by Leslie Krauz Stambaugh
for Recruit! Magazine: The Eyes and Ears of Today’s Recruiters
(A version of this was published in their Jan/Feb, 1997 issue)
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Sometimes the decision to hire a new recruit is a cinch! As a manager, you can often quickly spot a prospective recruit who has what it takes to be a “winner” in the business. Just as clearly, you see others who just don’t have a chance. You may not know exactly how you know, but experience has probably often proven you right. In all likelihood, however, most of the prospects you see could go either way; they could do well — even outstanding — but the odds of that are disturbingly low.
In the insurance industry, nearly 80% of new recruits don’t make it in the business at all and many of those who do “make it” do so only marginally. Most of those who struggle and fail were difficult-to-judge from the beginning, but some — probably the most painful for managers — are the new agents who had generated the most initial optimism. The overall rate of attrition — and especially the loss of real potential talent — is extremely expensive both to the agency and the companies they represent. My clients wanted me to help them improve these odds.
One of the ways I could help was to look at recruiting from the point of view of the successful new producer. What attracts them to the business? Why do they choose one agency over another? What are their expectations? What critical characteristics do these “winners” have in common? What contributes most to their success? I set out to answer these questions so that managers could.
- optimize their recruiting and interviewing practices to attract and interest the candidates they most want,
- spot recruiting prospects who have what it takes to generate strong production quickly, even in those who interview less well, and
- make sure their hiring, training, and support activities do the most to smooth the way to success for these new recruits.
I started my project, in about 1990, by asking a number of managers of large agencies to let me interview any of their new producers who had high potential and had already achieved excellent sales results early in their careers. Some of the managers had no candidates who met these criteria, but eight of them identified the 21 new agents who participated in this study. These agents represent companies like Northwestern, Mass Mutual, New England, and MetLife.
Sixteen of the agents in my sample were men and five were women. When they were first interviewed:
- most of the 21 agents had been in the business from 1-3 years
- 14 were married
- their average age was 30; ranging from 22 to 47
- achieved Advanced Career Profile Scores ranging from 9 to 19
- three had already qualified for Million Dollar Round Table
I conducted a 1( hour interview with each of them in 1990 and, after analyzing the results, reported back to my clients about the critical characteristics that appeared responsible for these promising careers. Six years went by and we noted that only some of these agents performed as predicted.
- 7 of them had qualified for MDRT (and often way beyond that level) for most or all of their years in the business (I will call these agents “stars”)
- 4 more had qualified for MDRT less than half of their careers (I will use the term “top producers” to refer to both this group and the “stars” together.)
- 5 were fairly average producers and had never qualified for MDRT
- 3 had left the business, having had weak performance long-term
In addition, two of these agents had become very successful in the insurance industry, but were no longer involved in life production. I was encouraged to reopen this study and refine the results to take into account these longer-term outcomes.
What were the characteristics these 21 new agents — dubbed as “winners” by their managers — shared in 1990 and how are those that stayed and maintained at least MDRT-level performance (the “top producers”) different from the others?
First, the easy things. Some of the results supported or confirmed what many general managers already believe. For example:
- Many GA’s have told me they believe experience in sports is important preparation for success in this business. Whether it is or isn’t, it is true that all but four of the 21 agents in this sample were actively involved in sports in high school or college, most on teams of some sort.
- Many have said that success is a habit and they look for evidence of earlier success in other areas. All of these new agents could point to some achievement during their school years that made them especially proud. Interestingly, the most successful new agents tended to look at accomplishments like getting included on a team, becoming an eagle scout, or achieving something in athletics. Less successful agents were much more likely to think about academic accomplishments.
- I have been told that having an entrepreneur or sales person in the family — especially someone in insurance — is a big help. There is some support for that here. If we define “entrepreneurial” somewhat broadly, 13 (of the 19 agents we asked) had parents who were entrepreneurs or sales people; three of these sold life insurance.
On the other hand, at least one common belief went unsupported. I have been told that successful agents are very competitive and love contests. Although the agents in this sample are very competitive, their love of contests was not confirmed in my interviews. Almost 2/3 of my sample said they did not like agency contests (but the remainder loved them!) Many of the “top producers” say their most effective competition is with their own past performance.
What else did I learn? Here are some of the other findings you may find helpful.
What Attracted The “Top Producers” To The Insurance Industry?
It seems no one (at least not in my sample) grows up longing to be an insurance producer! As a career, insurance is a taste acquired later — in the light of the alternatives. More than anything, most of the best recruits want to be in business for themselves — to be independent, to be their own boss. They see insurance production as one of the few ways now available to do this that provides a low initial investment, acceptable risk, and great opportunity. Over and over again, I heard, “I didn’t know what I wanted to do, I just knew that I didn’t want to work for anyone else.” Those who became “top producers” were already clear that independence means more work, not less, and they looked forward to reaping the rewards that came from making that investment.
For two of the twelve “”top producers”” the most critical factor was a little different — it was the industry’s potential to help people. Others mentioned this as important, but only two said it was the most important factor for them. One of them, for example, was so moved by how his father was able to help so many people through his work in the industry that, above all, he wanted to be able to touch peoples’ lives in the same positive way.
Most of the “top producers” hadn’t thought about insurance until it was suggested to them, usually by another agent or an agency manager. In fact two of those who achieved MDRT-level productions in their first year first contacted the agency on the basis of vague-sounding newspaper ads! Even so, those who become “top producers” tend to have a strong sense of what they want in a career and what they are willing to invest to get it. They think through their decisions very logically in terms of their overall goals and weigh the costs and benefits carefully. They evaluated the insurance opportunity in the same way. Some also looked at stock brokerage firms, but preferred insurance because of the range of products they handle — and the range of possibilities.
How Did They Decide To Select One Agency Over The Others?
Two related reasons came up again and again. First, these “top producers” were drawn to either the general manager (or, occasionally, one of the management team members). They liked and admired him and usually described him using adjectives like “ethical”, “sincere”, and “caring” — and, in many cases, as someone who could serve as a role model. Next, they believed this manager would be closely involved with their own training and support — that they could expect a lot of one-on-one attention from him. One person explained, “The decision came down to two agencies. But [the general agent of one of them] was cold and detached from the everyday workings of the agency and seemed to take no active interest in the agents. [The second GA] made me feel special and promised he would personally help me succeed. Naturally, I went with the second!”
It is important to note that three of the people in this sample (including one of the top agents) had left their first agencies after less than a year, because they lost faith in their agency’s manager and felt that they received poor support from him. Similarly, four very strong producers left their agencies after their first five years, but remained in the industry. Again, the reason for their leaving was due, at least to some extent, because their managers wouldn’t accommodate their needs as their careers matured. The realtionship with the manager is almost as important mid-career as it is in the beginning.
Note that not one of the “top performers” said they selected the agency because of the financing plan or the training they were offered, although these criteria were used by some of the poorer producers in the sample.
What Critical Characteristics Make The “Top Producers” So Successful?
- High Expectations: One of those who qualified for MDRT in his first year told me that, when he had just started, one of his more senior colleagues asked him how much money he expected to make. He said $75K and the colleague walked away muttering, “you just don’t understand how hard it is…” A number of the “top producers” realized early that many of the people around them were not as successful as they themselves expected to be, and rather than be discouraged, the “top producers” set about identifying producers in their agencies who were performing well and used them as models for their own work. Those with more average production were more likely to conclude that they are “doing pretty well considering….”
- A Focus on Achieving Bottom Line Goals: Most of the “top producers” in this sample have a very high desire to succeed and are extremely goal oriented. They not only set clear goals, but also monitor their progress toward them religiously. Many talked about not only setting the goal, but “making the plan and working it”. A few producers showed me sophisticated systems they developed to monitor their activities and goals and others showed me graphic representations of their goals displayed against their actual performance. Almost all the top performers had clear bottom-line goals and regularly met (or came close to meeting) them. The only exception to this was a woman who had a very strong fear of failure. In fact, for two of the “”top producers”, fear of failure seemed to be a stronger motivator than a goal of success — but all of them measured their progress based on their results, not their activity.Although most of the producers in this sample monitored their sales activity in some way, the less successful ones were more likely to focus on activity almost to the exclusion of their bottom line. They tend to emphasize their hard work and persistence rather than their progress toward a goal. Not that the “top performers” weren’t persistent and hard working — just that for them those things were not as important as their results.
- An Ability to Work Through People Comfortably: Something that is clearly central to being able to sustain strong production is the ease and enjoyment “top producers” have in working through people. It helps them in their learning, in meeting new people and building relationships, and in making effective sales calls. It is a quality that often overlooked because agency managers assume that it is more common than it actually is. In my interviews I heard many examples of this in how people described how they accomplished things: “When I first joined the agency, one of my first questions was “who’s the best” and then I weaseled my way into their lives. I learned how they got to be the best and adopted their techniques.” “I do a great deal of joint work. I look for people who can complement my skills and who can do what I can’t.” “If I want to meet someone I don’t know, I simply find someone who knows them and get an introduction. Sometimes I know more than one contact and then I can establish a couple of introductions and that is really effective.” “When I first came, I was asked to come up with 50 names of people I could contact. I gave some of the sheets to some people I knew who knew a lot of other people and I got 75 names within days!”
It is interesting to note that, of the 20 for whom I have birth order information:
- 14 come from families of three or more children and two of the seven “stars” belong to families with over ten children,
- half are oldest children,
- nearly half are middle children, and
- there were almost none who were the youngest or only child!
How Can a General Manager Best Support a Potential Top Producer?
One of the best things a manager can do to help “grow” top performers is to make sure they have access to the most successful producers in the agency and encourage joint work between them. Formal training alone isn’t enough and joint work solely among peers may only reinforce mediocrity. Those who become “top producers” use modeling as their number one mode for learning new behaviors and asking questions as their best way of learning new information. Less successful producers were more likely to learn well in classes, through books, or by trial and error.
Almost no one in this sample thought the agency training they received was particularly helpful (even though these agencies did offer some very good training programs and it is not clear that any of the agents could have done without them.) On the other hand, average producers and those who eventually left the business used poor training as an excuse for their inability to be more successful. “Top producers,” on the other hand, did not expect much from the agency training (and were sometimes disappointed with the amount of one-on-one attention they actually got from their managers), but quickly identified successful agents and found a way to work with them and model them.
As a manager, the best way to tip the recruiting odds in your favor is to find a way to attract more of those “winners” who have the potential to be top producers. And you can do that if you target your efforts toward them and keep clearly in mind what kind of people they are and provide them what they need to flourish.