'Tis the Season: To Increase Revenue!

The season is now upon us. Once again, this time of the year brings producers and their respective firms to the most important time of the year. What time is it? Well, of course, it is Stewardship Report Season once again! Take a look at your January 1 renewals. Are there any important revenue accounts that renew around that time? Of course there are. Many of you have the majority of your large account income stream that renews at that time. In fact, much of your Fall is taken up by doing all the work that this important date represents.

The season is now upon us.  Once again, this time of the year brings producers and their respective firms to the most important time of the year.  What time is it?  Well, of course, it is Stewardship Report Season once again!

Take a look at your January 1 renewals.  Are there any important revenue accounts that renew around that time?  Of course there are.  Many of you have the majority of your large account income stream that renews at that time.  In fact, much of your Fall is taken up by doing all the work that this important date represents.

Now, imagine what your life would be like if all your key accounts were “put to bed” in early December with renewal negotiations complete.  The only thing you really had to do on these accounts was to wish them all a Happy Holidays.

Here is the point.  What you accomplish now, in Stewardship Season, will have a direct bearing on your income in 2014.  You really need to do Stewardship Reports in July and August on these key income clients.  If you don’t, you are running the risk of someone else doing it for you in November and December when you are under competition!

Now I know that we have been telling you this for years.  Thankfully, many of you are now acknowledging Stewardship Report Season as an important part of your business calendar.  Remember, Stewardship presentations should be prepared and delivered 6 months in advance of renewal, not during the renewal process.  (It might be too late then!)

There are dozens of versions of Stewardship Reports.  Many of them are nothing more than a review of policies, claims and underwriting data.  Some of them are a list of services.  But, here is what very few do:  demonstrate how your firm actually reduced a client’s costs and improves their business organization in a quantifiable manner.

That is the key point of a Stewardship Report.  In fact, we call ours a ValueReport™.  The main difference is a ValueReport™ actually shows a buyer how your organization has helped them create a meaningful difference on their financial statement.  It demonstrates (in financial terms) how your representation and resources have provided an outcome.

Here is one more thing to consider:  Doing a ValueReport™ will impact your income/productivity by 7% next year.  That is the difference between the attrition in your book along with the cost to you and your family of being under competition on key renewals.   More on this later, but for now, just accept it.

So, if you are going to do a Stewardship Report, make it the best.  Right now the standard of excellence is represented in a ValueReport™.   Here is what they entail:

  • A meaningful cost comparison over time.  The creation of benchmarks and comparison periods that show the buyer your actual Value Proposition.

  • The value of your projects, not the features.  Demonstrating the actual value of your projects and services by quantifying them and translating them to the buyer’s financial outcomes.

  • The impact that your organization has achieved on your client’s Key Performance Indicators (KPI’s).  This is how you actually embed your outcome into a client’s business organization and demonstrate your value.

In closing, please remember this:  What you accomplish now in the heat of the summer ValueReport™ Season, will have a big impact on how “chilly” your yearend renewal season is!

By the way, if you would like to learn more about our ValueReports™, you should visit us at:

 [The Major Account Development System™]

All the best to Consultative Brokers™,

Rob Ekern

Build a Better Mousetrap!

We have said this before, but it bears repeating: The basics of selling have not changed since the Persian Traders first traveled the Silk Road 3,000 years ago. It all comes down to what Frank Bettinger so eloquently stated in his 1947 classic, How I Raised Myself from Failure to Success in Selling: "Show a person what they want and they will move heaven and earth to get it!"

We have said this before, but it bears repeating:  The basics of selling have not changed since the Persian Traders first traveled the Silk Road 3,000 years ago.  It all comes down to what Frank Bettinger so eloquently stated in his 1947 classic, How I Raised Myself from Failure to Success in Selling:  "Show a person what they want and they will move heaven and earth to get it!"

Perhaps this is better presented though one of the oldest adages:  If you build a better mousetrap, the world will beat a path to your door!

Over 320 years ago when the lads where sitting at Lloyds Coffee House, a novel concept was created: exchanging risk for money. It was a better mousetrap for entrepreneurs who were opening the New World through the sea lanes and trade.  Business people were willing to take risks because they could shift it to a third party through this new financial tool called insurance.

That was the best mousetrap of its time. . .

For over 300 years, commercial insurance has been unchanged.  Exchanging risk for a monetary expense (Rate).  Using brokers who bring underwriters the deal (Commissions).  Oh, you could tell me that the types of risks have changed . . . but the principle of rate for risk has not.  The only significant change in our business since the Great War has been the effectiveness by which the product is distributed (Technology).

Now, here is a little shocker that many of you already know.  Clients and prospects have been desensitized to the "privilege" of having their risk underwritten.  They do not consider themselves fortunate to be given the opportunity of shifting their risk.  Excellent service and stable carriers are expected.  Technical expertise is expected.   And of course, competitive premiums are expected.

Now the mousetrap is breaking.  It has passed its useful life.  But, like every dying process, it does not all happen at once.  The warning signs of the broken mousetrap come slowly until the trap is completely useless.  Some choose to ignore it because they either don't know anything else or they are so close to retirement they don't care.

Here are the warning signs of a breaking mousetrap:

  1. It becomes more difficult to hire and retain successful new people into the business.  The ways of 30 years ago do not attract them.  Many flounder because they are not provided tools to become better business people.

  2. The suppliers begin to merge or disappear.  They are not able to differentiate themselves so they must revert to pricing or cutting overheads.  Thereby being forced to abandon the 300 year old mousetrap.

  3. Potential new clients are much more difficult to engage in buying conversations.  They see nothing new in the old mousetrap and are not motivated by any urgency.  There is no scarcity in their options to exchange their risk for money.

  4. Large buyers leave smaller firms.  These larger buyers perceive a drop in "value" for their money.  After all, if they are only getting a 300 year old mousetrap, why not get it from someone who has a larger inventory.

Here is the bottom line.  I know that this will make some of you crazy.  You will not be able to remain in the upper half of the middle market unless you build a new and better mousetrap.  There has been too much change in your clients' business skills over the past several years.  Those who survived the Great Recession are not the same businesses who entered it.

While they are loyal, they are not naïve.  They are not continuing to accept a business delivery model that is 320 years old.  They just can't afford to.  Many now have debt, investment bankers and much stiffer competition from diverse channels of competition.

Now, I hope that I have convinced you.  If so, make certain that you catch our next Consultative Broker briefing.  In the upcoming edition, we will show you how to build the best mousetrap.  This one is the "next level" that everyone talks about.  If you are happy with the current mousetrap, then stay the course.  If you intend to be in the commercial insurance business in 10 years ...stay tuned.

-Rob Ekern


Change Gears to Write Larger Accounts

If you ask any highly successful Consultative Broker(TM) this question: "How did your book grow to the size it is today?" They will give you an answer that will surprise you. Most of the self-made successes will tell you this. "I began to be highly successful when I decided to change gears."

If you ask any highly successful Consultative Broker(TM) this question:  "How did your book grow to the size it is today?"  They will give you an answer that will surprise you.  Most of the self-made successes will tell you this.  "I began to be highly successful when I decided to change gears."

Many will go on to say, "I was moderately successful as a producer who mastered the commodity market.  But, I never reached my full potential until I learned how to attract and retain larger accounts."

Here is the lifecycle of a highly successful broker.  Many start as a commodity seller while learning the insurance business, markets and coverages.  They build a nice book of that type of business.  They are moderately successful ...then lightning strikes!

They work on a larger account, one with a high degree of expectations and (of course) income.  They succeed.  Now they have a taste of larger accounts and want more.  They quickly recognize several things:

  • There is less competition at the top, than the bottom.

  • The income generated on these accounts is much more profitable to them.
  • They need to develop a whole new skill set that goes well beyond just the risk financing.

So, they make a conscious decision to work primarily with larger accounts and build their practice around them.  Of course, this takes an entirely new skill set, but these successful brokers have embraced the challenge.  It pays them handsomely to do so.

The hardest part of this transition is the "Changing of Gears".  This is due to the fact that there are not many places to learn how to do this.  I was fortunate in my career to be surrounded by successful senior brokers at Willis that I could emulate.  But, how does a broker make this gear change and develop the skill set required inside of a regional brokerage?

If you want to begin a transition to a highly successful Consultative Broker in 2013, here are some things you must do:

  1. Understand where your bread is buttered.  Take a look at your current book.  Take the top 10% of your accounts.  How much of your book revenue is in this small number of accounts?  I will wager it to be close to 50% if you are like most.  These are your Franchise Accounts.

  2. Determine the common denominator.  There is a common denominator that ties all of these Franchise Accounts together.  It goes deeper than simply a shared industry type or coverage requirement.  Usually, these accounts have a common business style that resonates from each particular client.
  3. Replicate your Sales Style.  A highly successful Consultative Broker quickly learns the importance of this.  It allows the ability to cover a much larger patch of ground in the prospecting process.  This involves creating a much deeper perception of resource capabilities, client business operations and dialogue.
  4. Create Deliverables.  The bottom line to attracting and retaining larger accounts is the ability to create an outcome that actually has a benefit.  This benefit must be more than simply a checklist or a sales technique.  When you are able to do this, your reputation will precede you.

Changing gears is the key to becoming a highly successful Consultative Broker.  Once you do that, it is amazing what other impacts it will have on your business life.  Your clients, prospects, colleagues and competitors will see you differently.  Changing gears will allow you to cover a great deal of higher ground.  So, don't be left at the bottom of the hill, start changing gears today and see the whole panorama laid out at your feet!

Don't miss our next Consultative Broker Briefing entitled:  Building a Better Mousetrap.

Best Regards to Consultative Brokers,

-Rob Ekern

For more information on how to quantify TCOR, manage projects, build a value proposition, and consistently deliver stewardship reports and new business presentations to your customers, check out the Major Account Development System (MADS), an on-line consultative broker's toolkit. Available now!

Ready to learn more about Consultative Brokerage Sales Training? Visit the Consultative Brokerage Academy.

To learn more about C.R. Ekern & Company, please visit our website

Fees: Get Paid What You Are Worth

For years we have been saying this: There should be no correlation between your income and the commission paid by insurance carriers. The two just ain't the same thing. Now I know this sounds like sedition, but stay with me here.

As your clients have become more sophisticated, many of your firms have added internal resource capabilities.  Whether they be claims, risk control, client portals or financial analysis.  The commission structures that are developed and paid by insurance carriers just don't support the expense of these resource capabilities; and your producer compensation too.

So, the answer comes in 4 possibilities:
  1.  As producers you determine to give up part of your commission in order to support the resources required to stay in the game on larger accounts.  (A bad option)
  2.  Your firm requires you to pay for resources out of your pocket, thereby forcing you to select which clients get resources and who does not. (A worse option)
  3.  You decide as a firm to get out of the larger account arena and simply work on commodity transactions. (The worst option)
  4.  You learn and commit to developing ROI-Based Fees.  (YES!!!!)
There has long been a fallacy built into our business that no longer has legs.  This problem is around the calculation of a Fee and how we present it to clients. Now this edition of the Consultative Broker briefing will not be around the methods of fee calculations.  There are as many calculations as there are stars in the sky.

For today, we all need to accept one universal truth about fees.  At the end of the day, after calculating fees, most brokers then compare it to commissions.  If the fee is too low; they adjust up.  If too high; they adjust down.  So, eventually the fee becomes a function of commission benchmarks.

The key here is that they ultimately peg their income to what the market will bear.  Then, pray to god that another broker doesn't undercut them in a competitive situation!
But what about their quantifiable impact to the client?  Doesn't that count for something?  What about the ROI the client has received from their ability to deploy resources and achieve a consultants goal of improving the client's business model?  What about the impact your client has received in reduced costs, improved efficiencies, competitiveness and productivity?  What about that?  Shouldn't that be factored in the Fee as an ROI?  What about that?  Huh? Huh? Huh?

Now before you scoff at me.  Let me tell you a true story that recently occurred with one of our broker clients.  Over the past several years the broker and firm did a tremendous job of reducing this client's losses and premiums.  So good in fact, that the premium reduced from $550,000 to $300,000.  The fee on the renewal was $50,000 and the client was asking for a reduction.

Here was the problem our intrepid Consultative Broker faced.  He could either lower his fee and therefore not get fully compensated for the firm's efforts.  Or, he could present the client with a complete ValueReport based upon the calculations of our Major Account Development System.  He chose to present the ValueReport prepared by MADs.

So, what happened?  The client fully accepted the $50,000 fee based upon the evidence and proof of the ROI the broker had provided the client.  It approached seven figures over the course of the past 3 years.  Not only that, but the client acknowledged it would be fruitless to entertain any other broker proposals.

So, it is time for you and your firm to get with it.  ROI-based selling is the only way that you can stay in the game and compete for profits.  Remember commissions paid by carriers and under-priced fees should have no correlation to your income.  Hey, we have a vested interest in this.  Our goal is to help firms like yours to prosper and grow, no matter what.

If you keep reading, we will keep writing.

- Rob Ekern

Metrics - The New Normal

The CFO of today uses metrics and analytics for any number of purposes. These new data points help ascertain product launches, business goals, customer acceptance and yes even vendor evaluation. So, if you want to do business with larger organizations one of the keys is to provide your clients and prospects with business metrics that others are not providing.

If you want to have an enlightening conversation with a CFO prospect or client, ask this question:

"What are some of the metrics you use to evaluate your business performance?" It will lead you into a discussion that will rock your world. The information that CFO's need and use has changed at light speed over the course of the past several years. They have moved into metrics and analytics that help them improve their business on a quantifiable basis.

The CFO of today uses metrics and analytics for any number of purposes. These new data points help ascertain product launches, business goals, customer acceptance and yes even vendor evaluation. So, if you want to do business with larger organizations one of the keys is to provide your clients and prospects with business metrics that others are not providing.

The insurance brokerage business has traditionally provided clients with only one key metric . . . How their insurance premiums stacked up historically against exposures. For the most part, everything we have done points to only one thing . . . Price.

Oh, I know. In many cases, we do show clients or prospects how we drive down their claim costs. I suppose some would call those metrics. Not me, I call those project features with no quantifiable outcome; other than a reduction in claim costs or risk financing price.

As a Consultative Broker(TM), you are now able to provide your clients with a number of meaningful metrics that actually proves your Value Proposition and places it on the client or prospects financial statements. This is done by translating your Total Cost of Risk impact into the 6 areas of Business Risk.

Ready, here goes:

1. Hazard Risk - This is the simple comparisons that we have always known. (Hazard Risk Only)

2. Financial Risk - The entire Total Cost of Risk impact as it relates to profits.

3. Operational Risk - The TCOR impact as it relates to the clients competitiveness.

4. Strategic Risk - The ability to translate TCOR into business productivity improvements.

5. Human Capital Costs - Focusing the impact of cost reductions in turnover, training and human productivity.

6. Equity Risk - Demonstrating the impact of TCOR improvements on ownership evaluation.

These are the metrics that Consultative Brokers are becoming astute at providing their prospects and clients. They understand that to be acknowledged as a consultant and paid like one; it is imperative that they provide CFO buyer's metrics that are meaningful. These Consultative Brokerage Metrics become the backbone of their quantifiable value proposition.

So, if you intend to stay in the game of writing and retaining larger accounts; here is a word to the wise. You really need to get on board with discussing business risk metrics with your clients and prospects. They are getting them from other industries and using them to plan and operate their businesses. I can assure you that many of your best opportunities will come from being perceived as a valuable organization that helps create and provide outcomes based upon metrics.

They are now the new normal!

Best Regards to Consultative Brokers,

Rob Ekern

For more information on how to quantify TCOR, manage projects, build a value proposition, and consistently deliver stewardship reports and new business presentations to your customers, check out the Major Account Development System (MADS), an on-line consultative broker's toolkit. Available now!

Ready to learn more about Consultative Brokerage Sales Training? Visit the Consultative Brokerage Academy.

To learn more about C.R. Ekern & Company, please visit our website


The Truths of TCOR

Total Cost of Risk is one of the most misunderstood methodologies inside the insurance brokerage and risk management community. This observation is based upon over 35 years of experience as both a successful working broker and brokerage consultant. In fact, I was there when TCOR was first conceived. (Unlike Al Gore who did not invent the internet!)

Total Cost of Risk is one of the most misunderstood methodologies inside the insurance brokerage and risk management community. This observation is based upon over 35 years of experience as both a successful working broker and brokerage consultant. In fact, I was there when TCOR was first conceived. (Unlike Al Gore who did not invent the internet!)

By being there, I mean being in the industry as a working broker when TCOR was first introduced by Risk Managers. Why did they create it? It allowed them to have some deeper discussion with their bosses and financial management of their respective firms. Now, known as the C-Suite.

Since then, Total Cost of Risk has stood the test of time. The acronym TCOR is well known and established. As many of you know, our firm has built its reputation on helping successful brokerage firms create a quantifiable value proposition for large clients, based upon developing a TCOR business model.

Over the past 15 years, since the inception of Consultative Brokerage™ the TCOR delivery system; we have been fortunate to work with many of the top brokerage firms in North America. In that capacity, we have run the gambit of firms, producers and buyers who are all espousing their version of TCOR.

In many cases, each TCOR advocate shows their various adaptation of Total Cost of Risk and claims it to be the Holy Grail of TCOR. So, let’s separate the wheat from the chaff regarding the truth of TCOR.

  1. TCOR is made up of 4 distinctive parts. They are Risk Financing Costs, Loss Costs (Direct and Indirect), Administrative Costs and Taxes/Fees. A TCOR calculation that does not include all of these is not Total Cost of Risk. In many cases, they are not provided because the broker is not in a position to capture and demonstrate each section. Therefore, they rely upon simply converting the insurance costs. Or, in many cases, they make up new words and lump them under the banner of Value Added Services. Without being able to demonstrate the Value!

  2. Total Cost of Risk is not an enthralling topic. Yeah, I know, this sounds like blasphemy from the guy who is credited for bringing TCOR to upper middle market brokers and clients. But, ask yourself this question; “When was the last time you witnessed a group of C-Suite executives sitting around a table and swapping tales of their TCOR accomplishments?” What makes it an enthralling topic is the outcome it provides clients as regards profitability, productivity, competitiveness, human capital expense and owners equity impact. This brings up the next point.

  3. Total Cost of Risk impact is the only way a broker has to actually create a Value Proposition. The Value Proposition is created by the impact of resources and client projects as they relate to demonstrable, evidence based, quantifiable cost reduction to clients. Everything else simply revolves around the marketing and placement of the insurance products. Here is a little secret: Many of the brokerage firms all represent the same markets and products . . .

  4. Total Cost of Risk leads clients to REAL Metrics. Now, stay tuned for an upcoming briefing on this subject alone. But for today it is enough to know this. The term metrics and analytics are becoming a huge buzzword in our industry. In most cases, when these metrics are evaluated, you will find them to be simply variations of comparing prices of insurance carriers and risk financing placements. These pricing comparisons and placement and Metrics are very narrow and simply show the buyer a product comparison. Of course we all know that the product is only 20% of the buyers cost structure!

Consultative Brokerage™ was born 15 years ago. The Consultative Brokerage Methodology is based upon the development and delivery of Total Cost of Risk by brokers like you who are striving to make a quantifiable impact for your clients. During the course of that time, C. R. & Company has worked with successful brokerage firms who control over $3 Billion in revenues and fees.

By the way, if you intend to be in the agency/brokerage business over the next decade, it would be best to learn it now. The ship is sailing and the “me too” TCOR players will begin to fall of the vine.

But don’t worry, if you feel like you might be beginning to fall . . . we are here to help catch you!

-Rob Ekern

For more information on how to quantify TCOR, manage projects, build a value proposition, and consistently deliver stewardship reports and new business presentations to your customers, check out the Major Account Development System (MADS), an on-line consultative broker's toolkit. Available now!

Ready to learn more about Consultative Brokerage Sales Training? Visit the Consultative Brokerage Academy.

To learn more about C.R. Ekern & Company, please visit our website

Dodge the Torpedoes!

As many of you know, I was considered a successful working broker back in the bad old days of the last soft market. In fact, I was also fortunate enough to earn the top production award from my mega-broker employer. So, aside from now being a consultant, it does qualify me to give you some insights from close to 37 years of production experience and 4 cycles.

As many of you know, I was considered a successful working broker back in the bad old days of the last soft market.  In fact, I was also fortunate enough to earn the top production award from my mega-broker employer.  So, aside from now being a consultant, it does qualify me to give you some insights from close to 37 years of production experience and 4 cycles.

First of all, nothing changes.  I heard the first complaints about the marketplace in 1975.  The words are the same.  “Dog gone those insurance companies!  They don’t know what they are doing.  They are putting us out of business by constantly lowering their premiums.”

Or this one:  “My clients just keep beating me up over premiums.  Each year they tell me that I need to sharpen my pencil.”

Here is the one I really like:  “My insurance company gives me two prices.  The one they give me on renewals, and the one they give my competitor on new business.”

Here is another beauty:  “I talked to my underwriter today and they gave me the premium for your renewal.  But, they told me that they did not want to lose your business and I can probably get you another 7%.”

What do all of these have in common?  They are statements from agents and brokers who constantly live in fear.  They are afraid of their competitors, carriers, and in many cases their own clients.  Why is this?  Because in most cases they do not have any semblance of broker control.  They consider themselves simply messengers who feel lucky when a client blesses them with a renewal or an underwriter coughs up a price.

So, it is time to stop the bleeding and stand on your feet.  Dodge the Torpedoes!  Of course the water is filled with danger, but it will not stop you if

  1. Make certain your client knows what your value is.  That entails that you speak with them regularly about all the “little things” that you and your firm do for them.
  2. You must do Value Reports™ (Stewardship Reports).This shows your client the quantifiable impact that you make inside of their business.  It goes well beyond the pricing of insurance.
  3. Don’t live in fear. Clients can smell this. I have seen many occasions when a broker created their own competition by “running scared.”
  4. Keep prospecting tougher deals. Here is what most seasoned brokers know; there is less competition at the top than the bottom.  The bigger the deal, the less number of brokers.
  5. Prospect your commodity competitors.  Now that the marketplace is beyond free fall, some of your competitors will have no place to stand.  They cannot make up the difference by simply price

As a working broker in the depths of the last soft market, here is what I know.  Successful brokers grow their business no matter the marketplace conditions.  Once every decade or so, they get an artificial boost from the “hard market”.  But they do not wait for it!  They find prospects that have problems and these problems have nothing to do with the insurance marketplace.

So, Dodge the Torpedoes!  Get with it and understand that the marketplace conditions are the same for everyone.  Stop looking for the easy price deals, they don’t exist.  Everyone is in a feeding frenzy and the successful brokers will then be the ones who practice the ability to differentiate themselves by deployment of resources and the reduction of a client’s cost.

- Rob Ekern

For more information on how to quantify TCOR, manage projects, build a value proposition, and consistently deliver stewardship reports and new business presentations to your customers, check out the Major Account Development System (MADS), an on-line consultative broker's toolkit. Available now!

Ready to learn more about Consultative Brokerage Sales Training? Visit the Consultative Brokerage Academy.

To learn more about C.R. Ekern & Company, please visit our website

Creating a TCOR Urgency

To really create a Value Proposition using Consultative Brokerage and TCOR you need more information than the usual insurance quote transaction. In many cases, the buyer is not motivated or is confused about what the process is. So, rather than spend the time required to get you the information (ie claims, risk control, financial data) they find themselves lost in other projects.

One of the most difficult issues for budding Consultative Brokers™ face is to create a sense of urgency in a new prospect’s mind.  Over the years I have heard many new TCOR converts exclaim, “I have a buyer who says they are intrigued and want to learn more, but I just can’t get them to the next step.”

Here is one reason why this happens.  To really create a Value Proposition using Consultative Brokerage and TCOR you need more information than the usual insurance quote transaction.  In many cases, the buyer is not motivated or is confused about what the process is.  So, rather than spend the time required to get you the information (ie claims, risk control, financial data) they find themselves lost in other projects.

But, the bigger reason is the fact that as a broker you have not created a sense of urgency.

Now I don’t blame most of you for this lack of creation.  As traditional brokers it is something you have never learned.  Why?  This is due to the fact that historically we have been providing a product that every buyer needs with an expiration date that forces a decision.  So, we have never had to create that sense of urgency.

If you intend to become proficient as a Consultative Broker and a TCOR advocate, here are some of the things you must first master:

  1. Become an Evangelist - The first thing is the fact that you must really believe what you are attempting to accomplish for your prospects.  A true Consultative Broker would rather cut his hand off, than revert to the old methods.  This belief must ring true in all your interactions with a client.   If you waiver, your momentum will be lost.
  2. Have your buyer visualize the result – Really understanding Business Risk allows you to have a discussion with the prospect that will show them how their business operations will benefit from your Total Cost of Risk and Consultative Brokerage methodology.  This is the glue that binds the discussion.  Or like the late Frank Bettinger used to say: “Show a person what they want and they will move heaven and earth to get it!”
  3. Show them how others have benefited – Our clients have numerous examples of accounts that have reduced costs by tens of thousands or in some cases hundreds of thousands.  Once a buyer sees that their colleagues or competitors are improving profits, competitiveness, productivity and human capital costs; they desire the same results.  But remember, it is not enough to provide nebulous ramblings about value propositions or total cost reductions. (see bellow)
  4. You MUST Promise to Deliver a Quantified Outcome – As we have said for years, “if it ain’t got that swing, it don’t mean a thing”.  Prospects will not spend time with you, without that payoff.  So, you must promise to provide them with a Value Report™* that actually shows how you will change their business operations.  This of course presumes you have the ability to prepare one!
  5. Make it easy on them – In most cases a TCOR presentation is a complex sale with many constituents.  It is unlike the insurance transaction that simply includes a buyer, you and underwriters.  It is critical that you gather data from other areas such as risk control and claims management.  You should interface with these functions inside their organization.  This also gives you a chance to build relationships.
  6. Prepare for tough questions – Over the course of my career I have built the best long-term relationships with buyers who seemed tough in the beginning.  That is because many astute business people test you initially in order to find out about your backbone and maturity level.  How you respond to these questions will determine their interest in you.

The skill by which you create a sense of urgency will have a direct correlation to your ability to be appointed the broker of record.  As with any Conceptual Sale it is important that you make it come alive inside a prospects business model.  This requires skill not simply as a sales person, but also as a Consultant.  Hence the term . . .Consultative Broker™.

- Rob Ekern

For more information on how to quantify TCOR, manage projects, build a value proposition, and consistently deliver stewardship reports and new business presentations to your customers, check out the Major Account Development System (MADS), an on-line consultative broker's toolkit. Available now!

Ready to learn more about Consultative Brokerage Sales Training? Visit the Consultative Brokerage Academy.

To learn more about C.R. Ekern & Company, please visit our website

Large Accounts: The Way Forward!

The purpose of Consultative Brokerage is primarily one thing: To help you attract and retain larger accounts. That is the only way that you can outrun the marketplace and your competition. Why? Because those are the accounts that allow you to create value no matter what the marketplace dictates. Also, your carriers will always need you in the upper end of the market with accounts that require “hands on” expertise.

As you begin planning your production for 2011 here are a few things to consider:

The Soft Market will continue to expand its revenue eroding run.  In fact, in the past 21 years, 19 of them have seen softening prices.

  • Some carriers will begin to provide you with mixed signals.  As their revenue base continues to shrink, some carriers will continue to experiment with “multiple” distribution channels.
  • Your clients and prospects will continue to be under financial and business pressures.  Those who have survived the “Great Recession” will remember the lessons.
  • Your competition will go into a feeding frenzy.  Remember you are not alone.  Your competition will continue to target whatever they can get their hands on, driving your revenues even lower.

The purpose of Consultative Brokerage is primarily one thing:   To help you attract and retain larger accounts.  That is the only way that you can outrun the marketplace and your competition. 

Why?

Because those are the accounts that allow you to create value no matter what the marketplace dictates.  Also, your carriers will always need you in the upper end of the market with accounts that require “hands on” expertise.

Oh, there is one other thing you should know:  THERE IS LESS COMPETITION AT THE TOP THAN AT THE BOTTOM!

I can hear you right now: “Easy for you to say, Ekern. But, how do we do it?”

Here are some universal truths about the production and retention of large accounts in the current marketplace and economic environment:

  • You must approach accounts from a perspective of Business Risk, rather than simply hazard.  These are the risks that impact productivity, profitability, competiveness and human capital.  These are the important issues to CFO’s and do not revolve around insurance pricing.
  • You will need to learn and practice the language of CFO’s.  This will give you the confidence to have business discussions rather than insurance meetings with buyers.
  • You must have a Value Proposition that can be translated to the financial statement of buyers.  By doing this, you can overcome the “transactional” nature of the insurance placement.
  • You need to produce exceptional Stewardship and Conceptual Presentations. These documents show your clients and prospects ways that your firm differentiates itself.
  • You need a prospecting methodology that stands the test of time.  It comes as no surprise that many larger accounts do not buy based upon simply the fact that you have called on them.  In some cases the buying cycle of these accounts may involve several people and involve longer than 1 renewal period.  That becomes problematic to some agents and brokers who focus only on the transactional renewal date.

We formed C. R. Ekern & Company in the depths of the last soft market (before the 2 year reprieve in 2001 & 2002). Our mission was a simple one: To provide you with the training knowledge and tools that will allow you and your organization to prosper.  To that end we have created learning tools, consulting services and client development tools that all point in one direction . . .Larger Accounts.

So, as you look toward 2011 and beyond, remember this.  The business you will be in going forward may consist of a perpetual soft market.  There comes a time when you must say . . . “How’s that workin’ for ya?” 

You can go forward, or backward.  Larger accounts are the way forward!

- Rob Ekern

For more information on how to quantify TCOR, manage projects, build a value proposition, and consistently deliver stewardship reports and new business presentations to your customers, check out the Major Account Development System (MADS), an on-line consultative broker's toolkit. Available now!

Ready to learn more about Consultative Brokerage Sales Training? Visit the Consultative Brokerage Academy.

To learn more about C.R. Ekern & Company, please visit our website

Large Accounts: Feeding the Bulldog

As fall approaches many of us turn our attention to planning for the next year. Frankly speaking, you are where you are. More than likely no new prospects will fall out of the sky and you essentially know what opportunities you will be working on for the rest of the year. So, let’s talk about the business environment that you will find yourself in as you approach your thought process of planning next year's production.

As fall approaches many of us turn our attention to planning for the next year.  Frankly speaking, you are where you are.  More than likely no new prospects will fall out of the sky and you essentially know what opportunities you will be working on for the rest of the year.

So, let’s talk about the business environment that you will find yourself in as you approach your thought process of planning next year's production:

  • You should expect the “soft” market to continue.  In many cases, the fat has been squeezed from the market.  There might be a few drippings left, but don’t expect huge rate decreases.  Also, don’t expect any increases either (unless you are working on deep water drillers).
  • Many of your clients and prospects are still hurting from the “Great Recession.”  They understand that business as usual does not provide them new solutions.  Truthfully, many of them are wrung out.
  • Your competitors will continue to be in a feeding frenzy.  Remember, there is less insurance premium available to all brokers.  This is the first time this has happened since WW II.
  • The insurance carriers will continue to support this feeding frenzy.  They will start 2011 with a speech about “holding the line” but by the end of the first quarter, all bets will be off.

As some of you know, I do have a little grey hair.  I started my production career in 1974.  This is the fourth cycle I have seen.  This one is unlike the others - it is taking place at the same time as a major recession.  So, as producers, you are getting hit with the double play: reducing rates and a reduction in rating basis.

So, with all this in mind, how should you approach your production planning for next year?

  • Recognize that Old Solutions don’t feed the bulldog.  The concept of using the insurance carriers pricing as your point of differentiation is now obsolete.  Why?  Because the blood has been squeezed from the turnip.
  • Understand that your prospects are still smarting from the “Great Recession.”  This means that you must approach them from a place of helping them reduce costs and improve their business model.
  • Like John Dillinger said: “Go where the money is.” The money is with accounts that have losses and are complex.  These are the accounts that are considered larger and have issues which do not revolve around insurance.  Also, these larger accounts have problems that are costing them six figures of financial leakage.
  • Focus on pinpointing financial leakage.  Many of these larger accounts are hemorrhaging money and don’t know it.  Why?  Because their broker has focused only on the insurance coverages and payment of claims.  Once you show this to them, they will move heaven and earth to obtain your solutions.
  • Offer a “Business Risk” Solution.  Plan on building a prospect list of firms who see you and your organization as offering business solutions.  You must be able to give the buyer what they want: productivity, profitability, competiveness and human capital retention.  Your insurance offerings are simply the hazard risk.
If you intend to stay in this business and be successful, you must understand Large Account Production techniques to help you feed your bulldog next year and beyond.
 
- Rob Ekern

For more information on how to quantify TCOR, manage projects, build a value proposition, and consistently deliver stewardship reports and new business presentations to your customers, check out the Major Account Development System (MADS), an on-line consultative broker's toolkit. Available now!

Ready to learn more about Consultative Brokerage Sales Training? Visit the Consultative Brokerage Academy.

To learn more abour C.R. Ekern & Company, please visit our website

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