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Strategic Planning for Business Excellence
Retreat to Victory
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Models of Profitability
Producers as Profit Centers
Performance-Best Compensation
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Transformation On Call
Producers as Profit Centers

Producer compensation may be one of the biggest factors in agency profitability. It’s likely to be your largest expense. But more than that, how you compensate your producers affects producer satisfaction and effectiveness. An effective compensation program should help you with the three R’s:

Recruit the best staff available

Retain these employees through motivation and incentives

Reward behavior that helps the agency meet its overall business goals

An effective compensation program should also ensure that each producer generate more revenue than it costs to support his or her sales efforts and to service the book of business. In other words, each producer should return a profit to the agency.

Viewing each producer as a “profit center” has several benefits:

  • Evaluating individual producer performance--not only on the size of their book of business, but on its ability to generate a sufficient return on your investment--lets you accurately measure the effectiveness of your sales force.
  • Measuring individual profitability facilitates individual goal setting for new and experienced producers. It’s also a great management tool for helping producers understand the economic drivers of the business as well as their contribution to agency profits.
  • Understanding all the costs associated with producing business permits you to make more intelligent business decisions about adding to the sales force. It also provides insight into the amount of service staff required to support a producer’s book of business.
  • Reviewing income and expense at the producer level enables you to know what you can afford to pay your producers. It allows you to measure the success of your compensation plan and make adjustments where necessary.

Helping agencies analyze departmental and producer profitability is a specialty of Transformation Advisors, Inc. We can help you identify all the costs associated with each producer and, if the results of the analysis show you’re not getting an adequate return on your investment, we have strategies to help you make necessary changes to improve your performance.

To take profitability to whole new level. For truly meaningful measures of performance. To create your agency’s standards of excellence...

Fill out our on-line form or call Transformation Advisors at (530) 295-1083.


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