Any performance coach will tell you that setting the right objectives will improve performance. It does not matter whether your “team” is a football team, a rock band or a corporation. The same principle applies. Everyone needs to know what the ultimate goal is, and each member of the team needs to understand what he is expected to do to help achieve the objective. And everyone must be accountable.
In the corporate world, Management spends a lot of time trying to define the right objectives, and that they are SMAC (simple, measurable, achievable and compatible).
Unfortunately, as with many things in the Agency world, correctly defined and aligned objectives are the exception and not the rule. Most Agencies make the mistake of setting goals which incentive departments to act as silos. Every member of the team is pulling in a different direction.
Here are the three typical examples:
The Creative department will normally have goals that are creative quality related. They will aim to win awards or to score well on some internal creative product quality measure. Salaries, bonuses and career advancement will be closely tied to this. Even in Agencies where this does not apply, all Creatives know that if they win a major award, they will be worth more on the open market so that incentive never goes away.
The Account Management department will normally focus on Client satisfaction. Most senior account people will eventually figure out that if a Client is happy with them they will move ahead. Conversely, if the Client asks for their head, their career will be seriously affected. When you have to live with this reality, it is very hard not to focus on making sure your Client is happy with you, on a personal basis, and then with the Agency.
Agency Management will be dealing with Profit & Loss and New Business goals. Since it is virtually impossible to get an existing Client to pay more for your services, Management will focus on cost control and pursue New Business with abandon, even at the risk of neglecting existing Clients. In the rush to meet this year’s targets they may sacrifice the future. In their defense, if they do not hit this year’s objectives, they may not be around to worry about next year.
The net result of this misalignment of objectives is a team whose key players are all pulling in different directions. It may not happen immediately, but it will all blow up eventually.
So what objectives should they be focusing on? What can bring them together as a Team while at the same time make business sense?
The answer comes from understanding why Clients hire Agencies. And here we get to the crux of the matter.
Clients only hire Agencies to help them hit their growth objectives. There is no other reason.
Growth can be measured in units, tons, stat cases, traffic, or some other measure but it is always about indexing at over 100 in whatever metric the Client is accountable for.
The logical conclusion is that the single overriding objective for the Agency and every department in the Agency is to help the Client grow, at rates that are acceptable to the Client. This rate will be, at a minimum, what is in the Client’s marketing plan.
This means that every department should have Client specific growth targets as its number one objective and this must be the element that aligns everything in the Agency.
The Creative department must have client growth objectives by Client, and then its own Creative objectives. This is not a contradiction. Creativity is a means to an end and not an end in itself. Growth is the end and it is axiomatic that good work should drive growth (and bad work should not). Once you hit Client objectives, any and all awards are welcome.
Account Management must have a key Client growth objective, and then its own Client evaluation objective. It is much more likely that a Client will provide a positive performance review if his business is growing.
Agency Management must have a key Client growth objective and this must be the aggregate of all Accounts in the Agency. While negotiating fees with a Client will always be hard, it is much easier when the Client’s business is growing. Existing Clients will also be more likely to reward the Agency with new assignments under these conditions. As an added benefit know that that New Business from existing Clients has the highest conversion rates and strongly impacts the bottom line. Finally, there is nothing better to showcase in New Business than a stable full of Clients with growing businesses.
The Client growth objective will force an increased sense of urgency in all departments and as a whole in the Agency. It will help resolve the hopelessly siloed “Creativity vs Client Request” debate that goes on endlessly between departments. That discussion will be replaced by a more productive “will it make the Brand grow” debate. And when that question is answered correctly it will also make the Agency grow.
Getting the Agency to understand that Client growth is the objective and getting all the players to focus on this is a powerful way to improve Agency performance, and to do so quickly and cost effectively.