Are commercially aware teams the backbone to profitability?
We look at the impact of team commercial awareness, or lack of it, on agency profits.
We discuss this topic with three agency leaders. They share how they’ve created a more commercially focused agency by using data to drive commercial thinking across their teams and influence how everyone views their time and work.
Here’s what they had to say.
25 strong, London-based, digital experiences agency.
Peter McQueen, Finance Director
Peter was brought into Media Blaze with a clear mandate to raise the commercial focus of the agency as whole in order to drive profitability. In Peter’s words:
“Team commercial awareness makes a big difference to the daily decisions made at every level of the agency, particularly affecting the drive for profitability and growth.”
But Peter found this awareness was lacking in places and he started to unravel this by looking at over-servicing:
“Commercial awareness did not flow through all the departments of the agency as I'd have liked. We do have jobs that are over-serviced for various reasons. We've got really nice clients that we don't want to lose. It's that juggling act, isn't it?"
"Client services people naturally want to keep a client happy and don't want awkward conversations around additional costs."
"There are a number of things that I've done to make the agency more profitable. But the main thing is we report on over-servicing so we can take action."
"Instead of waiting until the end of the period or project to realise that we didn't do as well as we could. We compare the rate of completion to the percentage of costs burned, providing an accountability to client services.”
40 plus Edinburgh-based branding and design agency
Financial Director, Tayburn
Tayburn are a multi-award-winning agency for both creativity and efficiency. They’ve remained profitable for over 35 years. To achieve this, they have strong values revolving around simplicity, transparency and efficiency.
“We’re a very creative agency here, but we’re financially astute too.”
“There’s a buzz here. We do a lot of things to involve everyone. We have innovation teams. We do show and tells. I even do a session called ‘Finance is Funny’. You’ve got to keep it playful – that’s one of our values after all. And our phrase ‘Helping Make Remarkable Happen.'”
Steven knows all too well, the potential issues that can creep in, if you’re not razor sharp with your finances at every level of the agency.
“Clients are cute, as every agency knows. They subtly ask for amendments here and there, which used to get nodded through for free. But the extra work really mounts up.“
“We give transparency to our teams, so they have the information they need to manage jobs properly. Today, designers, artworkers and account managers are knowledge workers, even mini-entrepreneurs, for us.”
Steven explains the benefit to clients, when you get a grip on the financials:
“Empowering the account teams means they can advise the client rather than merely work on the job task. It’s a more consultative relationship, more valuable. It’s given them more of a sense of responsibility, more discipline."
"The team have become much more commercially minded now. They understand margins. It’s also helped our account managers & account directors earn more from existing clients.”
30-person digital marketing agency with offices in London and Lichfield.
Phil Robinson, Founder and CEO, ClickThrough
“Synergist showed us we had been heavily over-servicing. We had to reassure our team that we needed to know these things. It’s not a reflection on them. We just need the facts to make informed decisions. The information empowers the team, and Synergist is here to help them."
"They get that now. Smarter client conversations take place today. Because we can see everything in detail, we can see how the departments work together for maximum benefit to the client. There are no silos now.”
Phil explains how ClickThrough’s commercial awareness culture benefits the agency, but also individual team members:
“When young graduates join us and work on small clients, the data now lets them be strategic. They understand the money side of things right away. It’s such good career Experience for when they are promoted to handling larger clients.”
"It’s helped us change our culture. [Our FD’s] job has become more strategic, and people are empowered to run their own departments like proper little companies now."
"It’s also helped with fine-tuning targets. It’s removed all the debates and emotions – it’s all factual now. We discuss the benchmarks with each department. We can see when a department has earned extra hours of specialist time. They can allocate it how they need. That’s very empowering.”
“Upselling takes place now. Before Synergist, we wouldn’t have been able to achieve that. Having the data makes all the difference."