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Imagine your agency landing a seven-figure contract with a Fortune 100 brand, only to discover a year later that your agency profitability has cratered, resulting in: smaller dividends, reduced profit share, a negatively impacted culture and increased financial instability. Sound impossible? Unfortunately, we see it happen every day.
While there are numerous and well-documented ways to improve the top-line revenue of an advertising or marketing agency (establishing a niche, adding new capabilities, thought leadership, improved business development, M&A, etc.), none of these have a direct link to improved profits. Worse yet…increasing top-line revenue can actually decrease profitability!
So, as an agency owner, principal or executive, what can you do?
The goal of this three part article series is to help owners and managers of 50-500 person marketing services organizations (agencies) better understand, plan and execute the rollout of an Integrated Project Management discipline, the first major step in an operationally efficient and profitable agency. The three parts of the series will cover the following:
Project Management in a Creative Centric World
Designing a Successful PM Rollout
Managing Resistance to Change
The True Value of a Project Management Discipline
As agency Operations experts, we’ve seen it all – and we can confidently say that marketing agencies that empower a strong, Integrated Project Management discipline run more smoothly and profitably than the ones that don’t. It’s a fact.
One of the most common complaints we hear from agency owners and managers is that their Client Services team is too bogged down managing the details of their client’s projects, limiting their ability to provide effective account guidance, program strategy, brand stewardship and growth.
To their credit, many agencies find themselves in this vicious cycle because they’ve experienced explosive growth, landed big brands and rapidly added new capabilities. When this kind of growth happens, management feels like they are just trying to keep the wheels on the bus, so they end up throwing bodies at problems to plug holes instead of really examining their People and Processes. While increased headcount will temporarily smooth some of the symptoms, the systemic issues are still eating at the core of the business. Compounding matters, by adding the wrong type of headcount, they further burden the overhead of the organization. Think of it as a self-perpetuating, looping shockwave.
Fortunately, sometimes the most complex challenges have the simplest answers. Implementing an Integrated Project Management discipline can become a distinct competitive advantage, in much the way that an excellent niche or strong Strategy, Creative and Client Services team does. However, this requires a complete mental shift into what a great Project Manager brings to the table.
An Integrated Project Manager is a Houdini, a multi-tasker extraordinaire, magical cat herder, arbitrator, facilitator, project accountant, and someone who can represent the needs of the agency without compromising the client’s goals. This role isn’t a pit stop for someone who secretly wants to be a Strategist, Art Director or Account Executive. Rather, the people in this role relish making it all happen. Now ask yourself, how many people like this do you have on your team, and are they part of a formalized discipline that is empowered to increase the profitability of your organization?
What a Project Management Discipline Does NOT Look Like
Ok, so now that we’ve addressed what an Integrated Project Manager is and what their value is to an organization, allow me to discuss what we see in the field with organizations that are not fully committed to the discipline. They think they need some type of role to manage resources and move projects through their shop; however, they haven’t formalized a fully integrated project management discipline or hired the correct people to staff that discipline. Here are the most common examples we’ve seen of agencies’ attempts at Project Management:
Traffic as PM
Producers, Not PMs
Fragmented PM Discipline
1. Traffic as PM
One of the most common scenarios we see is an agency that claims to have a Project Management discipline when in reality what they have is an overworked and underappreciated Traffic Department. This is often a team of junior employees whose main priority is to get work out the door on time; with little concern about budgets or how many people they put on a job to get it done. Usually too junior or inexperienced to be client facing, their number one priority is to push work out the door, with little mindset for proactively managing a schedule, communicating about deadlines, balancing workload or monitoring budgets. And because the Client Services team doesn’t trust them to talk directly to the client, what you end up with is a version of the “Telephone Game” – where the PM is telling Client Services what the client needs to know so that Client Services can then tell that to the client. Just like with the Telephone Game, what ends up being told to the client… isn’t always what the PM wanted to have communicated to the client.
We find that this type of PM team tends to be more reactionary than proactive; they often pull in outsourced contract labor to get work done on time, with little regard for how that will affect a project’s profitability…and ultimately the client’s profitability and the agency’s bottom line. And since they are junior, they are often bullied and harassed into making short-term decisions that negatively impact both the client and agency. Needless to say, this is often a thankless job, and viewed as a role where you “pay your dues” before hustling into a more respected position.
2. Producers, Not PMs
There is another scenario we see often, where the Agency hires subject matter expert Producers, e.g. Broadcast Producers, Technical/Digital Producers, Print Producers, Event Producers, etc. – however, they don’t have what we call Brand-level Project Managers. Because they don’t have this overarching brand-level PM, much of the big picture program, campaign and project management ends up staying in the Client Services department – with people who are not necessarily naturally inclined towards detailed project management.
In most cases, the SME Producer is very narrowly focused on only the details of their projects, while the Client Services team spends their time focusing on the strategy of the campaigns, which means no one is focusing on the overarching program schedules, budgets and reconciliations needed to ensure a smooth, on-time and on-budget program delivery. This results in reactive project management, rather than being able to stay ahead of the curve and anticipate any issues with schedule or out of scope requests.
For these agencies with only SME/Project Managers, we also see a lack of clarity surrounding responsibilities and accountability. No one knows who is ultimately responsible for driving a program through its lifecycle, which can create either a massive duplication of effort or large gaps where things fall through the cracks. In many cases, both Client Services and SME Producers are attempting to co-manage project details through the agency and as a result, tend to create overlap, inefficiencies and confusion agency-wide. Or even worse, everyone assumes someone else is handling it and then, when the ball drops, no one is clear who was officially responsible for the task in the first place.
3. Fragmented PM Discipline
Perhaps the most common (and challenging) scenario we see in agencies is a fragmented Project Management discipline – where a small, understaffed team of senior Project Managers is paired with a large Client Services team. Because this small PM team cannot possibly handle ALL the project management duties agency-wide… this results in other departments, including Client Services, Accounting, Creative, Traffic, etc., supplementing pieces of the project management discipline. Talk about inefficient and ineffective!
And even with all these other people doing parts of agency project management, critical tasks are still getting missed. Since most of these people aren’t naturally inclined towards project management and are rarely trained in the discipline, there are large chunks of project management responsibilities and daily tasks that are just completely missed – like detailed scoping by project phase and function, daily budget management, transaction management, schedule + resource updates, SOW review, change orders, post mortems, etc.
When you split up core, critical components of good agency project management across multiple departments and people, you lose the efficiency and the effectiveness of the PM discipline, leading to lower project profitability, overworked teams and missed deadlines.
Designing a Successful Integrated PM Rollout
The second article in our Ugly Duckling Trilogy will focus on both the practical and tactical steps that managers need to undertake to successfully rollout an Integrated Project Management discipline. Great intentions are good, but execution is the difference between crossing the chasm and falling off the side of the cliff. As most managers realize, you only get so many chances to roll something out before it permanently stalls and employees become inoculated to the idea in its entirety. Topics covered in the second article will include:
Need Recognition
The Integrated PM Discipline Champion
Leadership Buy-In and Alignment
Communications Strategy + Plan
Organizational Structure
Workflow + Process Audit
Roles + Responsibilities with Job Descriptions
DiSC Testing and Behavior Mapping
Account Mapping
Transition Team Members to New Roles
IPM Discipline Rollout
Client Communication
Change Management
About the Author:
Vanessa Edwards is a serial entrepreneur, professional jet pilot, former agency owner and founder of Creative Performance Inc, a consultancy that empowers agency owners to achieve their cultural, operational and profitability goals. As a FunctionFox, Workamajig and Oracle PLM partner, she has helped over a 100 marketing services organizations (agency + brand) through large-scale organizational change, complex technology deployments and strategic planning.
Contributing Author: Jessica Stephens
CPI Blog (http://www.creativelyperform.com/blog/)
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