No one said that managing people and getting them to be more motivated was easy. You can set all sorts of goals for reaching a target revenue but if you can’t get your team to do the work, nothing will happen. The answer is simple: Be generous!
When we say that you should be generous with your compensation plan, we’re not saying that all of your people should be paid handsomely or that all people paid generously will yield a mountain of sales. What we are saying is that if there is no strong correlation between high achievements and a heavy paycheck, you’re not utilizing the most efficient compensation plan.
By nature, most people do the minimum amount of work for what they are paid. They work harder and go beyond expectations if clear incentives are placed before them. They almost always succeed when they are given a clear roadmap to reach that incentive. So, we’re here to tackle three big issues:
Motivation: Getting the Most for Gold!
Good sales people are wired differently from other people. They want to compete, and they want to know that the sky's the limit. Keep your producers’ salaries modest, commissions fair and bonuses reflective of their worth in your business. Just as athletes will push all boundaries with their body to win, sales people will stretch their people skills as far as they can to get a fat bonus. They won’t do it for a smile on your face.
If you’re capping how much your best agents and producers make at the end of the year by giving flimsy bonuses to those driving your revenue, you’re preventing them from reaching for loftier goals.
As for your mediocre producers, we understand why Santa’s not stuffing their stockings to the hilt. It’s a tough business but you can’t be handing out big checks to a nice guy. Now, a nice guy who can really sell is another story...
Compensation: The Pros of a Bonus-Heavy Salary
Not only will your producers yield more sales knowing their end-of-the-year bonus depends on it, but they’ll have to wait until the end of the year for a clean sweep. Yes, it’s a lock-in strategy.
Unfortunately, when you manage talent, you also have to worry that your producers are so good that your competitors are bidding for them to leave you (did we mention it’s a tough business?). An end-of-the-year bonus will prevent your producers from jumping ship, even a couple of months in. Leaving mId-year is also terrible when they have a bonus-heavy salary. Leaving would feel like wasted time because they’d be leaving without the spoils of the battles won.
You can be generous without throwing money out the window. It's pretty clear that employees don’t mind golden handcuffs (year-end-bonus). It’s the rusty handcuffs chaining producers to dead-end jobs with flat compensation packages that good sales people loathe. Those are the only handcuffs workers want to crack open because they are simply not compensated for their efforts. In jobs like this, you’ll find the most uncreative thinkers and the most low-energy sales people you’ll ever meet. TDon’t create a workplace like this (auto-dialer, anyone?). Keep incentives and energy high for the highest revenue.
Direction: Emphasize Retention!
Above all, your producers want to know how to please you and what to do to succeed. Half the time you’ll be like a football coach telling them to keep pushing, to keep calling, until they make the sale. Sometimes, you’ll tell them to tone down a little.
Buy your best producers leads. They are hungry to succeed so feed them all the data leads they can handle and fine-tune their style by reviewing their calls. Don’t skip the step of reviewing their phone calls. You need to see what is right and what is wrong with their elevator pitch, their follow-up style and everything else that matters in communicating with prospects and clients. Offer them heavy truths, without leaving out what they do right.
If your producers are savages and all about the bottom line, do you have a customer support team to pick up the slack with better bedside manners? Often, the perfect fix is to have average salaries for people who are professional pleasers, which is not necessarily the same personality that can bring business in (your producers). So, get your ducks in a row. And whatever you do, don’t leave your guys to their own devices for long. They will feel abandoned and they will continue making the same mistakes over and over again. Sure, we advise that your compensation salary should be sink or swim for producers, but you want your folks to succeed as much as they do. Your work is to guide them with a firm hand.
Most importantly, tell your producers that retention is a huge factor in the long-term success of the agency or carrier.The chances of retaining a client who buys both home and car insurance is higher than one product alone.
Retaining clients by bundling their policies will also bring your producers a larger commission. Half the time, getting existing clients to buy the other half of their bundle is an easy win.