I have no choice is a common sentiment among businesses: “The competition is doing it, so we have to do it.”

The insurance industry is ripe with traditions that agencies feel they must follow because “it’s always been done that way and really, how can we effectively compete if we’re doing something different?”

If you believe that you must follow suit with things your competitors are doing or offering, then you’re letting your competitors determine your business model and shape your company values.

Following the competition puts a limit on creative thinking and implementing any innovative practices in your business.

If you don’t stand for something or you try to stand for everything, you actually stand for nothing

Nothing - this is how the buyer sees a company who is generically the same as every other competing company.

Being the same, saying the same things, offering the same things, and maintaining the same model will not get you farther ahead. In fact, you will risk going backward because you’ll have to work harder and harder at doing the same things since there is no point of differentiation.

Buyers need a solid way to make a good decision for their business. When they look at a group of quotes from a seemingly homogenous group of agencies, there’s nothing but rather superficial reasons for making a decision. 

Which spreadsheet do they like better? Who do they like better? Who might offer better service after being hired?

There’s nothing substantial to use. And how solid of a business decision is that?!

Now it’s common thought to have a collection of products and services to offer as a point of differentiation, but the problem is that those same things can also be acquired and offered by any other agency. This is not seen as a point of differentiation in the eyes of the client. Instead, what they see is a collection of products that they can get from you or any of the others.

Take a stand and stand for something your clients would find valuable

Counter to this traditional thinking, it’s those agencies that deviate from the traditional model that are the ones who are seeing great success.

If you find that you’re competing on the same things as your competitors, then it’s time to step out and create your own category.

No one said you have to run your agency like everyone else. No one said you have to offer the same products and services as everyone else. No one said you have to work with all businesses regardless of size or industry.

Create a specialized process for analyzing a client business. Define a niche market in size, location, or industry. Create a specialized culture that delivers unique results to your clients (think Zappos or Umpqua Bank). Focus on a core set of services that you do exceptionally well and become known as the go-to source in your market (or even nationally).

If you create a new category, then the buyer now has a new way of judging the competition – who can offer the same thing as you?

Those who are truly finding a way to make themselves different will be dominating the market, making it even more difficult to continue competing with the traditional model.

Photo by John Paul Rodriguez.

@wendykeneipp

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We talked recently about managing the changes insurance and benefits agencies are making as a result of the changing business model. One of the questions we hear a lot in these discussions is “Whose responsibility is that?”

And it’s a good question.  One that needs to be explored within your own structure.  We can give you some ideas, but we can’t answer it specifically because each agency is as unique as the people within it. You might already be set up to deliver in some of these areas, or you might need to bring in new people, reallocate resources, or hire some outside firms for support.

One thing is for certain – you’re going to have to make some changes.

As buyers and their needs become more complicated, delivering on this new level of sophistication requires more people in the agency to take on an active role in acquiring and supporting new clients.

Let’s start with the producer role

In this new model, we need to take time to think about how the producer’s job has changed, and we need to evaluate what that change looks like for them, for the client, and for the agency. Producers are sales people who are good at working with clients and making promises. They may not be so good at delivering on all those promises, especially when we have a growing repertoire of services, and nor should they be.

Think about it like this. When you’re in a restaurant, does the waiter make the food? No, they are the liaison between the customer and the kitchen.  And they are experts, hopefully, at being that relationship person and the translator between the two. The chef is the expert at making the food and the bartender is the expert at making that drink. The waiter makes sure you have an excellent all around experience.

We need to look at insurance and benefits agencies in the same way. Producers should not be doing it all themselves. We’ve moved beyond that model where you can have a do-it-yourself production staff. It takes a team.

Let’s look at some areas within the agency where you might need to add or restructure

Marketing – Being the first point of contact with the prospect through marketing activities and messaging. Having a point person filling this role is an important part of the new model. This person needs to be a very strong connector between the leadership team (to help create the message) and the sales team (to ensure proper delivery of the message).  This person should also be creative and motivated to create a strong internal and external marketing program.

Prospecting – Bringing in new revenue should be top priority for the agency, and should be given appropriate attention and resources.  Prospecting efforts should be supported by strong sales leadership, which helps drive the efforts of the producers by providing accountability, time management planning, regular sales development meetings, and account strategy help.

Client Service – What the client receives needs to reach beyond reactive policy service issues. Additional services, unrelated to the policies, need to be delivered to clients, and people with expertise should be responsible for that delivery. This may be people with special areas of expertise in an area like wellness, it may be someone to help coordinate the delivery of third party providers, or it may be internal folks who deliver a variety of solutions around HR or risk management.

Traditionally, agencies have relied on carriers for a lot of their business support services like marketing materials and activities, prospecting lists, and they’ll even participate in team selling efforts and offer some client programs like wellness or safety.

Sometimes these are the right resources, but you also need to be open to partnering with other solution providers and creating some of these things internally.

Creating the right structure will take some time to figure out what works best. As you work through it, I highly recommend you first create a vision of what you would ideally like the customer to experience when working with your company.

Start from the ideal, and then create a structure to support it. Don’t limit yourself to thinking about what your structure or team currently looks like. Companies can be reorganized and people can be trained.

Photo by Marina Kuperman Villatoro.

@wendykeneipp

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When you change your client value offering and your sales model, you have to change the way the company supports these new efforts. Taking the time to evaluate your current structure and making changes to support the new model is critical to successfully executing on and delivering on your new value proposition.

When you make the commitment to what the new structure is going to be, you’ll have to take on the possibly daunting task of implementing on it. And it might not be fun because many people don’t like change – it’s unknown and that can be scary.

Anticipate the reactions

When you make the commitment to undertake a major change, or any change for that matter, you need to recognize that people will react differently. Be prepared for this and have a plan in advance.

• You’ll have your enthusiastic change agents who can’t wait to get started and are planning the details before you’ve finished explaining the end goal.
• You’ll have your naysayers who sincerely believe that this is doomed before you’ve finished explaining the end goal. They will work to remain as status quo as possible.
• The balance of your folks will be in the middle. They’re the fence-sitters.  They have very little opinion and are susceptible to going either direction.

The choice is yours

Now, you’re faced with a couple of choices:

Spend your time with the naysayers, trying to convince them why this change is a good idea.

Or, spend your time with your excited change agents who are already planning the next 90-day implementation plan.

Whichever you choose will yield results. It just depends what results you want to see.

Getting the swing vote

When you focus your attention on the naysayers it’s giving credence to their lack of support and belief in the new model. You will get frustrated trying to explain and convince someone who doesn’t want to change that change is a good idea. All the while you’re trying to convince them that this “will be okay” is time that you are not moving ahead with your new plans.

If, however, you focus your attention on the supporters, you’ll be helping them help you. They can take an active role in developing and implementing plans. You’ll begin moving ahead immediately with their support and efforts.

You’re eventually going to get the swing vote from your fence-sitters. They’ll sit by and watch, waiting to see how things play out. Whichever group appears to get management attention and resources is going to win.

• If it swings it toward the naysayers, you’ll have a resistance revolt on your hands with nearly your entire staff, and making any changes is going to become near impossible.
• If it swings toward the supporters, you’ll have nearly everyone ready and willing to help drive the company forward toward a new reality. The whole group can then actively participate in initiating and implementing the necessary changes.

It’s not all roses

Chances are pretty high that there will be some employee fallout from the changes, regardless of how well you manage it. There are some people who just don’t like making changes and they’d rather leave than tough out the process. That’s okay. Let them go. You need to make the best decision for your company, and having people onboard who don’t support the company goals and the company vision shouldn’t be allowed to bring down the team and thwart their efforts.

The choice for change is yours. You just have to decide which path better suits your desired end game.

Photo by Hunter Desportes.

@wendykeneipp

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Hi everyone -

This week we’re in San Diego spending a few days with our members at our BGNLive conference and networking session.

We have been head down preparing for the conference and won’t have any new postings this week. However, we’d love it if you followed along with the happenings as we share them on Twitter – we’ll be using the hashtag #BGNLive.

Even if you’re not a Twitter user, you can follow too! See the left side-bar of the blog – we’ll be replacing Kevin’s feed with the #BGNLive feed.

Want to know what we’re talking about? Here’s a look at the agenda:

• Marketing | Communicating business model & value offering
• Prospecting | Consistently filling the pipeline
• Sales Process | Teaching clients a new way to buy; Tailor the message; Control the process
• Accountability | Delivering what we promise
• Client Experience | Organizational structure & capabilities

Next week we’ll be sharing some wrap-up articles from the conference. Have a great week!

@wendykeneipp

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We’ve talked about the evolution into social business and offered some ideas of what that might look like in your agency. Here I’m going to offer some specific suggestions for getting started with that process.

Remember, social should not be an end goal itself; social media tools should become an integrated tactic within the operations of departments. And for it to be effective in helping you achieve your company vision and goals, there is a hierarchy that needs to be followed:

1. Have a clearly defined purpose and vision for the company along with clear messaging about what makes you a unique and compelling business.
2. Have the vision broken down into clearly defined strategic objectives, including a communication plan.
3. Recognize that social media tools are to be used as tactics, along with other specific programs and process, to help achieve those strategic objectives.

In order to effectively integrate social into the plan, you first need to learn what it can do for you and then you can figure out how to go about accomplishing it. And that starts with education.

Form a team

Since we’re talking about integrating into business operations, we want to have a team of folks across disciplines participating in the learning process and the strategy. If a department thinks it doesn’t relate to them, be sure they’re on this team at least in the beginning - good business decisions are made based on what we know.

Your team should consist of people who:

• understand business
• are good at communicating business strategy
• are able to gather information from people, interpret that information, and share the findings
• are enthusiastic about your company

Why do I need a team? Shouldn’t I just hire someone to be in charge of social media?

It can be tempting to hire someone young who’s comfortable with the technology and pass all of this off to them. But that’s a mistake. Notice that we’re talking about business operations and strategy. Your best friend’s niece who’s in college and has a million friends on Facebook does not know your business operations, your strategy, or your messaging. And she likely doesn’t understand what significant or nuanced ideas she comes across that could be really important to the future of your business.

Working in the agency and industry and having a healthy dose of business acumen is what gives you that level of practical knowledge. That’s what you want to tap into. People can learn to navigate the social platforms with a little education. Learning your business inside and out takes a lot more.

Unless you’re a large company with a major marketing strategy, hiring someone specifically for social media is unnecessary. Most independent benefits and insurance agencies will be just fine within your existing structure.

However, while you don’t need someone specifically in charge of social media, you do need someone to be in charge of company messaging. They need to make sure that everyone participating in social has the knowledge they need to be on target with the company message and are working within your corporate guidelines and strategy. Again, this likely comes from someone already on your team.

Educate yourselves

Now that you’ve got the team together, read a couple of books and get your arms wrapped around what this means for your company and how each department can use this as a part of their business processes.

Discuss each book and talk specifically about what it means for your company. Have great debates on how it relates to you and what you might do with it. Take rigorous notes on these discussions and use this as the basis for forming a plan of action and eventually communication with the rest of the company on what you’re doing and why.

Here are a couple of foundational books that will help you really comprehend social business:

I recommend reading The Thank You Economy by Gary Vaynerchuck to understand the evolution of social media and why it's important for business today and into the future.

Then I recommend The Now Revolution by Jay Baer & Amber Naslund to understand how to structure your organization to incorporate social media as an integrated business tool throughout your company – to some degree you will need to restructure your business/processes. This book will provide a great road map for what you need to know and how to get there.

Learn from what you read & hear

As you get going and start the process of becoming a social business, the most important thing to keep in mind is that you need to do something with the information you learn. Keep this team together to have ongoing meetings about what you’re learning. Have everyone bring their findings to the team and decipher what it means to your business – should you be changing processes or product/services as a result of what you’re hearing?

It’s important to have leadership involved in these meetings because you’re not simply talking social media, you’re talking business strategy.

Photo by nagora.

@wendykeneipp

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At our BGNLive! conference in Chicago this year we focused on the need to change the agency business model and how to effectively communicate those changes to our clients and prospects. Len Strazewski, writer with Rough Notes magazine, attended the conference and following are his takeaways of the content discussed at the session.

Agents and brokers that do not
manage that first impression run the
risk of letting random online information
or misinformation control what
prospective clients learn about them

By Len Strazewski

Do prospects really learn what you want them to learn about your agency?

Google says your agency sells insurance. Facebook says you have a great softball team. LinkedIn says you went to a state university.

Is this the way you want present and prospective customers to know and understand your agency? Do these sources communicate what you really offer your clients? Click here to read the full article at Rough Notes magazine.

Photo by Paul Downey.

@wendykeneipp

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Don, a friend of mine, recently hit one of those mile marker ages.  You know, one of those that require a trip to the doctor for a checkup.

Actually, he wasn’t all that concerned about it.  After all, he takes decent care of himself, has always considered himself healthy, and other than some fatigue, felt really good.  So in he goes to see his family doctor, Phil.  Phil had been the family doctor long enough that they really were on a first name basis.

So Phil tells Don, “Overall, you’re in good shape.  Sure you could lose a few pounds and a little more activity wouldn’t hurt.  However, the results of your tests are just a little off.  I really don’t think its anything, but I have a colleague who is a cardiac specialist I would like you to see.  Really, I don’t think its anything at all.  It would just make me feel better.”

Not overly concerned, off Don goes to see the specialist, Dr. Ting.  Dr. Ting asks a whole bunch of questions (some that Don wasn’t able to answer in the way he would have liked; maybe he does have some warning signs), runs a whole bunch of tests, and is much more concerned about Don’s health than was Phil.

The diagnosis

Dr. Ting, “Well, I’m sure this will come as a shock, but you came to see me just in the nick of time.  We’re going to have to install a pacemaker.  It wasn’t easy to detect, but you have an arrhythmia that we need to control.”

After getting over the initial shock and feeling a little anxious about the surgery and thought of a pacemaker, Don was still very relieved to have found out sooner than later.

The solution

Dr. Ting explained that, although there are several pacemaker manufacturers, there are only 2 or 3 that are likely to be the right device for him.  Dr. Ting assured Don that he would meet with the manufacturer reps, explain Don’s circumstances, and pick the right one.  After meeting with Joe, one of the manufacturer’s reps, Dr. Ting knew he had the right device.

Just a week later, Dr. Ting performed the surgery and it was a complete success.  Just a few days later, Don realized that he felt better than he had in 20 years.  Obviously, he hadn’t been as healthy as he had thought.  Good thing he went in for that physical.

Who are you in the diagnosis process?

Okay, so you might be thinking that I’m writing this to encourage you to go get a physical.  Even though that’s a great idea, that’s not my point.  What I want you to consider is which of the three individuals who played a part in Don’s medical situation are most similar to your business model?

Are you Phil, a generalist who can provide a decent amount of help in many different areas, but no depth in any one?

Are you Joe, a vendor whose contribution was to provide the right product?

Or, are you Dr. Ting, a specialist who truly diagnosed the problem and then installed the right solution?

Of course, each of the three played a significant role, but their contributions definitely were not equal.  While you’re thinking about your model, also think about:

• Who was paid the most for their services?
• Who provided the most value for what they were paid?
• To whom do you think Don was the least concerned about paying a large sum of money?

Obviously, the answer to each question is the specialist.  You can identify the problem and even the right solution, but if you don’t ensure that the solution is installed/implemented properly, nothing positive happens.

Photo by Erich Ferdinand.

@kevintrokey

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Positioning & Opportunities: How you differentiate yourself in the mind of your prospect

Believe it or not, fourth quarter, and arguably the most important time of the year, is upon us. You’re probably nodding your head, having a little anxiety over all of the upcoming renewals and agreeing with the importance of dealing with them.

And that’s true. But what’s also true is that most of you have a team to help you get through those renewals. Let them handle the lion’s share of that responsibility. It’s time for you to focus on the real reason why this is the most important time of the year for you: your pipeline. Despite all of the distractions that come with this time of year, it is critical that prospecting remains a top priority.

While prospecting has always been challenging, in this era of differentiation it has become even more so. I assume by now most of you have modified your business model and are positioning yourself as somehow different in the marketplace. It’s exactly that repositioning of your model that requires a more focused approach to communicating with prospects.

Problems in message delivery

Here are some problems I regularly see as I coach agencies and producers about delivering the right message during the prospecting/sales process:

1. Differentiation - You have to effectively explain what it is that makes your model different.
2. Overcoming the industry brand – If the prospect doesn’t know you or your agency, they will assume you are a traditional insurance broker.
3. Lack of personal preparation – The new differentiated model requires that you expand your knowledge to bring value to your future clients in new ways.
4. Inconsistencies –
   • In the amount of time committed to prospecting
   • In the client experience we talk about versus the client experience we deliver
   • In the written messages (website, blog, etc.) we send versus the spoken message communicated during the sales process

Responses to overcome the problems

Differentiate yourself by defining your position. Your message has to be a reflection of your business model. It should demonstrate how you are different from the competition (your position), and how you bring value to your clients. Analyze your business model in order to develop your message.

As you work to define your position, answer the following questions, but be sure that you answer in a way that is unique (can’t be claimed by your competition – or at least by most of them) and compelling (allows your prospect to see what’s in it for them).

• What do you sell? The reason you give your clients to do business with you.
• How do you sell it? Write down the steps through which you take a prospect.
• How do you retain clients? Describe why your clients remain with you.

If you can’t honestly answer these questions in a manner that meets the unique and compelling standards, you need to re-evaluate and adjust your business model.

Overcome industry brand and inconsistencies by developing your own message - Now that you have defined your position in a unique and compelling manner, it’s time to develop your message. Start by developing the core message that will be consistent throughout all of your communications. It is through this messaging that you must start separating yourself from the stereotype of the industry brand.

To create an effective message, but sure it is:

• Simple – Don’t make your audience sort through a bunch of noise to find the core message. Make it obvious.
• Visible – Be sure it paints a picture of who you are.
• Rational & Emotional – Appeal to both sides of your audience as they are always present

An effective message will tell the audience:

• What you do
• How you do it
• Why they should want it
• Their call to action (e.g. asking for the appointment)

Plan to communicate - Once you have defined the message to be communicated, develop the plan as to how it will be executed.

1. Marketing (Pre-sale) & Brand Communication – These are the ways in which you will reinforce the messages being taken to the market by your sales force. You can be sure that once a producer contacts a prospect, that prospect will go to these various sources to learn more about the agency and producer. Be sure all of the messaging is consistent, including website, blog, LinkedIn, Twitter, etc.
2. Sales Messaging for Agency & Producer – Develop the scripts to be used during the sales process. Allow producers the flexibility to personalize, but insist that they convey the core message developed above. 
   • Cold call
   • Approach letters, emails
   • 30-second commercial
   • Asking for referrals – COI/Client

Deliver on the new model/message with personal preparation – If you have committed to somehow being different in the marketplace, it likely means that you are going to need new skills and knowledge to do so. You will never be able to truly meet the promises that come with your defined position if you haven’t made an agency-wide commitment, requirement, and investment to acquiring the skills and knowledge necessary to execute on the new model.

Look at the position you have defined and identify every skill set, talent and knowledge that is required to deliver it successfully. Compare that list with what is currently in place and create a plan to acquire what is missing.

Block time for consistent prospecting – As much as I would like to be able to offer one, there is no magic bullet when it comes to prospecting. (The closest there is to a magic bullet are the client referrals I talked about in my February article.) However, with the right messaging in place, scripts identified, appropriate knowledge and practice under your belt, you will be positioned to get better results.

However, those results won’t come without action. No matter what, it all comes down to blocking out time on your calendar every week for dedicated prospecting activities. The thing is, now that you are better prepared, I think you will find that it’s not the horrible task you have maybe allowed it to be up to this point.

When you think about having a consistently full pipeline, you just have to ask yourself, “How badly do I really want it?”

Photo by David J Laporte.

@kevintrokey

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What’s your perspective on your competition? Do you think about them regularly and obsess over what they’re doing at all times? Do you worry that they’ve got a new solution, employee, or carrier relationship that you don’t?

Knowing who your competitors are and having an idea of what they’re doing is a good thing. But if you are obsessing over those things, you’re ceding control of your own business to them.

Running toward vs. away

If you have a strong company vision, a team you trust, you’ve empowered them to take the reigns in their own area, and you’re all driving hard on a vision toward a common goal, then you’re actively running toward something.

Yet if everyday is a focus on what the guy down the block is doing, and you’re worrying about that new solution they’re offering or the new sales guy they hired, and you’re looking for ways to one-up that other business, you’re not building a better company. You’re still running; you’re just running away. You’re running away from your competitors.

When you’re running away,

• you’re not thinking about the client; you’re thinking about yourself.
• you’re not thinking about your company strategy; you’re thinking about the competitor’s actions.
• you’re not thinking about and planning for your company vision and future; you’re thinking about today.

This limited scope, short term thinking will get you a random business model continuously disrupted with reactionary changes. It will also produce an inconsistent client experience.

Companies obsessed with the competition ultimately pursue damaging activities and create the scenario they’re working so hard to avoid – being beat-out by the competition.

Instead of focusing on what we don’t want, we need to affect change by focusing on what we do want. It is only with that driving focus on the goal that we’re able to choose the behaviors and actions we need to achieve the positive results we so desire.

The greatest financial opportunities lie in helping clients build better businesses, and without this properly placed focus, growth will prove elusive. 

Direct your thoughts, energies, and resources on what you can control – what you’re offering your potential clients and the experience you’re giving them after they’ve hired you. That is the best competitive advantage you can give yourself.

Photo by Tiffa Day.

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Independent insurance and benefits agencies face pressures from changes brought about by healthcare reform.

September 21, 2011 - St. Louis, MO - Kevin Trokey, President & CEO of Benefits Growth Network, has been selected to speak at the 6th Annual Employee Benefit Adviser Summit. He will present on the pressures benefits and insurance agencies are facing as a result of healthcare reform and what they can do to successfully navigate the transition.

Trokey believes that the current changes facing the industry may look familiar, but are actually quite different than the challenges the industry has seen in the past decades. He will explain the differences, explore the challenges, and offer ideas on how to modify the agency business model in order to compete in a new environment.

“There are unprecedented opportunities for growth in the benefits industry as a result of the healthcare reform changes being forced on agency businesses. However, without a purposeful plan of how to make a successful transition, many brokers and agencies will find themselves victims and casualties of reform,” says Trokey.

In the session, brokers will get an idea of how to create a new vision and strategy for their agency that takes a different marketing approach and value proposition to clients. Through this new model, agencies focus on helping clients build more successful businesses by improving the investment employers make into their staff.

The 6th Annual Employee Benefit Adviser Summit will be held in Dallas, TX September 25 – 27, 2011. The conference is focused on building businesses by providing the basics for broker/adviser staff, as well as advanced marketing and management techniques.

About Benefits Growth Network
Benefits Growth Network, based out of St. Louis, MO, is an international membership-based consulting firm specializing in growth strategies for independently owned employee benefits agencies and brokerages. Through the exclusive Benefits Growth System™, members get individualized planning, coaching, training, use of proprietary systems and access to a network of thriving benefits agencies. For more information about Benefits Growth Network, visit www.benefitsgrowthnetwork.com.