Marketing plan: This starts with the expense budget for next year, because you need to know how much revenue is needed to cover expenses first, and then set your profit goal. Chart A, “Marketing Revenue Projections” (at right), will help you project revenues based on your own agency's year-end results. This data is input from a “Monthly Income Report,” Chart B (below), maintained on a year-to-date basis.

Sources of revenue: This displays the revenue results from Chart A visually, in a pie chart. It's a great tool for owners, managers and all employees to quickly and easily view how all sources contribute to meeting the agency's annual revenue goal. While not all channels of distribution have access to all sources of revenue displayed, it can be tailored to the organization.

Reports for new/lost business production: Chart C, monthly and year-to-date, shows new/lost business, actual versus goal. Marketing — Chart D — shows sources for new business and reasons for lost business, displayed monthly and YTD. Results are used for calculating retention factors as well as other planning purposes. Below, a sample of what these charts could look like.

Department/divisional plan: Each department should create its own annual plan to be incorporated into the agency business plan. Each department's plan should be written by its staff and submitted to management. All should address and set goals for revenue objectives, sales and marketing tactics, new business generation focused on account rounding, cross-selling, new products, training and education, automation and IT improvements.

Operations team plan: Often overlooked as a revenue generator, this is an integral part of planning. The entire operations/admin/finance team should create its own annual plan, beyond logistics, with special emphasis on providing all reports and data needed for input to the annual business plan. Tracking all agency production and loss ratios from companies for contingencies, bonuses and profit sharing should be maintained and reported quarterly. The operations team should have its own revenue goal that can be achieved by identifying and referring opportunities for account rounding, cross-selling and new business opportunities they personally refer to the agency. All agency staff should be eligible for a “finder's fee referral” incentive.

Benchmark planning: Executives should focus on growth and profitability by measuring these benchmarks, at minimum:

The results of the past year and the new annual plan should be presented by the CEO at an annual meeting to share results — both good and bad — and introduce the plan for the new year for which all employees provided input. All departments should meet on a monthly basis to review their department plans and modify as needed.

Barry Seigerman founded the Seigerman Agency, a full-service, multi-line agency in 1975, and is now a producer for People's United Insurance Agency. Contact him at [email protected].