Digital agencies are increasingly reacting to forces squeezing them. They strive to find an identity that provides a value proposition separate from traditional agencies. They must wring costs out of their services, often making many of their offerings into commodities rather than a distinctive selling differentiation. And, clients increasingly have ratcheted up expectations but often without compensating budgets. This has created a knot which many agencies find binds their efforts to be innovative and distinctive.
Agencies have typically chosen a two-prong approach to address the dilemma, focusing on trying to expand their market share to power their organization or restructuring their internal reporting systems to improve efficiency. They have experimented with lead generation techniques to drive additional income. Although many of their efforts have been outwardly focuses, they have also tried different types of organizational alignments, such as the strong leader or governance by committee.
The results though tend to be increasingly constrictive and don’t address the need for vitality, problem solving and breakthrough creative collaboration that agencies need to excel in the marketplace. More rules and systems don’t encourage employees to own problems and involve others in creating inspired solutions. This can result in clients being underwhelmed by agency efforts and can factor into the inability to grow and penetrate accounts.
As agency after agency has followed the same worn pathway, it may be time for a new approach -- a way of moving beyond the organizational structure of an agency into the very fabric of the way it thinks about problems. The goal is to become a dynamic, internally-driven force with a culture that attracts both staff and clients.
There have been indicators that companies can increase sales through a defined internal culture. Customers want to engage with a company where people feel empowered in their work and speak positively about their experiences. Zappo’s is an often quoted example with its focus on customer service and positive employee word-of-mouth culture which impact sales.
Can cultural approaches observed in other industries be adopted by digital agencies? In our world, there is often a formalized hierarchy, waiting for approvals, and siloed responsibilities. Even if agencies reorganize, these same elements tend to exist.
To many agencies, the premise of changing the culture feels much more difficult than adapting the organization structure or accounting methods and is not considered in initial planning. Will it work? Will it create better leaders? Will it result in recognition, reduced staff turnover and improved sales? Without a clear model, indecision rules.
A key insight into how a culture shift can be effectively accomplished is in the approach suggested by L. David Marquet in his book “Turn the Ship Around.” He recounts how he took one of the poorest ships in terms of performance quality and turned it into a remarkable ship while also creating a cadre of leaders who are now in powerful leadership positions both in and out of the Navy. Many of the problems he encountered, we find in digital agencies: The need to provide exceptional services, to strategically outthink the opposition and to continually invest in the learning and well-being of employees. His principles have been adopted by many diverse industries. It may be the right time to try them in digital agencies.
His approach is to create a “leader-leader” culture throughout the organization by focusing on the principles of control, competence and clarity. It’s a way to build esteem, to get the organization motivated to solve problems and to be fully committed to working as teams to meet challenges.
Marquet’s motto is: “Achieve excellence, don’t just avoid errors.”
- Control focuses on turning followers into active leaders. In a “leader-leader” culture, emphasis is placed on having individuals generate solutions and reduce top-down monitoring. It embraces short, early conversations on directional approaches and thinking out loud to others. Conversations are active: “I intend to ….” There is a much sharper ownership of planning and execution instead of being passed tasks to execute.
- Competence is based upon deliberate and informed action. The organization prizes learning. They specify goals instead of methods, and they are aligned with a consistency in message. The focus shifts from briefing (where one person presents an overview) to certifying—where the person in charge of a group asks questions to “certify” preparedness to advance. This shifts preparation to the participants, and they must be ready to provide explanations.
- Clarity must exist in all levels of the organization. Mechanisms include using legacy for inspiration, leveraging guiding principles for decision criteria, reinforcing desired behaviors and building trust. Marquet advises to “begin with the end in mind” (acknowledging Stephen Covey). Although clarity uses principles for decision making, Marquet also emphasizes the role of a questioning attitude over obedience.
If Marquet’s principles can turn around performance on a highly complex nuclear submarine and can be used by corporations to maximize market share, minimize customer/employee churn while improving margins, then it may be a prime leadership approach for digital agencies.
With its emphasis on building a highly effective culture that produces at optimal performance, it’s an effective tool for attracting new prospects who are already intrigued to know more about an agency. Prospects see an empowered staff that is dedicated to bringing forth a high level of smart and informed effort toward their companies’ issues. This new type of culture is a great “selling tool” that draws clients across industries, but also the right kind of clients—those who believe in effective collaboration tools to solve problems.
Agencies often ask their clients to take a “leap of faith” with them in new positioning to increase competitiveness. It might be time to take their own advice and build a “leader-leader” culture to empower their staffs to create a new market-distinctive pathway to revenue.