ANALYZING EMPLOYEE BENEFIT LEVELS by John Jaques Many agency managers spend a great deal of time reviewing and setting staff and producer compensation levels, but often underst...

The determination of adequate compensation levels for the staff is one of the most difficult issues...

One of the most common questions we hear during consultation involves compensation for owner/producers, existing producers, and new producers. The principal question is how much and how to pay for production that compensates salespeople fairly and gives them incentives for continued growth.

The answer is complex because the same compensation models don't fit all producers.

It used to be the $1 million ceiling. That was the level of revenue at which an individual performing agent with a few helpers had to become a business with different people handling different clients and responsibilities. Everyone still worked for the agent, but the agent no longer made every decision.

However, running an agency as a business doesn't automatically result in growth and a high quality of professional service. By the time the agency reaches $2 million, it runs into another "invisible ceiling."

PRODUCTIVITY UP, PROFITS DOWN by Carol Hammes It's common wisdom that profitability should track directly with productivity. Often this is true: If the employees are more productiv...