Before I started Benefits Growth Network, I spent 18 years in the independent agency system, the last 14 at the same agency. Most of my time there was spent helping to develop the benefits practice.

It was a great experience, one that came with significant growth, both personal and departmental, through both successes and mistakes.

Knowing that many of you are in agencies that look a lot like my old agency, I thought I would share some of the highlights of that "road trip." As you look to grow your own benefits department, my hope is that you can get there faster by learning from some of my experiences.

Let me first set the scene for the situation I walked into.

  • I was the sixth benefits department manager in the 16-year history of the agency and the fourth within three years.
  • The P-C producers had no confidence in the department and were not eager to place their client relationships at "risk."
  • There were virtually no relationships with the insurance carriers; we were an unknown entity to them.
  • There wasn't enough benefits revenue to justify the two of us now working in the department, and certainly not enough to make the department profitable.

Mile Marker 1—Establish relationships.

Needless to say, I had a lot to prove. The first thing I had to do was connect with three groups of people: P-C producers, insurance carriers, and our existing clients.

Lesson 1—Whether you have someone new or a long-term practice leader, make sure they regularly communicate to each of these groups: their goals for the department, how they will achieve those goals, and how each group will benefit from the effort.

Mile Marker 2—Be able to drive the car yourself.

Sure, my business card identified me as the benefits department manager, but the greatest need of the department was growth. There was no one else to do it; I had to get out there and generate revenue. Proving that I would and could do the hard work of prospecting and selling was a major step in building credibility and momentum.

Lesson 2—As you build a benefits practice, you have to put someone in place who can sell. Just putting in a support person and assuming the other producers will do the selling won't work.

Mile Marker 3—Prove your value to others.

It would have been tempting to just demand that the P-C producers cross-sell every account, but it would have never worked long term. I had to help every P-C producer see me and my department as a valuable resource that not only wouldn't put their client relationships at risk but would actually enhance those relationships.

Lesson 3—Treat the other departments as your "internal clients." Spend time with the P-C producers one on one; educate them on the benefits and HR issues facing their clients; and explain how you can help uncover, and then address, those issues.

Revenue report: About three years in, our revenues were up 250%, our revenue per employee had also more than doubled, and we had gone from losing money to making a 16.7% operating profit.

Mile Marker 4—Factory built isn't enough: Customize.

By this point, we had assembled some great tools and resources to offer our clients. We had online resources, actuarial services, and seminars, to name a few. However, we also had to realize that many of our competitors had similar resources.

Lesson 4—If you are going to succeed in the benefits business, you have to make an investment in the resources your clients and prospects expect and need. To achieve an acceptable return on the investment, you have to take the time to determine how you can add value to the process by customizing the solution to meet the unique needs of each client.

Revenue report: Four years since the last revenue report, we had grown by an additional 43%, but our revenue per employee had dropped (there were two additions to the department), we actually had red ink, and our revenue per client was only $7,133. Remember, I told you I made mistakes along the way.

Mile Marker 5—If you want to keep driving, you have to buy gas.

I finally realized that this was an endurance race. In an endurance race, not only do you need the best pit crew, you also need more than one driver.

Looking at the numbers, I had to admit that it wasn't all about me and my ability to sell. It had become obvious that to continue growing profitably, a strong, viable benefits department had to be a destination of its own. Up to this point, we had mainly been there to support growth on the P-C side and help protect its interests.

Lesson 5—Build your benefits department as if it were a business of its own. Make the necessary investments, staff it with the best talent available, run it profitably, and plan strategically for its growth.

Mile Marker 6—How do you keep a convoy moving in the same direction?

For us, we knew we needed a consistent approach that could easily be replicated:

  • Sales Leadership is difficult, but necessary—As the leader, my job was to hire the right people, set clear goals, provide the right resources, hold them accountable, and keep the road in front of them clear.
  • Consistent Sales Approach—We defined a consistent message and process.
  • Cohesive Team—We had a unified team, and we made selling a department function in which everyone had a well-defined role.

Lesson 6—Run the benefits practice with discipline and as a department rather than a group of producers. Put a leader in place who can create the departmental vision, plan for the successful execution of the vision, use the talents of each team member, and establish successful processes that can be repeated consistently.

Mile Marker 7—If you drive a high-performance car, you have to buy high-octane fuel.

If you want to attract the "A" talent in your market, you have to be seen as an "A" agency/department. Investing time in building resources and creating the structure was worth it. Hiring great talent, both producers and support staff, is expensive, but they also deliver an unbelievable ROI.

Lesson 7—This one is pretty straightforward. If you want the best results, you have to be willing to spend for the best talent. Of course, you first have to create an environment that is attractive to the best talent, or they won't even listen to your offer.

Mile Marker 8—Profitability matters.

Growing the top line isn't enough. It's the bottom line that matters most. Benefits departments in predominantly P-C agencies will inevitably end up with a lot of small accounts that are likely to be "loss leaders." For us, the answer was to outsource the smallest accounts to a service center and focus our attention on those accounts we knew could be profitable. You can offer and support only what you can deliver profitably.

Lesson 8—Profitable ______ should never have to subsidize unprofitable ______. You can fill in the blanks with "departments," "producers," or "clients." I suggest you use all three.

Mile Marker 9—Carpooling makes the journey easier.

Having the right tools in the hands of the right producers isn't enough; what matters is how those tools are used and to whom they are offered. We aligned ourselves with other organizations that helped introduce us to the right prospects. We also aligned ourselves with other like-minded agencies around the country that were willing to share their best ideas. I referred to this as my "R and D Department" (Rob and Duplicate).

Lesson 9—There are too many great ideas and relationships out there to not expose yourself to them on a regular basis.

Mile Marker 10—Sometimes you need a travel agent.

Have you ever noticed that as you got older, your parents got wiser? The same is true for those of us who lead departments or agencies: there is more knowledge out there than you could ever acquire on your own. We aligned ourselves with a consulting practice that enabled us to go further than we would have ever been able to do on our own.

Lesson 10—The best performers in every field have coaches and advisors who help make them better. Find that trusted advisor who is able to make you better at what you do by introducing new ideas, challenging your way of thinking and operating, and holding you accountable for doing whatever is necessary for your success.

Revenue report: It's been another four years since our last report and 10 years since the road trip began. Revenue has doubled over the past four years and is 670% higher than when we started. Revenue per employee is now at $417,835. Revenue per client relationship (not including service center clients) is $39,285, and operating profit is just over 20%.

Mile Marker 11—Been there, done that.

It doesn't matter; you have to do it again (and again and again). You have to constantly reinvent yourself. Change is the one constant, and either you will lead it or your competitors will.

Lesson 11—The road trip never ends; there is always another turn in the road. Remember, what was exceptional yesterday is acceptable today but will be inadequate tomorrow.

Mile Marker 12—Who knows?

While it is critical to have a vision of what you will become, it is impossible to know exactly where it will take you. However, I'm certain it will be somewhere that you haven't been before.

Lesson 12—Someone will be the disruptor in your market. Make sure it's you.

For me, my role in the agency did eventually take me beyond the benefits department and into overall agency leadership. And now, my personal road trip has taken me out of the agency entirely and on a new road trip that has me helping other departments and agencies navigate their own road trips.

I hope you enjoy your journey as much as I'm enjoying mine.

Photo by Victoria Reay.