One of the greatest challenges faced by agencies is the ability to successfully hire new producers. Not that the transaction of hiring a producer is all the difficult. Sadly, the ease at which this transaction takes place is probably a big part of the problem.
Let me explain what I see as a successful producer hire. They come on board and are a cultural fit with the team. They enhance the brand of the agency. They start producing quality business in short order and continue to do so over the long term. They add value to the agency in countless ways.
The problem I’m referring to is:
- Finding a qualified candidate
- Vetting them properly
- Setting up an appropriate compensation structure
- Onboarding them effectively
- Training, coaching, motivating, and holding them accountable
I mean, when this is what it takes to SUCCESSFULLY hire a producer, what could possibly go wrong? 🙄
Spaghetti is for dinner
Because the odds of a successful producer hire are such a long shot, many agency owners take the approach of hiring several and hoping one sticks.
I cringe when I see this. It’s unfair to everyone. To start, it’s unfair to the current agency team. What a waste of their time to spend it with new team members who have just about zero chance of making it.
Worst of all, it’s unfair to “spaghetti” producers. It's cruel to ask someone to commit the next phase of their career to you when you haven’t done everything you can to ensure their success.
Hiring producers successfully will never come with a guarantee. But if you break down what is necessary to drive success and have a plan and resources in place for each of the following areas, you can dramatically shift the odds in your favor.
Six critical puzzle pieces
Most agencies get the producer hiring process wrong right out of the gate. They never give themselves a chance to succeed because they’re looking in the wrong place for the wrong people.
Why do agencies keep hiring from within the industry? I can’t imagine another industry where marginal talent gets recycled as much as it does in ours. Carrier reps bounce from one two-year guarantee to the next. Producers move from one agency to another.
Why would you even consider one of these retreads? If you do, you better have a clear and legitimate reason as to why they’ll find success with you when they haven’t found it anywhere else.
Agencies are also looking for the wrong traits. Because the industry continues to perpetuate the myth of this being a “relationship business,” agencies look for well-connected candidates.
I can’t even begin to do this issue justice in this blog. Instead, go read “The Challenger Sale” to better understand the traits that make for successful salespeople. Spoiler alert, only 4% of high-performing salespeople in a complex sale situation are Relationship Builders. No wonder agencies struggle to successfully hire producers!
Salespeople interviewing and hiring salespeople is a horrible idea. It becomes a competition of who can sell whom, and there are rarely any winners in this game.
Interviewing salespeople is a challenge for anyone. If the candidate is halfway qualified at all, they are likable, engaging, and interview well.
At the very least, use assessment tests to better understand the candidate. Here are a couple of my favorites for salespeople.
Omnia Profile -- This is a personality profile that evaluates the alignment between an individual and the position. I never hire because of positive results; that’s simply a green light (yellow sometimes) to move forward with the interviewing process. However, if the test says the individual is not a fit, don’t ignore the warning. You WILL regret doing so.
SPQ Gold -- This is a test for call reluctance. It’s not a matter of does the candidate have call reluctance or not—everyone does. Instead, it identifies what type of call reluctance they have and suggests ways to manage it effectively.
Finally, I would recommend creating a step in the interview process where you can really test the salesperson's abilities. I created a series of case studies that included prospect evaluation, creation of account acquisition strategies, and role-playing. Find a way for them to prove they are as good as they tell you they are.
There may be no topic of greater interest to agency owners than producer compensation. As much as owners would love to find that magic formula, it doesn’t exist. In fact, if you show me 10 agencies, there is a good chance we can uncover at least 20 compensation formulas (no, that’s not a typo).
When it comes to compensation, there are so many variables that come into play (geography, target client, resources provided, lead generation, etc.) that it is impossible to recommend one specific formula. However, the right formula for any particular agency starts with a clear understanding of what they want from the producer. After all, you must reward the behaviors and results you need from any position.
The way I look at a producer role, the primary results are lead generation, writing new business, help with relationship-threatening service issues (not day-to-day issues), and getting the business renewed.
Based on that, most agencies miss the mark by not paying enough for new business and paying too much for renewals. On top of that, they fail to incent over-the-top production by putting significant bonus opportunities in place.
Rather than go into details of what effective onboarding looks like here, I’m simply going to emphasize that there must be a plan to ensure they get up to speed quickly for every new hire, especially producers. Ask us about our ebook detailing an effective onboarding process - we'd be happy to share.
Training and coaching
When you think about how the role of a benefits adviser has expanded over the years, it is easy to argue that an adviser has a chance, and responsibility, to impact the business of their clients in more ways than perhaps any other “trusted adviser.” It is no longer enough to be well versed in insurance solutions. Now, advisers have to know compliance, technology, communication, HR, and employee engagement, to name a few.
For this reason alone, it is shocking how little, if any, training and coaching advisers receive from their agency. The typical barista pouring your morning coffee receives more training.
If you are going to hire a producer or any role, you have to provide structured training to ensure they can do the job you hired them to do and to do it in a consistent manner that protects the brand of the agency.
Producers have an unbelievable opportunity. They have a great work environment, good work/life balance (outside of the 4th quarter, of course), make a great impact on their clients' businesses, and make a great income.
But, with that opportunity, there must be equal responsibility—the responsibility to ensure steady new revenue into the agency. It’s that steady and predictable stream that makes everything in the agency possible.
But for whatever crazy reason that I have yet to figure out, producers are almost always the least accountable team members in an agency. In some agencies, they aren’t even given a new business goal. In others, the goals are much more of a suggestion than an actual expectation.
Producers can go year after year without hitting a sales goal and never suffer the slightest consequence. Imagine if the retention goals agencies give to the service team were as much of a joke as the sales goals of producers.
Set meaningful sales goals for your producers, but don’t wait until the end of the year to hold them accountable. Even more than the sale goal itself, producers must be held accountable for the activities and behaviors that drive the new business.
There’s too much on the line
As you look back through this list, do you see anything that seems unnecessary? I know I don’t.
Yet, there are way too few agencies able to go through this list and explain a well-thought answer to each of the six. Much more common are the agencies that wouldn’t have confidence in their efforts in even one area.
As I said before, there is too much on the line to not do everything you can to get it right. At the same time, the upside potential of decoding the producer hiring puzzle makes, as they say, the juice worth the squeeze.
But, if you aren’t willing to get it figured out, don’t hire any more producers. That would just be cruel.
Photo by Olga Yastremska.