2010 Best Practices Study

Analysis of Agencies with Revenues Under $1,250,000

Recruiting & Developing Talent More than half of the agencies in this study group are located in communities with less that 50,000 people. While the pool of potential candidates tends to be more limited than in larger cities, the smaller communities allow these agencies to network very effectively to fill a position via referrals from business contacts, existing employees, and clients. Another method is to seek out candidates from people such as the bank teller or store manager who had provided a positive service experience. Keys to Recruiting Talent (Top 5 Listed in Order of Frequency Mentioned) 1. Solicit referrals from business network, clients, & employees 2. Seek out candidates who have provided good service/experience in a business setting Although turnover is typically low in these agencies, the most successful agencies try to be are aware of “who is out there”. They maintain a pipeline of candidates generated from their network and are prepared to hire should the unexpected occur. Help wanted ads, placement agencies, and recruiting from college campuses were used, all having varying degrees of success. Interestingly, the agencies in this study group, particularly those with younger principals, tended to use technology as a recruiting tool. They are comfortable with online services such as monster.com to post openings and often employ social networking to “get the word out.” Not surprisingly, exceptional computer skills are now required for all positions in these agencies since technology is an integral part of all agency activities. 3. Utilize placement agencies 4. Place ads in newspapers, publications, online services 5. Recruit on college campuses

Mgmt. Perspectives

Many agencies in this group prefer to hire producers with sales experience but with little or no insurance backgrounds and service staff without experience so they can be“indoctrinated to the agency’s way of doing things”. As such, they have developed specific new employee training modules and use testing profiles such as OMINI, DISC, and others to help review, manage, and motivate these employees. Achieving Organic Growth The mantra for this group of agencies seems to be “cross-sell and ask for the referral.” These two strategies allowed them to drive positive organic growth in a difficult environment. As they identified and pursued the lines of business not written for existing clients, they nurtured client relationships through discounts for multiple policies with the same carrier, increased client communications and education, and enhanced service. This heightened level of service improved retention and created a fertile ground to ask for referrals. The most successful agencies established and enhanced trusted relationships with lenders, realtors, bankers, accountants, business owners and others who are influential in their communities in order to provide and obtain referrals. As one agent said, “They comprise 90% of our referral network.” To support their increased sales efforts, these agencies also put resources into new advertising/marketing materials and activities. Although traditional marketing support was used, this group, more than others, embraced the internet, email, and social media to create brand recognition, reach new prospects in a broader geographic area, address niche audiences, and communicate with existing clients. Other successful growth strategies included specialization and niche marketing to homogenous classes, franchises and associations. Results show that 3. Expand advertising/marketing efforts including website/social media/internet 4. Develop more niches/specialties/target markets 5. Nurture existing accounts through superior service delivered by knowledgeable staff 1. Implement disciplined cross-selling, account rounding, upgrading 2. Aggressively seek referrals from existing clients and centers of influence Keys to Organic Growth (Top 5 Listed in Order of Frequency Mentioned)

Profile

Revenues

Expenses

Profitability

Employee Overview

Producer Info

Staff Service Info

Technology

Insurance Carriers

Appendix

2010 Best Practices Study

Keys to Developing Talent (Top 5 Listed in Order of Frequency Mentioned)

Agencies with Revenues Under $1,250,000

1. Provide in-house training/mentoring

2. Pay for out-of-office seminars, programs

3. Utilize carrier training

4. Require and provide incentives to acquire industry designations

3

5. Provide vesting / ownership opportunities