Research Paper By Todd Mauney
(Business Coach, USA)
Partners Advantage Insurance Services (PA) is a very successful insurance marketing organization founded in 1993 and based in Riverside, CA. They provide insurance and annuity products and marketing services to agents and agencies across the U.S. In 2010, the founder and CEO, Scott Tietz, hired tenured executive business coach, Todd Mauney, to help him grow the organization, scale leadership and increase the value of his company. Scott is a consummate entrepreneur, always thinking, innovating and taking massive action to make things happen. These attributes served him well in sales and the launch years of his business. As the business grew, it reached a level of complexity with shared leadership roles and a growing staff. Scott, being an incredibly aware learning leader, knew he needed someone to watch his blind spots, add perspective and help him shape the organization and his leaders for accelerated growth.
The process started by refocusing the business on its clients, the value proposition and delivering it with greater precision and efficiency. Until this point, PA was structured in a way that targeted agents and agencies of all sizes and shapes where the value proposition was mainly focused on product, insurance and annuities. Through the coaching conversations, Scott decided to reorganize the business based on a segmentation of his clients. He realized the value proposition had to go beyond product and in order to figure out what it needed to look like, he needed to understand his clients better. Through some analysis of his clients and developing a new business plan, he formed three divisions focused on each segment, the independent agent, small agencies and institutional accounts. He then empowered leadership to run each division with two critical metrics, sales and profits with the emphasis on the later.
At this point he knew he needed much more structure in order to scale leadership and effectively grow. He bought into the need for a more comprehensive business plan and moreover, the need to align his leadership so they too had a business plan targeting key objectives. He began to require his leaders to assess, plan, execute and be accountable for their goals. Over the course of the next 4 years, Todd’s role as the executive coach expanded to currently include Scott, the President, James, the President and 8 senior leaders. With the help of a business coach, they were able to develop an annualized business planning process to maximize the performance of the leaders, their teams and the company as a whole.
This process began with analysis of their strengths, weaknesses, opportunities and threats. It also included an assessment of the team’s strengths and potential weaknesses, individually and collectively. In preparation for and through an off-site planning event, each leader developed a personal business plan that aligned with the corporate vision, mission, values and key performance indicators. They set their own division and department level goals, defined critical metrics, established clear projects and made themselves accountable for their results. The President established a cadence of accountability where each leader reports their progress on a predetermined frequency. They celebrate successes and support one another to fail forward as a team.
Todd’s role is dynamic as an executive coach. He’s provoked brilliance in the leaders to innovate and find ways to improve their areas of responsibility. His role has also been to provide performance enhancement and management structures to support continuous improvement and growth. And on an individual bases, he’s supported each leader stretch themselves, expand their perspective, learn new things and work more effectively with others to create synergies. Through this modeling at the senior management level, the leaders have now begun to cascade performance management structures into their departments and divisions in order to create a peak performance culture.
This case study takes a close look at one of those department leaders, Lisa Leach, and how she led her team to implement new structures to elevate the overall performance of her team and achieve her department level key performance indicators. It started with her learning the strengths of her team players and leveraging the right person to head up this initiative. She delegated! The brave leader who took on this tremendous project, Keith Kerr, is relatively new to the company but a seasoned entrepreneur himself and very successful business man. He has a knack for systems, processes and numbers. He’s grown several manufacturing companies and knows how to maximize efficiencies. And by Lisa empowering Keith with this role, trusting him and supporting him every step of the way, they have achieved tremendous measurable success to validate the importance of a performance management process reflecting an effective coaching model.
Introduction to the Problem
Lisa’s department is responsible for paying commissions to their client agents and agencies. The turnaround time on these payouts were 12 days. The amount of time a client (agent or agency) has to wait on their commission is of tremendous importance. This metric is something that has the potential to set PA apart from its competition in a really negative or positive way. The 12 day turnaround time was something many clients were complaining about so thus it had the potential to effect client retention and new recruits, two of the most critical corporate metrics of success.
Lisa, leveraging the expertise of her key staff member, Keith Kerr, determined with his help their department could not only meet her original KPI commission turnaround goal but exceed it to create a competitive edge. This, of course, would make the company more valuable to clients and her department more valuable to the company. And with Keith’s thought leadership, they were also able to show how this made each player on the team within Lisa’s department more valuable which fueled the performance system even more.
So the problem to be solved was to figure out how to reduce commission payout time from 12 days (targeted KPI) to 3 days, develop a plan to achieve the goal and implement it successfully.
It started with Keith noticing a report senior management had to submit each week as an update to the team on their business plan goals. He noticed one of Lisa’s KPIs (key performance indicators) was to reduce the commission turnaround time from her department to a 12 day turnaround. Keith noticed this goal and was willing to take ownership of this KPI within the finance department. This is a perfect illustration of how senior managers can cascade an annualized planning process and accountability structures down through the organization. Because Lisa bought into the senior management planning process and believes in volunteering accountability, she knew this project required a champion to get it done. She knew about and leveraged the strengths within her team, asking Keith to look at the entire commission payment system process and what had to happen to achieve a consistent 12 day turnaround on commission payouts. When Keith looked at it, he realized it wasn’t a good measurement nor did he feel they could accurately track it. As he began to look even closer, he recognized a lot of overtime hours were dedicated to paying out commissions. And there was apparently no standard operating procedures documenting everyone’s roles and responsibilities as it related to paying commissions. He felt from initial due diligence the KPI should be 3-5 days and eliminate overtime hours. Keith reset the goal based on an educated and reasonable assumption it was realistic. Now he had to convince others it was possible and they would need to make some significant changes as all lofty goals require us to do.
Keith invested many hours interviewing each individual on the team to begin documenting every step of the process, from each person’s perspective. By the end, he had the overall process map within reach but there was a lot of overlap and ambiguity. There were critical bottle necks in work flow, overlap in tasks being performed, vague interactions and a general lack of accountability. All of this was working against each individual on the team, each person in the department, the rest of the organization and its clients. Keith really “GOT” this perspective and vision…that each person on his finance team was capable of contributing a huge value proposition that could measurably impact client retention and recruiting. A substantial reduction in commission payout time could be a huge competitive advantage or disadvantage. Keith was insistent on making it the former and not the later.
After mapping out the entire process in a flow chart, he identified clear boundaries of responsibilities and where his people would need some additional training in order to implement some changes. He also recognized the critical need of having tracking metrics to determine what was working and what wasn’t. He invested time with each individual to define critical and trackable metrics. He had to be sure the metrics were relevant, targeting the right behaviors for that person, able to be tracked and frequently enough to see signs of progress. He knows substantial change happens incrementally and over time. So metrics are to motivate as much as to navigate.
He took a week to set up all the individual metrics which would allow each person to see how they’re doing while also seeing how the overall system/team is improving. The metrics were tracked in an Excel spreadsheet to consolidate it all (Appendix). The data is input from several sources. Once the goals were established and the process (or plan) was detailed out, he then started some training to educate everyone on the vision for this initiative, the impact it would make at all levels and the process they would implement to achieve it. It was fundamentally an opportunity to build buy-in and trust, two essential ingredients to change.
Because he has followed through on these goals, tracking, measuring, training, supporting and demonstrating effectiveness, they have continued to follow through TRUSTING him to lead. He has a weekly conversation with each of them to see how to they can improve on their performance.
The original problem was defined by Lisa as “lack of focus.” So Keith took that at heart and decided to refocus on the client first. By doing so, he came up with the following power questions…
- How much more loyal would PA clients be if they could shorten the payout time from 12 days to 3-5?
- How many more clients could PA recruit offering a 3-5 day payout vs. 12 days?
- What’s the clear connection between the work we do and this client impact?
The solution was much bigger than just having a plan or learning to have accountability conversations. The solution was the culmination of many pieces of a formula for change. We’ll go through them now:
- Actively Seek Knowledge & Awareness.Keith started by shining the light in all the important places. He interviewed employees from all parts of the company to find out what their perception of his team really was. He also interviewed each person on his team to find out what they were actually doing day to day. Once they all reported their roles and responsibilities as part of the process. Keith mapped it out with simple pictures that were so easy to understand. He also identified some behaviors that were neither appropriate nor acceptable.
- Reset Expectations and Standards.Keith called the team out on areas where they were falling short of their potential. He established clear and enforceable boundaries so everyone felt it was a level playing field. This resetting the bar for behavior and conduct was foundational. Only then could the team move from “forming” to being able to “storm” in order to “norm” and ultimately “perform” at the highest level (a.k.a. the Tuckman Model). Keith called them out on these and set the bar of expectation, “this kind of behavior will not be tolerated” and provided solid reasons why…to create a safer and more secure environment for all, to build trust. These critical leadership steps set a standard of professionalism, created respect and built trust in his relationship with them. It also sent a clear message of his heart and intentions, that all he was doing would be in their best interest. With the foundation in place, he formalized it more as an “operations manual.” As part of this effort, they also identified those aspects of the process that could be measured and what their capacity was to track, keep up with and digest these metrics. He set the expectation they’d start with a micro-tracking perspective based on individual and team performance standards (goals). The “WIFM” (what’s in it for me) was that by tracking individually, each person gets full credit for their contribution and by tracking departmental goals they can see how the parts contribute to the achievement of the whole. Keith’s leadership goal was to create a culture within his team that sets aside their personal egos and issues in order to fulfill their “PART” off the overall system…department…because everyone is dependent on everyone to make it all work. One culture moving towards common objectives. Three core values were communicated…driving revenues, solve problems and control cost. Those are the critical business drivers for the department so the matrix for tacking has these objectives at the foundation.
- Get Essential Buy-In and Weed Out the Rest. In Keith’s estimation, there are three types of people. Two of them are keepers and the third group must go. They are…
- Those that embrace the changes and even thrive in it
- Those who won’t necessarily agree but they will conform
- Outward contesters who dig their heels in and resist change
- Incentivize Excellence. Leaders must know what motivates each player on the team and appeal to them with rewards, recognition and incentive pay. Keith wanted to get those outward contesters on his team to be all in and had to push the envelope sending a clear message no one is indispensable. What one may loath, another sees nothing but gain. Patters over time set into thinking, some make the shift and others will not. So he brought in a few “new” resources (people) to join his team for an undefined period of time. He wanted the others on his team to feel they were desirable but not indispensable. He wanted to create a healthy sense of competition to see who would rise to the occasion. And by doing so, he’s able to determine who was truly in that last group, the ones he needed to let go. He pointed out to them that one of PAs core value is to have fun. He made it clear that having fun happens when you’re at the top, excellent at something and dignified having pressed through the difficulties to persevere and succeed. That’s the bar he set, at a company, department and individual level. He asked them…have you ever been the ‘best’ at something? We all want to have fun and having fun is being the best…achieving that ‘rock star status.” He cast the vision with them as the “rock starts.” He showed them how performance is going to translate into merit increases, career advancement and other incentives (bonuses, competitions, etc.). He gave public recognition. He sold the vision of what making a difference meant on a personal, departmental and company level. He’s most recently begun to communicate this improvement to sales in order to expand the trust his team has within the organization so they ultimately turn that communication outward to clients and prospects as an add value. Keith is also making the case internally to his team, that if they can provide this value to the sales team and thus, clients, they become more valuable!
- Implementation with Persistent Payoff Perspective. We are hard wired for the WIFM (what’s in it for me). The “what” typically falls into two categories, to avoid pain or for personal gain. This initial awareness phase was painful. After everyone was made more aware of their underwhelming performances, they fell flat, were lethargic, disillusioned, humbled, emotional and perhaps even angry. This was very important to Keith, for them to experience the low in order to appreciate the high that would come. This was a rare long term leadership perspective, knowing they’re going to be ok but allowing them to feel otherwise in order to make the shift, to find the inner strength needed to go from good work to great work. But this requires of the leader, an authentic commitment to the success of those who desire and work hard to be the best they can be. Right as they’re on the brink of despair, there’s more encouragement, follow-through and metrics to show incremental success…providing deeper connection to the bigger vision. This allows the team to say “we believe.” This “broken” time was quickly followed up with a building back up. They started the training, monitored the behaviors based on the process metrics and coached each person individually to achieve the objectives. As Keith noticed their hurt, pain or frustration, he’d cast the vision again... “yes, but imagine once we put these processes in place, you’re doing more of what you love to do, doing it better and making a difference on the team and for the company.” He turned a vision into a personal win for each person…and did this regularly because each person’s needs for encouragement are different and in different seasons. He wanted to stay on pace with each player, just a step ahead to make sure the team would be positioned for success.
- Other Leadership and Coaching Attributes.
- Keith had the team focused on following the process and measuring incremental success with continuous feedback loop (ie- meetings).
- Cast a vision of what could be with everyone working with purpose and passion. Influence rather than mandate. In Keith’s words, “a good leader isn’t someone that sits in the chariot but rather leads the horses…the team.
- Always give more than is expected.
- Become transparent and maintain transparency…moving to transparency was very difficult. What is covered or in the dark often doesn’t respond well to light. So be willing to walk with people through this process, a time to let go of the past and look forward.
- Embraced failure as part of the process for improvement.
- Follow through on expectations.
- Innovation is the life blood of the organization; it keeps it nourished with new growth opportunities. Creating a trusting and safe environment will stimulate innovation.
The Results & Conclusions
If this works the way he hopes, Keith wants to make a case to apply this same model throughout the rest of the company. He believes what senior management has learned about business planning and creating a high performance accountable culture, should be pushed down and made relevant at all levels of the organization. Keith has results to prove this overarching strategy impacts behavior and business results. Keep in mind the measurable results of implementing a performance management system leveraging a coaching ‘modality’ are always on-going, often in annual cycles. Lagging indicators are likely to be cumulative from a positive trend showing up now, in these metrics. Keith meets with his team once a week for one hour as a department to review any adjustments in the processes and/or systems as they tweak things. This is cross communicated with the other departments as well to learn, work closer with each other and manage expectations.
Keith is also noticing a clear increase in interest levels around promotions. They are looking for ways to grow with the company demonstrating heightened engagement in the work of the company. This is huge and there are three primary reasons the team is now aspiring to grow into elevated tiers of career growth:
- They better understand leadership’s motive, to have their best interest at heart
- Better understanding of their interdependencies, how each is dependent on the others
- More clarity on what they can do to demonstrate their value and contribute to creating a bigger value. They see more clearly how their work contributes to the company’s top and bottom lines.
The Results & Conclusions
- Accurate payouts are occurring every 5 days, with plans to improve over the next quarter to 3 days.
- Productivity per hour has met the breakeven requirement and trending upward.
- Capacity of production has been clearly identified with plans in place to improve capacity by 40% over the next 2 quarters.
- Lines per hour (total hours per week and hours processing) improved by 54% over a 30 day period.
- People are more focused with a sense of purpose, feeling empowered as a contributor of company value (dignity) and overall, attitudes have significantly improved.
- Communication and collaboration within the department has improved significantly.
- Communication and collaboration with other departments have been enhanced with ongoing dialogue and commitment to improving.
- Innovation has emerged as the driver to problem solving.
- Quality control measures have dramatically improved.
- The awareness to cost controls has influenced the strategic thought processes.
- Everyone is marching in the same direction to the same beat.
- Synergies are emerging.
- Lines of authority and channels of service have been established and enforced.
This initiative has also created a lot more conversation within the organization. The key to these communications is to focus on value exchange, what value they need from one another to be more successful so the team/company’s successful. This all creates more opportunities for growth and esteem.
When you give people the right tools, they can do the job. Why hasn’t upper management provided each department/division with the same performance management tools they’ve received, with the framework for targeting and reaching measurable goals? It’s a performance management process but has not been pushed down through the organization to it becomes interdependent accountability at all levels.Only way Keith knew about the use of the Work Compass as a tool for weekly accountabilities, from seeing it on Lisa’s desk. It hadn’t yet been made relevant to the front lines of the department, on a measurable level. That’s what sparked the conversation that led to Keith owning this project to install the same type of performance management system within his department.
Innovation has gone up as evidenced by the new ideas that drop on Keith by team members stopping by his office, bringing it up in a meeting or in the hallway. Keith makes it a point to acknowledge those ideas and recognize them publically when they’ve been implemented. He feels it’s starting to unleash that innovative power…gets them to realize how it provides them the opportunity to be entrepreneurial without the risk.
People are also more focused with a sense of purpose, feeling empowered contributors of PA’s value proposition. It creates a sense of personal value and dignity that create a positive attitude. He’s seeing this more and more. For example, the other day, one of the department staff had a huge smile on her face for the first time he’s ever seen. He acknowledged it and took note of another intangible example.
On the more tangible side of results, Keith has that one dialed in as well. Each key metric is tracked on a spreadsheet (Addendum). Each number tracked is done so by individual and formulated for the overall team so they can see how individual performance affects the overall team performance. This is powerful as it connects the dots and provides a structured way of seeing the metrics. The key metric is what they call “Lines” representing a line or transaction on a carrier statement. The number of lines one can process during a day is a key metric of impact on the commission turnaround time. Each line represents a policy transaction. This key metrics is used as the building block for other metrics. We will share some of the most significant measurable wins since this initiative started in January of 2015: