Management guru Peter Drucker said, “Efficiency is doing the thing right. Effectiveness is doing the right thing.” It is easy (and fun) to focus on the latest smartphone, tablet or app that helps us to be more efficient. But to create real growth in your practice, focus on becoming more effective.
The best way to become more effective, especially in today’s highly specialized environment, is to create a strategic partnership with the right brokerage general agency (BGA).
The mission-critical task of assessing which BGA is the right one for you can be one of the most important business decisions you are likely to face. In every strategic relationship, there are seven key components you must include in your evaluation.
1. Experience and expertise
This might seem to be the most obvious — and it is, which is why it should be the starting point in your evaluation. Begin by asking questions and learning about the core competencies of the BGA because, in the end, people are the prime determinant of success or failure. Learn as much as you can about the principals. How long have they been in the business? What were their career paths? How did they come to be BGAs as opposed to brokers, company reps, wholesalers, etc.?
If there is more than one principal, learn about each and take the time to evaluate whether or not they offer just one level of experience and expertise repeated several times (not good) or whether their experience overlaps and forms a web that will provide whatever you may need as cases and practice areas develop.
In today’s marketplace you have to be great. Good enough just isn’t good enough. The amount of detailed knowledge you need to be great at one practice area is overwhelming. Being great in all of the practice areas you discuss with clients is almost impossible. We also know that, over time, brokers find their sweet spot. For some, it may be corporate life; for others, individual disability income. Regardless, when evaluating a brokerage general agency, the first thing you need to do is take stock of your practice strengths and weaknesses. Be brutally honest.
Once you have your great/good list, learn about the areas in which the BGA specializes and which members of the BGA team have experience and depth of knowledge that can help you bring your good areas up to great. If you are an expert in annuities, partnering with a BGA that is great at annuities won’t help you. You may think this kind of analysis is a no-brainer, but you would be surprised at how many brokers select a BGA without taking the time to make this critical analysis.
3. Access to a team
If you are sole practitioner, you may be your whole team. That can work on the retail side of things, but it is definitely not a quality you want in your BGA relationship. The next step in evaluating potential partners is to assess the depth of their bench. If the BGA doesn’t have redundancy, you will find yourself waiting when you really want to be selling.
As an example, if you are going to depend on your BGA partner for disability income expertise, you don’t want come to a dead stop if the single DI expert isn’t available. We’ve all been at a client meeting where an unexpected (and often technical) question is asked. If you need to get an answer on the spot, you don’t want to depend on one individual; you want a team.
This may be one of the most serious aspects of selecting a BGA. You have already assessed what you work on. Each of us develops a unique style that suits us. You may see yourself as a general practitioner whose expertise is in developing a dreams-and-goals rapport with a client. This allows you to assess their exposures and to provide solutions that transfer those risks where appropriate.
Or you may see yourself as an expert in one or two areas. You are keenly aware of how much effort it took to develop that expertise — and how challenging it is to keep that knowledge fresh. Given the experience in your key areas, you know you need to ally with others to augment your expertise in areas where you don’t specialize.
However you define your style, a strategic partnership can help you to be a more complete and effective resource for your clients. The long-term goal is to develop deeper and more lasting client relationships. The more you (and your new strategic partners) can help, the more likely that will happen. Those deeper relationships are the key to securing sequential sales and significant referrals, two critically important components in growing your practice.