Talent is our future. To evolve, we must have the right people – well-informed savvy employees who support and drive future growth. Yet the muscle memory of the advertising industry is to acquire, hire and rehire talent.
We trade employees with competitors while acknowledging 25%+ turnover: a staggering rate for any industry. The annual cost of replacing an employee (many studies show that the total cost of losing an employee can range from tens of thousands of dollars to 1.5-2X annual salary) far exceeds the cost of retaining one, yet we stick with the status quo.
Employee retention is directly connected to the ability for staff to evolve skills and grow. Hence, agency employees are directly asking for training (particularly millennials). An agency recently shared that 100% of employees who left in 2016 cited a lack of training as the primary reason. Despite this data, the agency spent less than the amount of a single junior employee’s annual salary on training for the entire five hundred person staff. But why? What will it take for agencies to increase their investment in developing seated talent on par with other industries?
For a moment, let’s assume all of the above is true. If we agree that employees’ skillsets equal an agency's capabilities, how do we prioritize talent development? How do we get unstuck from the past and create talent needed for the future?
Maybe leaders simply need to understand the value of skill development. More often than not agency decision makers do not know actual staff capabilities, nor the impact education has on individuals, client relationships and growth. Leaders need more data. They need case studies, proof points, business cases, examples and metrics to support talent development. They need numbers to understand how learning new skills drives opportunity. Data changes talent investment behavior. Data encourages us to pay attention.
And now, we have data to share. According to a 2016 comprehensive study of global agency employees by smith & beta, many admit they are behind. In fact, 43% of study respondents believe they are unprepared to meet the future work of the industry. Equally disconcerting, only 7.5% of respondents thought their agencies were exceeding client expectations. Additional data from this survey includes:
-55% of respondents rated themselves novice or lower in Mobile Advertising Strategy
-50% of respondents rated themselves novice or lower in KPIs/Measurement
-44% of respondents rated themselves novice or lower in Social Media
So how do we solve for this lack of understanding in skill areas that support growth for agencies? What are the steps necessary to ensure that talent is ready for the future?
Step 1: Know Your Talent
Proactive agencies accurately assess how employees’ skills match up with business opportunities. A solid first step is to identify talent capabilities – critical weaknesses – and address gaps before they become issues. At Ogilvy & Mather in NYC, leaders invested in a full analysis of all advertising employees’ skillsets and shared that data with staff, HR and department leaders. This data informed investment in building employee capabilities annually. Know your talent by asking them what they know and what they need to know. Then quantify and aggregate this input annually. The reality of actual staff capabilities drives talent development investment.
Step 2: Design An Education Program
Once you understand true capabilities, design a program that matches needs. Employees are often eager to share their interests and weaknesses. Despite being exposed, great talent always wants to improve. Design a program that matches the level of ambition of your best employees, bring in program design experts, outside teachers and set aside a specific time to learn. If you hear “we’re too busy to learn” in the hallways, ask yourself what is the alternative to learning – stagnation.
As an example, each year KBS invests in an education program that ranges in topics from discipline specific master classes, creative critique, to writing workshops – employees attend classes every few weeks. In these classes, cross-functional teams are experimenting, solving problems, and creating opportunity for the agency by expanding collective expertise.
Step 3: Invite Clients
Here’s a challenge: call three of your top clients and ask them if they’re interested in learning about digital or other critical skillsets in 2017. Ask if they’d like to attend ongoing workshops or classes that build skillsets, common language and abilities. What client would say no? Very few.
At Goodby Silverstein & Partners (GSP), the agency designed workshops for clients and it paid off. In partnership with external teachers and Bay Area technology partners, GSP invited clients to learn with employees by offering workshops that supported brand interest and focus. Learning with clients allowed for improved collaboration, ways of working, and work product. “Education” is a valuable agency service, one that few agencies are providing. Although in 2017, we see this changing. Many agencies are interested in developing “schools” for clients to support shared learning.
Step 4: Measure Twice
From day one, measure the impact of education. At smith & beta, we often measure the ability for agency clients to win more pitches, retain employees and grow current business based on an increase in specific capabilities. Pick two important metrics, one that is focused on employee satisfaction and one that tracks new business growth. Create quarterly reports on talent development and leaders will begin to view training as an integrated strategic initiative tied to business objectives, rather than an isolated single event.
Many agencies are blinded by past success and ignore the ongoing need to evolve and develop talent. If you know abilities of all employees, you know your capabilities. From MIT Sloan, “Many businesses are not honest about where their capabilities really lie, nor about how they are going to ensure there is accountability for instituting real, competitive change.”
Make sure your agency is one that is committed to talent development and evolution in 2017, not one that remains firmly rooted in capabilities of the past.
Allison Kent-Smith is founder and CEO of Smith & Beta