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Breaking the mould

It's time for all agencies to evolve, dispelling age-old myths of siloed business practices

A porcelain ornament being smashed with a hammerBeing asked to write a thought piece always fills me with excitement. I sit here with a clear view of the loch, as the mist rolls slowly down the bracken-covered February hills. I sit with the brief, detailing requirements, audience and criteria, resting on my sketch pad which is slowly filling up with possible structures, numerous notes and rigorous diagrams.

Thirty years ago I am pretty sure this would have been passably true. In the heady days before email and iphones, we had more time and there was an emphasis on process and approach. It's just not like that anymore.

My approach to this article is symbolic of much of the way client service business has evolved. Life has become "full on", busy; juggling drive and discussion. I am desperately keen not to write a piece that's repetitious – you know the world according to X approach, beginning with a story about how a pause for thought has been remarkable, leading to a 'cut and paste' about globalisation, silos and some boxes and arrows.

To deviate from this course seems quite risky. Frankly, I don't want to seem an idiot in front of you; I don't want to be: "…that guy, the idiot from hive."

My task is to secure succinct biting observation that truly connects. But first, a couple of scene setters. I am nowhere near a loch, I have never written a thought piece for a magazine before and only have six hours until flight BA185 lands in New Jersey and I have to file this copy.

This pressurised environment is further fuelled by the fact that either side of me on this luckiest of flights are two potential clients – small world. Both of whom I know, and each one is dead keen to read and review this as it's written. It's been as termed 'helping out'.

The death of the silo
Times have changed. I have been lucky enough to work across all the usual silos in both big and small agencies. I cannot help but think that we all in healthcare have perpetrated and supported a myth.

From the agency side, the silo simply doesn't exist in the way many would have you believe. Whether by audience or discipline, the uniqueness and homogenous nature of advertising, medical education, PR is a fallacy.

All agencies cross each other when it comes to many of the core activities required by a modern client. I am not talking about getting an ad man to run an advisory board or the PR lead to develop an A4 ad concept, but in the more grey activities there is a defined crossover.

The communications business has diversified massively since the 1950s and continues to do so. Next time you have an all-agency meeting ask who is best placed to create the patient pack or speaker meeting invite for specialists. Or if you are having a particularly tough day, wave the budget-busting 100-page monograph artwork and watch the solid nature of silos in action as all clamber for this margin-busting cherry of a project.

The plain fact is that our silos are crumbling, with just a few distinct specialised projects owned by a specific silo. This post-silo confusion, where everyone expects to be able to do everything, will be tough. Perhaps we all can expect to merge – becoming healthcare communications agencies. Masters of nothing, all offering the same menu of services, competing on price. The onus is on us to realise this and find ways of driving differentiation between us.

Sacrifice the commodity
The monograph meeting game leads nicely to the need for us as agencies to understand our businesses better. In the past, we have not been very good at this. The rise of procurement and what seems like a new breed of operations director has been brilliant at forcing us to know where we make our money, to cost our business transparently and move away from 'licked finger' and prevailing wind estimations. It is forcing many to be honest about their business. Our margin should be delivered through selling time, whether that be for thinking, doing or managing processes.

Procurement has rightly prevented us from becoming shopkeepers and marking up pass through costs, yet more still needs to be done to make our sources of income more professional.

Artwork is now a commoditised service, and for many a great source of income, with some agencies deriving as much as 50 per cent of their margin from it. Is it right for an output that's so vulnerable to be so crucial? It makes you worry for the business.

It's time for agencies to start transparently outsourcing artwork, operating tiered costing models and developing capabilities across the world to reduce these costs. Enabling clients to do more, with the same budgets and get the value they demand.

Death of the pyramid
Agencies are a diverse bunch ranging from the enveloping borg of networks to boutique creative shops. The need to reengineer the model that we all have developed is clear: pyramid-shaped agencies that are run by few, with masses of junior implementers have to evolve; agencies that specialise in knowing audiences need to listen to their clients more.

Time and time again we hear from agency changers that they need senior people day to day. Implementation is a given, (you get fired for screwing it up, but not hired for it) yet strategic support and decision making mid-implementation can no longer be considered second class to the yearly brand planning day.

The big kids are needed on, and not just in, the business. The current approach most agencies adopt encourages the best strategists and most senior talent upwards and inwards, spending an increasing amount of time managing the business. Reporting up to the holding company, sorting out operations, succession planning, staff development, moves the most valuable players away from the coal face.

Many other industries face this challenge. When you describe the typical agency approach to a partner at a law firm they laugh at you, and rightly so. In the legal world partners are the lifeblood of the business and are freed up to face clients and drive value 90 per cent of the time. These partners are supported by teams but lead the relationship. Learning is done internally, the machine is set up to front the most valuable, and discard those who are not going to make the grade. It's food for thought perhaps that there are no B teams among the Big Five.

The rise of digital has been the cause for dozens of slides being delivered to lots of marketers. Web 2.0, augmented reality, avatars, virtual this and that, ad infinitum.

Our digital world and the increasing sophistication of our audiences will force agencies to start to consider digital not as a channel or (at its very worst) production function, but as glue that binds everything we can deliver. Consumer closeness, tracking and RoI all are facilitated by this rush for 0s and 1s. But we need platforms and integration not things. Agencies that are going to be 'mega' will be the ones that see digital for what it is – a seamless place to embed all activities and facilitate community.

The world of digital is moving so fast that risk is inherent in its delivery. As producers of digital, the risk must start to be taken in-house at agencies. It's the agencies' job to push the boundaries. Next time you see a presentation touting channel genius, ask the big question of your crew in this storm: "In this ever changing world of digital innovation how much do you spend on R&D?"

If the answer is nothing then you are already behind. Your agency should be sharing risk to deliver its margin and your RoI.

Presumption
Increasingly our clients are alone. Head count pressure and changes to the model have produced a new type of brand leader: one who is too often under huge pressure, under-supported and at risk. The clients we know and love are the ones that know this and don't just want stuff done, but value help and partnership.

As the need to differentiate brands theoretically grows, so will the ways in which we understand problems and develop solutions. The move away from off-the-shelf solutions forces agencies to change and be more open, not have all the answers, and be happy to open up their teams to work alongside clients to understand and co-create.

This is a big ask for an industry that often has pretended that its ideation process is a black box of inspiration and genius, as opposed to good people slogging hard, and building an idea from humble beginnings. This is so true with more complex projects that result from pseudo briefings, and client/agency development teams working on prototypes for audience testing.

I am sure much of the above has been expected. It seems really clear that we need to evolve our model and man-up in terms of transparency and defining what business we are in. Most important for me is that I see great clients and good agency talent striving to do good work, often in spite of the business model.

For me the ultimate aim is for agencies to be seen as Trusted Partners, on the inside, rather than service providers. Anything that gets in the way of this simple aim should either be questioned or set alight.

With 20 minutes to land and for the skippers among you: in a small bag of macadamia nuts the future of agencies is as follows; create your own silo, move the pyramid to an hour glass, insist on working with clients not for them, put your best front of house and keep them, fire your B team, jettison the commoditised business, show everyone how you make your money and be prepared for co-creativity.

Tim from HiveThe Author
Tim Scorer alongside Ian and Jas owns hive, a patient-centric healthcare communications agency and Ebee a healthcare innovation agency. Both agencies are doing what some call great stuff in a different way. Tim writes regularly for hive's blog and is in love with healthcare, innovation and what we in our industry are capable of doing. Tim hates writing in the third person and would like to thank 10A and 11J for their help in this article.

To comment on this article, email pm@pmlive.com

7th April 2010

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