it’s certain to stem from behaviors. But if your beliefs and actual behaviors are congruent, your results will be predictable and guaranteed!
Roger Sitkins is the CEO of Sitkins Group, Inc. After over 40 years he has truly become an icon in the insurance industry having trained and mentored thousands of insurance professionals.
Roger was inducted into the Michigan Insurance Hall of Fame in 2017 and in that same year also received the Dr. Henry C. Martin Award from Rough Notes magazine. Roger is among only six people to have the honor of receiving this prestigious award.
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 www.sitkins.com.