Are SMB Independent Agencies Dead?

Will small to medium sized independent agencies suffer the same fate as dinosaurs – extinction? There are a number of folks out there predicting their demise.

I’m not so sure they are accurate. The opportunity still exists for SMB agencies to be viable but it requires a serious change in structure and operation. Those agencies that acknowledge and respond to the need for change can still operate very successfully.

There are three key positions that every agency needs and they are Agency Operations Manager, Technology Manager and Marketing & Sales Manager. These positions are critical in an agency and they need to communicate and coordinate with each other as a team. It’s important they are aware of where their functions overlap the functions of the other two managers. Each of them must understand the needs of their specific area but they don’t have to personally perform all the functions. Many functions can be handled by current agency staff or outsourced effectively and economically.

The Agency Operations Manager is in charge of overseeing the business operations of the agency. Managing the day to day operations of the agency service staff while overseeing the HR operations of the whole agency. Their position requires giving special attention to the hiring, training, annual evaluation and retention of staff. They also need to deal with the increasing regulation and oversight by various government agencies creating issues like paid family leave, sexual harassment and the like. Another primary responsibility would be managing the physical business location – dealing with issues related to lease agreements, upkeep and maintenance as well exploring the use of remote employees.

The Technology Manager is critical in the modern insurance agency. They need to have a strong background in technology to assist with the agency management system, e-signature, automated phone systems or VOIP, electronic document storage, AI/Chat functions and cybersecurity just to name a few areas. Knowledge of social media and digital marketing is important. They will also be involved in regularly reviewing the agency workflow to simplify and increase customer response time, improve the overall customer experience, document transaction as an E&O function and develop an efficient and effective agency marketing and sales system.

The Marketing & Sales Manager also plays a critical role in today’s agency. Identifying and implementing the sales focus and marketing efforts of the agency. Reviewing and managing the sales and retention procedures of the agency to reach or exceed the agreed upon goals. Working closely with the Technology Manager in developing the agency’s marketing and sales system and then making sure it is operating as planned. Monitoring sales and working closely with all agency staff that have sales responsibility especially with the full time agency producers. Making sure the agency has adequate and competitive market access and researching/implementing potential areas of specialization.

Many agencies have existing staff filling these various roles and responsibilities in addition to their regular duties. Unfortunately these three areas are critical to an agency’s success going forward and require full time and focused attention. Working together with a solid agency staff this management team should be able to create the results necessary for a SMB independent agency to be effective in today’s marketplace.