By Category: New Business for CEOs

Need Three New Employees? Hire One Who’s Great. »

Identify the best talent
Published on May 05, 2011

idenitfy talentMost CEOs agree that one of their most most important jobs is to identify talent. When I think about talent I often recall a "Corner Office" interview in the New York Times with Kip Tindell, CEO of the Container Store.

Here's the paragraph that's stuck with me:

One great person could easily be as productive as three good people. So we try to pay 50 to 100 percent above industry average. That's good for the employee, and that's good for the customer, but it's good for the company, too, because you get three times the productivity for only two times the labor cost.

I can easily see how this applies in a retail environment, particularly if you're talking about the difference between a minimum wage employee and one paid double that. My question is, does this apply to ad agency new business?

I think it can, if you - the CEO - focus on identifying the best talent.

  • Let's say you're thinking about creating a new business team out of existing account service personnel. They're all likable and gregarious; everyone thinks they'll do great. Their all-in cost is $50,000 each, including salary and benefits. They don't know much about sales, but have some knowledge of the various industries you have expertise in. They're young and eager, and relatively inexpensive, so you're okay giving them a chance to show what they can do.
  • On the other hand, you have a prospective external candidate who will cost you $100,000 a year. She has worked at two different agencies over the last ten years, and has demonstrated her ability to work in related industries, has good sales skills, and can orchestrate a pitch.

Who do you hire?

Sure the external candidate is twice as expensive as any one individual candidate, but will she be three times as productive? I'd say she will, and perhaps in ways that you wouldn't even think of.

For example, many less experienced new business people will spend inordinate amounts of time researching a long-shot prospect. They'll argue that they need this information so they can relate to them once they get them on the phone. On the other hand, the more experienced person will quickly and efficiently do the research to identify potential business issues they're facing, and will then pick up the phone, engage the prospect with relevant questions and concise insights that reflect your agency's capabilities.

Good sales people are hard to find: most employers I know tell me that their success rate on new sales hires is 1:2 (best case) and 1:4 (worst case). So, if you go the "hire three" route, you're most likely to end up with one who's good. So, your decision really is between promoting one good person (but you don't know which one), versus hiring one proven, great person.

I'd go with experience and proven results and productivity every time.

What do you think? Do you believe in Mr. Tindell's approach?

 

Holding Cos. CEOs: What Must Change »

Growth, incentives, accountability
Published on May 04, 2011

wren, roth, sorrellIt's not every day that you get to see John Wren, Michael Roth, and Sir Martin Sorrell on stage together. At least I don't. One thing's for certain, when you do see them together you'll realize there's no shortage of ego on stage!

These three are smart guys, and as I expected, after listening to them recently I came away with ideas that apply to most ad agencies. And, as new business is always tied to the strength of the agency, if you implement their recommendations, you'll impact your new business effort.

Recommendations for agencies from The Big Three:

  • Keep pace with new technology and new media
  • Spend more on attracting and retaining talent
  • Use data and analytics to generate consumer insights
  • Focus on your people
  • Reflect your market in the diversity of your team
  • Implement a compensation model that reflects where the growth (new business) is, with financial incentives to match, and accountability

As you can imagine, when asked about agency-client relationships, they had lots of opinions. I thought the best were four things clients can do better:

  1. Praise more, express appreciation
  2. Encourage your agency to take more risks
  3. Don't try to take the last $5 out of my pocket
  4. If you kick your agency like a dog, you won't get good work

I'm sure you can add a few more to this list, but this is a good start.

 

What is Your Ad Agency’s Talent Risk? »

Are you training?
Published on April 27, 2011

developing talentMcKinsey & Co. managers spend thirty days per year training and evaluating their people. In contrast, agency managers spend two. Given that consulting companies like McKinsey are encroaching on turf that has historically been the purview of ad agencies, what does that say about the future...?

We use the excuse that we don't have time.

The reality is, we aren't taking our own advice - the advice we give to clients every day, said Andrew Benett, Global CEO of Arnold Worldwide at the recent 4As Transformation conference. He conducted a survey of 3,000 people at all levels in all types of agencies. This is what he found:

  • 30% of employees said they'll be gone in 12 months
  • 70% will call a recruiter back
  • 96% are confident that they could easily get a new job

"We accept that an employee will be with us for just a few years." 

  • 30% think they'll be with your agency for < 1 year
  • 37% think for between 1-5 years
  • 35% for > 5 years

Other alarming statistics:

  • 70% believe they need to take care of their own careers
  • 60% would leave for better compensation
  • 43% answered that "employees" are most important in their agency.
  • 50% feel there is no career path

This latter point is critical. Employees want the ability to learn, and the ability to be creative. If your agency can't give them this, they will move on.

It's not a factory, it's a garden. Adjust your paradigm.

Less than 10% of new employees come from referrals. In other industries, it's 50-60%. Bottom line, says Benett, the ad industry is not promoting itself. For example, "We are no-shows on college campuses."

Five steps to get the ad industry moving on talent:

1. Go back to school.

  • Commit senior management time to train
  • Partner with universities; go beyond career services

2. Promote cross-training

  • Share training sessions
  • Encourage reverse mentoring
  • Offer employee exchanges

3. Introduce new incentives

  • Offer paid sabbaticals; education reimbursement; relocation
  • Offer support to families

4. Fix performance management

  • Just do it.

5. Engage employees in the conversation

  • Solicit ideas; listen
  • In the decision-making process

 

What do you think? Will these ideas work?

 

 

 

 

 

 

 

Salesforce.com + Jigsaw = Recipe for IP Violation, Bad for Ad Agency New Business »

Be careful...
Published on March 23, 2011

 

salesforce logo

jigsaw logo

With Salesforce.com's acquisition of Jigsaw, you can now easily export contacts from Salesforce.com to Jigsaw. (For more on crowd-sourced data sources like Jigsaw, click here.)

However, ad agencies, as well as any other Salesforce.com user, must now recognize the significant intellectual property issues presented by this merger. Most importantly:

  • Whose contacts are in your current Salesforce.com account, or your internal database?
  • Do you have the right to export these contacts to a third party? If so, under what circumstances?
  • May that third party sell them?

This is important as your agency may be opening itself up to potential legal liability. Consider:

  • If you export contacts, purchased from a third party, into Jigsaw, what is your potential liability for violating the third party's license agreement?
  • If you import contacts from Jigsaw that belong to a third party, what is your legal liability for doing so?

Here are extracts from the license agreements of popular providers of new business prospecting information to ad agencies:

The List:

You are specifically prohibited from: (a) using or permitting the use of Information to prepare an original database or a comparison of the Software to other databases that are sold, rented, published, or furnished in any manner by or to a third party; (b) using or permitting the use of Information for the purpose of compiling, enhancing, verifying, supplementing, adding to, or deleting from any mailing list, business directory, or other compilation of information that is sold, rented, published or furnished in any manner to a third party.

 

Access Confidential:

The Content on this Web site is for use by the Subscriber and its Users only and not for commercial exploitation. A User may not decompile, reverse engineer, disassemble, rent, lease, loan, sell, sublicense, or create derivative works from either this Web site or its Content. A User may not use any network monitoring or discovery software to determine the site architecture or extract information about usage, individual entities or users. A User may not use any robot, spider, other automatic software and/or devices or manual processes to monitor or copy this Web site or its Content without the Provider’s written consent. A User may not copy, modify, reproduce, republish, distribute, display, or transmit to third parties outside the User’s agency network for commercial, non-profit or public purposes any or all portions of this Web site without the Provider’s written consent. A User may not use or otherwise export, or re-export, this Web site or its Content pursuant to the export control laws and regulations of the United States of America. Any unauthorized use of this Web site or its Content is expressly prohibited.

Redbooks (Lexis Nexis):

The Content on the Site is provided solely for your personal use and not for commercial exploitation.  You may not decompile, reverse engineer, disassemble, rent, lease, loan, sell, sublicense, or create derivative works from the Site or the Content.  Nor may you use any network monitoring or discovery software to determine the site architecture, or extract information about usage, individual identities or users.  You may not use any robot, spider, other automatic software or device, or manual process to monitor or copy our Site or the Content without our prior written permission.  You may not copy, modify, reproduce, republish, distribute, display, or transmit for commercial, non-profit or public purposes all or any portion of the Site, except to the extent permitted above.  You may not use or otherwise export or re-export the Site or any portion thereof, the Content or any software available on or through the Site in violation of the export control laws and regulations of the United States of America.  Any unauthorized use of the Site or its Content is expressly prohibited.

Hoovers (D&B):

The Services are licensed for Customer's internal use only and subject to any restrictions set forth in the Order. Customer will not provide Information, or other Services to others, whether directly in any media or indirectly through incorporation in a database, marketing list, report or otherwise, or use or permit the use of Information to generate any statistical or other information that is or will be provided to third parties (including as the basis for providing recommendations to others); use or permit the use of Information to prepare any comparison to other information databases that is or will be provided to third parties.

As you can see, if you've purchased information from one of these third parties, and have exported or plan to export it to Jigsaw, you are clearly violating their license agreement(s). For these third parties, the natural next step is legal proceedings. It remains to be seen if it's against Salesforce.com, their clients, or both.

My recommendation is to go back and re-read the applicable license agreements - your legal obligations - if you've purchased data from a third party anytime in the last few years.  And then, be very careful to document what you export to Jigsaw, if anything.

Better yet, just don't do it.

 

 

360-Degree Feedback to Build Team Players »

From classroom to workplace
Published on September 21, 2010

feedbackHow do you build team players? Is "team play" something that people are born with, or is it a learned behavior? How do we create it in this Millennial age, when our youngest employees have grown up hearing that 'everyone is a winner', even though in business there are winners and losers?

I recently read Randy Pausch's The Last Lecture. At one point he talks about a feedback system that helped the students in his "Building Virtual Worlds" class at Carnegie Mellon University learn how to operate effectively in teams. It occurred to me that this might work for creative, account, and perhaps even new business teams.

Here's how he did it:

First, he created four-person teams. Each person was dependent on the work of the other three members of the team, and their grades reflected it.

Next, he would ask each team member to evaluate the other three members of the team three different ways:

  1. How hard did this person work? Exactly how many hours do you think this person devoted to the project?
  2. How creative was his contribution?
  3. Was he easy or difficult to work with? Was he a team player?

There were five projects each semester, so each student ended up with 15 data points. He always found the answer to number three the most compelling:

What your peers think is, by definition, an accurate assessment of how easy you are to work with.

Randy then stack-ranked the results in a horizontal bar chart showing each student's scores. The results were hard to ignore.

He also asked for free-form suggestions for improvement for each student. When coupled with the chart, each student had numerous examples of their behavior in action, with suggestions on how to perform better in a team.

How might such a simple system work within your creative department? Account service teams? New business or pitch teams?

 


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habits

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A call to action
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churchill

A

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image

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image

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image

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image

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Measuring and graphing trends over time will show whether your new business process is improving, or not
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Take a page from Jack Welch's playbook
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In a

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I borrowed this post's title from Dharmesh, who

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Agency New Business: Making Your Vision Reality »

What is the one thing that must be done extraordinarily well to achieve your Vision?
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What is the clear, specific, measurable and achievable Vision motivating your agency?
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Agency CEO’s Managing Their Time for Proactive New Business »

If you can find the time to write a blog, you can find the time for proactive new business
published on May 07, 2009

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The

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Agency Start-Up in a Recession »

Starting an agency any time is difficult; succeeding today is even more challenging. Tips for success from a venture capitalist
published on March 27, 2009

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Procrastination Can Kill Your Ad Agency New Business Program »

Any excuse is a good excuse not to make prospect calls
published on March 23, 2009

Just last month an agency president told me, "Over 20 years I've made up every possible excuse in order to NOT make the new business calls I needed to make."

Here are 4 common forms of new

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11 Ways to Not Cut New Business Spending During the Recession »

Right-size your agency instead of eliminating your sales and marketing effort
published on March 17, 2009

The day before yesterday a Midwest agency CEO called and told us that they cut all new business spending at their 40-person full-service agency. I cringed when I heard the story.

What would you

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Focus on your Core Competency to Increase your Ad Agency’s Speed to New Business »

Spending money on what you don’t do well is as important as spending it on what you do well
published on January 21, 2009

Last week an agency principal from the West coast called and said, "I haven't forgotten you, we just got busy (months after his initial call). But, now we're ready to move forward with new

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