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What is fear doing to your agency
I think there are two things that help push past fear. Number one, we have to be really clear about why we're doing it and we have to have a deep desire to do whatever the thing is that we're afraid to do. So we have to be motivated in some way. And it can't be scarcity-based, it can't be fear-based. It really has to be something bigger and better than that. And number two, we have to find a way to push past the initial fear. So for some of you, it's an accountability buddy. For some of you, it is making a commitment to a business coach or a business partner. For others of you, it may be a significant milestone: the 25th anniversary of your business, your 50th birthday, whatever it may be. But when we are really clear about why we want to do it and we have motivation behind that is abundance-based and opportunity or experience-based and we hold ourselves accountable either by ourselves or oftentimes with a partner of some kind, somebody we're going to do something with or somebody we've made a commitment to do something, all of a sudden, then we can push past that fear. Watch »
Details show we care
Sometimes we are in such a hurry to get the work done. And especially today, because everything is so computerized, we're not sitting down with clients anymore to present work. We're just emailing it over to them. We've lost the art of sort of beautifying our world and our work. And I think there's a lost art to making something tantalizing to look at or to open or to feel like somebody went a little extra just because just for the effort of making something beautiful. As you think about how you present your work to clients, how you mail things to clients, how you show up, even how you do it for your employees, it's not just for our clients, but are there ways that you can really kind of beautify your work and the way you present yourself, the way you present the agency? Can you find little moments where you can create something special that makes someone feel like they were important enough to you for you to go that little extra mile? Watch »
Don’t count your chickens too early
Whether you prebill for media or you bill half upfront on a job for services or strategy, no matter what when you bill a client and it's prebilled, meaning you're billing it before the work is done. That should not show up on your P&L at all. That is not income to you. It's actually a liability and should show up on your balance sheet. And here's why? If the client changes their mind and asks for the money back, you haven't earned that money yet. You have to give them back their money. And so that's why, number one, all agencies need to work on an accrual basis. And number two, how you book that income and when it's income is very important in terms of tracking your AGI, your growth, your revenue, etc. Let's say you prebill a client for $100,000 of a media spend, and 15% of that is going to be commissioned to you. All $100,000 should be booked as a liability. So you want to show that it came into the company. But it sits on your books as a liability until you actually do the work or place the media buy, until you spend the money in one way or another, then you bring it over to your P&L. 15% becomes income and the rest becomes a cost of goods expense and an equal amount of income on the client's invoice side. Watch »
Keep Planting Seeds
For many agencies, for most agencies, Biz Dev has really been challenging in 23, and that's going to continue, I think, for the next several months. As we go into the summer, and it's so easy to sort of take our eye off the ball, I want to remind you of three things that you need to be doing right now to make sure that you have opportunities for Biz Dev in the fall and winter. Watch »
Crisis Averted
You know, as agency owners, we often fly by the seat of our pants. We don't rehearse. We walk into new business pitches cold. Oh, you're going to say this and I'm going to say that, but we don't actually practice. And I'm telling you, one of the things that I have learned over my 30-some years in the business is that that is not a way to success. Success comes from careful preparation, and anticipating all the things that could go wrong. Whether you're putting on an event for a client, you're in a new business pitch, or you're having a meeting with one of your most important clients or employees, all of those are pressure-cooked moments that have big potential outcomes for you and none of them should be taken for chance. And the more you prep and the more you prepare, the more you anticipate what could go wrong, and the more you surround yourself with people who are as invested in the success of that moment as you are, then no matter what happens, the event is successful. Watch »
Don’t cheat on your financial metrics
I recently got asked "if we're using freelancers or contract labor, should I count them or can I count them in the billability and utilization numbers because they're 100%? And so that would really improve my numbers." This is not about gaming the system. The metric is too important for you to start putting false data into the dataset so your numbers look better. One of the key reasons why you're not more profitable is because your utilization is too low. Too many of your hours are either non-billable or they're billable but they're not moving over to an invoice. Don't game the system by adding contractors who by default, of course, are going to be at 100 or close to 100%. It's sort of like saying you are on a quest to lose weight and you hop on the scale, and you're not crazy about the numbers. So then you talk yourself into saying, well, you know what? I had a steak for dinner last night and I had a big breakfast, so that's probably 10 pounds. That's going to work its way right through me. So I'm just going to subtract that from the scale. Accuracy is what is most important, so make sure that your billability and utilization numbers are clean, are accurate, and only include W-2 employees because otherwise, you can't know the truth and you can't start diagnosing why the numbers aren't what they should be. Watch »
Dealing with a toxic client
How do you deal with challenging clients? Now, I'm not talking about the normal level of challenging, I'm not talking about clients who have high standards or clients who miss deadlines. I'm talking about clients who make people quit. I'm talking about clients who are unappreciative. I'm talking about clients who are mean and who communicate in a way that is disheartening to your team. Sometimes, when an agency has this kind of client, this is an easy problem to solve when the client is small. But when the client is large when they are a good share of your AGI, this is a problem. If letting this client go because of their behavior would mean that you have to let go of staff as well, you have to reduce the team because they're that important to the business in terms of money. Now all of a sudden, there are complications. Watch »
How are you using your values?
One of the key things for you retaining your team and keeping them engaged in the agency and focused on the same goals that you're focused on, is actually having agency values that are clearly defined, that are regularly discussed, that are woven into performance appraisals, interviews, exit interviews, team meetings, and most important in your decision making metrics. So when you have core values that you really live by and that you talk about often, and your employees can recite them, can be guided by them, can remember what they are, and also bring them up when you're making decisions, that is a game changer in terms of employee retention. Our employees want to know why the agency exists, what we stand for, what we're about, what are our boundaries, and what are the criteria by which we make decisions? And an agency employee whose values align with our values is a really clear indicator of the stickiness of that employee. Watch »
Don’t hurt yourself!
When we're doing valuations, whether we're actually part of the transition or the succession plan or not, one of the things that I think many of you really underestimate is the power of how you compensate yourself and what that does to the valuation of your business. One of the larger factors in valuation is what we call owner compensation. And what we mean by that is every way that the owner gets value out of the business. Watch »
Should your project managers be billable?
The project management (formerly traffic manager) role is critical in most agencies today. But...how do you justify the expense? Easy. They should be 90% billable! Watch »
