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The inside approach

Ensure the highest standards are met in the way you select and manage your agency

Cars racing around a trackThe identification, selection and management of an external communications agency have never been so important. With the healthcare arena evolving daily, agencies can help provide pharma companies with an external, objective perspective and bring new strategic and tactical skills to support and augment existing communications activities. At the same time, as we all attempt to simplify our operations and optimise communications spend, it is essential to make sure we get the best agency for our needs – both in terms of cost effectiveness and quality of work.

This guide aims to provide a clear and concise road map for selecting an appropriate agency, the processes and procedures available to help in that selection, and once identified, the management and partnership with the agency in the most effective and productive manner.

Why work with a communications agency?
Communications agencies are an extremely useful resource if your team is undertaking sustained product communications activity (whether in support of a brand, portfolio or specific therapy area) and relevant agency services are not already being provided elsewhere in your company. In addition to bringing dedicated and expert project management, agencies provide strategic and tactical skills to support and augment your existing communications efforts.

There are many different types of communications agencies – many specialising in a particular area or discipline such as healthcare, consumer products, media relations, crisis and reputation management, financial relations, community relations, employee communications and more. They may be part of a large global network with international reach or they may be a small, locally based agency. There is no right or wrong operating model – the right agency for you depends on your specific needs. A large agency may be a good choice if you are rolling out a global initiative and need cross-functional expertise, while a smaller agency may be appropriate if you want more personalised service, have constrained budgets or need local media expertise.


In brief

How procurement can help you appoint the right agency
• Information on 'preferred agencies' (already working for your company or who have been vetted for new business by procurement)
• Assistance in contacting agencies to determine availability and suitability to pitch
• Provision and execution of confidentiality agreements with agencies invited to pitch
• Assistance with managing the Request For Proposal (RFP) process and pitch
• Rate/fee negotiation and contract negotiation (if applicable)
• Company policies on payment for specific activities, for example for travel, out-of-pocket expenses, planning or performance-related pay.


Identifying the right agency for your needs
Procurement can play a significant role in helping to identify and select the appropriate communications agency and in ensuring that the process is fair, unbiased and thorough.

When selecting an agency, it may be not be necessary to go through the full credentials process as much of this information could already be available via procurement. For example, if your company has lists of 'preferred suppliers' they may have signed confidentiality agreements and financial checks may be in place.

The agency pitch – getting the perfect fit
All agencies on the pitch shortlist should receive an identical brief and it should be as detailed as possible. The better the brief, the better their response is likely to be. Try to give a sense of your company's culture and ways of working, so the agency can demonstrate whether they would be a good fit with your team.

Agency participants should include, and be limited to, those staff members who will manage or work on the account. Getting the best from an agency is highly dependent on the composition of the account team. An important factor in selecting the agency team will be the combined experience, knowledge and expertise. If the managing director or senior staff member is attending, make it clear that he or she should primarily confine his or her role to introductions and let the team who will be working on the business present.

Carefully consider participants from your company too – at a minimum, your pitch team should include the product communications manager and your procurement contact. If possible, encourage key decision makers from the in-house team to participate in the meeting to avoid the final decision being delayed or overruled by someone who did not attend.

All company participants should complete a pitch evaluation form at the end of each individual pitch while the presentation is still fresh in mind. Following the pitch, your team should make a joint decision about agency appointment. Ensure you involve the procurement team in your decision-making and never tell the agency that it has been successful until discussions on fee and contracting have been completed by the procurement team, as this will allow it scope to negotiate a cost-effective rate.

For those agencies that were not selected, it's important to close the loop with them and provide honest but constructive feedback. Ideally feedback should be provided jointly by procurement and the product communications manager. You should also give feedback to the winning agency – this is often overlooked but can be very useful for both parties to start off in the right way.


In brief

Reduce the risk of duplication Involve procurement
Before starting an agency identification and selection process, talk to other teams or procurement to see what agency services are already being provided at in-country, or above-country level. Even if an above-country agency is in place, a market may still need to hire an agency locally but the services required may be more focused on tactical implementation rather than strategic support. Your procurement team should always be the starting point for agency selection. It will be able to help you identify preferred agencies already on the supplier list that may meet your needs. In addition, it will be able to help you research and benchmark any new agencies with whom you are interested in working and can also negotiate lower rates and ensure that existing rates are within the norm for your company.


Setting the ground rules
Remember that your company is held accountable and responsible for the behaviours of your agencies. Therefore it's essential to communicate clearly some key ground rules at the beginning of the relationship. Most of these will be covered formally in your contract but should also be discussed with your new agency team:
• Structure for regular communication and reporting (weekly telephone conference and status reports and monthly or quarterly in-person reviews)
• Role of company versus agency in project and materials development
• Adherence to deadlines
• Quality of written materials
• Expectations around measurement
• Process for agency contacting third parties on
behalf of your company
• Agency attendance at relevant meetings
• Maintaining high ethical behaviour and integrity – more critical than ever in today's environment.

In-house teams should also be held accountable for appropriate management of the agency. To work at its best, this relationship should be a partnership:
• Treat the agency team like colleagues
• Consider the timing of requests (eg, that would require late-night or weekend working) unless dealing with an issue
• Don't ask the agency to do things that are part of your job – this is inappropriate use of your company budget
• Adhere to agreed timelines and communicate with the team if timelines are delayed due to a slower than expected company response
• Do not ask the agency to do any activity which does not fall under your company's code of practice.

Managing the budget
From the start, set realistic and sensible expectations with the agency on budget management. Everyone is sensitive to the current environment, if your budgets change mid-year, be upfront with the agency as soon as possible so they can adjust their forecasts and manage their staffing levels.


In brief

Managing the budget
• Ensure project budgets are agreed and approved before the agency commences working on each project. Estimates should break out fees and costs/out-of-pocket expenses
• These project budgets provide a record of the scope of work agreed and can be an essential reference if a project comes in over or under budget. Unless you change the original brief, the agency should not demand additional budget to complete the project
• The agency should provide regular updates (eg, on a monthly basis) on agency spend versus budget to ensure ongoing clarity and transparency. This should show a full reconciliation of actual versus estimated spend.


Your agency should be consistent, competent and well briefed
The team who works on your business should be consistent with the team who pitched and include an appropriate mix of senior and junior staff with whom you are satisfied. In general, your primary contact should not be the most senior person on the team, eg, managing director or CEO, (as his or her time will be very expensive on a day-to-day basis), although you should have access to this person if required – either for senior, strategic input or to raise issues about agency performance. An exception to this rule is if your agency is a boutique agency or an agency with a small staff. In this case, your primary contact may well be the most senior team member.

Once the selected agency has assembled its team, it is important to assign to the team a lead in-house contact, who will be responsible for managing the agency relationship. In most cases this should be a communications person or the lead project manager. This person should be accessible and responsive to the agency team. All direction on work assignments need to come through this single point of contact.

Agency relationships are most productive when the agency is treated as an external 'partner' to the brand team. The more access an agency has to key people in the in-house team, the more information it will have and the better job it will do, so introducing the agency to the wider company team at appropriate occasions and where budget allows should also be considered.

Once the contract is in place, it is good practice to re-brief your agency, even if you intend to implement the pitch programme fully. A kick-off meeting, including key members from both agency and in-house teams, should be scheduled shortly after the appointing the agency. This is an opportunity to provide additional information not made available as part of the pitching process (eg, key messages, previous press releases, previous programmes, market research, etc). It is also an opportunity to review the plan and set some key milestones for future implementation.

Following this initial briefing meeting, it is good practice to share relevant information regularly and promptly, and include the agency at key meetings where relevant and where budget allows. Regular communication is critical, either via weekly telephone conference and status reports and monthly or quarterly in-person reviews, depending on the scope of work. Providing regular feedback is also recommended – this should include both positive feedback when the agency has done a good job and constructive criticism when warranted.

Conduct a regular performance review
A formal review should be conducted on a yearly basis. These are important to ensure that both parties are clearly communicating the direction and effectiveness of the relationship. If performance is not at the desired level, steps should be taken between the teams to correct the problem. In evaluating an agency's performance, the following categories should be considered: satisfaction with account staffing, budget/financial accountability, communication, creativity/strategic initiative, ethics, integrated collaborative approach, programme development and execution and trust.

Do not terminate agency relationships without good reason
Since both your company and the agency have likely invested significant time and energy working on an account, it is crucial that all appropriate steps have been taken before any termination decision has been made. A new in-house 'handler' should not result in a new agency. It is desirable to keep continuity of knowledge in an agency relationship and for your company to be a considerate partner. Issues can easily arise from the agency not getting adequate support or response from the in-house 'handler' so feedback needs to be two-way.

Reasons for changing agencies could include:
• Performance issues
• Circumstances/life cycle of brand means a reduction in resource and budget; agency services no longer required
• In-house team desires a fresh perspective or different expertise
• Agency resigns the business due to competitive interests / taking on conflicting business
• Agency undermines company's reputation.

In the current environment, often with decreasing budget available for communications, the mantra of doing more with less, and more scrutiny than ever, it is even more crucial that you select the best agency for your needs and ensure both the highest quality and cost-effectiveness. Managing the relationship as a partnership, open two-way dialogue and the involvement of procurement throughout the process are all key in ensuring the highest standards are met in selecting and managing your agency.

The Author
Sarah Mathieson is head of global product communications at GSK
She can be contacted at

To comment on this article, email

20th September 2010


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