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For The Future-Producer Recruiting


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Producer recruitment should be a continuous process that provides the lifeblood for your agency. In the long run, the quality of your salespeople will determine the success of your business. For your sales and earnings to grow, you need to recruit (and maintain) a producer force of motivated, aggressive men and women.

Like many sales managers, you probably find recruiting to be an expensive, time-consuming, and frustrating task. Managers often focus on selection principles (psychological testing and interview procedures) and tend to ignore the importance of recruitment. Until these managers become aware that producer recruiting forms an integral part of their job, they are exposing their sales force to the risks of high turnover, poor morale, and substandard productivity.

This article will provide guidelines for a systematic, comprehensive approach to producer recruitment that will enable you to build a sound, professional sales organization. You'll find out when to recruit, what personality types to seek out, where to look for these people and how to go about recruiting them.

The Importance of Recruiting

An effective recruiting system can save your agency thousands of dollars per year. Several studies have shown that the total cost of bringing in a new salesperson is close to five times his or her salary. In addition to obvious costs such as salary and draw, consider the costs of office space, phones, auto expenses, fringe benefits, vacation pay, additional backup costs (such as postage and secretarial expense), and so on -- not to mention your time. So, you can see the importance of weeding out unqualified candidates as early as possible in the recruiting process before wasting your time, energy, and money on them.

Salespeople must have a combination of specific skills and personality traits in order to become successful. If they lack one or more of these prerequisites, chances are that they'll fall by the wayside. Based on industry experience (in both the Life and Property/Casualty fields), you may have to recruit anywhere from 30 to 60 candidates to find one successful producer.

This high attrition rate means that a successful recruiting program will require a significant amount of your time. We recommend that agency principals devote at least 5% of their time on a continuing basis to building a 'stable' or backlog of qualified potential producers. These are men and women who are satisfied with their present jobs, but may be enticed to join your operation when a vacancy occurs. To keep these candidates interested in your agency, you need to keep in touch with them at regular intervals. One approach that has been used successfully is to send each potential recruit a personal letter every month and invite recruits to lunch every six months.

Creating a stable of candidates can protect you against the dangers of 'crisis recruiting.' Trying to come up with a qualified producer on short notice and under pressure is extremely difficult. Without a reservoir of recruits you may be forced to hire someone immediately and in haste, which is likely to result in a poor land expensive) choice. A continuous, systematic recruiting program avoids the problems of crisis recruiting and helps put you in charge of your bottom line.

Sources for Potential Producers

Recruiting salespeople is a matter of prospecting, no different in principle from your effort to maintain and extend your base of potential customers . These guidelines  will show you how and where to seek out future salespeople.

Your agency support staff (underwriters, CSRs, and so on) can provide a fertile source of producer recruits. These people start out with an advantage, since they already have technical insurance skills and know your agency operations. They may be hungry for the financial rewards they see your producers enjoying.

Use your current producers to prospect for their future colleagues. Offer your producers a bonus (such as money, a gift certificate, a weekend trip) for each new salesperson they bring in who meets his or her first-year sales goals. Or implement a program requiring each producer to submit a list every Monday morning of potential producers met during the previous week. For every producer hired through this program, the referring agent would get 10% of first-year commissions.

Your competitors can also provide you with sales recruits. In many cases, successful producers with other agencies may be dissatisfied with their current situation and looking for an opportunity to reach their full potential. There may be legal problems if the producer's current employer is located in the same area, particularly if he or she entered a 'covenant not to compete.' Even if there is no covenant, some agencies are reluctant to create ill-will by hiring a producer from a competitor. However, if there are no legal or social obstacles, dissatisfied producers from another agency could make ideal candidates.

As a rule, though, you should be wary of attempting to salvage producers who have not succeeded in other agencies, since it is difficult to ascertain the reasons for their ineffectiveness. The same warning applies to walk-in recruits.

Insurance companies have traditionally been a major source of producer recruits. Many agencies prefer to hire company people because of their technical knowledge and the image they project, even though they are not usually trained in sales. Since the companies are such a well-mined source, an innovative approach is needed to get their attention. Show your company contact the job description. Then ask for the name of the one person inside or outside the company who would best fit that position. Stress that this person has probably never told anyone that he or she is looking for a job. The specific job description and the focus on one person should make it easy for your contact to come up with a qualified candidate.

The same approach can be used for agents' associations, which have been another major recruitment source. Many associations also maintain lists of people who are seeking positions as producers.

Center of influence prospecting can be an invaluable recruitment technique. Many agents solicit prospects from bankers, merchants, and other community leaders. Even if you don't come up with any good candidates, you've flattered your centers of influence and given them the impression that your agency is a professional operation.

You can also employ the center of influence method with your policyholders. Once a year (or more often) ask each of your 10 Leading Commercial Lines accounts to name the insurance salesperson (besides your own) who has impressed them the most-and why. By definition, these people are effective producers. Even though they may be satisfied in their present position for the moment, they may be ripe for prospecting in the future. This method is also a valuable way to find out who your best competitors are and how they're operating.

Choose your centers of influence carefully to develop qualified leads from this source. In general, the quality of the referrer will determine the quality of recruits. Pick only the best sources: those who respect you and will be respected by those they refer.

Students can be recruited from high schools as well as colleges. Every spring ask each agency employee to list five graduating high school seniors who they believe might make good producers. Select the top 10 from this group, with help from the school's guidance counselor. Invite these students to a dinner where you and your leading producers describe sales career opportunities with your agency. Let them know that you're looking for one or two producers to join the firm and that you have an internship program available if they are planning on college. This approach may provide some high-quality candidates and will help build your agency's image in the schools and the community.

Let the placement offices of colleges in your area know that you're interested in both graduating seniors and alumni who may have been out of school for several years. Try to choose candidates with a 'B' average (those with higher grades tend to be product- rather than sales-oriented) who have proven their motivation by earning at least half of the money to put themselves through school.

Free sales seminars in your agency, open to anyone interested in improving his or her selling skills, are another recruiting technique. You can find students from personal observation, from referrals, or by advertising in the local paper.

Your top producers (or yourself, if you enjoy teaching) can lead these evening seminars covering the basics of selling (from prospecting to close). After one or two sessions, you'll be able to pick those men and women who are prime producer candidates. Following up with them should be easy, since you have demonstrated the professional selling skills of your agency staff. The seminar approach also gives your agency valuable exposure as a forward-looking organization, willing to share its knowledge with the community.

Seminars can also be used as a more direct recruiting technique. You can hold an open meeting or series of meetings to showcase your agency. Once again, your sources will be personal observation, referrals, and media ads.

The seminar agenda might cover these topics:

  • Why people change careers
  • The insurance industry
  • The agency: history, performance, and plans
  • Products and markets
  • The agency career path
  • Rewards and incentives
  • Individual success stories
  • Producer education, training, and support

Be sure to include timely and relevant support items (agency brochures, trade press articles on the agency or written by agency staff, sample newsletters, and so on). A question and answer session will help you pick the best candidates. Have the attendees fill out a card or form to indicate their interest, then follow up as soon as possible.

Advertising can be a valuable way to locate potential producers at a relatively low cost. To be successful, ads must have a strong appeal to applicants' needs, ambitions, and life goals. When composing what you want in print:

1. Have an attention-grabbing caption (such as, 'Is Your Present Job a Great Big Nothing? ' )

2. Omit meaningless, negative, or irrelevant qualifications or standards of exclusion, such as 'must be dynamic and aggressive' (most people believe that they are). Also, avoid specific requirements for employment-for example, a college degree. (All such standards must be demonstrably job-related. I Although few applicants pay attention to these admonitions, occasionally an otherwise well-qualified candidate may hesitate to answer because of them.

3. Sell, but don't oversell, your agency or the job. You might use language something like: 'Long established firm, leader in its field, rapidly growing and well-managed, has openings for men and women who wish to be their own boss.'

4. Answer the main questions the applicant wants to know. Be as specific as possible: 'Training provided at company expense; total support staff; car and expenses included; minimal travel; exceptional salary, benefits, and liberal incentives.'

5. Aim for the spouse's attention as well. Where feasible, include an appeal such as, 'Our winning salespeople and their spouses will be our guests in New Orleans at the ___________________ Convention this March. '

6. State the facts openly whenever possible. Your agency name may have exceptional appeal to ambitious candidates, and you also avoid the risks in the minds of applicants that they might be answering an ad from their own firm.

7. Personalize the offer by naming a specific individual, 'Bill Jones, ' whom they are to contact . This can be a fictitious name to alert your staff so that anyone appropriate can handle the contact.

8. Make responding as easy as possible. You might tell applicants to call 'Bill Jones at 123-4567 between 10:00 and 6:00 today, Sunday, January 7, for a personal and confidential phone interview. '

Depending on your needs, you might prefer either the 'rifle' approach (targeting specific candidates) or the 'shotgun' technique (obtaining a maximum number of recruits in a given time~- You can run rifle ads in the insurance trade press, state association newsletters, or the daily newspaper (in metropolitan areas).

An ad intended to obtain a maximum number of recruits can offer a highly productive, rapid, and inexpensive approach to recruiting. These ads are usually placed in the Sunday paper on the financial page, sports page, or another strategic spot. Instead of asking applicants to come in person or write to a box number or company, as in a conventional help-wanted notice, specify that candidates call in. Your ad might read something like this:


Call Mr.________________ at (a telephone number) between the hours of 10:00 am and 6:00 pm, today, Sunday, for a personal confidential interview. (If you are outside the city, you may call collect. )

Choose a different interviewer for each ad as a way to monitor its effectiveness.

Phone Interviewing

The phone interviewer should have a series of 'screening-out' questions designed so that a wrong answer to any of them will be immediate grounds for rejection. (For example, 'What type of work are you seeking? ' Many callers will admit that they're not really looking for a sales position, but called on the off-chance that the agency has some other job available.) The conversation should only be continued to the point that the applicant reveals he or she lacks one or more essential qualifications for the position. Under no circumstances should the interviewer answer questions about the position: His or her job is to screen candidates for further consideration.

The interviewer should keep a written record of the source and disposition of every call,including the reasons that each applicant has been accepted or rejected. This will be invaluable if an applicant later charges that he or she was excluded on grounds of race, color, religion, national origin, age, or gender. In most cases, about 80% of the responses will be rejected because the candidates do not meet the qualifications for the job in one respect or another or exhibit inappropriate behavior (excessive aggressiveness, sarcasm, and so on). Thus, phone interviews enable you to make contact with large numbers of candidates quickly and inexpensively and screen them down to a short list of prospects to invite for a personal interview.

Outside Recruiting Assistance

The recruiting techniques mentioned can be used without outside assistance. Some agencies,however, prefer to bring in management consultant ' headhunters' to help them fill upper-level producer positions (generally those earning $75,000 a year and up). The headhunter usually requires a detailed job description and statement of qualifications - Once promising candidates have been identified, the consultant will investigate their personal background and evaluate their education, experience, and temperament before passing them on to you. Most executive search services require the client to pay 25%-30% of the candidate's first-year salary (partly paid as an up-front retainer during the search period), plus all out-of-pocket expenses. You'll need to weigh these expenses against the cost of finding and screening candidates yourself.

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