Winning Strategies

What's holding you back?

Recognize and overcome your obstacles to growth

By Roger Sitkins

Agency principals and producers are always saying how much they want to grow their commission income. However, if you look at national studies you'll find that very few are experiencing acceptable growth in "Net New Revenue." While they are experiencing some growth due to the hardening of the market, for most agencies, top-line, organic growth is marginal.

In an effort to figure this out, I've been focusing lately on the obstacles to growth. Here are a few of the most common:

Competing on price only

We all know that if you live by the sword, you die by the sword. So it goes for agencies that compete based strictly on price. However, price is not the only game in town! Surely there are times when you've been high and kept a renewal and been low and lost a new prospect. So the real question is: What's your value play? How do you bring more value to your clients and prospects than your competition does?

If the only value you bring is price and great service, you've got a lot of competition! Therefore, some key questions to ask your team include: What is it that we do, that our competition doesn't do? How do we bring more value than our competition does? Are we telling our story effectively?

Empty pipelines

I realize this is not a new topic but, ultimately, results come down to your sales funnel. Are you putting enough new opportunities into the top of your funnel to guarantee you'll have enough new clients falling out of the bottom?

One of the things I find frustrating is that very few agencies and producers have identified what a Future Ideal Client looks like. They haven't created a profile of what they want to write, so they have no idea what specific targets to pursue. This puts them at a distinct competitive disadvantage. They should be investing their time and resources in identifying the types of business where they have an unfair advantage.

For example, some agencies cannot work with companies that have more than 100 employees because they don't have the requisite resources or services. Attempting to land such accounts puts them at a competitive disadvantage. On the other hand, one of our most successful agencies pursues just five classes of business in which it excels, far outshining any of its competitors. Incidentally, that agency boasts the highest revenue per employee of any of our clients.

Are your pipelines filled with Future Ideal Clients, or do you use what I call the "mirror approach" like so many other producers do (i.e., they're a great prospect if they can fog up a mirror and let you give them a quote)?

Not understanding the power of the 80/20 rule

This is a huge obstacle to growth because it applies to so many areas of an agency's sales success — or lack thereof. We all know that 20% of clients generate 80% of commission income, so where do you spend your time? Are you spending most of it with the top 20%, or are you getting stuck dealing with the day-to-day service issues of the bottom 80%?

This ties in with identifying your Future Ideal Clients because at the end of the year, the top 20% of your prospects will account for 80% of your new sales. Therefore, 20% of what you do yields 80% of your results. The key to growth is to spend 80% of your time (your only diminishing asset) on the following four activities:

1. Sales

2. Relationship Management

3. Proactive Part of the Continuation Process

4. Pipeline Building

Would you like to grow your book of business or agency by 50% in one year? Assuming your answer is "yes," go to the top 5% of your clients (who generate 50% of your commission income) and replicate them! Go out there and earn and ask for referrals and introductions. Keep in mind that the top 5% of your clients hang around with people just like them—birds of a feather do flock together—so if you can wow your existing clients, you can probably wow their referrals.

Lack of preparation

Every event deserves your very best, which means taking the time to thoroughly prepare. Unfortunately, instead of relentless preparation, we typically see less preparation, which is a big mistake. Every time you visit a client, prospect or center of influence, you must be prepared. Believe me; it shows! And that goes both ways. When you're winging it, people know you're winging it. So it's up to you to either impress them by being prepared ("Wow! This person really knows her stuff!") or leave them thinking you're incompetent and wondering why you wasted their time.

Research. It still blows me away that any producer would ask a prospect during their initial meeting, "So what is it your company does?" If someone asked me that, I'd throw him out of my office! Before any producer goes out on a new account, we direct them to either leave a voice message or send an e-mail to the sales manager outlining the first three questions they'll ask. This shows that the producer has invested the time to research the company — information that is easily accessible and free on the Internet. In turn, this helps establish a connection before the two parties ever meet.

Agenda. To me, the preparation litmus test is having an agenda for each client or prospect meeting and sending it to them in advance. Your agenda should spell out exactly what will happen and what topics you'll discuss when you get together. Establishing a clear purpose for your meeting saves you and your clients and prospects valuable time.

Rehearsal. There should be at least three rehearsals before a producer meets with any A or B+ client or prospect, which I refer to as "Three and Go." The first rehearsal is a preliminary rough draft of the presentation, which is fine-tuned during the second rehearsal. The third and final rehearsal is the producer's polished presentation.

Follow-up. Another part of preparation is following up with a reminder phone call, text message or e-mail about your upcoming meeting. You'll find it enhances productivity when everyone is mentally prepared to meet. Ideally, this reminder should include a brief synopsis of what was covered or accomplished last time and what you plan to talk about this time. For this reason, it's a good idea to summarize your notes from every meeting ASAP.

I summarize meetings using my smartphone. It takes only a couple of minutes to send myself a voice memo with a brief synopsis of the meeting and any follow-up actions. The memo can be transcribed later and sent to the client in an e-mail.

Lack of practice

There is absolutely no way you can hear something once and immediately master it. That's why the best agencies consider selling-skills practice a non-optional behavior. It's really the only good, low-risk way to become a skilled inquisitor, to learn how to handle objections, or to gain the confidence to ask for referrals.

When it comes to questions, the best agents know how to ask them in a way that creates pain issues for the prospect (potential problems that could have a negative impact on business). So rather than ask a yes or no question ("Does your company have a disaster recovery plan?"), the best agents will pose open-ended questions that the prospect probably hasn't heard before, the kind that will make them feel vulnerable about their coverage and raise doubts about their current agent. For example: "What does your company have in place as it relates to disaster recovery planning, training and implementation?" "What types of loss control and safety programs are in place at your business?" "How do you assist your employees with health and wellness?"

Asking those sorts of questions takes practice! This isn't a checklist. Checklists require no practice and leave little room for exploration. Good questions create doubt and desire. By prompting prospects to quantify potential losses, the best questions will make them want what you have to offer! But if you haven't practiced asking them, I guarantee you'll revert to the checklist method of questioning.

Are you willing to invest 1/168 of your time to improve? That's only one hour per week! Still, it's amazing how few agents will devote just 60 minutes a week to practice, regardless of the consequences.

Low-performing, high-performance teams

Most so-called HPTs are not performing to very high standards and in fact are dysfunctional at best. Typically, they work less like a team and more like individuals or even adversaries. Just as you can't win a game when members of the same team are playing against each other, you can't grow an agency without mutually supportive HPTs.

Salespeople and service people always have conflicts, due mainly to a lack of awareness of and appreciation for the other person's job. You'll often hear service reps saying they'd never want to be a salesperson and vice versa. Well, of course they wouldn't! It's not part of their factory-installed equipment.

We're all put on this earth to play a certain position on the team. That's why we've always preached the concept of having a Unique Abilities-Based Team, where individuals spend at least 80% of their time doing what their factory-installed equipment directs them to do. Salespeople focus exclusively on sales and not service, while service people are involved in service tasks only, not sales activities. By having a mutual understanding of and respect for one another's roles and responsibilities, they grow the agency as a team.

The bottom line

These are some but not all of the growth-stunting obstacles facing agencies and producers today. While it's possible to eliminate many of these stumbling blocks, there will always be new obstacles to overcome.

The best salespeople turn obstacles into strategies, using them to their advantage rather than viewing them as liabilities. Conversely, the average and worst producers see obstacles as insurmountable and simply stop, unable to work around or rise above them.

Is something holding you back? If so, are you doing anything about it?

As always, it's your choice.

The author

Roger Sitkins is the founder and chairman of Sitkins International, a private client group and membership program for some of the top independent agencies and brokerages in the United States, Canada, and Latin America. Members participate in training, advising and networking opportunities focused on innovation, sales, growth, profitability and value. Sitkins International is inventing the future of the independent agency system by providing intellectual property that empowers agents and brokers to become innovators.