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Five Stats Every Agency Owner Must Obsess Over

By Kelly Donahue-Piro

In my line of work with local agencies across the country, I often find principals are not focused on their agency’s data but rather they manage from the checkbook. Trust me, money is a key indicator of success and by looking at the numbers you can find papercuts before they become bigger wounds. So why do agencies tend to shy away from the numbers? I believe there are three key reasons:

  • When you pull a report from the management system you just know it’s wrong;
  • Pulling reports can be overwhelming if you’re not confident in what and how to pull it;
  • Some people are just afraid of what you may find.

Because of carrier rate increases, many agencies are shrinking but the checkbook hasn’t quite felt it yet, which is a challenge. When I work with agencies, one of the first things we do is dive deep into the metrics. I need to understand where things are on and off track. We then meet with the team to get the people and process standpoint. In my eight years of working with agencies, these are the five key metrics I generally obsess over:

New Business Sales

Seems simple, right? Well I slice and dice that data like a hot pizza. I want to see continued positive new business trends both on policy count and commissionable dollars. Also we like to break it down by agent to make sure everyone is pulling their own weight. We then like to analyze it month over month. This also helps you predict when an agent is heading into service land and taking a vacation from sales paradise.

Closing Ratio

I require all new quotes go into the management systems. We can’t manage what we can’t measure and knowing how many swings of the bat it takes to hit a homerun matters. If business is lagging, it’s either due to not enough opportunities or too many strikeouts. Any trailing producer will blame the leads. You need to know each person’s closing ratio and where the sales system can improve.

Email Percentage of Current Customers

Let’s face it, email is a cheap and efficient way to communicate to customers. If you don’t use email most likely the only thing they are ever going to get from you is their bill. Email allows you to stay in touch in an automated fashion and keeps your name front and center. Too often staff gets sloppy and doesn’t add it to the management system in the right field. This literally handcuffs your ability to stay in touch with your customers.

Retention Rate

While this can be a challenge to pull together, we cannot go off of our biggest carriers numbers anymore. We need to focus on our retention rates. You can do this by taking the number of renewals in a month vs. the number of cancellations that come in during that same month. You need to track this historically by premium and policies. You will see that the smaller policies generally leave you over the bigger ones. Knowing your retention numbers allows you to allocate resources toward retaining your accounts because you can predict the additional revenue.

Remarketing Ratios

One common theme I hear at every agency is “I don’t have time.” All too often we find that the team will spend their time on the wrong things. I frequently find remarketing is rampant. Team members often remarket accounts “just to see.” It can be a complete waste of time and run out of control. We recommend you track the number of attempts as well as the hit ratio. This will quickly tell who is remarketing out of control!

Numbers can be a challenge but they are critical to drive your agency to top performance. You can’t shy away from them. They are there and unfortunately they will come to bite you if you don’t pay attention. Early detection is critical. The other benefit to watching the numbers is driving greater accountability for your team. When you share your numbers and the goals with the team and then update them routinely, it’s amazing how the team can react. Your team will focus on what you focus on. When you focus on the numbers, your team will pay attention to better data entry, which benefits everyone!

Bottom line, focus on looking at the data as a long road goal. It will take time to refine it and polish it up–but it’s worth the effort!

 

Kelly Donahue-Piro, founder and president of Agency Performance Partners, is a no-nonsense effectiveness expert who has helped hundreds of insurance agencies identify and capitalize on sustainable improvement opportunities. Her specialties include agency culture assessment and change; management and supervisory coaching and benchmarking; customer retention strategy development; digital marketing strategy, planning and implementation; and sales planning, management and skillbuilding. In 2014, she created Agency Performance Partners with a mission to “partner with insurance entrepreneurs who dream to take their business to the next level and beyond, by relentlessly pursuing excellence in world-class service and sales strategies.” The centerpiece of the organization’s transformational work is its Agency Performance AssessmentTM, a comprehensive survey tool Kelly created to zero in on organization- wide improvement opportunities and provide the foundation for a customized agency action plan. Mrs. Donahue-Piro is an engaging speaker who is available to conduct in-person and online agency success presentations that complement her firm’s one-on-one onsite and virtual consulting practice. Connect with her on social platforms, via email at kelly@agencyperformancepartners, or by phone at 401-415-6205.
Kelly Donahue-Piro, founder and president of Agency Performance Partners, is a no-nonsense effectiveness expert who has helped hundreds of insurance agencies identify and capitalize on sustainable improvement opportunities. Her specialties include agency culture assessment and change; management and supervisory coaching and benchmarking; customer retention strategy development; digital marketing strategy, planning and implementation; and sales planning, management and skillbuilding. In 2014, she created Agency Performance Partners with a mission to “partner with insurance entrepreneurs who dream to take their business to the next level and beyond, by relentlessly pursuing excellence in world-class service and sales strategies.” The centerpiece of the organization’s transformational work is its Agency Performance AssessmentTM, a comprehensive survey tool Kelly created to zero in on organization- wide improvement opportunities and provide the foundation for a customized agency action plan. Mrs. Donahue-Piro is an engaging speaker who is available to conduct in-person and online agency success presentations that complement her firm’s one-on-one onsite and virtual consulting practice. Connect with her on social platforms, via email at kelly@agencyperformancepartners, or by phone at 401-415-6205.