Episode 16 : Production Log

Welcome to the Unstoppable Profit Podcast. This podcast will give you all the tools to grow your business and live life on your terms. Millionaire agents and entrepreneurs think and act differently than others. This podcast will give you a simple, proven three step blueprint to grow your business. Over the past 31 years of research in your industry, Mike Stromso has created a unique philosophy called the three people process and promotion. This outside the box thinking and guidance provides agency entrepreneurs just like you the knowledge and tools you can quickly implement to explode your agency business. He has been there, done that, and he's still doing it. Wherever you are today, if you're starting with nothing or are well on your way to the success you desire, with the right people, processes and promotions in place, you will be unstoppable. And now I'd like to introduce your host, Mike Stromso.

Greetings everybody. This is Mike Stromsoe live from the Living Agency Laboratory, welcoming you to episode number 16 of the Unstoppable Profit Podcast. And we couldn't be more excited today to talk to you about something that has become very near and dear to our heart. And you know, really, it's something that's so simple and it's something that we started years ago and we just decided to make a change. We're on the three times five times 50.

You know, evolution in our daily operations, in our business. As a reminder, three small changes every day, times five days a week, times 50 weeks a year equals 750 new tweaks or updates to everything that you're doing that will change your business and your life forever. If you're willing to take the action. Okay, so several years ago, we made this seemingly small change to our processes and systems that, that has produced absolutely mighty results. And we thought it would be very helpful for you today if we told you all about it. We created. Yes, I know that you're going to say, are you kidding me? Yes, it sounds so simple, but it's so powerful and important. The production log, and we essentially call it our scoreboard. Our scoreboard is the result of everything that we work so hard for as people within world class processes and systems, simply promoting the heck out of it. When we promote the heck out of it and we win new business, our scoreboard is our production log. And our strong encouragement for you is that you should have a public scoreboard available for everybody to see all of the time, every single day. If you're not willing to do it. Why?

That's my question. Why not? Why not you? And why not now it's going to cause people to act. People are paying attention to it, trust me. But at the end of the day, our industry is really, really simple. It's new business and retention. New business and retention, getting more clients and keeping more of the clients that we get. It's really that simple. Simple. And if your growth goals are 10% and your retention is 92%, which is very admirable, that means you need to be growing 18% a year just to get the 10%. I hope that makes sense to you. Because as I continue to work with agents all over the country, this little aha moment, light bulb moment comes on in their minds when we're talking about growth and they go, aha. I never thought about it that way, friends. It's critically important and that's why it's super uber important that you have this public proclamation of the new business wins that you've got going on up for everybody to see. And the other thing that it eliminates? Well, there's three things in my mind and it's on my garage wall. I look at it every single night when I pull into my garage. It says we can never be settled. We can never feel like we've arrived or act like we've arrived. And complacency kills. One of the things that the production log does, it gets rid of the complacency. There can be no complacency in any business. You got to be performing the activities every single minute of every single day to get to the wins. And it's got to be systematic, it's got to be automatic and there's a best way to do everything. So what information should be on your production log? Now, years ago, when we first created this, it was simply an Excel sheet. It was a very.

Forward thinking Excel sheet, if you will, had lots of formulas, pivot tables and all that cool stuff built into it so that when we log something, it automatically calculated totals in about eight different areas at the end of the Excel sheet. And it was fantastic. What happened was the intranet that we created and listen to our podcast on the intranet, the original intranet that we created was no longer because it was built on a software platform called Microsoft Frontpage, which Microsoft did away with. So we had to reinvent our intranet. By the way, that's a huge 10,000 foot level mindset of business. You've constantly got to be thinking about reinventing yourself in every way in certain aspects of your business. Remember, never be settled, never arrive and complacency kills. That's part of reinvention. You've got to be prepared to reinvent yourself when you need to reinvent yourself. So we came to the point where our intranet needed to be updated. And so naturally part of the evolution then was to update the production log. So we integrated and built our current production log into into our platform for our intranet, which is now on Microsoft SharePoint transparently, and the actual production log is built into it. And I'm looking at it right now on my computer. So what kind of information should be contained in your production log? Well, the first thing we need to know is name of the account. Now, in our particular agency management system, every client has a unique client id. So we also put the client ID next to the name. Why? Because we could get, you know, Juan Garcia or Susie Smith as a client. How many other Juan Garcia's or Susie Smiths do we have? Probably a lot of them. So that's why we ask that the client ID is put next to the name. Because when our marketing department or anybody else in our organization goes to look up something about that particular client, we don't want them wasting time. We don't want them having to go back to the producer and interrupt the producer's workflow to ask them a question about which one it is. Put the client ID there and it's over. Because every client has a unique customer or client id and it's unique and it's theirs and theirs only. So we put the name and the client ID right next to it. The next thing is, what type of account is it? Okay, is it a personal insurance package which contains home, auto and umbrella? Or is it a singular policy, part of an account? Is it a business owner's policy? Is it a commercial auto? Is it a worker's comp? Is it a cyber liability? Is it epli? What is it? Okay, then we have a column for type of accounts so we can see how many different types of new business policies we're writing in a particular month by account type. So we've got the name along with the customer ID and then the account type. The third column has to do with something that we created that is unique to us. And we strongly recommend if you can build it into your program. It's a game changer for us from a psychological standpoint, especially in the marketing realm. And it's why did they change to us now? It's one of the most difficult things to get to the real truth from our producing team. Why? Because they're too busy thinking about producing more business and they don't take the time transparently to get to the truth. But the question is, why did people change to us? And I want to know why they change to us from an emotional standpoint. People buy based on emotional reaction. Okay? So they've got something going on in their world emotionally that caused them to change to us. Now I'm looking at our current production log. Okay?

You know, they purchased a new property and they trusted our agency. And weak, in my humble opinion, they were just filling in the blank. Okay, the next one is better rates and it was a referral to us. Okay, my question is why were they referred to us and why did they end up calling us? See, that's the kind of stuff that I wanted to know. Okay, so another one is, I'm looking at them again. It's a newly purchased property. We convinced them to add the auto and get a package discount. That's your opinion. That doesn't come from the client as to why they emotionally bought from us. All right, here's another one. They said we followed up like nobody else. And we got the B of R. That doesn't help me either. Okay, so thank you for helping me out today. I'm learning that I need to go back to my team and do another training on this. Right?

There's a reason that they decided to sign that B of R. See, that's what I want to know. All right, so here's another B of R in here. The prior broker went out of business. Now that's information that I can use in my marketing realm. Alright, so that's better. Making progress. So you know, the column is again.

Why did they change to your agency? And what that does and what that means for you is it really helps you on designing target marketing messages to penetrate a marketplace that you can use. So when you know why people are moving their business from one agency to another, you can target market that with wording, keywords and the whole nine yards just using that information. So the good news is that we've been collecting this for a couple of years, but you're never going to have any of this information unless you start right now and collecting the information. So again, the customer and the client id. The second number two column is what type of policy is it? The third column is why did they change to us? The next column is how many policies did we write in that particular account? Okay, so if we combine it for production purposes and there's three policies, it's three items in that column which gives us a tabulation of how Many total items we write for the month. And the fifth column is what company did we place the business with? So from a marketing standpoint and from a leadership standpoint, if we identify that there's a company over a two or three month period that is smoking hot, that we're writing a lot of business with, that is a company that we want to maybe latch onto with some marketing dollars and promote in an even bigger way. Okay, so that's information you need to know as well. And I'm going to do a recap at the end. The next column is the amount of premium. Now, in our agency world, as far as the team members are concerned, the producing salespeople and the producing service people, we talk about production in realm of premium, not revenue. Me, the leadership of the organization, I think about it in revenue. It is two different conversations. But the people who are in the sales part of it and the service part of it, that's what they talk about all day long is premium. So I decided a number of years ago that I just simply needed to enter the conversation that's going on in their minds and talk to them about premium. Because that's what they know. That's what they know. That's what they know. They're smart enough, they can figure out what the percentage is and come up with a revenue figure pretty quickly. So I don't worry about that. But we list on our production log amount of premium. I can quickly do an average revenue calculation. In our world, the average revenue is probably about 14.1%. So it's pretty quick. For me, total premium times 14.1% is boom. Now, if I see some large group benefit policies or workers comp policies on the production log, I automatically know to drop that down a couple percentage points because those are lower commission deals.

So premium is the next column. The next column we have on there is commission. If they know the commission and they have a quick sec to add it on, fantastic. If they've negotiated themselves a better commission deal, put that on there. Or in the commercial realm, if you play in the commercial realm, you know that you can negotiate your commission down if it makes sense to get the deal. If I've got a $125,000 account and instead of me getting 15, I negotiate down to 13 to get 13% versus zero, I will take 13% all day long. And if I can blend in a fee or negotiate a separate professional fee for other services, I will do that to offset some of that commission. Got it. Because it takes the true premium down and that's what they're looking at as far as presentation purposes. And you separate out your value and your expertise when you negotiate those separate income agreements versus your professional fees. Right? So that next column is there for commission, and that's part of the intent of the use of that particular commission column. The next column is source. Source is what was the source of the business, okay. And it continues in our world. And this has been going on for five or six years since we've started tracking it. The number one source of new business applications in our business continues to be something from our existing book of business. Because for the first, I don't know, number of years in my existence in the insurance agency business, I didn't know how to write the whole account. Nobody ever taught me, not until I studied my brains out and I got with the best of the best in the industry and learned for years that I learned that we needed to learn to write the whole account. Right? So.

As far as percentage of business, our existing book of business continues to provide the greatest amount of production results for existing clients. Other things are lost souls. I'm looking at our current production log. There's a number of lost souls, people that left our agency and decided that the grass was not greener on the other side and they came back to us. Agent leads. A number of our sales producing agents are out there in their communities pounding the pavement, learning how to get more business on their own. We call that an agent lead, something they self generated. Referrals is huge on our list because we continue to get a lot of referrals. You know, we have a relationship with Dave Ramsey. I'm looking at Dave Ramsey. There's a lot of Dave Ramsey business on there. Web leads are becoming more and more prominent on our production log because of the efforts of our marketing department and just our digital presence out there in the world. We see more and more web leads and then there's some others which are other things which are not listed as an option. But at the end of the day, the majority of our business comes from just a few sources. And what that tells us we must just continue to reinvest more, more dollars into those particular areas just to generate more. I mean, we just want to continue to invest in it until the wells dry and the well never dries up. I mean our particular agency, I know this for a fact. If I draw a line of about 50 miles around our geographic location, there's probably more than a million people. We don't need to worry about anything else. If I had nothing but First P. Absolute winners coming into my door every day. I mean, the sky's the limit, right? The last column is the actual producer who sourced the business and was the producer who brought the business in. So that's it. It's really that simple. So we've got the date on the very left, which is the original effective date of the business. We've got the customer and the client. ID is column number two. Column number three is the policy type. Column number four is why did they change to our agency? Column number five is items. How many policies are in that particular deal?

Column number six is the company that we placed it with. Column number seven is the premium amount. Column number eight is the specific commission amount for that particular deal. And if you have to separate it out by policy, that's why sometimes for the same client, you might have two separate policy entries, because it could be a different commission level for each policy. The next column is the source of the business, and then the last column is the producer. Okay, I know that's a lot, but it's all organized in one public scoreboard for everybody to look at. So here's some other things for you to think about. If you're just starting out in this realm and you don't know what to do, start with an Excel sheet. Just create it in Excel and have it formulated to automatically total all of the fields. That's through formulas and pivots. So you've got to find somebody who knows how to do that. If you don't know how to do it, don't try to figure it out yourself. Just go find somebody who does and pay them to do it. It allows you to see what kinds of business you and your team are earning, what kinds of relationships are working, what kinds of relationships are not working, and all of the other things that are critical to the marketing effort and investment that results in the growth of your business. It even shows you what carrier you're winning with consistently, monthly, quarterly, and annually. You've got the whole scoreboard right there in front of you for everybody to see.

Once you have your production log in place, you're going to have the ability to track every piece of new business that enters your agency. And from a leadership standpoint, it's just a really, really good thing to have at your fingertips. 24 7, 365. We've got it electronic, we've got it visual in our office, and it's just a great thing to have. So.

We very strongly encourage you to get a public, social proof production scoreboard in place. If you don't already have one, as soon as possible. What this means for you, all of your new business wins will always be live for everybody to see all of the time. And our greatest encouragement is numbers do not lie. Get the numbers up there for everybody to see. Everybody wants to know and everybody's looking all of the time. We hope this helps you. We hope this helps you add one more piece to your world class processes and systems to continue to develop the agency that supports the life of your dreams. Friends. That's all we want for you. We want you to be able to grow your business, create financial wealth and and to have more freedom to live life on your own terms. Stay tuned to this podcast because very soon we have had a ton of feedback and please give us feedback on this podcast. Tell us what you like, tell us what you don't like, and tell us what else you would like to see coming up in the future. We've had a ton of people that have given us feedback. They say they want us to get back to more interviews that we've done for years. And we heard you. We heard you loud and clear. So we're getting those lined up. We're going to be bringing those to you on the Unstoppable Profit podcast very soon. Until then, please get out there and implement, execute and take action. Don't think about it, don't talk about it. That's not going to cut it for you. You've got to take action. And until next time, this is Mike Stromsto coming to you live from the Living Agency Laboratory. Go out there and make a difference. Be unstoppable and most importantly, leave no regrets. We'll talk to you soon. Take care. Thank you for listening. If you would like to listen to more episodes or share this podcast with someone you care about, please visit www.unstoppableprofitpodcast.com. now go out and make a difference. Be unstoppable and leave no regrets.