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Building Equity Value

Managing the agency's sales pipeline

Sales managers need to focus on leading indicators, not lagging indicators

By Jeff Jenkins, CPCU

Disciplined and proactive management of your sales pipelines can transform you from lagger to leader in your role as sales manager by redirecting your agency to predictable and profitable organic growth. Before delving further into the benefits of managing producer pipelines, let us quickly review the role of a sales manager in an agency or brokerage firm. The diagram on the next page depicts what we believe to be the critical roles and responsibilities of a sales manager.

Role of a sales manager:

1. Set the expectation for what you want from each producer in your production force.

2. Give frequent feedback on how each producer is doing against the expectation set in number 1 above.

3. Coach in the areas where the producer is not meeting expectations.

4. Move the producers who can’t be “coached up” to another role in your firm or as a last resort, out of your firm.

5. Recruit new talent into your firm to serve as producers.

In a regimented new business sales culture, the cycle never ends.

Sales pipeline

Because there are many different definitions of sales pipeline, let us begin with a succinct one. The sales pipeline is a repository of current prospects that a producer has already engaged but has not sold. Simply put, the pipeline is any defined opportunity that a producer has in process that could potentially end up as revenue in the current sales cycle.

Is closed business included? The answer is “no” because closed business now resides in one of your customer files and the revenue impact has already been realized. How about a prospect who says he wants to meet with a producer nine months from today? Again, the answer is “no” because the prospect is not yet engaged. Such an opportunity would move into the pipeline once the producer and prospect conduct their first meeting and decide to proceed with discussions.

Now let’s look at how sales managers evolve from laggers to leaders.

While most agency managers are very good at making every producer turn in a goal for the upcoming fiscal year, what happens if the goal is not achieved? Or, what happens when a producer thinks that he or she is on the right track for 12 months of the year but then fails to reach the commission target? Agencies that have established a true sales culture understand the importance of proactive pipeline management. They know exactly what is in each producer’s current pipeline at all times, from the number of opportunities to the average account size to the total potential revenues that the individual can expect to produce by year end.

The likelihood of being an effective sales manager is greatly diminished if the sales manager is unwilling or unable to show the leadership team exactly what is in the corporate sales pipeline at any given time. In the absence of that information, you will only know how much business has been written in the past and will lack a sound predictive modeling system that can help effect future change. And while closed business reports tell you the score of a game you have already won, they do not tell you whether or not any of your players is showing up for practice—or how effective their workouts are.

That is the problem with making revenue such a critical metric to track. Of course you should track revenue, but realize that it is the last indicator of performance to show up. Revenue is simply a lag indicator. If you want to be a great sales manager and leader, then you should shift your focus to the lead indicators, which takes us right back to pipeline management. If you do a better job of focusing on what is “in process” in the pipeline, you will know much earlier that a particular producer has a problem.

So what does a pipeline management system look like? There are many shapes and sizes, but they all have one thing in common: Each one tracks every one of your prospects through the sales cycle once a new business appointment has been generated. Additionally, each system gives you insight into the current activity levels for each sales person and indicators of where sales may be breaking down.

Other than the obvious, how can this be effective? In my opinion, the most difficult part of the sales manager role outlined in the beginning of this article is that of coaching producers in areas where they are deficient. But how would simply measuring the pipeline help in coaching?

The examples below will help to demonstrate how the producer pipeline can be used as the basis of effective coaching. Each example starts with a one-on-one meeting between producer and sales manager to discuss the current pipeline.

Example #1

The situation: There are not nearly enough opportunities in the hopper.

The solution: After making sure that the producer is aware of the problem, the manager has several options: He or she can schedule some time to make calls with the producer to help build the pipeline, line up additional prospecting training, or demand that time be blocked for prospecting for the next 30 days.

The very best coach would observe the producer in question who is attempting to gain new business appointments and then offer advice on how to improve. Others actually allow the producer to observe the sales manager’s techniques to learn how to prospect better. Whatever the coaching method chosen, it all starts with the weekly meeting to discuss the pipeline.

Example #2

The situation: The producer has a poor closing ratio.

The solution: In this example, the sales manager may arrange for a producer with a very low closing ratio to accompany another producer with a 60% or 70% closing ratio to allow the struggling producer to see how the successful producer qualifies or differentiates to drive higher closing ratios. Here is a startling fact: 90% of the firms we have worked with on sales management over the last five or six years have no idea what their closing ratios really are for any given producer. Not only can the pipeline management solve this problem but it can also allow you to set a target closing ratio for your production force so that they all understand that you will not be marketing every submission to your carriers just because someone has said a producer can offer a proposal. Again, without a pipeline system, this conversation could never take place.

Example #3

The situation: The producer has too many small deals in the pipeline.

The solution: In the weekly meeting, the sales manager can point out that if the producer in question closed 100% of the business in his pipeline, he still would not hit the new business target, even though there are a significant number of “deals” in the hopper. Having too many small deals can be one of the biggest career killers for producers.

The bottom line

It is hard to manage today’s producers if you are tracking only closed business reports. To become a true sales leader, leave the “lagging” to someone else. Ask your producers to submit their current pipelines each week. Use that information to facilitate a weekly one-on-one conversation to make sure they are on track to hit their goals. You will honestly be helping your producers in real time and may save them from falling far behind the goals they want to achieve for themselves. By using the pipeline management tool to coach and train (and not to beat people up) you can gladly call yourself a sales leader, not a lagger.

The author
Jeff Jenkins, CPCU, is senior vice president at Marsh, Berry & Company. He can be reached at (903) 597-2278 or at For a tour of a pipeline management system, please visit and select the “webinar” icon.


To be a great sales manager and leader, shift your focus to the lead indicators…If you focus on what is “in process” in the pipeline, you will know much earlier that a particular producer has a problem.



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