Amid rising economic, social and political uncertainty if there is one thing that remains constant is that businesses and agencies still need to grow.
Following his appearance at Agency Acceleration Day 2018, Oracle NetSuite director of strategic initiatives for advertising, media and publishing, Chris Hering discusses the key capabilities every agency needs to develop and how agencies are holding onto the best talent in their organisations.
Hering has been a part of NetSuite since the company went from start-up to being publicly traded, currently leading the GTM for the agency and media verticals.
What should an agency focus on first and foremost when it comes to growing its business?
There are three key capabilities every agency needs to develop: picking the right client, cultivating the right people and finding an accountability framework to deliver outstanding work at the right margin.
We’ve also found 5 common barriers to growth where many agencies struggle:
- Finding your next client – it’s not only important to always be finding new clients, but finding those that will value your skills. It doesn’t help your Agency to take-on client work outside your area of expertise as it leads to failed projects and dissatisfaction for everyone.
- Increasing margins – Many leaders aspire to grow EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) – but how do we do that consistently? Without focus on Profits and Output, investments into the business are limited, potentially leading to missed opportunities.
- Improving cash flow visibility – It’s important to have your finger on the pulse of your agency’s metrics and KPIs. Finding the right common decision platform will enable the team and drive choices when executive’s decisions matter to grow the business.
- Tackling regulations – Today, regulation challenges are more common in many industries. Both client-side requirements for audit as well as Government regulations take their toll on time and resources. Take General Data Protection Regulation (GDPR) for example – your team needs you to stay compliant with these regulations to ensure the long-term health and success of your agency.
- Building (and keeping) an award-winning talent pool – Attracting and retaining top talent is one of the biggest hurdles agencies struggle with. Since there is so much turnover within / between agencies, it is important that your company sets itself apart from your competition, but how do we do that?
- Attract: Demonstrate leading work and challenging opportunities; attractive client and project descriptions; link recruiting tied to client resource plans.
- Hire: Accelerate on-boarding programs; manage skills required for hires; mentoring, collaboration, knowledge-sharing.
- Engage: younger workers value culture, technology, flexibility (state of the art tech/systems don’t hurt); provide growth opportunities; focus on billable utilisation.
How do agencies position themselves alongside the bigger consulting organisations that are offering agency type services?
Larger organisations often allocate their time based on client’s revenues and broader initiatives where marketing services is only a part of the relationship; this approach can tarnish their relationships with brand clients. Also, boutique agencies often work on a project basis with more exposure, so they must continually prove their value on every pitch – while larger consulting organisations may still have a few larger AOR relationships, potentially diluting the focus on outcomes and work.
How should an agency go about choosing the right automation and technology platform set up?
Today’s IT or CIO and finance employees value the ability of the team’s time on insightful decision makers vs. ticket punchers – they want the ability to have technology that empowers their decision making and creativity. Agencies need a software model that is flexible enough to handle changing business models, international regulation and complex revenue streams so IT and finance teams can focus on client-facing work where they develop unique solutions for clients.
How are agencies adjusting their compensation models to win business today?
The old world of retainer-based models is dying. Today, most businesses work on an individual project basis. The move to project-based business puts more pressure on an agency to constantly deliver – since you are only hired for one project, it is in the agency’s best interest to put forth top quality work to ensure they are hired again for the next one. There is also no way to “make-up” for lost margin in another corner of a retainer. So, what we’ve seen is that agencies are finding rate cards and project plans that reign-in scope and limit (margin-killing) scope creep. Compensation models that reward based on project work is the norm – the change is simple, really: do a great job on a project, expect a reward.
How are agencies holding onto the best talent in their organisations?
Retaining top talent is crucial to the growth and long-term success of your business. Leaders will need to focus on both talent and culture – balancing the two together to retain the best employees. Attracting top talent requires that your team can demonstrate industry-leading work and offer challenging opportunities to add to portfolios. We’ve noticed two things that you can do to ensure your folks stay on-board: 1) focus on rewarding contributions monetarily, and 2) just as important, acknowledging great work by the team. Keeping a culture of creativity rewards the team beyond their take-home pay. The balance of permanent hires vs. contract workers is sensitive; although contract workers can be more expensive on a per-project basis, they can prove to be invaluable when working on remote projects.
What are agencies doing to accommodate the specialised skills required by international and multi-channel campaigns across social networks and country lines?
Today, almost every agency is global from the moment they open their doors – and if they aren’t global from the outset, agencies need to have a plan to service international entities built into their business models from the start.
A few key investments in a software framework that supports international billing and tax will pay dividends when spontaneous projects come down the line. For example, if your team has a project pop up in Brazil, your ability to deliver the work vs. subcontract means better work and margins. That may mean having a freelancer who is fluent in Portuguese and understands the intimate details of Brazilian culture. Thinking critically about how to enable your global staff to collaborate and deliver across borders is now more important than ever.
Oracle Netsuite was the headline sponsor for Agency Acceleration Day 2018, a one day event that will give you insightful, actionable and practical advice on all you need to know on how to reach the next level of success.