Thank you for returning for part three of the CPI Top Ten Broken Agency Processes. The first installment focused on identifying the top five operational challenges agencies face, with the second installment focused on the top five financial challenges confronting agencies. Subsequently, the third and fourth installments will focus on practical solutions to addressing these challenges.

Specifically, this article addressing our recommended solutions for agencies’ most common operational challenges will move from the abstract (found in part one) to the concrete. Our hope is that you walk away from this article with a list of items that can be debated, agreed upon, prioritized and then accomplished. If approached in a thoughtful and collaborative manner, we can reasonably guarantee that you will create (or maintain) a creative, dynamic and profitable organization. Let’s begin!

1. Agency Workflow: Who’s on First?

The Agency Workflow problem of Who’s on First most often stems from agencies who don’t have a well-defined workflow, have a workflow that isn’t aligned with their creative process, or haven’t included the proper checks and balances within their workflow. Remember, workflow is not just a word; it is the actual codification of how the myriad activities within your agency work together in harmony to produce fantastic and profitable work. Sounds easy, right?

Unfortunately, we often find that discussing Agency Workflow can be a daunting prospect. Why? Simply because defining truly effective workflows touches every fiefdom (ahem, corner) of your agency, from account direction to accounting. If there is a missing link, it breaks down. Period.

Our experience is that sessions to define Agency Workflow can end up feeling like couples therapy: we discuss what’s working, what’s not working, where the communication breakdowns are happening, what we could be doing better, etc., all of which tends to be a cathartic experience which can sometimes get contentious. That’s ok, as long as everyone in the room is on the same page about what you’re trying to accomplish – namely, making your agency more profitable while maintaining your creativity and culture.

It’s vital that your workflow discussions are open, candid and honest – otherwise, you’re going to define a new Agency Workflow that doesn’t fix any of your problems. When we see agencies objectively self- reflect on things that are (and are not) going well, we find that the creative/collaborative processes for defining and agreeing on new workflows goes much more smoothly.

When you set about defining your agency’s workflow, you can’t do it in a vacuum, or in a closed-door meeting with just your senior executives. You need team members who do the work – soldiers on the ground – involved in defining the workflow. If you get the people actually doing the work to help you develop the workflow, you’ll find them much more likely to adopt it as they go about their daily work lives. And, make sure to include people from all of your departments – including Account Management and Project Management – to ensure everyone’s voice and unique perspective is being considered. This is your chance to look at everything your agency is doing and collaborate to make it better; if you don’t include representatives or leaders from every discipline involved, you run the risk of developing a workflow that doesn’t actually work for everyone in your agency.

You’ll probably need multiple sessions to define your ideal Agency Workflow; it takes a while to think through everything that you do and discuss how you do it – and also how you would like to do it. Ask questions as if you’re an outsider or newcomer who has never worked in your agency before, things like:

  • How do you get new business?
  • What do you do to sign new clients?
  • Who is involved in new business?
  • Who scopes and estimates contracts and projects?
  • What goes into your proposals?
  • When do your senior leaders get involved in projects?
  • Are they involved in all projects, or just those for key accounts?
  • Which engagements involve strategy and which involve only execution?
  • When does the strategy portion of the work happen?
  • Who vets that the strategy is on target?
  • Where do breakdowns in handoffs happen?
  • etc.

As you sit down to define your workflow, remember to take into consideration the various types of agreements you have with your clients; if you’re doing some work on retainer, some as part of an AOR relationship and other work on a project by project basis, you need to recognize that the flow for those engagements will be much different. We recommend starting with the most complicated type of engagement you have – usually AOR – and defining that workflow first; then, you can pull bits and pieces from that workflow into other types of engagements you have. No need to reinvent the wheel each time!

Once you nail down your overarching Agency Workflow, you can then focus on the detailed, specific sub- workflows, which we call Project Architecture. Design these project architectures within the overall shell of your Agency Workflow – meaning the project architectures have to fit within the overarching steps defined in your Agency Workflow. You can’t have an Agency Workflow that says you will develop strategic recommendations in order to deliver a detailed estimate, and then design a project architecture that has the scoping and estimating steps before the steps to develop the strategic recommendations.

When your Agency Workflow and project architectures are complete, it’s critical NOT to leave these on the server, tucked away where no one can access them.

You need to design a workflow implementation strategy to educate your agency on the goals of and changes in the new workflow, as well as communicate “what’s in it for them.” As you execute your implementation strategy, use workflow champions to support communication and channel back any concerns. This rollout should both energize and prepare your team. If it doesn’t…you missed something.

We enjoyed working with one agency that actually created a comprehensive playbook that outlined all of their new workflows to share them with the entire company. They held a fun teambuilding event to teach people the nuances and critical pieces of the new workflow that would be changing moving forward, generating lots of hype and excitement, while getting everybody on board.

The last step (but a very important one!) in designing your new Agency Workflow is to make sure that you are selling and scoping within the framework of the new workflow. For new business, this can happen overnight; however, for existing accounts or active projects, you may need to be patient and ride it out within your legacy workflows. It’s important to set expectations with your team that there will be a transition period where both old and new workflows may exist in tandem. It’s going to be a little messy at first, but when you get out the other side, it will be well worth the effort.

2. The Scoping Shockwave

If your agency is constantly reeling from the Scoping Shockwave of under scoping, scoping in isolation, scoping without gathering input from subject matter experts, reducing price without reducing scope or poor risk analysis and planning, rest assured you’re not alone. This is one of the most common set of issues we see agencies dealing with – although they’re usually felt down the line, once you’re well into a project, so most agencies don’t recognize the issues as stemming from poor scoping processes. Don’t let the sonic boom get you!

One of the easiest solutions to address the Scoping Shockwave is to require involvement of your Project Managers in the scoping and estimating process of all business, unless you have a service that is already productized, with a fixed price and established cost and duration (that has already been vetted by operations).

It’s important to establish that your Client Services team owns value-based pricing while your Project Management team owns cost-based pricing.

Your PMs should be responsible for providing “bottom-up” numbers that include realistic estimates of the hours, resources and durations necessary for every project, while your Account Managers should be responsible for providing “top-down” numbers representing the value of the work, based either on industry pricing or value to the client.

In addition to including your PMs in your scoping and estimating process, the PMs should work directly with your agency’s subject matter experts (SMEs) for their input. These SMEs provide immense value in defining not only how long something should take, but also how to best deliver the work and structure the project/agreement to provide the best deliverable and end result for both the agency and your client. Additionally, PMs and SMEs should be included in your SOW review process prior to client delivery and approval, so they can identify any red flags before they’re presented to the client.

If your issues surround giving away too much work for free, or handing out discounts without the proper checks and balances, you should institute a Principal/Executive Investment process where discounts are escalated to your most senior decision makers and examined on a recurring basis.

When your PMs scope cost-based numbers vs. being forced to scope into a budget number, you may find that often the Project Manager’s estimate is higher than the Account Manager’s value-based pricing…that never happens, right?! In these situations, you need a good process in place for Account Managers and Project Managers to resolve these discrepancies. The first solution should always be to reduce scope, thus reducing the PM’s estimate; however, sometimes reducing scope risks quality of the deliverable – so then what do you do?

Well, what you DON’T do is just sell it at the value-based price, knowing that unless all the stars align perfectly, you will be over budget. (You can read more on our philosophies about the Scope “ROPE-A-DOPE” on our blog.) Instead, we recommend routing these scenarios to your most senior decision makers and letting them make proactive decisions about what clients/projects they want to invest in (aka: give a discount to).

When these types of investments are made, make sure your PMs manage budgets to the full, pre-discounted amount and manage all transactions between the discounted amount and the full budget amount as a Principal/Executive Investment Write Off that can be measured and reviewed.

To protect yourself from going over budget because of client requests and demands, develop clear and concrete project-specific assumptions and dependencies that are included in all of your client agreements. Consider adding labor contingencies to your estimates to protect your agency against potential risks of working with a client or on a particular type of project, especially if it’s complex or highly customized. Don’t forget to walk your clients through all aspects of your proposal/SOW, including what’s in scope and what’s out of scope, as well as the assumptions and dependencies critical to making the project a success.

Once you’ve alleviated the Scoping Shockwave, you’re no longer starting projects behind the power curve and your team doesn’t feel set up to fail right from the start. However, you may still have a few other issues to deal with…like Over Servicing and Over Delivering. Rest assured, we’ll address that next!

3. Over Servicing and Over Delivering

Are your clients getting the deal of a lifetime, paying for hamburger but getting Filet Mignon? If your agency is consistently Over Servicing and Over Delivering, the first thing you have to ask yourself is, “do we have a culture focused on Over Servicing and Over Delivering (win/lose) or one that focuses on win/win?” Do your team members think that they’re supposed to deliver more than what was planned? Do your clients expect free work? Ouch.

When agencies have a big Over Servicing and Over Delivering problem, we often find that it isn’t the result of just one rogue team member going above and beyond; it’s something that permeates the entire agency – and often stems directly from the Principal or key Executives. This can make it quite difficult to overcome. If you find yourself in this position, just executing the solutions below will likely not be enough; it’s important that you make systemic changes to your agency culture – starting at the top.

Over Servicing and Over Delivering tends to happen when people decide they’re going to do more work than was originally scoped or planned for – because it’s right for the project, or the client, or the agency. However, because it wasn’t planned up front, it causes your project to go over budget. Rectify that by thinking about what you want to give your client ahead of time and planning for it – in the form of a Principal/Executive Investment, as detailed above – so that you can estimate the full scope of work you want to deliver so you don’t go over budget. This way, when you realize you want to do 10 concepts instead of 3, you can consciously make the decision and communicate effectively the value of out of scope work you completed as an investment in the relationship – and you won’t go over budget!

An integrated Project Management discipline can help overcome a culture of Over Servicing and Over Delivering.

Your PMs should be managing project budgets to actuals on a daily basis, allowing them to very quickly identify this type of scope creep and rein it in. With a PM who understands the scope, as well as the budget of the project, you can easily keep track of Over Servicing and Over Delivering, nipping it in the bud before it gets out of hand. (If you don’t have a dedicated Project Management discipline, stop reading right now and read our three-part Ugly Duckling: Project Management in a Creative Centric World white paper series.)

However, if your Project Manager doesn’t have access to real-time project data or your agency has bad timekeeping habits, it’s very difficult for a PM to catch Over Servicing and Over Delivering in a manner that can actually be managed or mitigated. We recommend giving PMs all the tools they need to effectively manage their projects; this can be best accomplished with an integrated Accounting and PM technology (like Workamajig® or Advantage) as well as a strong culture of daily timekeeping.

In addition, implementing a Write Off Policy is a great way to track Over Servicing and Over Delivering – and to put an opportunity cost dollar value on all the time spent delivering Filet for the price of burger.

If you’re using an integrated technology, you can track and manage all of your project transactions, writing off all over budget transactions to specific reasons. This allows you to measure how much time you are spending – and how many dollars you are losing – in work that is mismanaged. If you don’t have an integrated technology, we recommend keeping track of the total Gross Project Actuals minus the total Amount Billed for all clients to measure the opportunity cost from mismanaging projects.

4. Resourcing Pains

Many of the pains that agencies attribute to Resourcing issues actually stem from the Scoping Shockwave or Over Servicing and Over Delivering. Therefore, addressing those problems first can often resolve many of your Resourcing pains.

However, at a certain size (approx. 50+ FTEs), software has a major role to play. Without the proper tools, any organization will eventually have a difficult time effectively load-balancing and distributing workload. Integrated Accounting and Project Management technologies (like Workamajig® or Advantage) can be a godsend for medium to large agencies struggling with Resourcing. Unfortunately, there is a major catch…technology simply expedites existing processes. If you have blurred roles, broken processes and/or poor handoffs, things will actually get worse with an integrated solution. Speed kills.

The number one factor for success when it comes to Resourcing is having dedicated Project Managers. We said it above when discussing Over Servicing and Over Delivering, but we’ll say it again…if you haven’t read our three-part series, Ugly Duckling: Project Management in a Creative Centric World, you really should read it now. Your Project Managers are the backbone of successful Resourcing; your PMs should be:

  • Setting up your projects following a detailed, Resourcing-specific project architecture
  • Estimating your projects at a detailed task level by function and/or person
  • Managing phases and sub-phases and updating schedules daily

Additionally, once you start Resourcing (depending on your agency size), it can be critical to have a dedicated Resource Manager working with PMs. This Resource Manager needs to understand the skills and capabilities of everyone on the team they’re resourcing, know the gaps within the team, identify any production calendar gaps, and be continuously load balancing the agency. Resource Managers should be holding weekly production meetings with the PM team to solve any short-term resource concerns, as well as daily stand-ups with their teams to keep everyone on track.

Often, Resource Managers are responsible for producing daily hot sheets and weekly assignment reports by person. This crucial role needs to work hand-in-hand with PMs, as the data they rely on to do their jobs is a direct output from PM efforts.

For Resourcing to be impactful…the data MUST be accurate.

If there’s a discrepancy between the verbal communication of what needs to get done and an assignment or hot sheet report produced from the tool, people stop trusting the data; instead, it becomes a game of “the squeakiest wheel gets the grease.” They put out the biggest – or loudest – fires first, leading to mis-prioritization of deliverables, missed deadlines and an inability to properly forecast or load balance.

To get accurate data, there needs to be a push-pull relationship between the team, PMs and Resource Manager. All the responsibility can’t fall onto just one of these roles; it needs to be shared across all three. Team members need to participate in the feedback loop by communicating when they have completed tasks. This provides PMs and Resource Managers with the updated status they need to avoid interrupting creatives 20 times a day, allowing for a more efficient workday for all involved.

The most effective feedback loop is daily timekeeping and updated task status providing real-time data.

If your agency isn’t tracking time daily or tracking the percent complete of their assignments, it can be nearly impossible to accurately adjust workload and load balancing for projects that are ever-changing. Since we know that projects and priorities basically change hourly, having a real-time feedback loop within your agency’s technology is crucial for effective Resourcing.

As we mentioned, one key to effective Resourcing is using detailed project architecture designed for Resourcing. Project architecture designed just for budget management and milestone management is significantly less detailed than what you need for Resourcing. If you try to load balance from high-level project architecture, it will create significant amounts of manual effort to figure out what is actually due each day and whether people are under- or over-resourced.

Taking it down to a more detailed level allows you to produce daily hot sheets and weekly assignment reports that clearly communicate what needs to be done each day. The catch to creating project architecture this detailed is that the schedules need to be managed and updated daily to ensure people are working on the right things. The rub is…this actually creates more PM work in the short-term. However, if done correctly, the concert of these efforts dramatically increases utilizations (deliverable throughput) across the agency, and more than pays for itself.

If PMs are creating estimates at the detailed phase level, this can easily be translated into daily hot sheets and weekly assignment reports. However, if PMs are estimating inaccurately (e.g. into a prescribed budget or mis-scoping), this can create significant issues with Resourcing downstream. For accurate load balancing, the most vital information is how many hours will it take to get the detailed phase/task done, not necessarily how many hours are within scope/budget. Ideally, these two are aligned. However, if your agency is struggling with the Scoping Shockwave (or Over Servicing and Over Delivering), keeping these aligned can prove extremely problematic.

5. Briefs: Are Your Briefs One Size Fits All?

If your agency has a Brief problem – either you have one Brief called three different things, or three different Briefs all called the same thing – there is help!

First and foremost, the key to solving your Brief problem is to define your standard Agency Workflow (as discussed above); once you nail down your workflow, you will be on your way to understanding what is working with your Briefs and what isn’t, as well as what types of information you need to be capturing.

Once you clarify the Brief requirements within the overall workflow, your next step is to examine your detailed project architectures to determine how many different styles of Brief you need.

We find that Briefs are the most successful when they are project-specific.

For instance, the information you need to capture on a Brief for a digital project is vastly different from the information you need for a printed brochure. If you use just one Brief for all project types, you will either have many irrelevant questions or it will be so broad that it doesn’t provide any value. Analyze the different types of projects you deliver and see if you’d benefit from having unique Briefs for different project types.

If your agency does a lot of program or campaign work, you might benefit from an overarching Campaign Brief that sets the strategy, tone, direction and metrics for the larger program/campaign, often guiding the initial campaign concepting. In addition to this Campaign Brief, you would also create detailed Project Briefs, which include the deliverable specifics based on project type.

Define a clear process surrounding the ownership and responsibility of creating these Briefs. You should have one team member – usually a Project Manager – who drives the Brief to completion, while other team members – Account Manager, Creative Director, and SMEs – are responsible for actually filling out the details within the Brief. In some cases, a SME PM could be responsible for filling out certain pieces of the Brief. To get the best Brief, don’t let any one person fill it out in isolation. Big no-no.

Within this process, you should also define when (or if) these Briefs get delivered to clients, and/or if you require client signoff. In our experience, the projects that meet/exceed client expectations are ones that start with a well-documented strategy within a Brief that was reviewed and approved by the client.

Having clients review and sign off on Briefs facilitates the partnership between the agency and the client, allowing for more strategic collaboration and resulting in increased alignment and clearer expectations.

Tough Love…

Now for our last piece of advice: please realize that solutions 1-5 require a level of planning, coordination and change management that will distract your organization in the short-term. There’s just no way around it. If some of our recommendations sound challenging…they are. However, if your mid- and long-term goals are to create a symbiotic relationship between your clients, your staff and your future…it has to be done!

Please stay tuned for the final installment in our CPI Top Ten Broken Agency Processes: Part IV – Solutions to Financial Challenges.