Learnings: Tim Williams - Agency remuneration and the talent crisis
Posted 25 May 2022.
The agencies winning the battle for talent aren’t necessarily the ones with the best reputations (although that certainly helps), but rather those with the most innovative business models. The high-profile defectors from the senior ranks haven’t jumped from one traditional agency to another, but from agency to technology company; agency to media company; agency to consultancy. The most talented people in the business aren’t just leaving your agency, many are leaving the agency business.
Want to learn more? Book your spot here
This workshop is for members only.
The Great Resignation has been fuelled by factors that are now very familiar to most agency leaders – the pandemic, the economy, and the accompanying need for flexibility. But these are largely temporary dynamics that will eventually turn themselves around. The central cause of the problem—the key driver—is the agency business model itself.
More specifically, agencies are lacking a revenue model. Whereas most other modern businesses have a dynamic, multi-faceted pricing structure, agencies simply have a schedule of hourly rates. They have a self-limiting inventory of hours they sell to their clients, which places a self-imposed ceiling on both income and profits.
In this new workshop, Tim Williams of Ignition Consulting Group shows how agencies can replace their current cost-driven compensation approach with an actual revenue model; a variety of ways they can price their services based on the value they create rather than the costs they incur. The result is a profit margin that will allow agencies to compete more effectively with other businesses for top talent. Key people in the firm will have a more promising, rewarding career path, armed with the confidence that the firm can pay them what they’re worth.
Beyond healthier salaries, adopting a modern revenue model can produce a host of other beneficial effects for the organization. This engaging workshop shows how:
To win the talent wars, agencies must move away from the “work a million hours, earn a million dollars” compensation structure and instead build a revenue model that allows the organization to scale its talent, expertise, and intellectual capital the same way other types of business do. In this workshop we’ll roll up our sleeves and identify specific ways to create the financial breathing room you need to invest in new talent, develop new offerings, and create sustainable new revenue streams.
- Reframing agency services as solution sets creates an inherently more valuable offering to clients. Many existing agency competencies can be reimagined as programs or products, which are more scalable, more repeatable, and ultimately more profitable than labor-based services.
- Moving away from the labour-based compensation approach means senior people can deploy their talents without the constant worry of being “billable,” which results in a higher degree of professional satisfaction.
- A focus on providing external value (instead of just conforming to internal guesstimates) provides the right kind of healthy, purposeful internal incentives and allows professionals to flourish.
- Overwork can be avoided by moving to a revenue model where there is clear alignment of economic incentives. In this model, an effective campaign can enjoy a long life (as it should) and the agency can benefit financially without having to constantly log hours against a project.
About the presenter
Tim Williams is one of the world’s leading authorities on business and pricing strategies for professional service firms. Tim’s workshops have been seen by business audiences on every continent, and his books and articles have helped inform the strategies and business models of thousands of firms across the globe. In his role as founder of Ignition Consulting Group, Tim has worked with firms ranging from mid-size independents to multinational agency networks.