Daniel Metcalf 0:01

Welcome back to the Scale Your Insurance Agency Podcast, the show built for independent agency owners who are done being the bottleneck in their own business. I'm Daniel Metcalf, and every week I'm joined by my co-host Mike Stromso, one of the most respected operators in the independent agency world. Between the two of us, we bring you the real levers that move a $3 to $20 million agency from successful but maxed out to systemized, scalable, and running without you holding it all together. Here's what we focus on. Mike brings the people side, leadership, team development, niche sales mastery, and a three-piece system that helps agencies build a business worth owning. I bring the machine side. AI, automation, and workflow design that frees your team from the operational drag, eating your margin and your time. Together, we're building a framework that can grow an independent agency 4X to 9X without burning out your people or your checkbook. If you're an agency owner who's tired of growing by hiring, who knows you have a capacity sitting on the table but can't figure out how to unlock it, this is the show for you and your weekly edge. Welcome to another week of the Scale Your Insurance Agency podcast. I'm here with my co-host Mike Stromso for another week. Hey Mike, how's it going? Good, Daniel. How are you? I'm fantastic as always. Um, we have a very timely and interesting topic that we want to cover today from the agency operating system model, which is your leadership team isn't aligned. It's coexisting. So when we see where the leadership team just seems to be coexisting rather than alignment, that can be a telltale sign of where scaling might be roadblocked. And so we want to take this episode to talk about that, on what that might look like and some ideas that we have to get your team realigned.

Mike Stromsoe 2:05

Yeah, I think it's a great topic. Uh I I see and experience this in many independent insurance agencies. And, you know, the first thing that comes to my mind when I think about what you just said, Daniel, they're not aligned, they're coexisting. They're just functioning, right? They're going through the same old, same all. They might not be in alignment as far as you know, what their human responsibilities are and their machine responsibilities, which we talk a lot about. But the big probably 20,000-foot level thought that I had, if they are not aligned, they're just coexisting. Coexistence is reactionary. They're just reactionary, they're not proactive. And that's that's the existence of our mission, is it not? I mean, I remember when you and I had our Saturday Saturday morning conversations, and that's the whole essence, if in case you haven't heard that of this podcast, yeah, because we're we're having our Saturday morning conversations, right? Right, right. We get so excited about the vision for an agency operating system. But the agency operating system can't operate and exist if everybody else, especially the leadership team. I mean, those that everybody in the agency is not only depending on, but they're watching from a you know leadership standpoint. They're watching everything you do and everything you don't do and listening to everything you say and everything you don't say. So uh alignment isn't, and let me just let me just I had this other thought when I saw that topic. You know, alignment isn't everybody necessarily liking each other. And I'm sure you've heard this too. Have you heard this, Daniel? Alignment isn't where everybody likes each other. And have you ever heard the phrase leadership isn't likership?

Daniel Metcalf 4:04

Yes, I've heard that phrase before. Correct. Yes, I have.

Mike Stromsoe 4:07

Yeah, yeah. So this alignment where every leader makes decisions through the same vision, the same priorities, the same operating standards. And more importantly, something that we've learned a ton lately in working with agencies, because you know, your team, which creates phenomenal, incredible automation and technology powered by game plans, you know, for two years. I mean, to really get it ingrained into an agency. But that can't be built on top of a non-existent what, right?

Daniel Metcalf 4:46

Yeah.

Mike Stromsoe 4:47

Foundation. Foundation, the business plan.

Daniel Metcalf 4:50

Yep, workflow.

Mike Stromsoe 4:52

And so it's critical, critically important that if it's missing, then people don't intentionally work against each other. They simply pull in different directions. So, yeah, leadership has to be aligned. So, because when when they go to implement everything that you bring to the table, Daniel, you and your team from a technology and automation standpoint, if they're not not in alignment, they can't implement it, correct?

Daniel Metcalf 5:22

Right. Well, the in a couple areas, right? We get roadblocked in from the standpoint of, hey, I have different priorities, I just, you know, I'm I'm already swamped, I can't, oh, that, yeah, I, you know, um don't really need more tools or a system in order to do my job better. I this is the way that we've done it. I think we're fine. If that department over there would just do their thing, right? Or, oh, that's probably better spent for them than it is for us. We start to run into some of that misalignment. Or when we're in the kickoff meeting and we're going through a lot of the discovery and everybody has their heads shaken up and down, yes, oh yeah, well, this is gonna be so excited. And then we get on the one-on-ones and they're not still living by the same vision, priorities, and operating standards. That's where we start to find ourselves having to come back and realign and be like, hey, we we're not gonna be able to scale the agency if we can't get it all even just the leadership aligned on where you want to where you want to go. And not you being the owner, you mean the business of where you want to go.

Mike Stromsoe 6:23

The vision and the plan. Right. Because I I know in working with your team for agencies and with agencies, that the team basically says tell us where you want to go. What do you want the desired and outcome and results to be? Tell us. And tell us the steps that it's gonna take to get there. If you will show us that so that we can put it in alignment to help you implement it, that's where we can really, really let go and let the power of automation and technology powered by AI let it be used in full force, shall we say? Right.

Daniel Metcalf 7:09

Right. And even just even things that don't need our automation and artificial intelligence, right? That that also will also see itself um start to matriculate more into uh more consistency, more persistency, how they hire, like all those things will start to come into place beyond just what we what's necessary to create uh efficient and effective automation in AI.

Mike Stromsoe 7:34

Yeah, fantastic. I was you know, as I was listening to you, I was thinking back to a conversation that we had about an agency a couple months ago, and and and working with their team members to install automation and tech and AI, the agency for efficiency purposes. You would you would ask one of the leaders about how things are done at the agency, you know, to get X done, and then you were talking with the teammate and you asked the teammate the same question. I don't know if you remember this. You got two different answers.

Daniel Metcalf 8:04

No, no, no, I don't remember no.

Mike Stromsoe 8:06

You got two different answers.

Daniel Metcalf 8:08

Well, that that happens so often that yeah, I I I could uh check that one off the list.

Mike Stromsoe 8:13

Well, and and that's they're not in alignment, right? Right, right. And so you certainly can't help them to the full extent possible if they're not in alignment.

SPEAKER_02 8:31

Yes.

Daniel Metcalf 8:31

Now on the same time though, Mike, when you are working with other agencies and you start looking at it department by department, how is it best that an agency should look at what is the type of thinking that we should be preparing them for?

Mike Stromsoe 8:50

Well, my 30,000 foot level thinking on this is it is all about the agency. And it's all about the agency. Because the goal is to keep the agency healthy. Because if the agency is healthy from a business perspective, financially, culturally, operationally, and in every other way, then it can perform at its highest and best levels. But if everybody's operating by department, oh, that's the commercial department insinuation, it's not my job. You're gonna have to go over to them. Well, wait a minute. I'm the customer here. What do you mean I've gotta hang up and call a different department? What do you mean I have to create another email to a different department to another person? Right? And so, you know, that was uh back to the vision of what we've created to operate as one team, right? So it's one agency, one way, if you will, and we talk a lot about this, right? Yep. It's the onyx way, for example. Okay, and this is the way it gets done. And that was a part of a conversation that you know we recently had with our team. You know, tell us what you want to get done, we will show you our way of getting that done for you. And we find many agencies because you know, it's back to the thinking of scaling versus growth, right?

Daniel Metcalf 10:31

Right.

Mike Stromsoe 10:32

And growth is this is the way we've always done it. And we've gotten to where we are, and we've grown a little bit, you know, maybe five, ten, fifteen, twenty percent a year. So we're gonna keep doing it that way, and they can't get out of that way versus scaling is to build the agency of the future and operate like that agency of the future in the present. So it's a different way of thinking, it's a different way of operating.

Daniel Metcalf 11:02

So once you get them all leading in the same direction that we're the agency, what are some of the behaviors that we start to look for when we know that they are aligned?

Mike Stromsoe 11:20

Well, the results are apparent. And what I mean about that, when you can see you look at the results and the results that they're getting for their activities, it tells the whole picture. So when they're all in alignment, people are more productive, they're more efficient, they're getting more done, they're only doing the things that only they can do from a mindset standpoint, because every role in the agency has a certain function and a certain desired outcome or result, right? And so people should go in, and and the great thing is the culture gets better. People's desire to get up and come into the agency every single day becomes better. I'm excited to get to work. I mean, I was working on something just yesterday, I was really, really excited, and and the more it grew and I saw the vision of it, I said, and I woke up this morning, I said, I can't wait to get up because I want to work on that more. And it was for an agency based on the foundation.

Daniel Metcalf 12:39

Right.

Mike Stromsoe 12:40

Because we help agencies build foundations so Daniel and his team can come in and say, all right, we can take this to the, you know, the 4X to 9X level.

Daniel Metcalf 12:51

Right.

Mike Stromsoe 12:52

And that's the kind of stuff that gets us excited. So efficiency, profitability becomes a lot stronger and better naturally. EBITDA improves, the culture gets better, the clients receive a better experience, which improves their desire and ability to tell other people about their experience with ABC agency. I mean, everything exponentially improves naturally through the process.

Daniel Metcalf 13:21

Yeah, and to build off of that, you you mentioned some numbers in there, and you mentioned some ways that you can measure. One of the things that we do notice when there is a leadership alignment is although competition competition can be healthy, competing against each other, while as a leadership team, that's not necessarily as healthy, where you'd rather compete, make the enemy or the competition be the uh competing agency or you know, a certain market share, whatever it might be. You don't want that to be internally competitive with the leadership team. And so one of the areas that we see when we're building out scorecards is that, well, I use this scorecard over here, or we use this scorecard over there. Oh, yeah, that's the one we go through in our leadership meetings, but this is really the one that I keep over here. Again, that is another telltale sign of a place that you're gonna run into a roadblock for scalability, because although it appears that we're all working together in in competing with our numbers or competing with others, right, not within ourselves, and they're actually competing internally. And that a lot of times we have to uh flesh that out and start to correct on that alignment of these are the key performance indicators of the agency. These are the key, these are what your which each of the different leaders are ultimately responsible for because if we all make sure that someone has responsibility to it, all that should rise to our agency KPIs. Um, and that's that is something that again, it will, it will, once you start going down the process of alignment, scaling, um, a lot of putting an operating system in place, you will start to find those uh misalignments when you find these mysterious scorecards hanging out in spreadsheets places that you didn't know existed once you start ferrying those out.

Mike Stromsoe 15:15

Exactly. Exactly. So 100%. And sometimes, back to the spreadsheet example for a thought process, that's the way they've always done it. And so they don't know any other way, but that's where you become healthy when you shift and improve and redesign the way things are actually done to grow and scale the agency. And ultimately, I'm not an advocate 100% that the customer's always right, but it is all about the customer first, meaning, and now in my mind, they're number three in line. It's about you. You are the number one customer first, you are your own customer first. If you don't take care of yourself, then nothing else can follow. So you got to prepare yourself like the airline flight attendant. Number two is your team. So we have to set the example and the model for the team and then the customer. So you don't want to compete against yesterday's model. You want to build the model for the future. And that, Daniel, the work, the work that you guys do on the dashboard, which is the ultimate scorecard for the agency, one of the things that we constantly encounter, right? Is because those spreadsheets exist, because other data exists in other areas. Oh, what about this data? Well, oh, that's it's over there, right? Like you you've got it in, you know, four or five different areas. We need to unify it. Let's talk about how we're gonna unify it. And then a whole nother effort comes into play. Right. Because that unification is easier said than done, right?

Daniel Metcalf 17:18

Absolutely. Especially if never put, you know, never set up your CRM that every lead goes in and doesn't all get tagged. If you don't set up the the differences between what's really new business versus what's what is a renewal versus what's uh um additional premium above that renewal, right? An upsell, if you will. If you find out that, hey, this is this is how many service tickets I I get in a day versus, right? But you just start to cherry pick which service tickets go in to the system versus which ones do you only put in because it's going to take more than more than a couple of days to complete, right? Well, that one I could just get done. I don't have to have a ticket in the system. I just leave that out, right? And as they go to their leaders and the leaders look at the numbers and go, wow, those are really, really good. Well, I don't put this in or I don't do that in, then they just say, Yeah, we don't have to do that anyways, right? If we don't reinforce, hey, these are the standing operating procedures, and the reason why we put this in here is so we can get it, we can see where we're going, how our numbers are, to what we need to adjust in order to get better. This is not a not an indictment against you, this is an indictment about about the department. This is literally allows us to make the decisions that we need to and the investments that we need to, the whatever it might look at, in order for us to get to where we want to go. And if it's just if if we just allow people to build out whatever they they think that they need, then trying to look at numbers at the top just won't, it just will never get there.

Mike Stromsoe 18:48

Well said. Very well said. One agency, one operating system, one way of doing business. Because the other thing that we encounter a lot, and we encounter this with agencies from time to time, oh, so-and-so's out on an illness sleeve or so-and-so's on vacation. Well, if any position within the agency is dependent that much on a person, the agency may not necessarily have an operating system. It's piecemeal together. And that's what we're trying to help them overcome. So the entire agency operating system, run by both humans and machines, and for clarification, the machines being automation technology powered by AI, right, allow it to do the things that only it can do. But it's the legitimate and the humans that really dictate that happening. Yeah, tell us more, Daniel.

Daniel Metcalf 19:53

Well, ultimately, again, the story is that if agencies recognize that they want to scale and they don't have an agency operating system in place that can allow them the freedom to scale, and if their leadership isn't on board, they're going to have a difficult time doing it, right? And even though they're shaking their heads up and down, yes, we we have to do some further investigations to see what are the behaviors that are going on on the leadership team that really might mean they're saying no to what we're trying to accomplish. And so that's really what this episode is about is what we've experienced up to this point. Um, when we see the difference between those that are ready to scale and those that aren't, is how to get those leaders that leadership aligned. And one of those areas that once we've once we've kind of checked the box to say, yes, the leadership is aligned, the vision, the mission, the everyday tasks, the goal, the projects that we've signed ourselves up for, those are all moving towards that scaling number. Then it comes down to the communication. And so, Mike, one of the areas that you've been talking about a lot lately is how leadership meetings should be should be run in order to create action, not just more check-ins.

Mike Stromsoe 21:20

100%. So I remember uh as we moved to scale our own independent insurance agency after a what I call a character building year. And if you haven't heard me say that lately, we have good days and bad days, right? Bad days are not bad days, they're character building days. When you have those days or those weeks, they're character building weeks. So building our agency, we had a character building year in the agency because of so much growth and so much going on, and we need to get in alignment, right? And so one of the things that the expert who advise that we hired to advise us to take us in that direction. Said, you need to meet weekly with your leadership team. It doesn't matter to me what day, pick a day, pick a time, and that's going to be it. And I was one of five leaders in the beginning of that adventure. And they all wanted to meet first thing Monday morning. Now, it's not that, you know, I've been out all weekend, you know, drinking and carousing and all that. It's just I like to get my week started on Monday morning, and that's just who I was. But for the effort of the agency and in the best interest of the agency, I started doing, we started doing that Monday morning meeting. And I'll have to tell you, after about a month or two months, I was excited for that meeting. I couldn't wait for the meeting. Good things were happening. And ultimately, Daniel, we were in alignment. We were starting to see the future of the agency. They were starting to build out an agency operating system without me. And everything else that brought so that I could only do the things that only I can do. And we had an action plan out of that meeting. And we had an app that was built for that particular process. We all knew what we were going to do. We were all accountable to the leadership, the rest of the leadership team, and the system that we were building. And so it got really, really good. And I will tell you, that was year two. By the way, we redesigned three years in a row. Three years in a row. And I and I emphasize that because somebody recently said to me, Did I hear you say on the podcast you re redesigned three times in one year? No. Three years in a row. And that was the second year, by the way. The first year, extremely painful. And so that was also part of the reason, Daniel, right? Yep. When we came together and started talking about this in our Saturday morning conversations about the agency operating system. And we're so excited. And you know, then you build momentum and everything else behind it, uh, the action. We have clarity. Who owns what is going to be done? By when there's a deadline. So we have clarity, ownership of action, a deadline, and most importantly, how success will be measured.

Daniel Metcalf 24:30

And that's the most important. How do we know when we're one path until successful, right? How do we know when we're successful? So who owns it, right? Who's ultimately responsible? What we like to say, right? Who's ultimately responsible? When will this be done? And how will we know it's when it is done, right? Or how it's been successful. And a lot of times, what I like what Mike helps people think through is let's start with what does the done look like? And we work backwards into by when and who's ultimately responsible, and who else will need to be on the team in order to make that successful. And they may or may not already be within the agency. Like that, those are the times where I where we really start to see momentum in those meetings.

Mike Stromsoe 25:18

100%. And Done look like, I mean, where do you want to go? Where do you want to go? So I was I was talking with an agency this morning, um, and they want to go basically, they're they don't have grandiose scaling goals, but at least he knows where he wants to go. You know, he's just under a million rent.

SPEAKER_02 25:43

Right.

Mike Stromsoe 25:43

Yeah. And he wants to get you, he wants to, you know, at least probably six X's agency, you know, in the next seven years. Great. At least he knows where he wants to go. And so the reverse engineering of it, and I love that, that's what it is. It's the reverse engineering. Tell us where you want to go, and then we're gonna help you figure out how to get there. And and we commonly see the agencies that are the right fit for what we bring to the table in the Onyx operating system, we can help them 4x to 9x. Yeah. Within within a very short time.

Daniel Metcalf 26:29

Yeah, and I mean let's let's let's even break it down from this standpoint of it that no matter what the numbers, we come up with the scorecard. No matter what everyone decides where they want to go, right? Where we want where they want the agency to go. And that includes leadership, and they're all aligned. Or that means that we're really good at communicating and that we have the right leadership meetings. What we've really identified, Mike, and I'd like to get your thoughts on this, is it's the behaviors of the leadership while we're going through this, right? While we're while we're on this journey together, that then develops trust within their teammates and the other leaders, which then creates speed, which then creates results. And I think that's one of the areas that ultimately gets skipped also along the way, is have we measured and solidified the behaviors that every leadership needs to adhere to and to follow consistently, which is then right, followed by all, right? We do have the followed by all consistently. That is how it would that then that trust gets built through the whole, you know, creates its own personality through that consistency is where they really start to see the speed towards those results. I'd like to get your thoughts on that.

Mike Stromsoe 27:58

Well, first of all, I couldn't agree more. And back to that same example that I just was talking about a couple minutes ago. The leadership team of five. Yes, we started out with the leadership team of five. It did not last as five, it went down to four. And the reason is because of behaviors, Daniel. One of those leadership team members was agreed to certain behaviors, and this person was high character, and that high character never changed, remained high character, right? Yep, but that leader identified that the required behaviors for her department that needed to be in place consistently, as you say, were not happening. Right. And because she was fighting that internally and from an ability standpoint, and she had already had training in this area, right? So it wasn't for lack of training and experience and knowledge and all that. She just didn't love holding people accountable. And she did not like learning the skill of you know having to enforce the accountability on the spot in the team huddles and coming up with an innovative way to shift around a situation and all of that, right? The required behaviors that were needed for that leadership position were not her. And so, to her compliment, she said, look, this is where I'm at. And we mutually made a decision. She stepped out off the leadership team, but here's the good news. We had a hole in another department, and we started talking to her about that particular position. And not only did she have a heart with it, we we self-identified that. That's right. She came from an organization when we hired her that did that. It was the group benefits department, right? Yep. And so we said, perfect. So we put her over there. She was doing group benefits along with commercial work. Perfect fit. She flourished. We had the leadership team. So, yes, it is the behaviors, but I think also, Daniel, back to something we were talking about a few minutes ago, is clarity, right? Yep. Clarity of the required behaviors for all to be followed by all. Because trust isn't built through personality, right?

Daniel Metcalf 30:31

No, not no. Some might get away with that.

Mike Stromsoe 30:35

For a period of time. But we're talking the long game here, right? Yeah, exactly. Yep. I mean, we're talking the long game here. We're talking we're talking about operating consistency, we're talking about predictable revenue, which we talk a lot about. And ultimately we're talking about valuation. And unless all of these things, if all of these things are not in place, all of that cannot be optimized. And that's why it's important that leaders consistently communicate with clarity, keep commitments, as much as possible. Look, it's an imperfect world, right? We know shiitake happens, but to the best of their ability, and most importantly, hold each other accountable and then hold their team accountable. And if you want another update on accountability, we have been getting tons of compliments about episode 321 of the Scale Your Insurance Agency podcast with Joel McKenley. Go back and check out that episode. Because when there is accountability, then decisions happen faster. People stop and guessing one another, and they keep taking action, right, Daniel?

Daniel Metcalf 31:55

Absolutely. That's a good episode to go back to. That is that one's very powerful.

Mike Stromsoe 32:01

Yeah, very much.

Daniel Metcalf 32:04

Well, let's wrap this up, Mike. I think we've covered this subject thoroughly up to this point that we could without looking at everyone's very specific situation. Um and I think you left them with a really good action item for them to go through, go listen to that episode. And second is to start to look at the behaviors of your leadership team. Do they meet the do they meet the requirements? And are you able to see the trust being built within the leadership team? If not, that is the that is the place that you're gonna have to start to focus on before you're really gonna start to see any scaling.

Mike Stromsoe 32:40

Yeah, absolutely. So, yeah, by the way, Joel McKinley is our accountability coach within uh UPP Onyx. So he is one of our teammates and he uh helps people be more accountable and be better accountability leaders in their agencies. So, Daniel, great stuff, my friend.

Daniel Metcalf 33:00

Yeah, you too, Mike. What uh what do we want to end on?

Mike Stromsoe 33:04

I I think the most important thing to end on is to make sure that your leadership team is in alignment with your plan for your business going forward, whatever you choose to call it. Uh I we see vision plans, we see business plans, we see a combination of both, but whatever that is, do a spot check. Do a spot check in your next leadership team meeting and make sure that everybody is in alignment to maximize the momentum that you've got going forward, and that everybody knows what done looks like. And here, here's something, Daniel. So they have absolute clarity that they know who owns every particular activity, for lack of a better word, what the deadline is, or by when it's expected to be done. And like you love Daniel, and how success will be measured.

Daniel Metcalf 34:02

Absolutely. I think that's a good takeaway there. Um, for all those agency owners listening to our podcast, if you ever want to talk to us about your specific agency and where you're at in the leadership uh department, feel free to always inside the show notes. There's a ways of getting hold of us as well as signing up for a one-on-one session with Mike and myself, if that's something that you want to look specifically at your agency and if your leadership team is ready to be at the scaling level. Mike, thanks so much for another fantastic week. Really appreciate you being here, and we will catch you next week.

Mike Stromsoe 34:38

All right, thank you, Daniel. And remember, everybody, people are silently waiting to be led. Lead them. Have a good week, everybody.

Daniel Metcalf 34:49

That's a wrap on this week's episode of Scale Your Insurance Agency. Quick reminder: everything we talk about on this show is built to do one thing. Turn your time into profit. More revenue, more margin, more freedom without adding headcount to make it happen. If something landed for you today, please share it with another agency owner who needs to hear it. This community only grows when good operators help each other level up. Please subscribe, download, and share our podcast and all your other favorite podcast engines. And if you're ready to stop figuring this out alone, Mike and I are both in the field working with agencies right now. Please reach out. Find us on LinkedIn or on our websites, and we'll tell you exactly where your biggest opportunity is to scale. Now, until next week, build the system, protect your time, and scale the right way. See you next week.