Free time and vanishing consultants

4a418526-de23-4f96-b611-dd1cb769a252

 

 

 

 

 

This morning I was part of the panel – along with Tony Langham, Lansons and Esther Carder, Kingston Smith W1 – for the publication of the 2015 PRCA Industry Benchmarking Survey.

While the full contents of the survey are only available to those agencies that took part there are two findings that particularly stood out while I was presenting this morning.

Fridays are free

The average over servicing rate was 21%. This means that we’re giving away one day a week for free. My experience is that for many agencies over servicing sits at around 40% but let’s assume that the 21% figure is accurate.

The impact of giving this much time away for free is that it reduces profit margins and in turn decreases funds available to invest in new services, recruit consultants and return dividend to shareholders.  Importantly, over time it decreases the value of the work you are paid for in the eyes of the client and so undermines the quality of your client relationship.

There is no quick fix for this issue. It takes tenacity and a willingness to change agency culture so that all members of the team value the work they do and believe that it makes a measurable difference to their client’s business.

This means of course that you require measurable objectives and agreed evaluation in place. Neither of which are exactly an industry standard currently.

Where’d they go?

The second survey finding that jumped out to me was that a staggering 46% of people who left agencies did so to go to another industry, relocate,  return to full time education or did not return from maternity or paternity leave.

Clearly the long hours that over servicing client accounts demands is not the sole reason for this loss of talent from the industry but it will be a factor in the decision. This loss of talent really is something that we will need to focus on in the medium term if we are hold our own in an ever more competitive marketing services sector.

Finishing on a positive note, I can tell you that average operating margins were 17% not far off the 20% so many of us strive for.