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April 28, 2015

Two Unique Challenges About Running An Agency

At the end of this piece I'll share why I'm nervous to admit this, but for now let me just say that your job running an agency really is different than running another kind of firm. There are two reasons for that.

You entered the field through the craft door. So your background is journalism, communications, design, marketing, advertising, etc. You learned to do a job, and then you built a business around yourself as a vehicle to make money with that skill. All of your training and most of your experience is in doing a certain function well--how to run a business is secondary. You were drawn to the field by the craft. Yes, some of you have learned to love the business portion, too, but most of you have not. You don't hop out of bed in the morning and get excited about feeding the machine, doing that employee review, developing a client conflict policy, or swapping a key client's contact person yet again. Reading a balance sheet isn't something you're excited to pass along to your kids. For a moment, consider the relative importance of being skilled at your craft versus making smart business decisions for your agency. And look around you at what's taken firms down within your orbit. What takes these firms down is bad business decisions, like....

Growing Your Business, Growth, Management, Managing People, Roles

October 6, 2014

Your Agency Needs Something Different from You

If you could concentrate in a few different areas over the next eighteen months, here's what could happen at your firm:

There would be more opportunities from which to choose. No more feeding the machine with frequent compromises. You've failed with this up until now, either letting the urgent displace the critical or delegating it to someone else who can't manage it with the presence that you bring.
You'd have your arms tightly around your agency's performance, with eight key metrics always at your fingertips. Remember that your firm won't fail for lack of creativity--it will fail because you made a business mistake.
You'd have a trusted and capable middle layer of stars who made the trains run reliably, whether you were there or not.

That's not going to happen, though, unless you give up some things, because you just don't have the capacity. I'm not asking you to work harder--I'm asking you to work smarter. If you are ready for this, consider giving up some things, and giving them up in the right order:

Growing Your Business, Growth, Management, Managing People, Roles

March 2, 2014

Maintaining Relevance Over Decades

Click here if you would rather listen to this blog entry (7:39).

It’s too raw to talk much about yet, but I nearly lost my business in 2013. The entire year was largely an epic fail and only now--with the situation in the rearview mirror--can I see it with any sort of perspective. I’ll write a blog post about it shortly (or maybe a book), but one of the threads weaving through those events is this notion of remaining relevant, and for a long time. On the drive to the cabin yesterday, where I am now, thoughts began to flow about just that. I wanted to formulate a perspective about being relevant over several decades, and I was thinking of myself and of you as this began to take shape.

Maybe it goes without saying, but I’ll say it anyway: it presumes that you are relevant in the first place. A certain relevance accompanies anyone making a living and helping employees make a living. That’s noble and rewarding, and it’s how developed economies thrive. But I’m talking here about rising from your peers as a leader, and that requires that you see all the same things they do but that you observe different things than they merely see. You develop a perspective that other people--not just you--believe to be unique and they pay you money to help them observe, too.
Maintaining relevance doesn’t necessarily mean that you are consistently relevant to the same people. As your strengths deepen and creep, you may need a different audience if you want to remain relevant to anybody. Your audience will change organically, in good ways, and you will even lose part of your audience in that process. Just be sure it’s because they can’t keep up and not because they quit learning from you. This is one of the larger tensions I have struggled to navigate.
It is solidly a privilege to remain relevant for decades and most definitely not a right. Doing great work once means that you have just one more chance to do great work again, and so the cycle repeats itself. But the cycle can be broken for any reason at any point in time.
While I think that luck plays an outsized role in being relevant in the first place, I don’t think luck has much of any role in being relevant for decades. That result comes from....

Expertise, Growing Your Business, Growth, Managing Clients, Succession, Succession and M&A, The Work

January 26, 2013

Using Tweriod to Analyze Your Twitter Account

There are thousands of tools for social media, and only a few dozen that strike me as useful. One of those is Tweriod, which analyzes your Twitter account, including when followers are most likely to interact with you, and thus when you should post. Best of all, it will auto-populate your account at Buffer, building the schedule for each of your accounts accordingly.

Click to download a 9-page PDF of the data from my account to illustrate what you'll see.

Growing Your Business, Growth, Marketing, Marketing Yourself

January 3, 2013

Losing a Gorilla Client

A "client concentration" problem refers to having a single related source of work representing more than 25% of your gross profit (fees + markup income). That's usually the point at which the yellow light should blink on your financial dashboard. That same light should blink red if it moves to 35%, because my research shows that to be the median at which one-half of firms fail. In other words, one-half survive the loss of a client that represents ca. 35% and the other one-half fail. Maybe not immediately, but they can usually trace it back to that point if they were not prepared for it. This is meant to prepare you for it.

You either had, have, or will have a gorilla client. Don't be afraid of it, and don't say "no" to the work. A problem like this almost always comes from something great you've done and you deserve the accolades in the form of even more work. Don't get a huge head, though, because unusually high spikes in your top line revenue typically stem from a client concentration issue and not unusual and sudden strong new business skills.

First Step: Honesty

When I talk about this to clients, the first thing they always say is this: "Yes, but all this related work is coming from different departments, and even different contacts in the same department. In fact, they hate each other and we'd probably get more work if we lost one department!"

That's bullshit, if you'll pardon me, because it assumes....

Clients, Developing Processes, Finance, Growing Your Business, Growth, Managing Clients, Marketing, Marketing Yourself

October 25, 2012

Managing Client Relationships

I had trouble getting to sleep last night, and for some reason I started thinking about how managing client relationships has changed over the years. I'm not talking about my clients, but your clients. Do you know the really important things about how to do it right? I'm not sure i would have figured all these out, but I have paid attention to the hundreds of firms I've worked with and tried to cull out the best practices that have been proven in the field.

Just for fun, I started writing these down as they came to mind in a stream of consciousness style. Here are a few of them:

The only power you have in a client relationship is to withhold your expertise.
The degree to which you have power in a relationship is directly related to how long it takes to replace you.
There are only two ways to have more opportunity than capacity, which represents your ability to say "no" to prospects and clients: create more opportunity or reduce your capacity.
The most important criteria in evaluating a prospective client is whether or not they've used a firm like yours before. Never be the first.
Your cheap ass clients are the ones spending their own money. You want to work for clients with budget authority over someone else's money.
The clients who trust you say: "I have $140,000 for this project. What's the most we could do with that money?" The ones who don't trust you say, "Here's what I need. What will it cost?"....

Clients, Growing Your Business, Growth, Managing Clients, Managing People, Roles, The Work

October 12, 2012

What Success Looks Like at Your Firm

A great client recently asked me to outline my definition of success for their firm. I really enjoyed doing that, and below is a version that you can adapt to your own situation, putting your own stamp on it:

Partner compensation equals or exceeds industry benchmarks.
After that is achieved, you still 20% net profit.
The more entrepreneurial employees are satisfied that their contribution to your gain is recognized and accounted for.
Partners and employees in key roles will have already tasted competence in the area of your focus, or they will experience it within nine months of joining the firm.
There will be few or no young employees who value variety over expertise.
When employees talk about your firm, while still employed, their private comments will be complimentary.
When partners and employees head out the door to work for the day, they look forward to the challenges, the companionship, and their participation in the overall culture.
As a firm you will not require extraordinary people....

Clients, Developing Processes, Finance, Growing Your Business, Growth, Management, Managing Clients, Managing People, Marketing, Marketing Yourself, Processes, Roles, Succession, Succession and M&A, The Work

September 8, 2012

Good Questions to Ask Yourself

I was recently working with a firm under our new "Come to Nashville" program for a day and we were doing long-term planning, mainly, but with an eye on how that might impact the short term. I came up with some questions that turned out to be very helpful as they took a break from the continuous crazy days we all have, and then answered them honestly and seriously.

How do you feel about the current positioning of your firm? If you could waive a magic wand and change it (without regard to current employees or clients), what would your positioning be?
What are your biggest fears in just pursuing that positioning, even if it means doing so alongside your current firm and maybe even doing it all alone without employees?
If I watched you on a typical day, would it look like you are taking care of clients or would it look like you were taking care of employees (who would then take care of clients if you did your job well)?
Who are the two weakest employee links who probably should be dismissed in the near future?
Who is the most talented person at your firm who is disruptive to the culture? Are they on the list, above, of people to dismiss?
You likely started this firm to create an environment for yourself that allowed for more freedom, control, and money. Now that you have built it, to what degree are these three things true?...

Developing Processes, Finance, Growing Your Business, Growth, Management, Managing People, Roles

September 4, 2012

Should You Start Your Own Firm?

I seldom give up my 17,000-person blog platform to guests. Keeping your attention is important and my primary marketing tool. But, I read a blog last week that Mark Busse wrote, and I thought it was brilliant. I'm sharing it here with his permission:

Rushing into starting your own design business can turn a dream into a nightmare.

Recently I heard from two former students of mine. As they entered the industry a few years ago we had some honest talks about their options, and against my advice they decided to skip internships or junior positions--which they felt were both beneath them--and went into partnership together with another classmate to form their own design studio. After some early success working for friends and family, their studio quickly fell into chaos, the partnership dissolved, and the company folded, leaving their clients in rough shape.

I'll spare you my story of how running my design business has still not brought the freedom, flexibility or financial reward I'd hoped for after 15 years--and I have a business degree--and how I often miss the days of just working for someone else. Instead, let's talk about how lazy, short-sighted and dangerous starting your own business can be.

You heard me: lazy, short-sighted and....

Growing Your Business, Growth, Management, Managing People, Marketing, Marketing Yourself, The Work

August 5, 2012

Why Your Firm Might Fail…and Preventing It

Forgive me for the ominous subject line of this email, but there are times when it's best to be objective and forthright. I've been talking with the executives of large associations and educational institutions in this field, hoping they'll drop the status quo and beginning offering real help to their members and graduates. So far I've made very little progress, so I'm just going to use my own platform (16,000+ of you).

Look around, think back through the last decade, and make a mental list of the firms you knew that are no longer around. Did any of them fail for lack of creativity? Even if you don't think they were that creative, the answer is a resounding "NO". Here is why those firms--and possibly yours, if you don't listen--will cease to exist, in descending order. I'm going to list seven reasons firms fail, and then seven things to keep a very close eye on.

What to Keep An Eye On

Make Poor Business Decisions. I'm thinking of things like leasing too much space, incurring debt instead of examining the issues behind why you need it, spending more than 45% of your AGI on compensation, establishing unnecessary satellite offices, ignoring standard embezzling safeties, and not really understanding what the financials are saying.
Let Growth Happen to You. This is the land of opportunity, as we're told from a young age, and so one of the most difficult decisions an entrepreneur must make is to turn down opportunity. By avoiding that, they let the marketplace determine how large they will be, in spite of all the additional management load that brings, and worse yet they match their capacity to their opportunity and forgo the ability to say no to clients who don't fit. Eventually they end up consistently accepting work to keep the butts in the seats busy, focusing on cash-flow rather than profit.

Clients, Developing Processes, Finance, Growing Your Business, Growth, Management, Managing Clients, Managing People, Marketing, Marketing Yourself, Succession, Succession and M&A

September 13, 2011

What I Want to Be When I Grow Up

I'm 51, so I figure I'd better get this right pretty soon. :) I think about this a lot, though. The common thread through the last 25 years, though, is that I've worked for myself. That's a lot of years without a safety net, and it's also a lot of years to learn habits that would make it almost impossible for me to work for someone else.

About 20 years ago, though, I put together this list. At the time, I felt like most of my life was ahead of me and that I wanted as many options as possible. So there's very different from each other, and it was just me dreaming one day:

Growing Your Business, Growth, Management, Managing People, Succession, Succession and M&A

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