Strategy is valuable, so why don't we value it?

Kevin Chesters, is the partner/CSO of The Harbour Collective and former chief strategy officer of Ogilvy UK.

Strategy is valuable, so why don't we value it?

It came to my attention recently that two chief executives (who’ll remain nameless mainly because they didn’t tell me who) mentioned to The Drum that they thought strategy was the next agency function (after creative, media, data, etc) that would probably be moved in-house because it was an area that clients thought they could handle internally and agencies would accept having to lose.

I was asked for an opinion. It won’t surprise you to hear, as a strategist, and I'll admit that this got me a little riled.

I’m going to start by saying that, for me, being asked to write a piece defending the value of strategy is a bit like being asked to write a piece defending climate change science. I think it is ludicrous that it has to be done in the first place, but one feels duty bound to do it in order to stand up against ignorance.

When it comes to taking anything in-house it is important, firstly, to ascertain the reason for doing so. There are many very valid reasons for bringing previously outsourced functions inside the tent of a client and they have been extensively covered elsewhere in recent weeks. I should also state for the record that I used to be an in-house strategist at British Telecom so I can certainly see the value when it’s done properly for the right reasons.

The first thing I’d say is that if the primary reason you’d bring strategy in-house is to save a few quid (because you don’t value it) then knock yourself out. But don’t be surprised if the quality of your insight, and its application, is more Del Boy than John Lewis. If the motivator is speed, then I’d also suggest that getting the best answer isn’t necessarily that important to you.

But those chief executives seemed to be challenging the ‘value’ in strategy, per se. Clients should (and all the decent ones do) respect and value strategy as a function of the creative process. It is a specialised skill that should only be taken inhouse if your motivator isn’t time, money or convenience.

I find it impossible to imagine any half decent (let alone great) client or agency creative lead ever questioning the value of strategy (the original hypothesis). I mean, go and ask Tony Davidson at W+K the role that Stu Smith played in developing 'Grrrr for Honda'. Or go and ask Danny Brooke-Taylor at Lucky Generals whether Andy is a peripheral, outsourceable function at the agency. Failing that, ask the client at Sport England how pivotal Vicki Holgate was in unlocking the insight and applying it for “This Girl Can”. Ask the Direct Line client if they could have done what Richard H did themselves. Any creative director, CEO or client who really understands that creativity is the key to commercial success will confirm the critical nature of the relationship between creative and strategy in developing great, effective work.

Great strategists unstick the stuck. They separate the useful from the interesting. The planners’ task is “not so much to see what no one yet has seen but to think what no one else yet has thought about that which everyone. sees.” (Schopenheaur).

Great strategists provide the logical framework within which the creative chaotic magic can happen. Why would anyone with half a brain think that wasn’t needed in an agency or wasn’t worth paying top dollar for? I mean, honestly.

So, I found myself asking what could have happened in our industry that could ever lead someone to believe that strategy isn’t that valuable anymore. Or that anyone could just knock it out.

I think it starts with the fact that agencies increasingly don’t give clients a reason to value it because of how we act towards it or charge it. Perhaps some clients don’t value strategy because we, as agencies, have started to put no value on it ourselves.

It starts with those increasingly insane RFPs. You know the ones that ask you if your agency can provide a stunning, proprietary, never-before-seen strategic POV in a page for a brand or category – for free – in exchange for the one in five chance of possibly going forward to a pitch. Where the “lucky ones” will be asked to come up with multiple strategic (AND creative) ideas FOR FREE, for the chance of a headline that says “X Agency scoops Y business”. This is insane if you think about it. Ask yourself, what other industry gives away its most valuable product for free up front with no guarantee of getting that value back? Who would even have the front to ask them to?

If we demonstrate on a daily basis that we don’t value what we do, why should anyone else? If something has no value put upon it, then why would anyone see it as valuable?

A ‘juniorisation’ of strategy has also come about due to new business pressures, and the nature of modern pitching. The agency C-suite’s have largely become new business engines – shifting onto the next pitch the moment the previous win is in the door (and moving off that client almost instantly). If we want clients to be willing to pay top dollar for strategic thinking, then we need to give them access to the best brains - not shift our best agency thinkers onto the next pitch the moment they’ve landed the last one.

Clients want to have big conversations and they need to have them with the best people. Increasingly as agency fees have started to be squeezed (because clients are taking those things in-house that agencies used to make money on) we are starting to not give clients the brightest and best the agency has to offer on a day-to-day basis. So they are, rightly perhaps, starting to question whether strategy is worth the price they pay for it. And also looking to consultancies as an alternative to their ad agency.

The pressure on agency margins has led some agencies to try and provide strategy on the cheap too. We’ve seen a couple of recent examples in the news where agencies have tried to save on senior talent. Clients are not idiots and can spot these cost-cutting moves quite easily (regardless of the spin agencies try to put on them) & they can spot the ensuing decline in quality too. We cannot, as an industry, expect clients to pay a premium if they get the understudy not the star(s). If clients get the B-team then why wouldn’t they think they could do it themselves just as well?

Great strategy leads to great work. Great strategy comes from great strategists. Great strategists cost money. If you read the great effectiveness cases from Sainsbury’s, or Honda, or John Lewis, or Ikea, you will see that great strategic thinking leads to insane amounts of business growth. All good clients know that and value it. The facts are there for all to see in the new APG ‘ThinkTank’ resource.

So, great strategy is valuable. Let’s stop giving it away for free. Let’s it treat it with the care and respect it deserves. Otherwise one day we might wake up and find it’s moved house, in-house.

For more insights into solving current agency issues, check out The Drum's forthcoming conference, Agency Acceleration Day in March.

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