Your agency exists to be creative – you use your imagination and hope to come up with award-winning campaigns for your clients. However, you still need to have effective business processes in place to make money.
Step One – Capacity Management
The staff at your agency are your biggest asset and your largest single cost. They define your capacity to service clients. If know how much capacity you have, you’ll know how many projects you can take on and how much you are spending on resource. Managing capacity effectively cuts down on freelance costs and makes you more profitable.
Step Two – Resource Management & Planning
Track your resource effectively. Your creatives should be giving their best work to clients without over-running, or under-servicing clients. It affects the bottom line if they do, so you need to be aware in real-time, if it’s not real-time it’s too late to make adjustments accordingly.
Step Three – Avoid Idle Hands
If you have creatives who are consistently under-utilised, you need to know about it. You can look for ways to up-sell the kind of creative talents they offer, or perhaps review whether that skill set is even needed by your agency.
Step Four – Keep Your Clients Happy
Let’s be honest, how often do you turn down work? Instead, you’re likely to take on freelancers to keep your clients happy but this often means increasing your costs dramatically and running the risk of missing deadlines if your team is unable to cope. Having a view of your total capacity in real-time can help you spot these potential problems and solve them well before they occur.
Step Five – Avoid The Danger Zone
Spending time on something than you are not being paid for erodes your profit margin; it’s the biggest single destroyer of value in your agency. You need to know in real-time what you’re doing as opposed to what you’re getting paid for. You can then take the decision to re-negotiate with the client or offer extra time as a gesture of goodwill - but make sure the client has visibility of all the work you are doing.
Step Six – Estimate Accurately
In order to estimate accurately, you need lots of information. The more detail you can find out from the client, the better. An accurate history of past projects can help you to predict how long a similar project might take for the same, or similar type of client. Track your project history and use it effectively to estimate new projects.
Step Seven – Control Scope-Creep
Once a project brief begins (no matter how detailed), items will be changed or added so the scope of your project changes. As well as a good account manager, you also need an early-warning mechanism for everyone within your agency to be able to see this occurring in real-time. Coupled with an audit trail to track scope-creep and determine what is billable, you’ll be able to pinpoint the change of the project immediately.
Step Eight – The Power Of The Human Brain
The human brain is the most powerful resource you have. Traffic/studio managers have been around for years with good reason – they make your studio work more effectively and contribute directly to increased profitability. Just make sure you give them the right tools to be able to do their job properly. Leaving all the knowledge of workflow to one person causes a bottleneck of communication.
Step Nine – Use The Right System
You need a comprehensive studio management system that does the dull, difficult bits and allows your team to get on with the actual work. These are the essential elements you need to look for:
Step Ten – Put It All Together To Make More Money
If you have the right business processes, the right human resources and the right system in place, you are well on your way to increased efficiency and profitability. Your creative team want to be imaginative – free them up to do what they’re good at, which is keeping your clients happy and building your bottom line in the process.
Industry Insights features highly accessible and practical content from experts in the marketing services sector providing you with tools and resources to improve your business performance. If you would like to submit a report to the section contact firstname.lastname@example.org