Super Agent

Archive for July, 2012

Using an Assessment to Stay Client Focused and Differentiate

If the goal is to be valuable, improve employer outcomes, and differentiate from competitors, a well-crafted assessment can be a powerful tool for producers to use in the sales process. Conducting an assessment of the employer’s business and processes focuses the conversation on their success and outcomes.

What is an assessment? It is a prepared list of questions that provide the producer with a repeatable and consistent structure for dialog. Most importantly, it can be used to help the employer self-discover risks and threats to their business that they were previously unaware of. According to writer Tim Donnelly, you should “avoid jumping in right away with your pitch and talking about how wonderful your company is; instead, sit back and ask some probing questions of the prospect.”

It is important to remember that although these are prepared questions, you should (1) spend a significant amount of time practicing so that the questions are natural, (2) approach the conversation with genuine curiosity (3) be comfortable with the purpose of the questions, and (4) be sure that you have the ability to respond expertly and insightfully.  

A good assessment should:

 - Facilitate employer-focused dialog
 - Allow the employer to self-discover problems
 - Align the producers resources and capabilities with the goals of the prospect 

Additionally, an assessment should be used to determine if the prospect would benefit from new or added coverages or processes, and in turn, can be used as the groundwork to establish agreed upon goals and action plans that hold both parties accountable.

Liberating Unwilling or Unable Producers

Agencies often spend a significant amount of time and resources on branding and messaging campaigns that will attract new business and differentiate them from competitors in the marketplace. But, if agencies allow unwilling or unable producers to represent them, they are putting their brand at risk. Just as agencies must be willing to do their part by hiring leaders, creating an environment of expectation and providing consistent and effective training to producers, they also must be willing to liberate producers whose lack of commitment and ability negatively affect the agency’s viability and culture.

Here is a list of common ways that producers can erode an agency brand:

- Unwilling to accept and adopt the agency’s goals and objectives
- Unwilling to move away from the flawed bid- and-quote process
- Unwilling to grow and improve professionally
- Unwilling to connect agency capabilities with client needs and goals
- Unable to effectively communicate the agency’s value proposition and differentiators
- Unable to effectively guide clients through the sales process
- Unable to gain commitments from prospects

Producers who exhibit these qualities should be identified quickly and offered opportunities to improve within a specific timeline. Producers who are not operating within the agency’s goals and objectives and who continue to erode the agency brand beyond the specified timeline will threaten agency success. Although liberating producers may not be an easy or comfortable task, business speaker Jay Goltz explains that letting people go is “necessary for the survival of [a] business.”

Overcoming Fees Fears

Even when producers or agency owners recognize the value that they bring to their client relationships, they are often reluctant to put a price tag on that value. According to Alan Weiss, “the toughest part of this sale is to yourself, not the buyer.” Once you’ve established your value with a buyer, offering fee-based services can be an excellent way to generate new forms of revenue and establish a relationship with a client that is based on shared success.

So, why are agencies and producers often hesitant to charge value-based fees? And, how can you overcome your hesitancy?

1) Competition. We often hear producers and agency owners say, “My competition is doing it for free, so I have to.” This is a dangerous thought process that can weaken an agencies value and brand and decrease profitability. To avoid this, be sure that you are clear on how your capabilities are going to improve outcomes for prospects. Understanding the advantages of the prospect will help you stop worrying. 

2) Negative industry behaviors of the past. Free “value-added” services have been lethal for the profitability of many agencies, and can result in a decrease of client appreciation. When services are offered for free, clients will undervalue agency resources which will, in turn, be depleted in the process of implementing strategies that have not been linked to the needs and goals of the client.

3) Fear. Most producers understand the concept of charging for value, but they are often afraid of overcharging or under-delivering. It is important for producers to change the way they think about fees. In his book, Value Based Fees, Weiss explains that fees “are not a ‘necessary evil’ nor a ‘dirty part of the job’, but rather a wonderful and appropriate exchange for the superb value you are delivering to the client.”

The secret to effective implementation: Believe in your own value, establish your value with the prospect, focus on prospect/client goals and outcomes, and understand that the product is mutual success.

Reshaping Workers’ Comp Relationships

Many insurance agencies with large books of workers’ compensation business can leverage these challenging times in the market to reshape their relationships and processes. Regardless of the premium rate or economic environment, employers still need help with their workers compensation programs.

We’ve already discussed the value of being a specialist and leading with workers’ comp when most employers are unaware of practical methods to reduce their workers’ compensation costs and address risks. It is important to recognize the vital role that agents can play in helping employers compete for business and manage threats. For example, reducing injury costs, increasing productivity and managing experience modification factors are essential for employers who want to remain competitive. According to Jon Coppelman of Lynch Ryan, “Employers who want to stay on top of their insurance costs need to ratchet up their loss control programs. The best injury is the one that never occurs. And for those moments when a safety program fails, employers need to enhance their post-injury management programs.” By working collaboratively with employers, addressing issues and providing valuable knowledge, agents can redefine and reshape their business relationships.

The agent must assume the role of leader and advisor and guide the employer to implement effective practices. After a complete workers’ compensation assessment is done, both parties can work together to develop a plan of action to reduce risks and improve outcomes.

Producer Cross-Selling Reluctance

Cross selling can be defined as selling services or additional offerings within an agency. And, because producers have a fear of sharing business and risking their own accounts they are often reluctant to cross-sell. Interestingly, agency leaders rarely step in to remediate the issue because they see this behavior as typical. But, failing to address producer reluctance in this area can be detrimental to agencies who must cross-sell to attain profitability and success. According to Inc. columnists Karl Stark and Bill Stewart, cross-selling “will raise the average profitability of a customer and lower the number of customers you need to break even.”

So, what do agency leaders need to do to encourage and facilitate cross-selling?

- Assess your services. Is there a legitimate basis for producer fear and reluctance because there are service issues that prevent cross-selling opportunities? If so, it’s important to develop a plan to change that.

- Discuss and set goals. How many of your accounts are currently working in multiple business units? What process do you have in place to make sure that cross-selling opportunities are being discussed?

- Set expectations. You should have clearly defined guidelines for addressing client issues that may arise, and a plan for how communication will occur within the agency. Be transparent with producers. Your goals and their goals should be aligned.

By addressing producer reluctance in this area, you will be able to serve more clients’ needs, increase agency revenues and capture more business opportunities.

Relationships are the Result of Your Efforts, Not the Start

We often discuss the need for agencies and producers to move away from the flawed bid-and-quote sales process that discourages organic growth and hinders success. Decision makers have changed, the market is more complex, and what worked in the past will no longer work today. In the July-August 2012 Harvard Business Review, there is a must-read article (The End of Solution Sales) that discusses the success strategies of the top salespeople from 82 companies. In it, Brent Adamson, Matthew Dixon and Nicholas Toman talk about the tendency of salespeople to focus on selling “solutions”, and the radically different approach of those who have abandoned this traditional model. Their research suggests that the best salespeople lead with insights meant to overturn and challenge a prospect’s way of thinking.

It is important to remember that most decision makers are satisfied; they don’t know what risks and threats to their business exist that you can identify and mitigate. Decision makers don’t want to change; they are resistant to see risks because doing so would mean abandoning the status quo, which they will only do if they are guided and challenged. Targeting prospects that are unaware of their risks can be an important strategy for agencies to increase their opportunities for demonstrating value. The key to this “insight selling” approach: Offer the prospect your innovative and expert insights and ideas, always keep your conversation focused on them and efficiently lead them through the sales process.

Are you challenging your prospect’s way of thinking? Are you providing them with new insights, ideas, and a vision for a better future with you?

Effective Training: One Size Does Not Fit All

Too often, agency owners and sales managers will provide producers with the same sales training and resources regardless of their skill level, needs or performance. As we’ve discussed in the past, failure to assess the needs and attributes of producers before implementing a training strategy can be a waste of time, energy and resources. According to an article published in Harvard Business Review by Thomas Steenburgh and Michael Ahearne very few companies are focusing on getting the most out of their salespeople, and “companies that take individual differences into account will realize better results across the performance curve.” It is important to segment your producers and identify their performance problems in order to align effective training that will improve outcomes.

Identifying where underperforming producers are lacking is the first step in aligning the right training resources with specific producer needs. They may be lacking knowledge, or they may lack the ability to convey their knowledge fluently. Asking these questions can help identify where producers are underperforming and what skills they are lacking:

Fluency Questions:

- Can the producer identify right-fit clients and convey a message that captures attention and curiosity?
- Does the producer have the skill to connect resources with a prospect’s risks and threats?
- Does the producer have the ability to identify and adapt to marketplace changes?

Knowledge Questions:

- Is technical knowledge missing; do producers have the necessary knowledge to understand problems and identify opportunities?
- Does the producer have a good understanding of the sales process and the ability to effectively lead the buyer through the sales process?
- Does the producer have the ability to up-sell and cross-sell clients?

Once these questions are answered, a distinct and effective training strategy can be developed. Segmenting producers and assessing their needs is a necessary step in developing a training program to improve their success. According to John Baldoni, “when it comes to reaching people, one size does not fit all.”

Leveraging Your Centers of Influence

In the last post we discussed the importance of segmenting your pipeline to manage leads. In addition to this, it is also important for producers who work on referral to have a comparable process for managing their centers of influence. Centers of influence can be clients, coworkers, or other professionals (accountants, bankers, lawyers, etc.) who have a level of influence with the prospect. As a result, their recommendation of your service and their introduction provides you with additional leverage in the sales process. According to business blogger David Chwalek, COI’s “have great potential to be among your best referral sources.”

So, how can you create opportunities to effectively utilize your centers of influence?

1) Clearly define your perfect client-type.

2) Clearly articulate how and why a business relationship with you will be advantageous for their contacts.

3) Identify which of their contacts you are interested in meeting—it is more effective to state who you would like to be introduced to rather than ask your center of influence to determine which prospects would be appropriate to meet with.

4) Create a short presentation about your sales process to inform your center of influence about the way you will engage with the prospect.

5) Express true curiosity about what your center of influence’s perfect-client type is in order to reciprocate and develop a mutually beneficial relationship.

Leveraging your centers of influence “will allow you to build strong relationships with key people, help you obtain useful information and open doors of opportunity for your career.”- Thomas Barrett