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Current  Goal  Setting  – Not the correct way

Currently, all Agents set their Goals based on the Results. These goals are in the form of No of Lives to be done OR Amount of Annualised Premium/ FPI  to be collected and this can be called as the Results based Goal setting.

This is not the correct way of setting goals. Why?  Learn below:

ldea-explConcept of the Flour Mill
There are two things in the Flour Mill
The Input – which is Wheat.
The Output – which is Flour.

Similarly, there are two things in our Business.
The Input – The  Controllable Part which is the Activity (Face to face meeting with Prospects)
The Output – The Uncontrollable Part which is, the Lives and the FPI

Let us enumerate the same as follows

The InputActivity – Face to Face meetingsWithin our control
The OutputBusiness Results  – FPI and No of LivesNot in our Control

 

Predictable Success

To help us to make success predictable we will have to know the co-relation between the Input and the Output. The co-relation is a ratio and has to be calculated by each advisor or by the Agency Manager for each of his advisors as this co-relation is unknown to most insurance salesmen and managers.

THE   MISSING  LINK

We do not know the relationship between INPUT and OUTPUT which is a Ratio and which is called a constant In Mathematics

The formula would therefore be

A x m.B = 0  

Where A is the number of face to face meetings Activity (Input) and B is the Commission that you want to earn in the year which is the Output and m is the constant which will remain same for that agent for at least a year.

 

THE  FORMULA  FOR  SUCCESS IS

  • Capability     X   Effort
  • KASH   X    Face to Face Meetings
  • Knowledge
  • Attitude
  • Skills
  • Habits

Let us take an example.  Assuming that an agent has kept proper records of his sales and commission received and we have calculated his Visiting fees then we can calculate as follows

If the Visiting fees are Rs.1500/- and if No of meetings done is 400 then commission earned would be

Capability     X         Effort
1500               X         400     =  6 Lakhs

Commission earned would be 6 Lakhs   
If Visiting fees are Rs.1500/-  and if No of meetings done is 600 then commission earned would be

Capability     X         Effort
1500              X          600      =  9 Lakhs  

Commission earned would be 9 Lakhs   

 

If Visiting fees is Rs. 2000/- and if No of meetings done is 600 then commission earned would be  

Capability     X         Effort
2000              X         600    =  12 Lakhs

Commission earned would be 12 Lakhs   

 

The Goals are

  1. Specific
  2. Measurable
  3. Achievable
  4. Romantic
  5. Time Bound

There was no way to validate if the Goals are achievable but with this method, Goals can be validated.

 

 

Performance Management Process

  1. Workshops and interventions to change mindset, upgrade skills and improve knowledge
  2. Input based Goal setting
  3. Record keeping of Activity
  4. Weekly Monitoring
  5. Monthly Analysis