Business

Build a Strong Forecasting and Reporting Model

Hiring decisions must be data-driven, otherwise, you are putting your agency’s financial stability at risk. Monthly forecasts give you predictive data—what you anticipate will happen—and time-tracking software provides the historical data—what has happened to date. Both are essential. For predictive data, managers should be able to view and edit monthly forecasts by clients and employees.

Unfortunately, I have yet to find a reliable software product to perform this task, so we have built an Agency Manager dashboard in Microsoft Excel. It requires manual updates, so it is not ideal, but it works well for PR 20/20. If you figure out ways to improve on the template, I would love to hear about it.

Shift to Campaigns Concentrate on shifting 80 percent or more of your client base to long-term contracts, which creates predictable recurring revenue and workflow. For agencies that are predominantly project-based, forecasting is nothing more than futile guesswork. If you plan to grow a stable and scalable agency, you must build a campaign-based agency

The Retention Issue

Identifying and recruiting A players is challenging, but retaining them long-term can prove to be even more difficult, especially given the industry’s employee retention issue. According to the Transforming Talent Management report from the American Association of Advertising Agencies (4A) and Havas’ Arnold Worldwide, 30 percent of the collection agency workforce will be gone in 12 months, and 70 percent of employees would call a recruiter back if one reached out to them.

Model agencies recruit to retain. They seek to hire career professionals who view the agency as a destination rather than a steppingstone. Although some top employees will move on to lead or find other agencies, the goal is to maintain stability through retention. As professionals advance and compensation packages increase, this becomes more difficult, so agencies must grow and continually evolve to offer competitive pay and rewarding environments. Keep in mind that A players are in high demand. Just like free agency in professional sports, there is always another organization willing and able to pay more.

This is why culture and the pursuit of purpose, which we investigate in Chapter 10, are so essential to your agency’s success. Retention starts by hiring intrinsically motivated talent. Although everyone has baseline financial needs that must be met through salary, bonuses, and benefits, money is not the primary motivating factor for these professionals. Compensation certainly must be fair and competitive, but once they reach certain financial thresholds, and all their basic needs are met, more money has minimal impact on their motivation or happiness.

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Last word

Assuming that an agency maintains competitive compensation packages, if someone leaves on their own free will, and it is a solely money-motivated decision, then they were not a fit for the firm from the start or they lost their connection to the culture and purpose somewhere along the way. In either case, as hard as it is to replace top talent, it is probably for the best that they leave. Model agencies are built around loyal professionals who passionately believe in the mission, vision, and values. They are your greatest asset, and the only means by which you will create a significant and lasting brand.

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