I must confess.
Initially, I wanted to create a monster piece that focused on “how to scale an agency”, but when I did a quick search on Google, I found some pretty impressive stuff out there already.
There’s so much content on SERPs that provides insight into how agency owners can “increase revenues” or “land new business”.
I wanted to do something different.
During my research, something that became apparent is that there isn’t much out there that focuses on how agency owners can use practical methods to cope with the pressures of growing their business.
From all of the conversations I have had with our agency partners, it’s clear that growing an agency is an emotional and mental struggle.
No matter where you are in the development of your agency, there’s a lot of pressure involved. And I could take a bet that there have been days where you’ve felt like throwing in the towel.
I spend a lot of time following and interacting with agency owners on Twitter. Through this, it’s easy to get the impression that owning an agency, in particular, is like a walk in the park.
A lot of agencies choose to engage with their audience through the power of social and will approach this by “becoming more relatable”.
They might post a picture of their recent ping-pong champion, or document how they’ve recently smashed their record of “the number of teas made in one brew round”.
I mean, who doesn’t love ping-pong and caffeine – right?
Thing is, although this is making your brand seem more approachable, it can also create this illusion that owning an agency is an easy slog.
When in reality, it’s quite the opposite
Sometimes Taking Deep Breaths Just Isn’t Enough
I did find some insightful articles on how business owners can keep their stress levels under control.
How taking deep breaths can make the feeling of stress disappear, or how keeping a tidy environment can help maintain a clear mind. And although these practices may be scientifically proven to release stress and can have a major impact on your sanity, they count for nothing if you haven’t got an on-hands approach implemented in the workplace to run alongside.
In today’s high-pressure industry, you probably feel as though your business is constantly on the line.
As an agency owner, you more or less have the final say on every decision, negotiation or pitch. Empowering as this is, it also carries a lot of emotional burdens which can wear you down.
You need to remember this: you’re not alone.
How Others Are Coping With The Pressures Of Scaling An Agency
Mitchel White, Founder & Managing Director of LeftMedia admitted that he’s “one of those people that worry a lot, but running an agency can put a big pressure on you mentally and physically”.
With that said, I thought it would be a good idea to approach a variety of agency owners, all from different cultures, and ask them the following question:
“What do you consider is your biggest pressure growing your agency, and what methods have you put in place to reduce/avoid it?”
By doing this, I was able to understand the common pressures that agency owners face on a daily basis and get first-hand, actionable insight into how they’re keeping those troubles at bay in the workplace.
Hopefully, by the end of this article, you will of been able to connect with what our agency experts have had to say and take onboard some of their methods.
This is a monster 8000+ word practical guide on how to cope with the pressures of scaling your agency. I’ve produced this guide for agency owners at all stages. So with that said, you may find the stuff our agency owners have advised is something you’re doing already.
Knowing this, I’ve included a quick navigation so you can go straight to the sections that you identify with the most:
Let’s dive in!
Below you will find a list of pressures identified by the agency owners I emailed. Plus, the strategies they’re using to keep their tensions to a minimum.
Dealing With The Common Pressure of Financials
Once I started to receive some feedback, I noticed a clear pattern straight away. Most of the agency owners that I questioned all share the mutual pressure of cash-flow uncertainty, as well as ensuring that they have enough revenue to cover operational costs.
Was I shocked? Not at all.
Image courtesy of Hubspot
A previous survey by Hubspot revealed that two-thirds of agency owners consider unpredictable cash flow one of their top three challenges, and 19% of them called it their top concern.
Mitchel White and Dan Cullen-Shute, CEO & Founder at Creature of London, both share the same pressure which is ensuring that they “keep the lights on”.
In addition to this Dan believes that “there are a million pressures that come from running an agency.”
“The pressure to make every piece of work something you’d be as proud of in Effectiveness Week as you would in Cannes; the pressure to ensure we don’t run out of Crunchy Nut Cornflakes on a Monday morning; and the pressure to make sure you’re both funny AND insightful when asked to supply a quote for somebody else’s article. Sitting atop ALL of that, though is the pressure to keep everybody’s mortgages paid”, he says.
Darren Marble, CEO of CrowdfundX, can relate to Dan’s statement. He also revealed that his biggest pressure is “ensuring that they generate enough revenue to cover salaries and overheads on a monthly basis”.
Whatever size your agency is or how fast it’s growing, there’s always going to be that uncertainty of cash-flow. Sadly, we can’t see into the future and predict when we’re going to get hit by unexpected costs or experience one of those ‘bad months”.
Fortunately, the agency experts I questioned shared their methods on how to reduce that pressure of uncertainty and provided me with tips on how to manage your finances in a more efficient and reassuring way.
Put An Estimated LTV (Lifetime Value) On Each Client
Jordan Scheltgen, Founder of Cave Social, believes that a lot of agencies are quick to tell their clients to spend big on SEM, SMM, but then don’t do any of that stuff themselves.
He says that “you need to figure out what it costs you to get a client, then put an estimated LTV (Lifetime Value) on that client.”
Jordan believes that putting an LTV on your client is “key to financial growth”.
Also known as, Customer Lifetime Value (CLV) or Lifetime Customer Value (LCV) – depending on your preference. LTV is a method used by marketers to project the revenue a customer will generate during their lifetime.
Lifetime Value (LTV) = Total Customer Revenue – Total Customer Costs
Jordan demonstrated his belief by using an example of his own, which he shared on Inbound.org:
LTV can determine the financial gain of your business and is a valuable metric for those running an agency or subscription-based model.
By calculating the LTV of your customers, you can reveal where stronger marketing efforts are needed, as well as the long-term financial impact of losing current customers.
More importantly, LTV can be used as a premature warning sign to detect defection rates. It identifies in which segments “a problem” originates, so procedures can be put in place to correct the cause. In turn, reducing that dreaded pressure of “cash flow uncertainty”
Switch To A Retainer Based Pricing Model – If You Haven’t Already
We heard how Mitchel White’s biggest pressure “is keeping the lights on.”
He also told me that, “the additional costs of premises and PAYE (for example) add extra pressures with cash flow being notoriously hard in a traditional agency where fees are project based.”
One way Mitchel has tackled this is by increasing the number of his recurring revenue clients. By doing this Mitchel has, “guaranteed monthly income when new projects go a little quiet.”
Although to receive the true benefits of recurring revenue, you will need to ditch your project-based pricing model in favour of a retainer. In fact, Jordan Scheltgen strongly advises anyone billing hourly to “switch to a retainer pricing model as soon as possible – if you haven’t already”.
In addition to this, he advises that you should “project your hours (internally), then put forward a price monthly with your deliverables.”
By implementing a retainer-based model, you have a predictable source of regular income and clear mechanisms for operational costs.
More importantly, you have a clear roadmap for future production and can budget your team’s time accordingly.
Using a retainer model has enabled Ed Leake to factor his average billable working hours and overhead per role, giving him a baseline cost.
Leake says, “It’s really simple, anyone with a copy of Excel can do it. I use total working hours – holidays – 3 days sick * 70% efficiency, per person.”
Leake shares with us a quick example of what this process looks like:
Ed accounts for a person’s wage, the business cost (office, equipment, software tools etc) and any advertising budget.
Next, he adds in projected hours per service, which gives him a no-nonsense baseline. The spreadsheet then calculates a 20% creep/slack with a 35% profit margin.
The end result, an ACCURATE price for the service.
Here’s an example:
Ed claims this process (in tandem with tight project management) has enabled him to propose retainers to the nearest hour billable.
“Often our prices look ‘funny’ because of this, we don’t round up or down to get a job – we give exact figures without discount”, he says.
Ed claims this process offers “immediate trust and transparency”.
Retainers are most efficient when you know a solid, predictable relationship makes sense. They are an effective method for both agencies and clients. Less time is spent on unnecessary paperwork, allowing both parties to focus on what matters the most – achieving results.
In addition to this, retainers make scheduling easy and simplify your proposal stage. Instead of generating a custom, project-specific proposal for each of your clients. A retainer can help you draw up a template contract, which can come in handy if you receive a lot of proposal requests.
Watch Every Penny – Even When You’re Making Money
This may sound obvious, but you’d be surprised at how crazy some people get once they start to see the money piling up in the bank.
Go on a spending spree too early, and you’re going receive a backlash of financial pressure.
For most people, running an agency doesn’t equate to instant riches.
Ed Leake, Founder of Midas Media believes the best way to manage your finances is to, “be tight and watch every penny – even when you’re making money. This isn’t just in the first few years; you need to do it forever.”
He goes on to say that, “some of the richest people in the world become rich because they keep an eye on their expenses like a hawk.”
Tom Corley, an accountant and financial planner, surveyed 233 wealthy individuals. Mostly self-made millionaires, he asked them questions about their daily spending habits.
The majority of wealthy people in Corley’s research said that they save a significant amount of their revenue income. In fact, 80% of the individuals in Tom’s study didn’t become wealthy until the age of 50.
Corley recommends that you should put 20% of your monthly income into savings.
For example, if you generate £100,000 each month in revenue, try and put £20,000 into savings. By doing this, over time you will start to see your savings account grow.
If the recession taught us anything, it’s that the most successful businesses can sometimes encounter financial challenges beyond their control.
So, by keeping a cash supply on hand, you can ensure that your business will stay afloat in lean times.
Not only will this enable you to keep providing services, but you take away that pressure of generating enough revenue to cover operational costs and employee wages.
For Mike Ramsey, President of Nifty Marketing, he has opted for Dave Ramsey’s personal financial guidelines for his business and finds it very conservative. Dave Ramsey’s personal financial guide is pretty much in tune with Thomas Corley’s advice.
However, whereas Corley recommends that you put away 20% of your revenue each month. Dave Ramsey suggests that you should have 3-6 months of expenses on hand at all times.
For example: at £65,000 per month of expenses, you should have between £195,000-£390,000 in reserves.
Dave admits that this can seem like a lot of money. With that said, if clients unexpectedly drop, or major industry changes necessitate a completely new model, you will have the cash on hand to make good decisions – instead of desperate ones.
By following Dave’s advice has put Mike’s agency in a unique position, “we’re growing, but not at a crazy rate.”
Mike says, “if we lose a client, it’s ok. If we have late payments, that is also ok. I can sleep given I know we have months of float with zero income if needed.”
He accepts that his biggest pressure is “false pressure” that he puts on himself that he has to scale at a certain rate each month.
He believes this type of thinking can lead to seriously bad long terms decisions and can deplete cash flow rapidly.
“Greed can build things fast, but can also bring everything down just as quickly. I would rather take my time and play the long game”, Mike says.
There’s always a cheaper or more efficient way of achieving your results on a budget, it’s just getting into the habit of finding that cheaper alternative and some strategic planning.
Focus On Building A Solid Process For Getting New Business
So, we’ve established that cash flow is easier to calculate and maintain by switching to a retainer pricing model. And that calculating the LTV of your customers will allow you to estimate the financial gain of your business.
Although, before getting to these formulas, you will need to ensure that you have a solid process for getting new business.
I mean, there’s no math without clients – right?
Seb Dean, Managing Director of Imaginare Digital, advises that “you should be focusing on building a solid process for getting new business.”
He isn’t alone in saying this.
Previously, we heard how Darren Marble’s biggest pressure is generating enough revenue to cover salaries and overheads on a monthly basis.
A common pressure shared by many business owners – I’m sure you will agree?
To address this challenge Darren stays “relentlessly focused on new client acquisition and creating reference accounts” which helps him sell against the competition.
Darren believes that “sales solves all problems” and recommends that you “make it your core focus.”
By plotting out his sales process, it’s allowed Seb Dean to accomplish his goals.
Seb leaves us with a couple of questions which you can ask yourself when building a solid process for getting new business:
- Think about who your customers are?
- How are you going to reach them?
- Where are your leads coming from?
- How many appointments will you need to have each week to make enough money to pay yourself a wage?
If you’ve asked yourself these questions, and feel as though you have come to a dead-end, then there are other alternative methods you can take to generate new business.
Oliver Gaywood, Founder of Civic Web Media, made sure that everyone in his network knew what he was doing. People he had previously worked with and even his friends. It was this process that allowed Oliver to develop some of his most profitable relationships.
“Some people wanted help with their content, some referred me to those they knew who needed it and others, even though they didn’t really know what content marketing was, associated the term with us and would mention us in relevant conversations”, says Oliver.
If you feel as though you’ve exhausted all your personal networks, Josh Ballard, Founder of Paradox Marketing, says that you can accelerate Oliver’s process by “getting out and networking as hard as you can in your own hometown.”
“As you meet new people in person make sure that you have a follow-up plan for engaging with them online. Always be adding value and never be sold. You will win more work in the long run by sending through meticulously well-curated content to your prospects than you will by pointing out how their digital presence is not working well”, says Josh.
As well as this, you should also build a solid process for your existing accounts too.
In my previous roundup, I emailed agency experts to get their perspective on how they scale agency revenues by expanding existing accounts.
If you run both processes alongside each other in the right way, those pressures of generating enough revenue to cover salaries and overheads with soon evaporate.
Dan Shutes says, “we’ve stuck to winning business whenever possible, which has done us alright so far.”
The Challenges of Recruitment and Hiring The Right Talent
For Brian Whigham, Founder of Venn, “raising money has become incredibly easy, especially in the North West.”
Brian believes this is due to the focus on the Northern Powerhouse, “from government funding, private equity through to crowdfunding, the access to investment has never been so good.”
He claims that the challenge of growing a digital agency is “simply twofold.”
The perception that the web is becoming easier and cheaper when in reality, it’s getting harder and more expensive.
“As marketers, we are flooded with tools and resources that supposedly make our lives easier. In reality, the speed of evolution is creating a storm that every agency and business is trying to compete in”, he says.
As a direct consequence, Brian feels “there is a dearth of talent.”
Along with the uncertainty of cash flow and revenue, another common issue shared by agency owners is the challenge of recruiting the right talent for their business.
On the launch of Seed, Founder Nick-Stuart Miller felt that his biggest pressure would be maintaining the high standards which they set themselves for achieving results.
Although, because they’ve structured their message to empower team members with self-development and autonomous decision making. Nick soon realised that the challenge is actually hiring the right kind of people to support their existing values.
Image source: The 2017 State of Inbound Report
He isn’t alone feeling like this.
Jane Asscher, Managing Director of 23red and Kayleigh Toyra, Co-founder of Seeker say their biggest challenges revolve around recruiting the right talent, as well as building and maintaining their organisational culture.
Jane believes this is “relatively easy when you’re in startup mode”. Although admits that it gets more difficult as an organisation grows and the owners can no longer be hands on everything.
According to a report by Hubspot, hiring top talent was the eighth biggest challenge marketers faced in 2017.
So, why is finding talent such a challenge for agencies?
In the past couple of years, there has been a significant shift from outbound to inbound marketing.
There seems to be a bigger demand for top talent, but not enough supply out there to cover it.
In addition to this, the required skills a modern marketer are very different from what they were a decade ago. Nowadays, roles seem to have overlapped and morphed.
For example, marketers are needed to oversee marketing activities as well as assist sales to generate new business and drive growth within existing accounts.
job description courtesy of Indeed.co.uk.
To make matters more complicated. In 2016 it was reported that millennials are actually job-hopping more frequently than previous generations, according to this research conducted by LinkedIn.
Combining all these factors together, it’s no surprise that agency owners consider finding the right talent a challenge.
If you’re lucky enough to find that “talent superstar” who has all the required skills and more. There’s no guarantee that they will actually stick around long enough to have an impact on results.
Retain Your Employees and Reduce That Challenge of ‘Talent Shortages’
Talent shortages seem to be a common issue throughout many industries. Although, it is a significant challenge for those who work in the digital and tech sector.
Ed Leake says that “talented people are your lifeblood” when it comes to agency growth.
So, what can you do to reduce that talent shortage and pressure of finding the perfect candidate for your business?
It may sound obvious, but the most effective way of counteracting talent shortages is by focusing on getting more out of your existing employees.
More than half of employers globally are developing and training their own people in order to overcome recruitment challenges.
Jane Asscher and the team at Red23 have implemented management practices, staff benefits, training and development plans to support their existing staff and combat any recruitment issues.
“We are looking for people to grab opportunities to learn, develop and share new concepts”, says Jane.
Jane provides her existing employees with a cultural allowance which they can spend on theatre, museum galleries and other events. The aim of this is to help encourage employees to flourish and expand their cultural know-how.
This focus on their culture and values has helped Jane attract and retain talent. Ensuring that they have one of the lowest levels of staff turnover in the industry.
So, instead of waiting for that “worldie candidate” to come along, who has all the skills you desire and more. Why not invest time into someone who has worked at your side for a while, and demonstrated their dedication to your business already?
In this study, Data Freaks discovered that 89% of millennials said that they would stay with the same company for 10+ years if just two criteria were met:1.
- 1. Opportunities for upward career mobility
- 2. Regular increase in compensation.
It is this exact method that has allowed Nick Stuart-Miller, Founder of Seed, to alleviate growth challenges.
“We have made sure every person at Seed feels like they are an important part of our company, and giving them responsibility, accountability and the voice to be heard”, he says.
In addition to this, Nick has ensured that their leadership team, himself and business partner Robin, are available to the team at all times.
With an intrinsic level of openness, Nick communicates with his team to ensure that individual challenges are supported.
Communication is key to success. Make time for your employees, and give them the responsibility they’ve worked so hard for.
Bryan Alston, Senior Director at Los Angeles’ fastest growing digital agency and now as Head of E-commerce at BAMF Media, says “having more two-way conversations between sales and operations is key.”
Nick and Bryan are prime examples of how communication can help cap staff turnover and reduce the challenge of “talent shortage”.
Could We Be Making A Difference To The Talent Shortage?
Is there something else we could be doing now which will have an impact on our “talent dilemma” in 5-10 years time?
Brian Whingham believes the main problem with the talent crisis is that there isn’t enough focus at the grassroots level in school.
“Young boys and girls need to be shown the opportunity that online companies present for their career and personal development”, he says.
Personally, as a marketer who has experience in SEO, PPC and Content I do struggle to tell friends and family who don’t work in the industry what I do for a living. In my agency days, I found the easiest thing to do was tell others that “I just help other businesses with their online presence”
People outside our industry literally have no idea that our jobs exist. In fact, I’m going to use an example of how unacknowledged our market is:
I was watching the apprentice final with a friend.
For anyone who hasn’t watched the apprentice before. It’s a reality game show in which a group of aspiring entrepreneurs (plant pots) compete against each other in a series of business-related challenges in order to win a £250,000 business investment from Lord Alan Sugar.
In this particular final, one contestant pitched their confectionery business and was then followed by another individual who promoted their IT recruitment idea.
My friend turned to me and said, “that IT person does what you do!”
Considering that SEO, PPC, content and other online marketing activities have been around for over a decade now, the lack of exposure for our industry is quite concerning.
Brian Whingham believes “once we solve the talent problem, the role of the agency owner will become much easier.”
Personally, as a marketer, I feel as though we need to come up with innovative ways on how we can shed more light on what we do.
Liverpool Geek Girls are a perfect example to follow.
Their core mission is to tackle the current gender imbalance and skills gap in the technology sector.
However, in my opinion, it’s the fact that they host events, courses and workshops for women and girls of all ages which makes them so important.
They’re doing exactly what Brian Whigham says we need to do. They’re targeting youngest and exposing them to the possibilities of the tech sector. Something a lot of us didn’t have access to at an adolescent age.
A lot of individuals have built a successful career off the back of the marketing and tech industry, but have failed to give back to the community.
I believe if we take a hint of inspiration from organisations such as Geek Girls, we could break down the barrier on the talent shortage for generations to come.
Take Your Time and Avoid the Cost of a Bad Hire
Although the methods that we’ve just discussed can help decrease staff turnover and “talent shortages”, they won’t completely prevent staff from leaving your business – but that’s okay!
Hiring is hard. Especially when an existing employee leaves your business without any warning.
A big mistake agency owners do in this circumstance, is get into a panic and advise the job position on a LinkedIn update.
We’ve all seen those status updates…
Hiring the wrong person will disrupt the rest of your workforce and can lead to a loss of revenue.
When Kayleigh Toyra started out, she took advice from other agency leaders on how they manage their own recruitment challenges.
“I’ve come to realise that taking your time with decisions; and hiring on attitude, not just aptitude, are good strategies”, says Kayleigh.
Who would you rather choose:
- A candidate with all the desired skills, but a negative attitude towards teamwork?
- Or a dedicated individual, who has a couple of weakness, but has demonstrated their determination and ability to adapt to your current environment?
Rather than searching for a candidate when a position becomes available, Kayleigh has remained on the lookout for new talent – even when it’s not required.
“With growing an agency, you need to constantly be on the lookout for new talent – it’s an ongoing, rather than a ‘stop and start’ process”, says Kayleigh.
Being Able To Trust and Let Go
Kyle Racki, Founder of Proposify, highlighted this in his email to me.
“The biggest pressure growing an agency is handing over the reins to other people. As an agency owner, you started as a freelancer where you managed everything: the clients, the projects, the invoicing, the new business”, he says.
Kyle wasn’t the only person who made me aware of this pressure shared by many agency owners.
Whilst scaling his agency Jamie Huskisson, Managing Director and Founder of JH, witnessed first hand how “most people try to do things themselves, finding it hard to let go.”
Most agency owners do start out as freelancers. So, in the past, they’ve had complete control over client projects.
However, scaling an agency is a whole different ball game, and on the road to success, agency owners must sacrifice that time they use to spend controlling client projects steering the business.
Understandably, this can be a difficult routine to break.
While no one knows your vision or brand better than you, scaling an agency demands a variety of skills at the top. With that said, our agency owners shed some light on how to ease your fears of letting go.
Hire People Smarter Than You
Previously, we heard how Ed Leake used to whimper when he looked at overheads, but now he cherishes them.
He knows that beneath his numbers is a solid team of experts who save him from mental overload. Experts he can rely on and who clients enjoy working with.
Ed strongly believes that “if you’re the most skilled person in your business, you’re not hiring the right people.”
Some agency owners have developed this pressure that they need to be the smartest person in the room, or they will lose the respect of their employees. As they’re a leader, they feel as though they should hold all answers.
This isn’t true.
Jess Butcher says, “you need to ensure that you’re hiring good ‘managers’ and not just good doers – people potentially better than you at their areas of expertise who you can empower to hire, manage and develop their teams and really ‘own’ their areas of the business. You simply cannot scale if you continue to have direct input in everything that the business is doing.”
In this article, Richard Taylor, Fundraising and Marketing Director for Macmillan Cancer Support, says “the secret to success is to bring in people who are better than you at any job that you could ever do.”
Hiring someone who is smarter than you doesn’t necessarily mean that you should bring someone who could step into your role tomorrow.
Being smart means that an individual isn’t afraid to use their brain or ask questions. They’re curious, and that’s the type of people you want taking over the reins.
Hiring smart people gives your agency a better chance of success, and makes your role as an agency owner easier.
Taylor believes hiring smart people “makes you look good.”
To become a great leader you must surround yourself with talented people. It is your responsibility to build a team that can bring innovation and unique ideas to the table.
Businessman R.H Grant once said, “when you hire people that are smarter than you, you prove you are smarter than they are.”
Preventing The One-Man-Band Syndrome
This doesn’t just happen to startup owners. One-man band syndrome can strike when you’re years into the business. For anyone who is unaware of what this is, it’s when an MD or founder try and run their whole business by themselves.
In the beginning, you generally need to have an understanding of sales, marketing and tech if you want to get your business off the ground.
However, if you adopt one-man band syndrome for too long, the growth of your company will eventually flatline.
Kyle Racki says that “many can’t get out of their own way. It’s essential to not be the star when you run an agency.”
He admits in his article on how to start an agency, that one of the hardest things to do as an agency owner is to step out of the spotlight.
If you ever get the temptation to set up your own one-man band. You should ask yourself this question.
“Is this really in the best interest of our clients, or it is in the best interest of my ego?”
One-man band syndrome can demonstrate a lack of trust and lowers team morale. More importantly, it can have a backlash on productivity. Increasing churn rates and igniting that pressure of “future unpredictability.”
In his book, great from the start: how conscious corporations attract success, Author John B Montgomery speaks about how the CEO of Semiconductor was a victim of one-man band syndrome.
The CEO of Semiconductor was unable to delegate and had no executive team to support him.
He made every decision – from hiring new employees to buying paper clips.
His inability to surround himself with a strong team of employees prevented his company from scaling to its full potential.
Eventually, Lucent Technologies eventually acquired his company.
Avoid The Trap Of Micromanagement
Comparable to having one-man band syndrome, micromanagement is when leaders give responsibilities to others, but closely observe and control the work of his/her subordinates.
It’s so easy for agency owners to fall into that trap and get confused between “leadership” and “Micromanagement”.
Leading your employees and keeping them accountable is a huge part of scaling an agency.
I’m sure you’re all aware of the management style of Steve Jobs’.
He was progressive, intense and very particular. It’s well-known that Job’s had a slight infatuation with dictatorship, which in the beginning, was an issue at Apple.
His micromanagement caused confusion and fear amongst employees, which was having a negative effect on the development of Macintosh.
Moral of the story here is, by micromanaging your employees, you’re potentially decreasing the chances of agency success.
As much as you want to be involved in every aspect of the business, which you built from the ground up, you need to learn how to step back and allow your employees to make key decisions without your input.
Scott Berkun has an insightful analogy for owners and leaders who are guilty of this common habit:
A good way to overcome this habit is by developing an awareness of why you’re micromanaging. In most cases, it’s because of insecurity. Maybe you’re afraid that it will reflect badly on you if your team doesn’t succeed.
“what excuses am I using to micromanage?”
Instead of using excuses such as, “it will save time if I do it myself.” Or “too much much is at stake to allow this to go wrong” Wilkins recommends that you focus on, “the reasons why you should not micromanage?”
Micromanagement diminishes creativity and innovation. When employees feel like they’re being watched they are less likely to step outside the box.
By asking yourself the question of “why you should not micromanage?”
You increase the job satisfaction of your employees, ensuring the future of your business.
Integrate Autonomy Into Your Culture
“Autonomy is the antithesis of micromanagement”, says Joan F Cheverie, Director, Professional Development of EDUCAUSE.
Your agency needs a leader, not a micromanager, who knows how to give autonomy to employees who can lead the company more effectively in specific areas.
For Jamie Huskisson, “one of the most important things when growing an agency, is to give people the power they deserve and provide them with the autonomy, when they can deal with it, to really flourish.”
Jamie recommends that you should “identify your leaders early” and “give them the opportunity to shine as early as you can.”
Autonomy is crucial for building employee engagement and is believed to decrease the levels of emotional exhaustion felt by employees.
In this 2011 study, from the Foster School of Business at the University of Washington, they found that handing over more autonomy to one “talent superstar” isn’t enough. Other teams members should also have the ability to get involved in important decisions.
So, how can you go about giving your employees autonomy they need to succeed?
If you’re feeling the pressure of handing over the reins still, start by raising your team’s autonomy slowly. This way, you will be assured that you’re not giving away too much control at once, avoiding any potential backtracking in the future.
Also, make sure that you identify the balance between autonomy and structure. Joan Cheverie recommends the following:
“Stop telling your staff how to do their job and, instead, set the strategic direction deadlines and benchmarks”.
Let your staff decided how they will accomplish the job, encourage your employees to set their own goals. Cheverie says that this creates a specific kind of motivation called intrinsic motivation – the desire to do something for its own sake.
By defining the end result clearly, you can outline any barriers. You’re giving your employees the autonomy they need but within a specific perimeter.
Jamie sums it for us, as to why it’s so important to provide your employees with the autonomy they need to succeed:
“By providing autonomy you’ll grow quicker because you have more people tackling different tasks at once and you ‘move as one’ as a leadership team internally”
Maintaining Standards and Achieving Results
Some agency owners share the mutual pressure of maintaining their standards as they start to take on more projects and experience sustainable growth.
Bryan Alston considers “the biggest challenge to growing an agency is making sure you have the resources and capabilities to live up to client expectation, and aligning that with the sales team from day 1.”
On the one hand, you’re ecstatic with all the business that is coming through the door. On the other hand, you’re worried that when you increase projects, you will dilute the quality that you’ve worked so hard to achieve.
In addition to this, agencies are constantly having to adapt and change, as the online industry continues to rapidly evolve.
Andy Golpys, Co-Founder of MadeByShape, says in the early days the main pressure is “getting the work.” However, believes his biggest pressure was/is to “keep the standards high all the time.”
He admits “this might not sound like your typical pressure” but says, “the standard of our work is our reputation and if that standard drops, it has a knock on effect. We won’t get as many enquiries or repeat customers, and that creates the pressure of having to bring money in to pay the wages.”
In the book, scaling up excellence: getting more without settling for less, coauthor Robert I. Sutton says that, “companies grow well and scale badly when they focus on running up the numbers but not the quality. They get bigger and start to look like just any organisation. And there goes the value.”
It’s so easy for agency owners to lose sight when it comes to quality control, especially when their business is scaling at a significant pace.
The following are just a few practices, recommended by our agency owners, which you can take on board to avoid that dreaded pressure of maintaining standards.
Don’t Be Afraid To Say “No”
For all of you out there that did start out as freelancers, you will of been inclined to say “YES” to any project or client that came your way.
We’ve all got bills to pay – right?
It’s this experience that makes it hard for agency owners to say no to jobs which they simply can’t accommodate. While cash-flow is crucial, you need to ensure that any work you take on is aligned with your business goals.
Andy Golpys is a great example of this.
His vision was to operate a small studio, and for various reasons, never wants to go past 12 members of staff.
Andy says, “as an agency grows, there become more difficulties such as, increased volume of projects, tighter deadlines, more staff to manage, more people to deal with, and a lot more travelling which takes up time”.
By putting in place simple, but effective methods, Andy has been able to tackle the pressure of maintaining standards head-on.
As well as tweaking their “client-side process” to elevate production. Andy has taken a back seat in terms of design to solely concentrate on business development, client and project management.
Andy says, “this involves planning the diary 3 months in advance, and saying no to projects if the diary is already full.”
By saying no to projects, Andy has remained loyal to his initial goal of establishing a small studio specialising in search engine optimisation, web design and development.
However, for some, saying no just doesn’t come naturally. We either can’t face letting people down or refuse to be perceived as a “no person”.
You need to remember, it’s not unprofessional to turn down work. By saying no to things you don’t want to do, allows you to say yes to more of the things that you want.
Before saying yes to a job, ask yourself the following questions first:
- Will saying yes to this job divert me from my initial goals?
- Do I want to be known for this type of work?
- Is it enough to cover operational costs?
- Do I have the resources to execute the project?
Work that pays little in terms of revenue and fulfilment will leave you demotivated. Inevitably, this will lead to lousy standards and more low-quality projects.
Understand Your Businesses Strengths and Weaknesses
In order to maintain standards and survive in this ever-changing market, agency owners must set their goals based on their strengths and downplay any weaknesses.
Jess Butcher, Co-Founder and CEO at Blippar, believes “one of the most critical things as a business owner is understanding your own strengths and weaknesses as honestly as you can.”
When identifying your strengths and weaknesses, you need to outline competitive advantages and distinctive qualities your agency does and doesn’t carry.
Most agency owners adopt for a SWOT analysis and consider it the easiest way to determine internal and external factors which could be having an effect on their standards. SWOT is an acronym and stands for:
Strengths, Weaknesses, Opportunities, Threats.
A SWOT analysis is an effective way of identifying any issues that could be crippling your agency. By doing this, you’re able to conduct strategies that will allow you to maintain your standards, as you focus on scaling your business.
To remain in control of your SWOT analysis, keep in mind these simple rules:
- 1. Only list four per category max.
- 2. No opinions. Stick to facts to ensure honest information.
- 3. Make weaknesses and opportunities actionable.
- 4. Try and be exact when listing items in each category.
Self-explanatory, your strengths are what your agency is good at already. Although, the purpose of using a SWOT analysis is to identify these strengths so you can utilise them to meet organisational goals and high-quality standards.
You might be a web design and SEO agency that specialises in online marketing for law firms. Straight away you would produce a strategy that would position you as an authority in that specific field.
Alex Moss, Managing Director of Firecask, found that his skills in WordPress helped him and his agency stand out from the crowd.
Moss says, “because of this skill, I was able to make myself [somewhat] of an authority when it came to WordPress and SEO. Once you have this, work to get yourself as an authority via speaking and through networking.”
I’m going to put this lightly. We all have weaknesses. In order to maintain quality and scale, you need to minimise your weaknesses or turn them into strengths. The key here is to identify your weaknesses as honestly as you can.
You may feel that you’re advertising a lack of services to your clients. You could consider a partnership with another agency or SaaS product to strengthen and compliment your current offering.
With that said, it’s worth mentioning that we offer our own agency partnership program. You can click through here to find out more about how that works. 🙂
An opportunity to identify external factors which could have a positive impact on your business. This could be something like a change to the current market or growth in technology.
For example, in 2016, we saw a record of 80 new companies being launched in an hour. So the opportunity here is that eventually, these organisations will likely require online marketing in order to grow.
Sadly, threats are unpredictable. In most cases, you will need to rely on predictable forecasts and intelligence to gauge the best possible decisions. It’s not feasible to avoid all threats, so what you need to be asking yourself is this: How can I reduce the impact of a threat?
For many agencies, they will consider their competitors as one of their biggest threat. To reduce this pressure, you could perform a SWOT on your competitors to identify their strength and weaknesses. By doing this, you know where your agency stands compared to others.
With that said, it’s important that you don’t “get too caught up” in what your competitors are doing.
Chris Martin, Head of Marketing at CommonTime, says it’s important that you “don’t get caught up with what your competitors are doing.”
“It’s very easy to spend a lot of time trying to work out exactly what all of your competitors are doing and how you differentiate yourself”, he says.
If you do consider your competitors as a threat, then keep in mind that you’re the unique aspect of your agency.
Chris believes that “your knowledge, experience and insight will be the differentiating factor – that’s something no-one will ever be able to replicate.”
Don’t Try And Reinvent The Wheel
A lot of agency owners put this self-pressure on themselves that they need to come up with innovative ideas otherwise they will fail as a business.
It’s time to accept reality.
Commercial advertising and political campaign displays have been found in the ruins of Pompeii and Arabia. It’s likely that any idea you come up with now, it’s already been done.
Craig Wiltshire, Managing Director of Struto, says that it’s OK to “borrow shamelessly from other places.”
So with that said, stop putting this unnecessary pressure on yourself to come up with the “next big thing”.
Instead, find a concept that works, and tailor it to your specific service. It’s this exact process which we’ve adopted here at Ruler.
Founders Ian and Dan, worked with a lot of agencies previous to Ruler Analytics.
They faced the common obstacle of proving the value of their campaigns. The client’s phones were ringing, but it was difficult to demonstrate where those calls were coming from. Frustrated by some of the limitations of Google Analytics, Ian and Dan went on to develop Ruler Analytics.
A big focus for Ruler was/still is the call tracking software. Despite it being a popular and affordable product, we found it difficult at first to break through the noise being made by other competitors.
With that said, we went ahead and evolved our servicing, sales and marketing approach.
With call tracking still at the core of our product, we now focus on connecting the dots between Google Analytics, DoubleClick, CRMs between website visits, phone calls and leads.
By integrating data with popular CRM tools, marketing teams can get an end-to-end overview of the success of their lead generation based on closed sales, not just contracts.
More about that in this video:
The bottom line here is that call tracking was already around before we entered the market. However, we took the concept of the idea and produced a service that is more engaging with our target audience.
For those of you who are at the start of their journey, Craig Wiltshire leaves you with this, “just because you’re starting out doesn’t mean you have to start from scratch. Don’t try and reinvent the wheel.”
Just Focus On Doing Great Work
I’m not an agency owner, but this is one topic I can relate to on a personal level. It’s so easy to let standards slip when your schedule is bursting with tasks. Although, to avoid that dreaded pressure of slipping standards you must continue to stay focused on doing great work at all times.
In their book, Sutton and Rao argue that scaling isn’t just about getting bigger. It is also about getting better. They say the best way to know you’ve succeeded is to ask yourself the following question: If I stopped putting energy into this, would it continue to go well?
They share the same beliefs when it comes to staying focused on doing great work.
Both Cathal and Kevin admit that doing great work does “sound obvious”, but it’s an important factor if you want to scale and maintain agency standards.
Agency owners can spend so much time getting new business trying to prove that they’re good at their profession, they become blind and stop putting energy into existing client campaigns. Inevitably, this can have a negative influence on standards.
Kevin says, “it’s much more important to be doing great work internally than it is to look like you’re doing great work publicly”.
By doing great work, it doesn’t mean you need to work harder and longer. It’s all about working smarter.
It just simply boils down to “focusing on delivering outstanding results/value first and foremost”, says Kevin Gibbons.
I read this article which highlights the chapters in Michael Bungay Steiner book, do more great work.
Michael says that you should think back to moments in life where you felt like your best. Where you reached your perception of success, i.e. an award-winning ad campaign or a scenario where you ranked #1 organically for a competitive search term.
The aim of this process is to identify commonalities between these moments. It’s this feeling that will spur you on to do great work.
“Just remember to keep improving because doing it just once isn’t enough”, says Alex Moss.
What Have We Learnt Here?
Whatever pressures you suffer from, you’re safe in the knowledge that you’re not alone when it comes to scaling an agency.
Mitchel White has been in business for 4 years and has been able to look after himself a little more, physically and mentally.
Despite going to the gym at least 3-4 times a week to relieve tension. The main focus for Mitchel over this time has been to prevent the worries of agency ownership from taking over his life.
He admits “that pressure doesn’t ever really go”, but “it what spurs us on to continue doing brilliant and successful things every day.”
Mitchel told me that he recently took a couple of days out for his mental health.
“I needed to take a couple of days out for my mental health (I posted a LinkedIn post about this) – some people frowned upon it but taking those two days out allowed me to relax, unwind and come back afterwards feeling refreshed and full of energy. The business didn’t fall apart without me in the office either. Win-win.”, he says.
Whenever you start to get that feeling of pressure, just remember that scaling a successful agency is one of the most rewarding things that you can ever do.
Kyle Racki, leaves us with this simple takeaway:
“Hire great talent, delegate the work, trust your team to deliver and focus on the big picture – sales and staying profitable.”