People, plans, principles, processes, powers, and purposes are the basic building blocks of success in any business. Therefore, this paper’s message follows six guiding principles:
q Formal business plans should be written and shared with everyone who is expected to contribute effort to any business venture just as general contractors share their blueprints as team plans with subcontractors.
q Business plans should reflect stakeholder’s principles, processes, powers, and purposes so resulting products and services are attractive to customers.
q Popular products and services result from realistic plans reflecting sound principles, logical processes, well distributed authority, and meaningful purposes.
q People’s principles and powers should reflect their purposes; plans should reflect stakeholder’s reality.
q Implementation of a well developed plan enables planners to influence organizational culture by proposing new values, introducing new ways of doing things, and articulating new governing ideas.
q People tend to maintain best what they have created most so plans should be developed by whoever should use them.
Efficient and effective use of the previously mentioned building blocks prompts many decision makers to use goals, objectives, strategies, and tactics. Do you see how all business plans should include the following items?
q A strategy is a formal or informal statement of purpose with one or more goals. Strategies are made realistic by large-scale action plans’ details explaining ways to interact with the business environment in order to achieve long-term goals. Strategies are implemented as tactics are executed.
q Tactics are the specific actions required by the organization to implement its strategy. Tactics are executed as activities are implemented.
q Activities are groups of tasks required by organizational units or departments for completing a tactic. Activities are implemented as tasks are completed.
q Tasks are defined limited action assignments with target completion dates or well defined cycles. Tasks are the most basic actions individuals and teams perform continuously at work.
This chain of logic could be summarized as: Plan to do the tasks you need to accomplish so your activities will give you a tactical advantage in strategic ways. Using this chain of logic enables users to act in ways that are more aligned with their organizations’ values and abilities because their thinking is changed or at least structured differently. Changing how people think, changes their actions. Organizational cultures change/evolve as people’s beliefs, assumptions, and values change. Communicating such planning and making people accountable for selling will evolve a sales-oriented culture.
A business plan to increase the frequency and significance of insurance policy sales in excess of the industry’s growth rate should enable users of that plan to act in ways which will enable them to gain tactical advantages as they implement the plan. The following descriptions of tactics reflect a sales-oriented mindset/strategy. Implementation of these tactics in a gradual manner would lead to sales success and secondary benefits such as personal accountability for work performance.
1. Understanding and reflecting social styles to increase trust enables sales people to begin, build, and maintain productive relationships, producing loyal customers. Build a values-based system which encourages mutual respect to facilitate the development of trust.
2. Using credibility and authority to drive a wedge between prospects and their incumbent agents will increase our team’s sales-to-quotes ratios. Develop a commonly shared method for setting prospects’ expectations and committing them to appreciate our work.
3. Engineering coverage in response to less than ideal but not obviously poor risk characteristics helps to prevent unintended coverage. Using non-insurance risk management techniques helps to avoid predicable losses. Use insurance and non-insurance risk management techniques to get more premium dollars more profitably.
4. Empowering all players to participate in creation and use of a team playbook assures fairness and equality in ability for all who will use the playbook to communicate and script their speaking and acting. Create a document the team can use to learn, commit, and do good work. Holding all players accountable for their actions in our expansion will gain their commitment to our purposes.
5. Encouraging team members to have fun constructively will generate enthusiasm for their work and reduce employee turnover. React to customer and employee challenges in cheerful ways with humor.
6. Translating corporate marketing objectives into practical underwriting procedures and policies increases the likelihood of underwriting results reflecting what marketing departments have set as targets. Make sure employees’ efforts are directed to produce desired results (e.g., use what is traditionally known as MBO " management by objective" ) while using the right methods.
7. Verifying each employee understands his or her roles, duties and responsibilities will increase the entire organization’s effectiveness and attain high efficiency. Build a process to communicate expectations and test each employee’s understanding of what is communicated and expected. Just because they nod "yes" doesn’t mean they got the message.
8. Managing use of our existing customer base to generate more referrals, enable sales people to cross-sell lines of business to existing customers, and retain the most rewarding segments of our books of business.
Lack of organizational alignment and congruence is often seen in groups with diverse needs and abilities. The tactic referred to as CYA is not a customer focused strategy for increasing sales but many members of middle management take actions and perform tasks in an effort to avoid political damage. CYA does not produce results which are congruent with an organization's values. Alignment and congruence will result in collaboration between an organization’s teams with diverse concerns. For example: work assignments delegated by sales/marketing professionals as opportunities for success are often perceived as more work for the same pay by operations people often the cause of much friction and discontent among visionaries and front-line employees.
Activities and Tasks
The activities and tasks chosen for executing a tactic often reflect people’s perceptions more than they reflect their organizations’ strategy or reality. The scope of this paper does not include a specific organization therefore no specific strategy or reality is readily available for use in determining what activities and tasks should be performed to execute any tactics. Enough and sufficient activities and tasks must be defined, planned and implemented so each tactic can be implemented successfully to produce each organization’s preferred results.
Illustrations of the eight sales strategies
The following bulleted statements reflect how the actions listed above could be applied to an agency’s sales staff:
1. Understanding and reflecting prospective clients’ social styles in an effort to earn their trust will enable producers to begin, build, and maintain productive relationships with insureds. Prospects and clients can begin to appreciate agency personnel as reliable subject matter experts who encourage economically efficient risk management practices.
2. Driving a wedge between prospects’ and their incumbent agents will increase producers’ sales-to-quotes ratios. Set prospects’ expectations and commit prospects to appreciate our combined efforts.
3. Engineering markets’ coverages and limiting potential hazards in response to less than ideal but not obviously poor risk characteristics helps to prevent negative loss results and increase policies-in-force counts while preserving profitability. Agency personnel should encourage clients to use insurance and non-insurance risk management techniques to get more premium dollars more profitably.
4. Empowering agency personnel to participate in creation and use of an agency team playbook will enable producers and CSRs to collaborate and cooperate more efficiently and effectively, benefiting more of the agency’s clients/customers. All agency personnel should be made aware of what they can do and when they can do it so they can act with greater confidence, comfort, and consistency. Accountability will enforce this awareness.
5. Encouraging agency personnel to have fun constructively will generate enthusiasm for their work and endear them to their agency team members. Agency personnel who react to challenges posed by prospects and insureds in cheerful ways help CSRs and producers feel safe and confident in their relationships with agency owners/managers.
6. Translating markets’/insurers’ underwriting guidelines and marketing materials into practical front-line underwriting procedures and policies increases the likelihood of producers and CSRs producing favorable underwriting results. Agency managers and owners who make sure their personnel’s efforts are directed to produce desired results will get more of what insurers’ want produced and be able to ask for more exceptions to underwriting guidelines.
7. Verifying each producer and CSR understands his or her roles, duties and responsibilities will increase each agency’s effectiveness and attain higher efficiency. Agency owners and managers who build a process for communicating expectations and testing each producer’s and CSR’s understanding of what is communicated/expected will get what they want more reliably than those who just assume their message was received.
8. See the last page of this document for explanations and illustrations of the book of business strategy tactic.
The eight tactics listed above, when embellished with specifics and implemented as a formal plan, enable insurer and agency personnel to stop guessing and start growing profitably, acting with greater consistency, correctness, and comfort. Expectations will be communicated and plans will be developed to achieve those expectations as people are held accountable for their roles in expansion of an agency’s market share.
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