Creativity is a Means, not an End in Itself

Creativity is a Means, not an End in Itself

Litigators are aggressive; consultants are analytical; investment bankers are greedy; ad agencies are creative. This is what we need and expect...for some higher end. We want litigators to win, consultants to provide insights and investment bankers to make money for us. And we want ad agencies to grow brands and make them more profitable. We assume that creativity is required. Creativity is not an end in itself.  It's a means to an end.

 

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Voodoo Benchmarking: Overhead Rate Benchmarks

Voodoo Benchmarking:  Overhead Rate Benchmarks

Benchmarks for overhead rates are part of  "Voodoo Benchmarking," a set of business practices preached by Procurement Departments and their consultants, believed in by those who have a such a need  -- but invalid from any scientific, mathematical, accounting or logical basis. Voodoo Benchmarking is so well-established in business that even smart people accept its existence and quibble only about the details. It's part of the dumbing down of business decision-making, liberating executives and staff people from having to think. Instead, they compare ratios to "benchmarks" and make their decisions accordingly.

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Agencies -- Playing a Loser's Game?

Agencies -- Playing a Loser's Game?

Feeling a loss of control over agency operations and profits?  It's understandable. Clients control both income and Scope of Work workloads. Out-of-scope unpaid work is 10% or more of agency workload. Fee negotiations push fees lower, while clients push workloads higher through experimentation with digital and social media. It's harder to make budgeted income and profit margins without downsizing. Agency senior executives need to restore control over agency operations, for today and into the future, rather than letting clients call all the shots.

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Ad Agency Operational Health -- 10 key metrics

Ad Agency Operational Health -- 10 key metrics

Whether it's a single agency office, a local or global client, a region or the whole shooting match -- there are ten key metrics that should be used to diagnose and track ad agency operational health. These metrics go well beyond income, staff-cost ratios, hourly rates, overhead rates, multiples and margins, not that these are unimportant. New metrics are required to track and measure workloads, prices and resource productivity. That's the only way agencies can evaluate and negotiate changes in the fees they are paid in today's marketplace -- and halt the erosion in agency operational health. Without the metrics, it's hard for an agency to know or fix its state of health.

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