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Sounding Board-Looking to grow your agency? Optimize

Agency health creates the climate for M&A. Hard economies and soft markets notwithstanding, agencies can boost their financial performances by optimizing their internal performances.

By Demmie Hicks | Updated on June 29, 2009

An industry report on mergers and acquisitions activity landed on my desk recently. One sentence caught my eye: “Since agency buyers evaluate deals and set pricing based on projections of growth and profitability, valuations and deal activity suffer when agency performance is weak.” Translated: Agency health creates the climate for M&A. Hard economies and soft markets notwithstanding, agencies can boost their financial performances by optimizing their internal performances. This means fine-tuning everything that influences top-line growth, from how clearly leaders define and articulate their visions to how employees work together. That’s not to say producers should be overlooked. Producers who counsel their clients, providing answers and applying ingenuity, will close more business and build trust and confidence. If “optimize” means to make something as good as it can be, agencies should:

Pinpoint areas within the agency that either help or hinder sales. New business stems from vision, values, communication, collaboration, and many variables. You have to know what’s fueling success–and what’s holding you back–before you can do something about it.

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