Talented producers. How important are they to your agency's success? Do you have as many on board now as you need? Are you confidant that you can hang on to your best producers, despite recruiters who are probably trying to lure them away? Are you also confident that you can identify and attract talented new hires to replace producers you lose, or that your agency will need if it is to grow?
Consider your agency very fortunate if you can answer, "Yes" to those questions. The reality for most agencies is the opposite. For the past two years, the #1 weakness expressed by agencies in the IIAA Best Practices Study has been the "inability to hire effective agency producers." And this complaint is echoed repeatedly at association conventions and other gatherings of agents.
Why? The answer is simple: the demand is high and the supply is low. There just are not enough experienced and capable producers to meet the needs. One reason is that the industry has done less than a stellar job of selecting and training high potential sales talent. Historically, careers in insurance have not been the first choice of talented young people with options; the entire industry has long suffered from an "image" problem in the eyes of outsiders. Another reason for the shortage is that intense competition among agents and new demands from insurance/risk management buyers are raising the bar on the talent and skills producers must have. In short, the "game" is getting tougher and it will take better players to keep winning.
This lack of talented sales people is, we believe, a major dilemma facing the industry. And, unfortunately, there is no quick pill, instant solution. But there is a solution, a solution that we know works because we saw it work extremely well in a major brokerage firm. We called it our "Grow Your Own," or GYO Program. We attracted and hired recent college graduates who were exceptionally talented, we accelerated their training, and we treated them in ways that kept them loyal and highly productive members of the firm. Our upfront investment in these young people paid significant dividends for the firm as they rapidly learned the business and became substantial contributors.
This solution is neither new nor unique. Major corporations have been applying it for decades to maintain the flow of talent into their organizations. And the IIAA Best Practices sales-focused survey published in 1996 reports that 54.3% of the organizations surveyed hire talented untrained individuals and 44.4% hire recent college graduates.
But beware--this solution is not without risk.
We talked recently with an agency CEO who tried
to grow talent for his agency by hiring and training recent graduates. "It doesn't work," he said. "They have all left. And we sunk a lot of time and money into hiring and training them--all for the benefit of their new employers!"
This regrettable result underscores our main point in this column: GYO programs can work extremely well if they are well conceived and implemented, and they can fail miserably if they are not. The difference between success and failure rests with three keys: implement these keys well, and you can solve the talent dilemma.
Key #1: Hire the right people. We're almost embarrassed to offer such an obvious instruction. But how many times have people problems (and the costs that accompany such problems) resulted from hiring the wrong people? It need not happen. There is a process and technique for identifying the right people that selection professionals have applied successfully for decades.
The pros start the selection process with a firm understanding of what they are looking for in candidates, of what will distinguish "the right people." They define the knowledge, skills, motivation, personal traits and characteristics that become standards against which all candidates are evaluated. Here, for example, are some of the standards we used to ensure that we were hiring the right people for the brokerage firm.
We wanted bright people, quick learners, good problem solvers--people who could learn the business rapidly and who would impress prospects and clients with their mental acuity. We wanted people with the emotional maturity and empathy to build successful, problem-solving relationships with prospects and clients, as well as with others on the team. Strong self-confidence and achievement focus were also key selection criteria. In addition, we wanted people who were motivated to make money, but also to learn and grow, people who would be proud to be a successful insurance professional. These are just highlights of the standards we developed in detail.
Initially, we recruited recent college graduates for the program. Some were insurance majors, some finance majors; all were undergraduates with meaningful work experience. We found that the trainees' (we called them "Risk Management Associates") course of study, however, was far less important than how they measured up to our selection standards. Bright, non-insurance majors learned just as fast and did just as well as those who had studied insurance in college. Far more important was level of maturity, how ready the individual was to settle into the routines, the career, and the geographical location they found in the office to which they were assigned (we made sure that candidates either had roots in the office location or had compelling reasons for wanting to put roots down there).
But defining the right selection standards is just the first step to hiring the right people. The second step is to apply screening techniques that separate candidates who meet the standards well from those who do not. We used multiple expert interviews, tests, and expert reference checking. Space does not permit us to provide specific techniques here, but we will do so in future columns. Learning how to interview and check references like a pro is not difficult, and can pay big dividends by assuring that the right people are hired.
Key #2: Apply structured learning. Once the right people are hired, the next step is to get them productive--generating business--as soon as possible. That takes structured learning. It starts with a plan, a plan that details what learning objectives the trainee will meet, what resources he/she will use to meet the objectives, and in what time frame. At the brokerage firm, we prepared a comprehensive list of what the associates needed to know to become successful producers. Then we defined the resources that would be used to impart the knowledge. For technical training, we relied on the Institute's programs, and the associates devoured them. Most had passed two or more CPCU courses (starting with 3 and 4) as well as gained their ARM designation by their second year. Their development plans also included sales training, and familiarization with the office and how it worked--everything they needed to be confident and productive.
But a structured learning plan is not enough. There must be a support process that includes coaching and mentoring, monitoring of progress, and rewards that are commensurate with learning achievements. Each associate had a coach and mentor to guide him/her through the learning; someone who helped answer questions and resolve problems; someone who truly cared about helping the associate succeed.
When the right people are hired and a structured learning program is applied effectively, we have seen trainees bring in business that is paying their costs during their second year. Talented, trained, and highly motivated young people begin producing fast. And that is why key #3 is also essential.
Key #3: Apply retention planning. There is only one measure of the success of a GYO program: ROI, the return to the agency on the investment it made in hiring and training the associate. And, clearly, the ROI is a function of talent, training, and retention; of how long the agency reaps the benefits from its investment in each associate. So the third key to a successful program is a plan to maximize the potential for retaining each associate, and earning a high ROI.
Retention planning actually starts with the selection process. It starts by ensuring that candidates fit the job and agency and, equally important, that the job and agency fits the candidates' desires and motivation. It is like a marriage, it works best when the needs of both parties are understood and met.
Retention planning continues with the structured learning program, and with the quality of support the associate receives. One of the advantages of hiring talented graduates is that they are accustomed to studying and learning. But they are also high achievers who want to do well, and they will become frustrated and disillusioned if they are not supported with an intelligent learning plan that is accompanied by effective coaching and mentoring.
Frequent milestones, with recognition and rewards when the milestones are reached, are also part of an effective retention plan. And appropriate compensation is essential. Trainees' "street value" escalates rapidly as they learn rapidly and become effective producers, and they must be paid accordingly. Agencies that offer the potential of a future ownership position in the agency provide a powerful retention incentive.
Finally, an effective retention plan ensures that associates' general attitudes and morale are monitored frequently. The need is to discover and to address any serious concerns or dissatisfactions that may arise before they result in a lost investment. Good mentors are sensitive to how their associate is feeling about his/her job. But agency leaders must take ultimate responsibility for the success of the GYO Program, and personally demonstrate their interest in each associate's success with the agency.
If this program for growing your own talent appears to require effort and commitment, it does--at least initially. But it is like a machine that takes more time to set up than it does to keep running. The learning, practices, and tools needed to provide the three keys become the agency's GYO "machine" and once they are set up the first time--the effort needed declines while the commitment increases naturally.
We plan to use this column, as well as our Web site, to provide more details on the learning, practices, and tools required to initiate successful GYO programs. And we encourage agents with such programs now to share their success stories with us, so we can highlight them here for the benefit of all. We'll certainly do the same as we help agents to build successful GYO "machines."
The author
Doron (Bud) Antrim is managing partner of Woodgate Partners, LLC, a firm dedicated to helping agents achieve a winning edge with talent, leadership, and culture. He encourages interested agents to visit their Web
site at www.woodgatepartners.com
for more information, as well as for free tools and materials. Bud can be reached via the Web site, by e-mail
at mail@woodgatepartners.com, fax
at (410) 833-2650, or by calling
(410) 833-6468.
©COPYRIGHT: The Rough Notes Magazine, 1999