Typical Broker of Today vs. Consultant of Tomorrow

Kevin Trokey on July 08, 2013

How would you finish the following statement?

Three years from now, the way I perform my job will be…

  1. Pretty much the same as today
  2. The same, but I will have to work harder and do more of the same
  3. Significantly different than today
  4. As an employee in a government-run Exchange

I hope we don’t have any future government employees in our midst. And I hope even more that you believe your role has to change significantly. After all, change is the one constant. Some type of change is going to happen. It becomes a matter of if it is random change or purposeful change. For purposeful change to happen, it is something you have to plan for and work to make happen.

The idea of creating a plan for change is something we discuss at Q4i all the time. We look at a plan as three basic elements:

  1. A very clear picture of where we want to go.
  2. An honest assessment of where it is we are starting from.
  3. Once those two end points are established, we can identify the actions we have to take to get from one to the other.

As you consider driving purposeful change in your job moving forward, let’s look at those two end points a little more closely in four key areas.

What type of relationship do you have with your clients?

Typical broker of today – Insurance vendor

All too often, brokers are playing a vendor role. They take information from the prospect and deliver it to the carrier. Then they take the quote from the carrier and deliver it to the prospect. Then, when the inevitable problems associated with the insurance product happen, they step in to help fix those problems.

Now, don’t get me wrong, those steps are important and necessary, but when that’s all the broker is doing, there just isn’t that much value in what they do. There especially isn’t enough value to justify the compensation received. Unfortunately, a vendor is only able to have a temporary, surface-level impact on the business of their clients.

Consultant of tomorrow – Business advisor

While the broker of tomorrow will still be placing insurance and helping with problems, that is just the beginning of what they offer. The broker of tomorrow will understand broader business issues and be able to offer advice, consultation and guidance to truly improve the performance of their client’s business. As opposed to a vendor, an advisor is able to truly impact the performance of his/her clients and do so in a way that has a lasting impact.

Suggested first step – Take inventory of the non-insurance solutions you already have available. Because the quoting of the insurance is an even playing field, identifying non-insurance needs associated with these additional resources and developing implementation strategies should become the focus of your sales process. A few of the areas I would suggest you look for first: communication, compliance, attraction/retention strategies, wellness, safety and workers’ comp.

What do you sell and how do you get paid for selling it?

Typical broker of today – Product/Commissions

Today, most brokers don’t get paid until they place an insurance product. The problem is, his or her business and success depends on a product controlled by somebody else. If that carrier decides to change the features or increase its price, it’s up to the broker to deliver the news. When the carrier drops the ball or has an answer the employer doesn’t like, it reflects as much on the broker as it does the carrier. Oh, and if the carrier decides to use a different distribution channel, well, the broker is simply out of luck. Finally, in this model, it is the carrier, with their commission schedule, who determines how much the broker is worth. And, if they decide tomorrow the broker should get paid half of what they did yesterday, then the broker takes a big pay cut.

Consultant of tomorrow – Value/Fees

Instead of getting paid for the placement of a product, the broker of tomorrow will get paid for the value they create. They understand that their greatest value to the client is in their advice, consultation and guidance.

The broker of tomorrow recognizes that insurance will only be one solution with which to impact the business of their clients. They understand that their greatest value is bringing knowledge and a process that will enable them to identify the areas of greatest need, align the right solution, and then take responsibility for ensuring the solution is implemented and utilized properly. The broker of tomorrow realizes they have to be in control of two key aspects of their business: what they sell and how they get paid.

Suggested first step – Control starts with a conversation. Go out and have a conversation with each of your clients about how much you are getting paid and the value you deliver for that compensation. Somebody will have this conversation with them; it will either be you or your competition. And, I don’t think your competition will be kind enough to discuss your value.

Whose story matters most?

Broker of today – Mine

During the sales process, most brokers of today are exclusively focused on their story. They want to talk about their “gold status,” their countless years of experience, how they will be like an extension of your HR department, and try to impress with their list of stuff. They exhaust the prospect with the same old story that sounds just like everyone else’s same old story.

Consultant of tomorrow – Prospect/Client

The broker of tomorrow understands that the prospect assumes the broker has all that stuff or else they wouldn’t waste their time taking the meeting. Instead, the prospect is most interested in learning how you can help them. The broker of tomorrow knows that the better he/she knows the prospect, the more likely they are to be able to help. And the more likely they are able to help, the more likely the prospect is to buy from them. They may still leave the prospect exhausted, but it will be from an insatiable curiosity of the prospect’s story.

Suggest first step – Define the picture you need to be able to complete for each prospect and don’t start telling your story until you know theirs. At a minimum, you need to know: how they define their future success, what is working well for them, what isn’t working so well for them, and where do they have recognized needs for which you may be the right solution.

Where does your hard work take place?

Broker of today – Execution

Execution is the time actually spent in front of the prospect. The typical broker of today does minimal work before getting in front of a prospect, but works incredibly hard once they are face-to-face. You see, when your business model and story looks and sounds just like everyone else’s, then you have to work exceptionally hard telling the story to have any chance of winning the business that day.

Consultant of tomorrow – Preparation

The broker of tomorrow will still work hard, perhaps harder than today. However, their hard work will be almost completely about preparation, the things that take place before they arrive at the prospects office. The great things about the hard work taking place in preparation are twofold. First, most of this hard work can be used over and over again with multiple prospects. Secondly, this kind of hard work results in a value proposition so much stronger than that of the competition, the sales process itself becomes easy.

Suggested first step – Define what preparation means to you and create a process to use it consistently. I believe it should include the following:

  1. Researching the prospect to learn as much detail as possible.
  2. Practice asking questions that will allow you to uncover critical needs.
  3. Build your business acumen to have the broadest and most meaningful conversations possible.

Of course, that’s how I see the consultant of tomorrow. You may see it differently – and I’d love to hear your thoughts below! The key is to be honest in determining what your clients will want and need from you and what you need to become in order to deliver.

The work that will get you from today to tomorrow won’t necessarily be easy, but it will be rewarding. You just have to ask yourself, “How badly do I really want it?”

 

Photo by Bengsoon Chuah.

Topics: Leadership + Management