What's In YOUR Pipeline?
Insurance agencies inherently know the sales process: obtain the X-date; then the policy information. Quote the risk. Deliver the proposal…and ask for the business. Have the applications signed. Get the check.
While many insurance agencies have processes in place to move a sale through the appropriate steps to issuing a policy, they lack the technology to effectively manage the sales process. This deficiency may not immediately seem critical to some, but it is only when agencies are able to track and manage the sales processes are they able to understand their strengths and weaknesses as an organization and influence future sales performance.
The Ten Steps of Effective Sales Management
Implementing these 10 steps at an insurance agency improves sales performance; conversion rates from prospects to clients improve considerably. Lasting sales performance rarely comes from super star sales people, but rather it comes from great sales management processes and the systems that enable them. Great systems are reliable, easy to use and will enable your sales people to improve and maintain their performance.
The best sales organizations have implemented management around these 10 areas:
1. Sales Position Descriptions need to outline the expectations of your sales people. You cannot afford to have outdated position descriptions. If your sales person does not have a clear charter, how can you correct any failure to meet your expectations?
2. Sales Procedures describe how to perform certain tasks expected of sales people. Even aspects taken for granted, like meeting with a prospect, are important and occur regularly… and must be appropriately documented into Standard Operating Procedures and made available to your sales staff.
3. Activity Expectations are the minimum quantity or quality of calls, visits, and other tasks inherent in the sales procedures. Since activity is what yields results, activity must be measured and reported on.
4. Performance Expectations are expressed as premium or commission of new customers sold. Performance is a direct result of the correct procedures being performed at adequate activity levels.
5. Monitoring and Reporting Activity and Performance is both the means for sales people to record their work and show it to you. Both public reporting in charts and private reporting to management is ideal.
6. The Three Laws of Sales Contacts are:
a. There must be no unaccountable time in the work week.
b. No contact must occur without an agenda.
c. No contact must go without an outcome of some kind or a next step.
7. Regular Sales Meetings are a must – at least weekly. Work needs to be interrogated so that management and consultants can provide guidance.
8. Strategic Guidance includes communicating a comprehensive set of goals and methods that the agency is planning for the upcoming sales period(s). This might include discussions of marketing plans, targeting of certain geographic or risk profiles, etc.
9. Corrective Guidance means admonishment and advice designed to cease activity that is not productive and encourages activity that is productive. It also includes suggestions and information of value from management to overcome a hurdle the sales person has encountered.
10. Employee Reviews are the last component. While this is really a component of a good HR system more than merely a good sales management process, it is nonetheless an important part of a system that promotes accountability. I encourage you to work with an HR professional in implementing this process.
What Is a Sales Pipeline?
How many quotes do your producers need to perform in order to meet their sales goals? How much business will you close in the next 90 days? Are those projections based on producers’ “feelings” or do you have hard empirical data to support the claim? Without understanding your sales pipeline, you couldn’t even begin to answer those questions. Effective sales management begins with a sales pipeline. Most sales professionals understand that a sales pipeline is a graphical representation of all sales opportunities at play. The extent to which pipeline management becomes important to a business depends largely on how much interaction you have with your customers. In low transaction environments, businesses typically have little interaction with customers making it difficult to log or track potential deals before they happen. For insurance agencies, the level of interaction is considerable, making them most in need of pipeline management. An accurate pipeline of qualified opportunities offers the best insight to the agencies future sales performance and can add value to your organization in multiple ways:
• Consistently filling your sales pipeline with qualified leads gives you the very best chance of meeting your sales quota.
• If the opportunities in your pipeline are well qualified and accurate, you can use your pipeline to predict what business will close in a specified time frame.
• Identifying weaknesses in your pipeline early, will allow you to modify your sales or marketing plans in order to avoid poor sales performance.
Survey Results: How important is it to your agency to be able to track prospects?
Source: 2010 ACORD AUGIE Survey Extremely Important 30.99 % Very Important 27.94 % Important 22.18% Not Very Important 7.45% Not At All Important 0.66%
You Can’t Manage What You Can’t Measure
The pressure on sales people to meet their sales quotas can be significant. Failure to meet their sales goals can ultimately lead to losing their job. It is for this reason that they focus on the tactical side of their job and less on compiling reports, opportunities, and activities. As a result, the monthly sales number becomes a nebulous number based on gut feeling. Why? Because they have not entered their activities in complicated systems or compiled the information from the various Post-It™ notes and business cards spread around their desk. However, the most important component in managing sales processes is managing sales activity. When your sales staff uses appropriate technology, it allows you to effectively manage the activities your producers are taking to drive more sales. If you don’t consistently measure the activities that turn leads into sales, you’re shooting in the dark.
For Instance:
1. Do you monitor the number of daily calls that producers make, and the number of “nurture points” — such as emails and follow-up calls?
2. Do you track the conversion success rate? You can’t manage what you can’t measure. By building a pipeline plan to deliver a particular volume in relation to your quota, you have the best chance of consistently meeting the sales goals. By defining clear steps of sales momentum, you can more accurately represent opportunities within the pipeline. At a time when leads are scarce and new business is becoming harder to come by, agencies can ill afford to keep their head in the sand. A strategy needs to be put in place to identify all available opportunities, isolate neglected leads and improve sales productivity.
3. One of the reasons agencies do not implement a pipeline plan is because it has traditionally been hard to do. Tracking individual sales opportunities in a way that allows you to truly understand and control your business becomes difficult without the right tools. Many CRM, lead management and agency management systems do not complement the sales process but, in fact, may increase the effort of the sales person to keep their momentum moving forward.
New Business Workflow
Forcing producers to use technology is often a challenge, and more so when the application is hard to use, heavy with layers of unnecessary sales data entry. This is most readily apparent when agencies purchase technologies that don’t speak to their business needs, especially from companies that are unfamiliar with the insurance field. There is no magic bullet to sales success, but there are plenty of tools that can help make your agency more successful. Among them is sales management and lead management systems such as FSC Pipeline. These types of tools assist an agency owner or sales manager with creating and maintaining repeatable processes for opportunities and activities. Even more importantly, these systems create actionable reports that measure employee activity and allow for more efficient management. With the cost of leads increasing, agencies must focus on every opportunity to “Win the Business!”
If you would like to talk more about why a Sales Management Program may be important to your agency, please drop me you from constantly asking that same question to each and every producer, at each and every sales meeting, “What’s in YOUR pipeline?”
On the local convention scene, this past January 20th at the Hilton Hotel in Midtown Manhattan, NY, was the 2011 Metropolitan Regional Awareness Program, hosted byPIA of New York. This was the first time the event was held in Manhattan since moving to Brooklyn in the wake of the attacks of Sept. 11, 2001 and the nearly 600 insurance industry professionals in attendance certainly welcomed it back in typical NY style!
Attendees enjoyed a sold out trade show, continuing education classes, very enjoyable reception events, and a keynote luncheon awards ceremony.
Well, thanks for taking a ride with me on “Pelham 1, 2, 3” up to the 52nd Street station for the RAP Conference, and coming up this spring (I can’t believe we’re even talking about “Spring” after all of this snow we have had this winter!) we have the ACT/AUGIE conference in Tampa, FL; PIA of CT; Westchester, Buffalo, Rochester, and Syracuse “I” Days; and a few others…See you there!
