No-one needs to hear the 'unprecedented' word again, or 'may we live in interesting times' ('not this bloody interesting' I hear you cry!). However, as we've all adapted to the situation and circumstances it is worthwhile reflecting on what we've seen, heard, learnt and done.
In my work with agency owners and leaders I'd sum my experiences over the last 6 months into the following 6 areas:
1. The steering wheel is more important than the accelerator
There was definitely a tendency to continually chase down an ever increasing monthly revenue number as that was perceived as the key measure of growth. What that then naturally led onto was an 'any revenue will do' attitude regardless of where it was from and what it was actually for. The slightly longer term consequence of this is a steady erosion of any semblance of a specialism/area of expertise in the business. It also typically meant poorer and poorer agency commercial performance for 2 reasons:
The budget probably wasn't enough to do a great job - so to do so means using much more time than you're getting paid for (or a very pi**ed of client because what you can deliver is nowhere near what they thought they were buying).
You're doing work that is not within your core area of expertise - so, again, you can't do it efficiently or to the right level of quality.
From what I have seen and heard, those agencies that have clarity around the direction of the business from a strategic perspective (Blair Enns describes this really nicely as 'the services you provide and the markets you serve') are the ones that are already seeing positive growth - and on all commercial measures - meaning that the accelerator hardly needs touching.
2. Don't Do One Thing Well - Do It Brilliantly!
In truth, this is an extension of the point above about focusing on the services you provide and the markets you serve, but with one very important additional point - quality, or brilliance, or greatness; however you choose the say it.
In Good to Great, Jim Collins talks about the Hedgehog Concept which is the intersection where your passion, your brilliance and market demand overlap. The brilliance part is often the missing link, and it's not necessarily that agencies don't have the ability, it's more that they don't give themselves the time, budget or even permission to do so. Meaning, at best, they do good work, but certainly not great work. And we all know that 'good is the enemy of great' and, of course, that clients don't expect or pay for good work either. They want much more than that.
Doing great work does not just make good business sense, it's actually intellectually and emotionally satisfying for everyone involved, the value of which must not be underestimated.
3. There really isn’t any room for passengers
This is of course a tough one, in fact in many respects it's the hardest thing we have to do as agency owners and Directors - make decisions around our people and team. However, the reality of the impact of the Covid-19 lockdown meant that the focus on cutting costs took every owner straight to people/salaries, even allowing for the Govt's furloughing scheme.
However, a solid and strategic people evaluation process was followed by a surprising realisation - those that were identified as the poorest performers were actually poor performers as well. From a pure business perspective there were 2 sobering questions:
Why/how on earth did we allow poor performance not to be challenged?
How much money have this cost us?
And 2 important positives to help balance out the negatives:
The team is much stronger now ('weakest link' and all that)
This won't happen again
4. Count every pound in, and every penny out
We're all used to those regular budget/forecast meetings where the focus is on sales and revenue, and quite right in terms of maintaining focus and momentum on the money coming into the business.
Once people related costs had been looked at the attention then turned to other outgoings. Rent got very prompt attention, and to varying levels of success depending on the landlord. It then got down to the long tail - i.e those many seemingly insignificant costs that were actually far from insignificant when added together.
I know of many agencies that have saved thousands of pounds by cancelling subscriptions and cutting back/tightening up on freelance/external support costs, I've heard one agency owner talking about the way his business spent money being 'like the wild bloody west'. In truth he was exaggerating but it did get sorted quickly and there are now some very strict processes in place to manage the approval of the spending of the business's money.
5. Have a concrete and deliverable marketing strategy and plan
And then there's marketing. The irony here is if you've got the aforementioned clarity around what you do and who you do it for, the marketing becomes relatively easy. However, if you don't, you're therefore potentially in the territory of doing anything for anyone, then your marketing is very, very problematic.
Either way, not many agencies have a working and effective marketing strategy and plan in place. And unfortunately it's not possible to turn it on like a tap, it takes time, consistency and effort for it to genuinely work.
I've seen marketing performance improve significantly over the last 5 months or so for those agencies who were 'on it' pre-lockdown. Those starting from scratch are making slow progress, but it is progress nonetheless.
6. Stay in control, it's a nice place to be
One final realisation is that having much tighter control of, and confidence in, the direction of the business, the quality of work, the team and their performance as well as the money coming in and going out, is incredibly satisfying and rewarding - not to mention helps you sleep at night. And what's not to like about that?
This article was first published on LinkedIn