Master Plans: Top Master Agents Address Evolving Role

Allen: It’s incredibly important because especially with us being a pure master agent, our margins are so slim that just from an efficiency standpoint, it’s huge. I also think in an environment where subagents tend to get a little from here and a little from there, the more you can offer them from a continuity of experience standpoint, the more they are apt to do more business in that same environment. It also helps us add value to carriers. Those same efficiencies allow us to work better with our carriers.

Miehl: I would agree with that as well. In order to run a master agency, you have to run efficiently. The best way to do that is with various tools. Automation is key, especially if you are managing a lot of orders. SLAs, trouble ticketing, commissioning — all of that needs to go through some type of tool.

Bradley: I think it’s the biggest lever in the bottom line. If you want to grow your business, you have to be out there dealing. If you want to be out there dealing, you have to have automation in the back office to make it possible.

Foster: I think we are all in agreement about automation. The interesting thing is that a lot of us have used the same platforms. A good example is RPM. Since most of us have agents that work for many of us and we get similar feedback on what an RPM looks like through CMS, versus through Intelisys or someone else. That can go either way. It has a lot to do with what you can make available to the subagent through that platform. The key is making sure the sub has the tolls and resources that you can possibly give them.

Schuman: Just to be a lightening rod, I have to disagree a little bit. I never thought I would say this. I am probably the senior statesmen in terms of self-employed master agents on this call; perhaps not. There was a time when I thought that automation and Web site tools and resources was the crux and the future, and the only way to become efficient, high-producing master agents; I would still today. Moving the clock forward, I would agree that there are certain minimal tools and resources you have to have to have the efficiencies previously mentioned. I no longer subscribe to the premise that it is the cure all/end all and the differentiator for people on this call.

I think it comes down to the relationship with the selling subagents. There are many of us that share subs that price deals out between Jay and Brad — you can go right through the list. They shop us for prices; they shop us for commissions. The differentiator is as time evolves as more and more of the carriers have proprietary platforms — I would love to link them together. I think the Masterstream quoting tool is a fabulous first step, but I think it’s just a first step. It’s a tremendous advancement from where we were years ago, but it’s still got a long way to go.

I did a survey to our own agents to find out what drives and motivates their behaviors and where they send business and how they make those decisions. Systems and resources ranked very low on how they decided where to send their business.

Raue: We continually improve and update our portal management, commission and automation for quotes and CRM, spending thousands of dollars per month over the last 10 years as it is crucial to our business. It is absolutely critical to succeed as a master agent to have it and make it work. However, you must manage it. We spend most of our time managing the processes to ensure our agents are served properly by our automation and use our systems to help our agents close the business. Our channel managers and sales engineers as well as our support teams from our providers need to be involved to close deals. What good is a quote to an agent if they do not have the proper paperwork or if they need help to close the business? Likewise, our success depends on helping close business and developing personal relationships with our agents as they try to sell in spite of automation. Training, support and good follow up are the expectations from pre- to post-sales to commissions for our agents. Not only is it crucial, it is a foundation for success to manage it in a productive manner.

Vince Bradley: I think it’s a mixture of what I have heard. We certainly appreciate the value of CRM and automation. We have our own systems internally and we have integrated with some ASP stuff. We don’t want to be a software company as our core competency. We need to balance that. But I agree with what Ted said: It’s about the relationship, too. It’s a fine balance of the relationship with the agents, having a good portfolio, having good automation and being a solution for all the agents rather than just some of them.

Allen: The reason these things are not highly rated by subagents is there is an assumption that if you are dealing with a master agent of any scope and scale that there is going to be automation. I don’t believe that you can go around and say my RPM is better than yours. My comment is that I don’t think I can be profitable without automation.

Shepstone: You could probably write an article on RPM versus Salestream. I think Salestream is going to be the future. I think the way they are partnering with the vendors that they will be the dominant player soon.

Bommer: I think there are two reasons why we are doing it. One is stickiness with the customer. We provide multiple touch points with the carriers. They come to us instead of having all their eggs in one basket. That’s a nice second effect. The main reason is that these specialty providers like conference calling offer a much more competitive commission versus a carrier that offers a blended commission rate. The second factor is equally important and a nice byproduct.

Miehl: From our standpoint, we wanted to diversify and provide more solutions to our agents and consequently to our customers. We wanted more carriers, and by doing so, we have grown and diversified our revenue.

Jay Bradley: It’s similar for Intelisys. You meet the market need. It goes back to the comment about the agents sell what they want to sell. When we have an opportunity to put carriers in front of a critical mass of partners that feel the buzz about the regional CLEC or whoever it is, we go through that process of bringing them on.

Raue: We’ve been in business since 1990 and realized since the beginning that the industry changes due to regulation, technology and consolidation. And, strategies by providers in regards to their use of their agent channel in the marketplace change. We must change proactively with the right providers and diversify to have enough products for the end user and agents to take advantage of what is selling today and tomorrow. And to make sure it works. We don’t talk enough on provider performance. When they perform, you must sell it. If they don’t, you need a new provider.

Allen: We have increased our carriers not by taking on a bunch more carrier directs but by partnering with a lot of people on this call.

Miehl: It makes sense. If there is one master agency that has a lot of revenue with a specific carrier and they have that relationship and continue to manage it on an ongoing basis, it only makes sense to partner with them or look at a reciprocal relationship.

Allen: You are working with like organizations. The efficiencies are there. They understand the pain you go through every day. It tends to be low-maintenance business, so you can afford aggressive pass-throughs. We can all support our prime contracts instead of chasing deals that shouldn’t be prime contracts.

Schuman: I can only speak for the Agent Alliance members who are on the call. That’s been a big part of our business. I think we all recognized many years ago that you can’t be all things to all carriers. You might have one provider that kills it with an under-the-table brother-in-law deal that is not going to be replicated. Why not take advantage of it and do some pass-throughs or whatever? You end up doing some horse trading back and forth. I can tell you between PartnerTEL, PlanetOne and CMS, the three of us have all exchanged contracts back and forth. It’s all part of being part of the relationships that have blossomed from being part of the Agent Alliance. How’s that for a shameless plug?

Raue: Every day. We enjoy working with the other guys, too. Being part of the Agent Alliance and working with Curt, Susan and other masters not on this board for reciprocal business is a big part of our days. Helping our agents secure more revenue by sharing makes sense for all of us not to fail by attempting to be a master of all. We can use other master’s strengths and provide the provider-based solution needed to help our agents make some money and win a deal that we could otherwise not help them with ourselves.

Vince Bradley: An example of that would be Level 3. These guys have bought almost 10 companies in the past year and a half, and it’s become problematic for them to provision. It’s a great network and a lot of us want to do a lot of business with them, and we are frankly, but it’s a very big challenge. That’s one example. There are a lot of others. I think the biggest pain that we have is getting APIs with all of our carriers. Some of them just won’t do it. They are too big of a company and they have too many security issues. It’s impossible for us to integrate with them and give our agents provisioning status reports so that they can proactively manage accounts. What ends up happening is we find out after the fact that something went wrong.

Allen: I think that would be the answer to the question last year, next year and the year after. To a large extent, it’s the reason why the channel exists. If the carriers were perfect at provisioning and billing, they wouldn’t need sales agents to represent the end users. And if they could handle subagents, they wouldn’t need master agents. Thank God they stink to some extent. But I think that’s always going to be the struggle in shortening those time frames and turnaround.

Raue: It’s job security. We are order-provisioning and commission-paying houses. Order fulfillment has been and most likely always will be priority No. 1. Mastering the fulfillment process is a full-time job that like other jobs is no longer 9 to 5. Every year, there are going to be providers that simply do not perform. It’s our job to make it happen for our agents. It’s the value proposition that we provide to our agents and partners. If we are efficient despite provider provisioning challenges, our agents will make more money because they can spend their valuable time selling, not implementing or dealing with provider’s provisioning issues.

Shepstone: Level 3 has definitely turned the corner. It was classic problem solving. I think they are very much on the up-tick. They are too big to go away or not fix their problems. I think they are well on the road to being back and better than ever.

Provisioning has always been a problem. … We can do it more efficiently than the carriers can. Does that mean we pay the people less than the carriers? That may be part of it. Does it mean we operate more efficiently in other ways? … It’s a combination of things. It’s a good reason we are in business. I like to say that you don’t buy your car from GM, you buy it from a dealer. Telecom is not unique enough to avoid those traditional distribution centers and that’s what we are.

Knocke: I don’t think I would single out Level 3 necessarily. It seems to be an issue not with one carrier or with resellers, not just with LECs. It applies across the board. To a large degree, our expertise as master agents is the challenge to make a smooth process out of it. That’s where we bring value to the table.

Schuman: I think a good portion of our days is spent trying to do damage control and trying to manage around disasters because these carriers are spread so thin. I have not yet received a call since we have begun doing our own provisioning, our own pricing, issuing our own trouble tickets, resolving and figuring out our own credits and billing disputes, saying we really appreciate all the heavy lifting you do and how your role has changed and how instrumental you are to our business and in essence we are going to offer you a higher residual than we did the previous year, so please sign this new addendum.

All: Laughter.

Miehl: I think Ted nailed it. They really do not recognize all that we do now. Before, it was selling and bringing in new orders. It’s not that at all. There is so much more involved. You are trying to evaluate the role of the master agent. It’s definitely sales, but quite frankly it’s definitely managing carriers and managing the process. That’s part of the role of the master agency. Increasingly, it’s more complex to do that. We actually deliver reports back to the carriers and show them these are the areas where you have had problems. They can log in and see all the SLAs that have failed. They recognize there is some value there because it’s feedback they can use.