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Analysis of Agencies with Revenues
Between $2,500,000 and $5,000,000
R
EVENUE
G
ROWTH
“If we are not growing, we can’t pay our
people more; we can’t make new
investments; we are dead in the water.”
“In the past, we always grew a little, but
never knew why. When we reached a
size that made growth tough because of
the diversity of our revenues, this
became a central area for us to
measure.”
“Growth did not seem that important
until one year we felt that we could not
give meaningful raises and bonuses.
Suddenly, everyone was committed to
growth.”
Growth in revenues, and the ability to sustain growth over time, is a
critical success factor for most businesses. The best agencies in
this revenue category are investing in new producers, looking for
cross-selling opportunities and improving customer retention. There
is also an awareness as to the importance of increasing revenues,
and the measurement tools needed in order to understand the
source of new revenue.
Many firms now measure net growth in a producer’s book of
business (instead of new business and renewal business) and
measure the pricing changes in the renewal of existing business in
order to understand the impact of the firming market on revenues.
The firms are having regular meetings with clients to discuss the
impact of the market on the customer’s business. Other firm’s are
realizing that if the producers with the largest books do not grow
their books, meaningful growth for the agency as a whole is that
much harder to achieve. As a result, these agencies are looking for
ways to free up the most successful producer’s time so that they
can continue to pursue new business.
T
ECHNOLOGY
U
TILIZATION
The use of technology has gone from being an annoyance to being
an area that the leading agencies feel is a core competency. The
best agencies have invested in training, have screened new
employees for automation competency and hold everyone to a
higher standard in the use of automation. Abilities that were once
only for the servicing staff are now critical for producers to have in
order to service their books and to write new business. Producers
are expected to have a functional understanding of basic issues on
both the agency management system, and the use of third-party
software, e-mail and the Internet.
“We make all of our producers take an
automation competency test. It is mostly
Internet and e-mail centered. These are
skills that a producer has to have to
compete in our market.”
“We live in a new age, and technology is
at the center of this age. We plan on
staying around so we are trying to make
sure we apply the right technologies to the
right business strategies.”
These agencies have made hardware costs, software costs and
training costs a regular part of their budgeting. Failure to invest
wisely in this area is having a dramatic impact in separating the
most efficient agencies from the others.
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