Situation
A multi-billion dollar Financial Services and Insurance provider was experience declining revenue growth in one of the Insurance product lines it sells through its Captured Agent Channel. The client wanted to determine if it needed to reevaluate its captured agent organizational structure and commission-based compensation to drive additional growth through this channel. Most importantly, our client wanted to ensure it was offering a competitive compensation structure, and, if necessary, it was prepared to invest considerably to increase commissions.
Methodology
Maia benchmarked the client’s recruiting performance, organizational structure and compensation and benefits plan against 3 competitors. This required extensive primary research of on the competitors’ Captured Agent channel.
Analysis
Maia benchmarked the client’s Captured Agent Channel versus the competition, and realized that the quality of the client’s agents was equal to the competition, and that its compensation arrangements were competitive with the market. Additionally, Maia discovered that the client experienced a lower degree of turnover in its Captured Agent Channel than its competitors. The issue was the management structure. There were too many layers between specific regional area channel executives and actual producers/sellers of the insurance product. Where competitors only had 1-2 layers of middle management, our client had 3. It slowed the organization’s sales activities and caused confusion among “front line” sellers. Maia recommended that the client consolidate and simplify its Captured Agent management structure.
Impact
Instead of investing more toward compensation, Maia’s recommendations saved the client $10M in unnecessary human resource personnel cost. Once the reorganization was implemented, the client increased sales by 15% and front line producers found the organization much easier to work for given the removal of unnecessary bureaucracy.