A few books and observations are worth noting over the years.
A few books and observations are worth noting over the years.
Against this backdrop, if you are thinking about the reinvention of your agency, here are some things you may want to ask yourself:
1. What Business Do You Want to Be In?
Do you want to provide solutions to marketers’ big, challenging marketing problems?
Or do want to provide marketers with communications tools (ads, TV spots, brochures, PR, etc)? There is a significant difference.
The former has very high value and is intellectually driven. The latter has the characteristics of a commodity, and as such is price sensitive. Make no mistake; it is very difficult being successful at both simultaneously.
Yet each by itself can be a viable path. A conscious decision of which is
right for your agency may well be in order.
2. Are You Consumer Centric?
This is a tough one. All agencies are constantly pushed toward client-centricity. Simply because the clients pay the bills, yet consumer centricity and client centricity should not be confused. They are pretty different.
Now that consumers have taken complete charge of what commercial messages they want and when and how they want to receive them, advertising is a changed game.
A true understanding and deep empathy with the consumer is the key to success. Without an unrelenting reaffirmation of this truism, client think can creep into an agency’s psyche. Blinding it to marketing solution
opportunities. And the resultant changed consumer behaviour.
3. Is Your Agency Capable of Reinvention?
Reinvention usually requires the discarding of baggage. And many agencies have lots of baggage that has accumulated over the years. A few key baggage tests require looking at how much of your gross income comes from making ads, spots, and other stuff. And how many of your staff are primarily
engaged in this activity?
If much of your agency’s time and talent is focused on making stuff, you may well be starting a slide down the commodity provider’s slippery slope.
Becoming an agency well-paid for solving complex marketing problems for its clients may require fewer folks with radically different skills. A transition that can be painful.
4. How Will You Get Paid?
The preceding question leads right into this one. Much agency compensation today comes from hourly charges for providing ads, TV spots, etc. Stuff that is primarily priced by the cost of labour needed to make it.
Solutions to big marketing problems are different. They are ultimately valued by the incremental economic benefit they bring to the marketer. A value that has little, if any, connection to its cost. And a value that may
provide very long-term benefits.
Thus, the agency should consider some form of continuing compensation that recognizes and is connected to, that continuing value. To do otherwise is to give away the most important thing to secure price-sensitive commodity work. Not a brilliant business deal.
5. What is Your Agency’s Transition Plan?
Ok, let’s say you want to reinvent. As the old song goes, “Wishin’, and Hopin’, and Thinkin’, and Prayin,’” will not get you there. It takes a solid action plan. One that enjoys the support of your people. One that
relentlessly moves ahead despite all the obstacles that come up.
Reinvention is a slow and difficult process. It will not come easily. Or overnight. It will take trial and error. It will suffer setbacks. People will lose resolve. But you, and your other leaders, can’t.
A practical plan executed with steadfast determination will be essential.
The Quick and the Dead
Like the Biblical judgment, marketers are coming to make choices. Choices that will determine your agency’s very future. As well as the future of every other agency and even the advertising agency industry.
Decisions that you make today for your agency can shape what that judgment will be.
BY Paul Alofs
Several years ago, I was at the Thomson Building in Toronto. I went down the hall to the small kitchen to get a cup of coffee. Ken Thomson was there, making himself some instant soup. At the time, he was the ninth-richest man in the world, worth approximately $19.6 billion—certainly enough to afford a nice lunch. I looked at the soup he was stirring. “It suits me just fine,” he said, smiling.
Thomson understood value. Neighbours reported seeing him leave his local grocery store with jumbo packages of tissues that were on sale. He bought off-the-rack suits and had his old shoes repaired. Yet he had no difficulty paying almost $76 million for a painting (for Peter Paul Rubens’s Massacre of the Innocents, in 2002). He sought value, whether it was in business, art, or groceries.
In 1976, Thomson inherited a $500-million business empire built on newspapers, publishing, travel agencies, and oil. By the time he died in 2006, his empire had grown to $25 billion.
He left both a financial and an artistic legacy, but his most lasting legacy might be the culture he created. Geoffrey Beattie, who worked closely with him, said Ken wasn’t a business genius. His success came from being a principled investor, surrounding himself with good people, and staying loyal to them. In return, he earned their loyalty.
Thomson understood that for the long-term viability of any enterprise, you needed a viable corporate culture. It, too, had to be long-term. So he cultivated good people and kept them. Thomson worked with honest and competent business managers, giving them his long-term commitment and support. From these modest principles, an empire grew.
Thomson created a culture that extended out from him and has lived after him. Here are eight rules for creating the right conditions for a culture that reflects your creed:
1. Hire the right people
Hire for passion and commitment first, experience second, and credentials third. There is no shortage of impressive CVs, but you should try to find people who are interested in the same things you are. You don’t want to be simply a stepping stone on an employee’s journey toward his or her own (very different) passion. Asking the right questions is key: What do you love about your chosen career? What inspires you? What courses in school did you dread? You want to get a sense of what the potential employee believes.
2. Communicate
Once you have the right people, you need to sit down regularly with them and discuss what is going well and what isn’t. It’s critical to take note of your victories, but it’s just as important to analyse your losses. A fertile culture recognizes when things don’t work and adjusts to rectify the problem. People also need to feel safe and trusted, to understand that they can speak freely without fear of repercussion.
The art of communication tends to emphasize talking, but listening is equally important. Great cultures grow around people who listen, not just to each other but also to their clients and stakeholders. It’s also important to listen to what’s happening outside your walls. What is the market saying? What is the zeitgeist? What developments, trends, and calamities are going on?
3. Tend to the weeds
A culture of passion capital can be compromised by the wrong people. One of the most destructive corporate weeds is the whiner. Whiners aren’t necessarily public with their complaints. They don’t stand up in meetings and articulate everything they think is wrong with the company. Instead, they move through the organization, speaking privately, sowing doubt, strangling passion. Sometimes, this is simply the nature of the beast: they whined at their last job and will whine at the next. Sometimes, these people simply aren’t a good fit. Your passion isn’t theirs. Constructive criticism is healthy, but relentless complaining is toxic. Identify these people and replace them.
4. Work hard, play hard
Obtaining passion capital requires a work ethic. It’s easy to do what you love. In the global economy, we can measure who has a superior work ethic and who is leading in productivity. Not many industries these days thrive on a forty-hour work week. A culture where everyone understands that long hours are sometimes required will work if this sacrifice is recognized and rewarded.
5. Be ambitious
“Make no little plans: they have no magic to stir men’s blood.” These words were uttered by Daniel Burnham, the Chicago architect whose vision recreated the city after the great fire of 1871. His ambition results in an extraordinary American city that still has the magic to stir men’s blood. Ambition is sometimes seen as a negative, but without it we would stagnate. You need a culture that supports big steps and powerful beliefs. You can see these qualities in cities that have transformed themselves. Cities are the most visible examples of successful and failed cultures. Bilbao and Barcelona did so and became the envy of the world and prime tourist destinations. Pittsburgh reinvented itself when the steel industry withered. But Detroit couldn’t do the same when the auto industry dived.
6. Celebrate differences
Most universities consider more than just marks when choosing students for a program. If you had a dozen straight-A students from the same socio-economic background and geographical area, you might not get much in the way of interesting debate or interaction. Great cultures are built on diverse backgrounds, experiences, and interests. These differences generate energy, which is critical to any enterprise.
7. Create the space
Years ago, laboratory scientists were often in underground bunkers and rarely saw their colleagues; secrecy was prized. Now, innovation is prized. In cutting-edge research and academic buildings, architects try to promote as much interaction as possible. They design spaces where people from different disciplines will come together, whether in a workspace or a common leisure space. Their reasoning is simple: this interaction helps breed revolutionary ideas. Creative and engineering chat over coffee. HR and marketing bump into one another in the fitness center. Culture is made in the physical space. Look at your space and ask, “Does it promote interaction and connectivity?”
8. Take the long view
If your culture is dependent on this quarter’s earnings or this month’s sales targets, then it is handicapped by short-term thinking. Passion capitalists take the long view. We tend to overestimate what we can do in a year, but underestimate what we can do in five years. The culture needs to look ahead in months, years, and even decades.
The writer Arthur Koestler said that a writer’s ambition should be to trade a hundred contemporary readers for ten readers in ten years and for one reader in a hundred years. Lasting influence is better than a burst of fame. Keep an eye on the long view.