Let’s start though by dissolving the myth that failure is always bad. No-one wants or looks forward to recession, but it’s vital for challenger brands. When else is there going to be a change of buying behaviour, except then? When else are you going to find out who your best leaders are? Think Summer and Winter. Any fool can run a business in Summer. The living is easy. The cotton is high. You try it third week in January. When relationships have broken up due to how you behaved to your in-laws on Christmas Eve. You’ve got Covid for the 11th time. You just got your credit card, gas/lecky/water bill. Always measure from the bottom. Darkness, stars, blah.
Agency failure is still surprisingly common. When these trees fall in the woods, they make little sound. Of 740 agencies in the UK, a snapshot at present reveals around a fifth in trouble at present. And remember that’s looking backwards. You can double that going forwards. The industry is like Diplodocus. Vegetarian. Small head. Long tail. Soon to be extinct. There are a lot of small, under-invested lifestyle agencies. Account or personnel loss or even tech change can kill them off. Let’s call this structural failure. It goes on all the time but accelerates during times of rapid change.
Sometimes, agencies are doomed at birth. Too many partners split too little profits. Too little to reinvest. A partnership stands or falls on the maturity of the partners. Egos visible from space are not great. Too much space between the ears. Not that great either. Too little space and they fly apart. Difference is better. Lifestyle professionals and their businesses tend to lack ambition. Dictatorships are generally limited because the self-made worship their creator. Let’s call this conceptual failure.
No agency goes bust in a day. You don’t win pitches on the day either. Agency business is generally sedimentary. Success or failure is a million decisions over a million minutes. That’s a couple of years to you and me. It’s based on economic tide. Most fail when it recedes. Then you can spot who’s been swimming in the nud. Let’s call this cyclical failure.
The timing is easy to spot. It’s most common at the end of a long boom, like now. By then, an agency has forgotten the ability to hustle, if it ever knew it. If it was once there, it can be rekindled. If it was never there, it leaves people shit-scared of the fear of rejection. The reassuring thing is there’s no one type that can hustle. You can be a double-barrelled sherry trifle from the Hohme Cownties. You be a flat-vowelled, gravel-voice from Ramsbottom, Lankusha. What matters is that you have to squeeze out the fear and break it down. Think MC Hammer. Put on the baggy pants and dance. It needs to be fun. It’s the only way to do it. Why? Because competence follows preference. People only get good at what they like doing. And you win more new business when you’re winning new business.
Confidence is everything but it involves systematic marketing, too. The stuff that agency normally advise their clients on. The irony. Our industry is a cobbler’s kindergarten.
It all comes down to the one business metric than cannot be measured nor achieved. It is not a Simple, Measurable, Achievable, Realistic, Target. It’s balance. The absence of this objective owes much to the education system of agency leaders. No uni gives marks for empathy, collaboration, flexibility, resilience or sense of humour. The vast majority are graduates who have never been measured on some of leadership’s greatest skills. They seek it here. They seek it there. They all sense it. But few have balance as an objective. What counts, can’t always be counted.
Above all, if you want to stave off agency failure, you need stay hungry. There are two stats here. Firstly, that non-graduates can earn more than non-graduates. Secondly, there’s growing evidence that first generation graduates do better than their uni peers. If success is not an expectation, you’re more likely to hustle. This is one of the reasons why progressive agencies have opened their doors to non-graduates. Attitude matters as much as academic achievement.
In short, if you want to avoid agency failure, professional skills are no longer enough.