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April 7, 2022

17. The Firing Decision - Asset, Liability, or Non-Factor

Many insurance agency owners struggle with deciding when to fire an underperforming team member. The answer to this simple question can save you tens of thousands of dollars and hundreds of hours of time.


Many insurance agency owners struggle with deciding when to fire an underperforming team member. The answer to this simple question can save you tens of thousands of dollars and hundreds of hours of time.

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SCHEDULE A STRATEGY SESSION

We’ll Discuss Your

  1. Biggest Goal - If you or your agency could only achieve 1 thing in the next 12 months, what would it be?
  2. Value of Biggest Goal - What's it worth to you (money, free time and / or happiness) to achieve this goal?
  3. Biggest Frustration - If you could "fix" 1 thing in your agency in the next 12 months, what would it be?
  4. Frustration Cost - What is your biggest frustration COSTING you (money, free time and / or happiness)?

 

Then, We’ll Discuss the Plan & Expected Results

  • Which goal(s) are likely to be achieved and how long it usually takes, based on our experience.
  • The best way to help you achieve your goals, based on your style and time available to implement.
  • Your anticipated time investments & money investments.
  • What guarantees we can make

 

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Transcript

Is your team member an asset, a liability or a non factor? This one question is at the heart of the biggest challenge for most business owners, and that is employee turnover and employee performance. Now if you think about this every day, you're rehiring the people in your business. So if Johnny or Susie has worked with you for ten years or ten days and they come to work for you tomorrow and you don't kick them out, they're still hired, so you're still voting for them. Now I want you to think about this.

 

If a person in your business is a liability, if they are hurting your business, they're costing you sales, they're costing you customers, they're costing you time, frustration, whatever it might be. If your reports, if your numbers, if the team members that you work with or your best team members are telling you this person is costing you business, when do you need to let go of them? Well, the answer is now, as soon as humanly possible, because it's literally hurting you. That person is taking away from your business every time they're working with you, every hour they're working with you, they're hurting you. And these are the situations where very often you will find messes after this person leaves.

 

You will find if it was the old days, you'd find files hidden. We used to find files up in the rafters up above, little things. We have little squares, and you move the square side. You can put stuff up there, people put files up there where they're hidden. You find all these things that weren't supposed to go wrong, and they do.

 

And that's what happens when somebody is a liability. So somebody who is a liability, we need to let go of them as soon as humanly possible. Even if you're understaffed. What if a person is a non factor in your business? Let's think about this.

 

If you paid for advertising, if you paid for some postcards or a park bench or a Billboard or some cost per click ads and you paid for them for three months in a row and nothing happened, how long would you keep paying for those ads? You might say, well, wait, the ads aren't hurting me, but they're costing you money. And the money indirectly is costing you time. In the case of a team member, if that team member is a non factor, usually that's not even truly accurate because somewhere they're pulling on someone else's time or attention. There might be a financial situation where it seems like they're a non factor, but usually they're costing you something.

 

If nothing more, they're costing you the frustration very often of your best team members who are wondering when you're going to catch a clue and let go of this person. So if the person is truly a non factor, the best time to let them go is today. And the way you confirm that, if you're not sure, you talk with your best team members and you say, let's think about this. Is this person simply underperforming, but they're helping us just not as much as we'd like them to? Or are they literally a non factor?

 

If they're a non factor, you should be moving on from that person. If a person is an asset for your business, the question becomes how strong of an asset? So if you think about a continuum of 0% to 100%, if a person is 100% asset, well, obviously that's somebody we want to keep. The Gray areas start to come in when the person is, let's say a 25% asset or a 50% asset. What do I mean by that?

 

Well, put simply, if they're supposed to be putting in 8 hours a day of work and you're getting 2 hours a day of good work, that's pretty much a 25% asset, or they're a 50% asset, maybe they're giving you 4 hours a day of work. These are the situations where sometimes, especially if you're tight staffed, it can be difficult to let go of somebody. Because if you talk with your other team members, they might say, look, this person is not as good as we could have, but they're doing something. And if this person is gone, it's going to cost. It's going to cost me.

 

I'm going to have to pick up after their work. And if I pick up after their work, I'm not going to get through the Proactive stuff that I do. So the toughest situation is not when a person is a liability or a non factor. It's when they're an asset, but they're somewhere between, let's say, 50 and 75% or 80% where you know there's some value that's coming from them. Maybe they're slightly overpaid.

 

Maybe they're having a little bit of a challenge for the rest of your team because they're distracting other team members, but they're still producing something. Of all the three situations, this is perhaps the one that you might want to work with and see what you can do to remedy it. Maybe you can get this person to be more productive. Maybe you can get them to be more focused. Maybe you can coach up somebody who is 75% productive to a level of 80% or 85%.

 

And if you have a person that's at 80% or higher and they're never going to leave you, those are situations that are sometimes hard to move away from simply because turnover costs are high. And it might be worth it to have people that you know are steady and aren't going anywhere. On the other hand, if you invest extra time with this person, you try to coach them up and it either frustrates them and makes their performance go down or it's simply unchanged, then you have to decide, are you willing to live with two things. Number one, this person's lower level of performance than what you're hoping for? And number two, are you willing to live with the perception and the opinions that come from your other team members who are performing at higher levels, who are noticing that this person is underperforming and yet still being paid as if they were performing well?

 

So in any situation where you have somebody underperforming, you definitely want to start looking. You want to start your recruiting process to replace that person. Hopefully you always have some sort of recruiting process ready. And in some situations you might have it constantly going, depending on how frequent your turnover is and how many people you have in your business. But overall, we want to make sure that if you're in a situation where you don't have the best productivity, the best results coming from a team member, that you first look to see what you can do to fix it, and truly look at it through the lens of how am I perhaps not showing up as the owner or the boss as best as I can?

 

How am I not leading in the way that I could? So how could I perhaps become better even if that person goes away? If I can become a better leader in the future, maybe next time a person like them comes on that maybe needs a little more leadership from the get go, I can lead them upfront before things turn out to be not so good and learn from that. On the other hand, if the person simply is not able to be taken in the right direction, if they're not able to make changes, then you will have started your recruiting process. You'll be in the situation where, you know pretty soon you're going to have another person to do that.

 

And in the Meanwhile, you can communicate your team members and say, Look, I'm doing everything I can anytime. If this person becomes either a non factor or liability, please let me know if that's the case. I'll make sure that we do what we can and focus on that and either fix that or let that person go. In all of these situations, I want to make sure I'm being very clear that this is not a game show where I simply go around every week and ask everybody, hey, what's working, what's not working? Who we fire this week?

 

It's not one of those situations. This is when you have other data and other reasons to believe, either from feedback from your best performers or just from what you're seeing that this person is not making it. And there's a reason for you to dig deeper into this. A simple way to look at the evaluation of a team member is to think, Would I hire this person again today if they were applying? And if they were trying to come in the door, would I let them in?

 

If I wouldn't let them in today, then I might be looking at it's time to ask that question. Is this person an asset a liability or a non factor? If they're a liability, they need to be gone as quickly as humanly possible. If they're a non factor, they're probably costing you money and time and other resources. So we want to let them go as quickly as possible too.

 

And if they're an underperforming asset, we want to see how quickly can we help this person perform at a level that is going to be satisfactory or awesome for the business and then hopefully help them feel great about the work they're doing or if that's not the case, help them get to a place where that can happen. I hope you find this helpful. If you have any questions on any of this, please let me know. As always, I look forward to helping you impact more people and make more money in less time. Do what you do best so you can better enjoy your family, your friends and your life.

 

Thanks for listening.

 

Wade Galt, CPCU, CLU Profile Photo

Wade Galt, CPCU, CLU

I teach Entrepreneurs & Professionals to Make More Impact & Money, In Less Time, so they can fully enjoy Family, Friends & Life

Wade has 35+ years in the Multiline Insurance Agency Industry...
- 8 years’ experience as a part-time team member in a multiline insurance agency
- 7 years as a productive employee in a Fortune 35 Multiline Insurance Company (2 years in claims, 5 years in Agency Sales Management & Training plus as a Subject Matter Expert for Sales Process Software Design)
- Over 20 years as a software company founder & owner, corporate consultant, sales process implementation coach, accountability expert, recruiter of superstar talent
- Provider of mental health counseling (psychology) services
- Life coach and 3-Day Weekend Entrepreneur