According to the latest Future One Agency Universe Study, nearly one-fifth of independent agencies don’t use any agency management system at all.

If you’re one of them, here are four reasons to consider investing in an AMS—today.

1) Focus. Rushang Shah, director of marketing at HawkSoft, Inc., believes an AMS solves a problem that has many insurance agents scratching their heads.

“We’re not going to teach agents anything about insurance that they don’t already know. But what many are still trying to perfect is how to build a business with strong foundations and how to scale it,” Shah points out. “That’s where a management system is going to add value. It’s going to let you scale your efficiencies with automation, and uncover your inefficiencies so you can work to improve those.”

“An AMS is going to give you better data about your customers, and it’s going to free up your people’s time to focus on serving customers and selling,” agrees Michael Howe, senior vice president, product management at Applied Systems. “Agents who invest in tech over the course of five years, 10 years, 20 years—they vastly outperform their peers who don’t.”

2) Growth. For agencies that are just in maintenance mode, an AMS may not be necessary.

“But for an agency to hire enough people to fully focus on bringing in new leads, cultivating ones they already have in the system, to handle all that with spectacular customer service, meet all their current customers’ needs with the type of communication they are looking for—that’s going to be fairly cost-prohibitive. That would take an army of people,” says Brenna Johnson, lead product manager and senior business analyst at EZLynx.

“It’s very difficult to drive growth off an Excel spreadsheet,” agrees Sharmila Ray, senior vice president of product and strategy at Vertafore. “Are you doing everything you need to do, when you need to do it, and are you systematically keeping track of all of that? If not, you’re not only exposing yourself to errors & omissions risk—you’re also shortchanging yourself on growth and retention.”

3) Health. Agencies that don’t have an AMS will find it “incredibly difficult” to get an actionable analysis on the health of their agency, says Johnson, who notes EZLynx reports that information to agents on a monthly basis.

While many agencies rely on data from carriers, “that information only pertains to that specific carrier’s markets,” Johnson points out. “As an independent agent, you want to be able to look at the bigger picture to find out, are your policies increasing month over month? Is your retention measuring consistent month over month? What are your close ratios? Quote to bind ratios? What’s your book distribution? Are you well-balanced? If something happens, is your business going to be sustainable?”

“Agents get so busy stamping out fires in the middle of the floor that they can’t find the time to go grab the fire extinguisher on the wall,” agrees Paul Hawkins, CEO of HawkSoft, Inc., who says HawkSoft’s built-in Agency Intelligence reporting suite provides real-time metrics that enable agents to make better business decisions. “They have to be able to spend as much time on their business as they do in their business. Until they can study what’s working, what’s not working, until they can understand those key performance indicators, they’re not going to thrive.”

4) Survival. Howe would be willing to bet that for most agencies that aren’t using an AMS, the culprit is inertia. “The business has probably been fairly successful for a number of years, and probably a lot of the same people who helped make it successful in the first place are still there,” he points out. “Those people are thinking, ‘Why do I need to change? What I’ve been doing seems to be working fine.’”

But in an increasingly technological future, “what got you here ain’t gonna get you there,” Howe cautions. “The world is changing around the agent, whether they like it or not. Their insureds are becoming more demanding. The agent who does not evolve to meet those expectations will be left behind.”

Jacquelyn Connelly is IA senior editor.