By Jessica Stevenson, Account Executive – MySalesResults
Conclusions: If you don’t have goals, how can you exceed them? Sales people who are “maintaining” and not “selling” are not sales people, they are account managers.
This is the final article in a 4 part series where I will be presenting the results of an in-depth insurance industry research project. As a part of the research, I interviewed several of the industry’s top agency sales managers to find out everything I could about what makes a great sales person and how to effectively manage sales teams. This post focuses on accountability and motivation.
Goals – What are the goals & minimum expectations set for your sales people?
Goals and minimum expectations are necessary for every producer within an organization. After all, if you don’t have goals, how can you have something to work towards? It is also very important to let the sales numbers be open to the entire team. This helps to create peer pressure; sales people are natural competitors and will be driven to succeed. The following is a list of the minimum goals that all sales people should be held accountable to:
- Calls | Appointments
- Premium | Revenue
- Closing Ratios
- Top opportunities | Prospect pipeline
Measurement – What do you use to measure and track goals in order to hold your sales people accountable?
As the saying goes, “what gets measured and managed gets done.” It is important to have some sort of tracking and measurement system to help hold your producers accountable, even if you are just using excel. If you are looking to the market for a sales management system it should possess the following characteristics in order to have a high-level of implementation and buy-in from your team:
Characteristics of a good Sales Management System:
- Simple – easy to use
- Designed with the sales person in mind
- Efficient – doesn’t take a lot of time
- Specific to the insurance industry
- Web-based – portability
Meetings – What is your sales meeting structure?
Having regular (and a variety) of sales meeting will help to ensure you producers are staying on track in addition to creating a team atmosphere and helping with business acumen. Below are a few examples of sales meeting that should be held at least once a month in order for sales organizations to be successful:
- Individual – one on one meetings – reviewing specific accounts, pipeline, individual goals/results, accountability & action plans
- Division – Acct Managers & Producers – carrier specific info, divisional goals/results
- Group Sales (monthly &/or quarterly) – top performers, key accounts written & top prospect opportunities, sales related info to share (articles, blogs, books, etc.)
Compensation – What type of compensation plan do you use to ensure your sales people continually exceed minimum expectations for both new business & overall growth?
Agencies have struggled over compensation models since the beginning of commission pay structures. Compensation models vary for simplistic new business and renewal commission percentage to more complicated models that help to ensure producers don’t get stagnant. Here are a few sample models we discovered in our research:
Standard Compensation Models: Ex. #1 – 50% Commission on New Business, 35% Commission on Renewal Book. Ex. #2 – 45% New Business, 25% Renewal, 20% 1st Year Referral Commission.
Plus Compensation Models: Here a retroactive bonus is added based on hitting minimum goal expectations: Ex. #3 – 25% New Business, 15% Renewal Business, 15% Retroactive on both New & Renewal at year end if a certain growth percentage is met in their overall book of business (note: overall book includes referral revenue.) Ex. #4 – 35% New Business, 35% Renewal Business, 5%|8%|10% Retroactive on both New & Renewal based on hitting different levels of new business revenue.
Plus Plus Compensation Models: The final model places on emphasis on both new business goals as well as creating incentive for stagnant producers with large books of business to continue to write new business. Ex. #5 – 40% New Business, 40% Renewal Business: Each year that the New Business sales goal has not been met 2.5% commission is deducted from both the New Business and Renewal percentages. There is a minimum cap at 30% commission. However, incentive is added for this too because this model pays a 7% Sales Expense (to be used for all sales expenses, including gas, dinners, events, etc.) If the minimum New Business Goal is not met they will continue to deduct a percentage from the sales bonus as well, creating less of a “spending fund” for the producers who may not seem to have an incentive to write new business.
Accountability | Motivation – Summary
Accountability and continued motivation for your entire sales team (both new and seasoned producers) is critical and necessary for the continued growth of your agency. It is important to note that not one agency is perfect; however, it is all about progress. Setting some form of sales goals for your producers and then tracking those sales goals to help hold the producers accountable. Holding regular sales meetings to help create a team atmosphere, provide continuing business acumen and again holding your producers accountable. A compensation plan that integrates at least a focus on at exceeding new business goals will help to ensure producers continue to write new revenue, even if they have large books of business.
Thank you again to all of the agencies that participated in this project.