Agency Leadership Podcast Helping PR and Marketing Communications Agencies Prosper Fri, 15 Feb 2019 20:00:48 +0000 en-US hourly 1 The Agency Leadership Podcast provides insights for agency owners and executives. Co-hosts Chip Griffin and Gini Dietrich share practical advice and industry news relevant to PR and marketing agency leaders. Chip Griffin and Gini Dietrich clean episodic Chip Griffin and Gini Dietrich (Chip Griffin and Gini Dietrich) Copyright 2018 Agency Leadership Advisors Helping PR & Marketing Agencies Grow and Thrive Agency Leadership Podcast The Agency Leadership Podcast provides insights for agency owners and executives. Co-hosts Chip Griffin and Gini Dietrich share practical advice and industry news relevant to PR and marketing agency leaders. Weekly ALP 18: How to handle clients who want 24/7 or other manpower-intensive service Thu, 14 Feb 2019 14:00:17 +0000 0 This week, Chip and Gini explore how to handle clients who want around-the-clock social media management or other services that require major staff commitments -- and would prove to be quite expensive to offer. This week, Chip and Gini explore how to handle clients who want around-the-clock social media management or other services that require major staff commitments — and would prove to be quite expensive to offer.

As is often the case, this question originated in the Spin Sucks Community, where an agency leader said he had stopped providing social media management services:

We used to offer it a few years ago but continued to run into expectations issues with clients. Mostly our clients wanted our team to be 24/7 on and often they would not approve our content fast enough … To give the clients what they needed / wanted, we would have had to charge more than they were willing to pay so we stopped offering it to avoid losing clients.

This is a challenge that many agencies face — especially in a 24/7 media environment.

Chip and Gini discuss strategies for handling these situations, and also explore other lessons that come from requests like these.

The co-hosts also give a shoutout to Shel Holtz who will be recording the 1000th episode of the For Immediate Release podcast next Monday.


Hello and welcome to another episode of the Agency Leadership Podcast. I’m Chip Griffin

and I am Gini Dietrich

and we’ve got a great episode ahead of us today. But first I wanted to give a shoutout to the founder of the FIR Podcast Network who is getting ready to record the 1,000th episode of FIR.

1000! Crazy! 1000.

and here we are on episode 18

We’ll be there someday. Someday, someday.

Yeah, now in fairness, Shel Holtz and Neville Hobson did have an advantage in the early days, if you can call it that, in that they recorded twice a week. So you know, they were able to squeeze in 100 episodes a year as opposed to us doing it weekly, where we do 52.

And I just looked, Inside PR is 534 and I think it started in 2006. So yeah, so he’s doubled it. That’s crazy.

That is, it is absolutely insane but it is a great listen, continues to be and the network that he’s put together and that the show is part of, I think is really fabulous for the communications community.

Totally agree. Congratulations, Shel, that’s great.

Absolutely congratulations, Shel. And another milestone this week – I don’t think it was number 1000, but I believe that you may have had a birthday.

It was definitely not 1000!


Probably even less than 534.

It is less than 534 as well.

But I suspect higher than eighteen. This is episode number whatever of Gini Dietrich’s life.

Of my life. Thank you. Thank you.

So happy birthday. We will we will not sing it, or I will not sing it for two reasons. One is I am not good at singing. And secondly, we don’t want to pay the royalties to use that song, which really boggles my mind, that you can’t sing happy birthday in a commercial setting, without paying a royalty. You know, it is what it is. So…


and so I guess with that, we will, we will jump into the more meaningful topics of the week, or at least for those people listening to this podcast who are maybe less interested in birthdays, anniversaries of shows and things like that.

So in any event, let’s jump in. And we’re going to talk about how to basically take client projects and make them of a manageable scale. And it’s based on a particular question that came up in the Spin Sucks community as so many of these shows do. It’s a great place to be. So if you’re not part of it, I encourage you to reach out to Gini and and join. But Gini, why don’t you tell us about this particular question and then we’ll share a few thoughts on it.

Yeah, I thought it was pretty interesting. So he asked, you know, when it comes to social media, we’ve taken the safe approach and offered to our clients, consulting, ideation, content, audits, etc. But no actual management. He said, we used to offer it a few years ago, but continue to run into expectation issues with clients – I can’t imagine –

mostly because our clients wanted our team to be 24/7 on and often they wouldn’t approve content fast enough or send us imagery requested to make it relevant, interesting, all the kind of stuff


and to give them what they wanted and needed especially for that 24/7 being on, holidays and all that, weekends and nights, we would have to charge more than they’re willing to pay. So we stopped offering it to avoid losing clients over lower profitability, blah, blah, blah. But he says, you know, over the during the last few months, we’ve had most of our most of our new prospective clients ask for it. And when we explain why we don’t do it, it concerned them. And so he’s wondering, you know, do you offer social media community management? And if so, do you suggest we reconsider this? It’s a really interesting conversation because he’s right, you know, clients do expect your team to be on 24/7, but they’re not willing to pay the 24/7 rate. So it’s an interesting conundrum I think we all have to face.

It’s a huge issue and it is, it is something that that folks face whether it’s in social media management or all sorts of other things that we do as communications agencies and, and trying to meet those expectations you know, often makes the difference between a successful engagement in a profitable agency and one that is neither.

Right, right.

And you know, and I think the question actually opens up all sorts of different avenues so we probably won’t be able to touch on everything that it opens up in the next 20 minutes but you know hopefully we can at least you know hit some of the the broad brushstrokes and you know I guess the place to start is you know how do you how do you deal with it when a client or prospect comes to you with essentially what is a wish list right, which is I would like you to be working for me 24/7, on demand whenever I kind of feel like it, and you’ll just be ready and and your team will jump in, you know. How do you, how do you work with them to set the right expectations? Or how do you give them an alternative solution? You know, so I think that’s sort of the place to start because that’s where most people get thrown immediately, which is there’s no way I can support a 24/7 operation.

Well, and not only that, but I think there are situations where you can and it’s called crisis communications, right, but you bill at a premium rate, and it’s usually by the hour and it’s usually really expensive, and it’s because you’re in a crisis that you have to do those things.

And it is usually short term just for the duration of the crisis, right? I mean, most most agencies are not out there selling 24/7/365, they’re selling, as certainly I’ve done a number of times with my various businesses over the years, 24/7 but for you know, 3, 6, 7, 30 days whatever, you know, whatever the particular crisis may be. And usually the 24/7 is only for the first few days, and then you back off. You still, it’s more intensive, you know, and it obviously depends on what the individual crisis is. Some where it has been 24/7 for months on end. That’s not the norm. But you know, if it’s there, it is what it is, but you just have to bill the client for it.

Mm hmm. So there are situations like that. But I think what we’re talking about here is, you know, it’s certainly, especially for consumer businesses. I think it is important for 24/7 social media management. And if you’re going to outsource, have that outsource, then you have to recognize that not only does the agency have to set it up so that their team can react but it would be the same thing as if the client hired it internally. I mean, maybe you have shifts and you have people working shifts, so you’re having to, instead of one person handling it, you have three people handling it and they have three shifts. So it’s going to cost you an amount of money. But I don’t think that unless there is a crisis, social media truly needs to be handled 24/7. Now maybe there’s a rule that we say, yeah, we’re happy to handle this for you. But we only answer between eight and five, we don’t do nights and weekends, unless there’s something, you know, unless we’re, we’re in a crisis or there’s something that’s firing up or something like that, then and, and certainly we’ll monitor it, but we’re not going to actually engage and respond and do all those things except during business hours. So I think there are ways that you could definitely set expectations, but I don’t think especially in 2019 that you have to be on the computer every single second of every single day to see what’s happening on social. Not even for the Cokes of the world, I don’t think you have to be.

Right. No, I mean, I would agree with that. And I think you know, one of the things that we’ve seen over the last you know, 10-15 years is that you know, these incidents where you have social media blow-ups, and people say oh this is the death of Brand X, right, because of, you know whatever it is, whether it was gosh back in the day Motrin moms – remember that? – Motrin was going under because of a little firestorm over the weekend that at the time felt big, I’m sure to Motrin, but you know my guess is most listeners here probably don’t even know what the heck I’m talking about. So you know that shows you what the long term impact of it was. You know part of it is setting expectations, but I think part of it is you know when you’re an agency and you’re working with a client or prospect, you know, if they come to you and say hey, we need 24/7, say you know, okay well you know, this is what it would take for us to achieve that. You know, here’s what we would suggest instead and, you know, give them give them an alternative option I’m I’m a big believer that you know, when you’re working with clients or prospects you try not to say hard no. And and instead you try to redirect them towards, Well, here’s an option that you may like better. And particularly in something like that with a 24/7 operation, you know, the client has to understand that they would need to have someone available to the agency 24/7 as well, right. Because, you know, as was pointed out in the original question, you know, there needs to be someone to approve things and make decisions. And so if they’re not going to staff for it, then it doesn’t make sense for you as the agency to because all that that means is the client is overpaying because if they don’t have the infrastructure on their own, and they handle whatever is coming from the agency, you know, what’s the point?

Right, right. And that’s a really good point too, that there has, I think there has to be a certain amount of autonomy on the agency side, because you can’t from a social media perspective, you can’t sit around and wait for content to be approved and imagery to be sent and all those kinds of things. So those are those are things you have to consider as well, if it’s you know, and I have some background knowledge on this particular agency owner and I know that they focus mostly on fitness centers and you know, so if, if it’s something that’s local, yeah, sure, we’re happy to do that. We have a photographer on staff who can come out once a week to take photos and make sure that we have the right imagery and all of that. And here’s how much it costs. If you want to provide that, that’s great. But here’s what we expect. We have to have imagery for the following week by Wednesday, like you have to set those kinds of expectations so that they understand that this is what goes into it, and this is what goes into what you’re asking us to do.

Right. Right.

Right. Right. And I think it’s also important that on the agency side, you know, if you’re, if you’re looking at something that is that intensive, did you take a realistic look at what it would take from a staffing perspective. You’d mentioned earlier, you know, running shifts, but it’s, you know, one of the mistakes that I’ve seen, in fact, last year, at one point I was working with someone who was putting together a proposal for a 24/7 monitoring operation for an organization and they they said, Okay, yeah, right. We need we need three shifts, but they didn’t factor in that there are seven days a week. And you’re not going to have three people who are going to work seven days a week, right? So, so it actually takes more than three people. Yes. Right. You know, realistically to cover 21 shifts, you know, you’re talking at least four, probably five, maybe even six, depending on how you break it up. So the number of bodies that you’re going to require is actually fairly substantial. And so you want to think that through and even if you’re only doing it on an all on-call basis, you know, that that still is something that you need to factor in, you know, if you’re if you go to them and say, Look, you know, we’ll do 24/7, but only in a crisis well, then you need to, you know, since crises, sort of by their very nature don’t tend to send you an email a week in advance and say, Hey, I need to schedule for this, right?


We’re gonna have a crisis next week, so just heads up…


Right, so that means fundamentally as an agency you need to have pre-identified if if our clients have a crisis on this weekend here’s what my coverage plan is. And back when I did a lot of crisis coverage for clients we always had that. And so we always knew, you know, who had who had this Saturday and this Sunday if if something cropped up and most of the time they weren’t necessary. But you knew who they were going to be so that you had that option in place and you weren’t caught flat-footed when you get the call at 4pm on Friday, you know, hey, this this horrible thing just happened. We need your help.

Or in my experience at 7am on Thanksgiving. Oh, okay. Thank you.

Right right. I mean you never know. And you know, I’ve also overseen a lot of tech teams and so obviously that’s something from a tech team perspective you always have to to work on as well because servers are are sort of like crises – they don’t, they don’t phone ahead to let you know when they’re going to have an issue. And and you know, sort of sort of like my furnace in my house. It always seems to go bad on holidays.


Or when it’s nine degrees outside. It can’t go bad when it’s 50.c

Yeah. But I cannot tell you how many Thanksgivings and Christmases we have had the HVAC people at our house over the last 20 years. It’s kind of spooky how that seems to play out. Actually a few years ago we had a we had the HVAC people up, we had a power outage on Thanksgiving. So that sort of, we cancelled Thanksgiving, needless to say.


Yeah, I mean, you have to, because you can’t cook. So yeah, you would have to.

Well, we could because, you know, we, you know, we could have cooked on our grill or something like that, although it was an ice storm. So that’s not really too convenient. No, not not super convenient. But the bigger issue is that since I live in rural America, we have well water and so if you lose power you don’t have running water. That is a problem, that is a problem, that is less than ideal. Yeah, yeah. So yeah,


yeah. So


I think it does. I mean, it’s, it’s definitely, I totally 100% agree with you that you never want to just outright say no, but there is an opportunity for you to say, Okay, if that’s, I mean, we can do that, yes, here’s what it’ll take, here’s what it will cost. Here are some options and here are our recommendations.

Right. And I think the the key to all of it is, and this is advice that I give folks on every aspect of agency operations, take a step back and ask, what are we really trying to accomplish? Right, and that’s, that’s good for your internal operations. But it’s good for working with clients as well. Because, you know, too often when we’re talking with clients and prospects, you know, we hear them say, Oh, I want this, this and this. And so, you immediately start working on, you know, what would it cost to give them this, this and this, but it’s really, the key is to understand why they want those things, what are they trying to accomplish, and then say, look, you know, I, I know this is what you’re trying to accomplish, I’ve got it I’ve got a way you can do that, you’ll get 90% of the benefit for 50% of the cost or whatever. And so then, you know, not only can you put together something that’s manageable for you to execute on but you know, you can look like a hero to the client by reducing their overall bill. Right, because it’s it we really need to be careful that we don’t just become order takers from our clients. That’s, that’s not a pleasant place to be in the long run but it’s also not, it’s not where we maximize our value and therefore maximize our profitability, which we care about.

Our job is to maximize our profitability while we take care of clients because if you don’t you’re not in business and clients don’t want you to go out of business. So there’s there’s that piece of it too, but I do think exactly to your point. Don’t be an order taker, be able to step back and say okay Hang on a second. We actually stopped doing social media management or whatever happens to be because of X, Y and Z. We would love to be able to do it for you but here’s what it’s going to take. And you know I think that does build a level of trust while you make them look like a hero, because you have saved them, but it builds a level of trust that then it becomes a partner – a true partnership versus a vendor relationship.


Right. And I think, you know, too often we are not honest enough with our clients, right? You know, we don’t, we don’t take the time to explain to them, you know why it is that, that we want to do something or don’t want to do something. And, you know, frankly, it can be a useful educational process for the client to sit down with them and say, Okay, look, you know, what you’re asking for, in this particular case, this is this is what it would require from a manpower perspective. You know, this is what it would require from other resources, you know, here’s why we think that that’s, you know, probably not the best solution in this particular case and and a lot of times frankly, they won’t think about those things, right? Because in their minds, I want 24/7 monitoring. Do they think about the fact that that means, you know five or six bodies? No, absolutely no,t that’s just, that’s not – they’re thinking about the outcome they’re not thinking about all of the behind the scenes stuff it takes to get there, so don’t be afraid to explain it.

And they’re not really thinking I need 24/7 monitoring, they’re thinking I need people to be paying attention so that if something happens or somebody has something negative to say, we’re responding in a, in an appropriate amount of time. They’re not saying, in their minds, they’re not thinking, Oh, well, somebody’s got to be on Twitter at, you know, 2 am. That’s not what they think at all. But that’s how they’re, that’s how they’re communicating it is, I just need somebody to be available and responding, and it doesn’t take two days for response, it takes an hour or if it’s not during business hours, we’re clear that you know – so that’s what they’re thinking. It’s that, versus I expect somebody to be sitting up all night watching my Twitter feed.


Right. Well, and a lot of times, you know, these sorts of requests come about because of some particular incident that either has taken place already for that organization or elsewhere in the industry or something their boss heard about and said, Don’t ever let this happen to us. Right. So, you know, working with them to understand you know, why are they asking for it, you know, will often you know, help you realize oh, look, really what they’re looking for is just to make sure that they don’t get caught flat-footed, right? And, you know, they, you know, it’s sort of like, you know, back when I ran a media monitoring company, you know, one of the things that we often did with clients was we would set up particular monitors for the CEO’s name, right? So that the CEO never heard about news coverage from anyone other than the people designated to monitor it, right? You wanted them to be the first ones on it. And, you know, so those are the kinds of things that you know, oftentimes people are are thinking internally, but that may not be how they verbalize it to the agency. And so, you know, getting to the root of what they’re trying to accomplish will, you know, often be incredibly helpful and, frankly, strengthen the relationship as well. And so much of what we do as agency owners is having that kind of strong relationship with our clients because that’s, that’s what keeps us going.

Yup, it’s chemistry, it’s relationships, it’s trust.

Absolutely. And, you know, I think the other interesting thing that comes out of this this question was, you know, where the original question talked about how they’ve, they’ve been asked several times recently about this, right. So they’re… and I think that’s smart, right? You know, if you start hearing from the marketplace on a regular basis, something that maybe you haven’t heard for a few years, or haven’t heard at all, you know, that’s new, you know, you start to pay attention to those trends and say, Okay, how do I, as an agency respond to that? And, you know, oftentimes it’s, it’s easy as just say, No, we don’t do that. In this particular case it’s something they used to do. So, you know, it’s an easy one to start figuring out, okay, do we dip our toe back in the water in some fashion, but if it’s something you don’t do well do you find a partner who can? You know, you know, how do you address that? Because if you’re starting to hear it consistently in the marketplace, then you want to make sure that you’re adapting and not just saying, Well, you know, that’s – we’ve never done that we’re not going to do that. It doesn’t mean you should do everything that you’re asked, right? I’m not, I want to be very careful to say that I’m not saying just say yes to everything that comes across your desk. But at the same time if you’re hearing something consistently do try to find a way to solve that problem. Even if it’s just by referral, yeah, you may generate some goodwill with the client or prospect, if you can point them in the right direction.

Even, I mean, some of the conversation that we had in the Spin Sucks community was, you know, Here are several people who actually do offer it. So maybe there’s a partnership there. And, you know, you can start to build an outsourced team from that perspective too. But to your point, I think it’s really important to pay attention to what the trends are doing, we are seeing a lot, a lot, a lot of retainers go away, and clients are just doing project work now, and they may keep agencies on for years, but they’re just doing projects versus retainers. So it’s significantly more challenging to predict cash flow. So when you have a client or a prospect come to you and say, you know, we’d really like you to do this and we’ll keep you on retainer. Go for it because that’s not happening a lot right now.

Right. No, I would I would agree. I’ve certainly seen a lot of the same thing and you know, of course the the challenge too with project work is, you know, for most agencies, project work is not as profitable as retainer work right. So it also requires, you know, you if you continue to see that on that same trend in your own agency, you know, how do you how does that make you rethink how you price things or how do you, you know, rethink your cost structure in order to address that because it is, it is a very different animal – project income versus retainer income – and not just from a cash flow perspective, it’s the profitability of it that can be you know, wildly different as well if you’re not careful.

Yeah, yeah.

And you know, if you’re doing the project for the same client, okay, that, you know that that’s not quite as bad because you start to learn that client, right. But you know, so much for an agency is is learning the client for the first time and so if you’re just doing a lot of one-off projects for clients, then you’re investing a ton of time just trying to figure them out and it’s it’s hard to charge them for that.

It is hard to charge them for that.

Yeah, you know, it’s hard to say, look, I, you know, I really don’t know anything about your industry, you know, I’m gonna have to factor in that it’s going to cost me, you know, several thousand dollars worth of staff time just to figure out what your industry is. Most clients are going to respond to well. You still need to find a way to recoup that cost, right? You just you just can’t be really overt about it. You know, if you want to win the business at least.

Well, it is interesting and I wish our friend well because it’s a – it’s a great problem to have. Still a problem.

It is. You know, look, it’s always helpful when when prospects are coming to you and asking you for services. So it’s hard to complain from that perspective. But making sure that you figure out you know, how to navigate those and make sure that you’re not digging yourself a hole by agreeing to do something that, that you can’t do well or profitably and trying to figure out how to turn it into something that, that will make both parties happy, I think is really the key.

Totally agree.

So with that, Gini, that brings us to the end of a another episode of the Agency Leadership podcast. And so that means I’m Chip Griffin.

and I am Gini Dietrich

and it depends.

This week, Chip and Gini explore how to handle clients who want around-the-clock social media management or other services that require major staff commitments -- and would prove to be quite expensive to offer. This week, Chip and Gini explore how to handle clients who want around-the-clock social media management or other services that require major staff commitments -- and would prove to be quite expensive to offer. Chip Griffin and Gini Dietrich clean 24:06
ALP 17: What responsibility do agencies have for client behavior? Thu, 07 Feb 2019 00:23:17 +0000 0 The recent documentaries about the disaster that was the Fyre Festival raise an interesting question: are agencies responsible for their clients' actions? The recent documentaries about the disaster that was the Fyre Festival raise an interesting question: are agencies responsible for their clients’ actions?

Chip and Gini tackle the topic in this week’s episode and explore the different ways that agency leaders can handle their concerns about prospects and clients.

The duo discuss what expectations of agencies are reasonable, how money influences decision-making, and some real-world examples where both have had to confront ethical dilemmas in the past.


Hello, and welcome to another episode of the Agency Leadership podcast. I’m Chip Griffin

and I’m Gini Dietrich.

And you know, I’m very excited because the Patriots were on fire this weekend and won the Super Bowl for the sixth time in this century, it’s fantastic.

I loved the NFL Centennial commercial where they’re all you know, tossing the football back and forth, and it comes up to Tom Brady. And he takes all these rings off and goes here, hold these, I laughed.

Well, and now he’s got another one in that collection. And now he will certainly have to use two hands.

Well, I was going to say at this point he may as well get one for every finger. Right?

Well, yeah, I mean, and he would like to, he said he wants to play until he’s 45. Although I still have a sneaking suspicion that that he might retire and I know that

He has said that he would not do it. But there was just there was a mere moment in the interview after the game

where he seemed to almost be suggesting that he was going to think about it and then caught himself and it was it was you know it could be completely wrong but you know just my impression is that he’s getting a lot of pressure from home to just stop playing.

You know Gisele has been pretty open in some of her interviews saying that she doesn’t particularly like it but that she supports him and he emphasized the importance of having support from his family to continue to play so, I don’t know I just, you know we’ll see what happens. You know and I think I mean honestly i think you know most of those players at that level are you know it does take them some time to come down off of the season and figure out you know, what really matters and so whatever they you know, even if they say zero percent chance going into it, you know, as Brady did i i think that’s it’s hard to rely too much on that because who knows how you’ll be thinking after you’ve had a chance to go sit on the beach for a week and say geez do I really want to take another blow to the head.

Yeah, yeah, yeah.

yeah, yeah.

Ah. How old is he?

He is 41.

Oh, well, yeah. If he did four more years and won four more Super Bowls, then he’d have one for every finger.

He would. Yeah. Yeah,

that would be,

that would be fantastic. But, you know,

one season at a time, one game at a time. It’s the Patriot way.

Yeah. Yeah. Yeah.

Don’t get too far out ahead. Actually lots of good lessons there for for agency owners, as far as you know, how to stay focused on those sorts of things. In fact, maybe I’ll write an article about that just to help agency owners and piss off all the Patriot haters at the same time.

Not even that, there was a really good article, I can’t remember where I saw it, about his, the way he approaches just life in general, his

the way he eats and the way he exercises and you know sleeps and all those kinds of things, I mean he is super super disciplined and there are some good lessons in that.

Absolutely. You know I think as as successful people often do he’s taken a few of them a bit to the extreme. You know some of his some of his eating habits are…


I was gonna say interesting but sure we’ll go with crazy, and I’m not sure how sustainable they are for most people who don’t have private chefs to adequately compose everything.

Or people who like French fries like me.


Yes, I mean french fries are, I think aren’t they an entire food group I think they are.

I think they are, yeah. Yeah, I mean, he is very very disciplined I think there’s some great, no matter if you’re a fan or not, there’s some great lessons in there for sure.

True So there we go. Maybe I’ll get something for an article for later this week or maybe I’ll maybe I’ll see if I can get it placed on Spin Sucks and get some reference in there to Chicago.

Oh, well, we’ll edit that part out.

I did like the Red Sox tweet that they put out after the game on Sunday night. They put out a tweet that said congratulations to the Patriots on ending Boston’s championship drought of three months.


Slightly arrogant, but you know unfortunately my kids don’t know any different and so that’s that’s frustrating for me right? I mean I grew up as a long suffering Red Sox and Patriots fan and and you know, when I was a kid, the Celtics were good and the Bruins had been good a decade earlier. But that was pretty much it. And now, you know, my kids are just used to seeing Boston in the championships. I mean, this is this is the I think what? the 12th Boston championship of this century already.

They’ll have a rough life, later on, when they realize that not everything’s about winning.

It’s not. Which is actually a good segue. Apparently, that is not a lesson that Billy McFarland ever learned.

And actually, you know, we were talking about the Patriots being on fire, I was at least and we’re going to talk about the Fyre festival, how that applies to agency owners and leaders because there are some good lessons to take out of that as well. And, and some good discussion to be had around it. Because ultimately, when you think about what took place there, it wasn’t just meant – for those of you who haven’t seen the documentaries on either Netflix or Hulu, first of all, I would encourage you to do so they’re, they’re, it’s really worthwhile watching for anyone who’s interested in communications, technology, entrepreneurship, any of those things. There are lessons to be had out of it. Or just interested in a good documentary. So, basically, the, the idea is that Billy McFarland is a scam artist. But nobody really realizes that at first, and he puts together what is supposed to be like the new Coachella on a private island in the Bahamas that used to be owned by Pablo Escobar, maybe, possibly, because, you know, everything that comes out of his mouth is 50/50, whether it’s the truth and so gets all of these, you know,

presumably wealthy, or at least people with fairly disposable income to pony up thousands of dollars to come to this thing, only to find out that they’re sitting in FEMA disaster tents with no plumbing, no food and and yeah, it was just an absolute, yeah, utter disaster, utter disaster. But the reason why it’s relevant for this podcast is because it involved the marketing agency, at least one, maybe more that helped promote the Fyre festival and also did work for the underlying company because the Fyre festival wasn’t even the core business, right, but that was, it was supposed – it started out as a marketing schtick to help a company called Fyre that was basically doing, it was a booking site for celebrities to make celebrity appearances and that kind of stuff, but so there was a marketing agency involved and there were also influencers involved, primarily supermodels and that kind of stuff. So from the perspective of the communicator, What are your obligations as far as figuring out that your client is a scam artist and not promoting it? How much due diligence do you need to do and you know, how much blame should be heaped upon the agency that helped do this work?

Yeah, I mean I think it’s a tough one because my my perception of it all was, first of all this agency, Jerry Media that won the social media piece of it …you know, they said, like this is one of the biggest accounts we’ve ever won, and here we’re working with, like, it’s more money than we’ve ever ever made and we’re working with supermodels and this guy who has this great idea and he’s paying, you know the likes of Kendall Jenner a quarter of a million dollars to share stuff on Instagram and you know we we’ve created…

Not share stuff. Share a single post.

I think it was four. Was it for one or four?

No, the 250 was for a single post.

Was for one. Okay. Yeah, so it’s like all this stuff. And so yeah, I mean, you certainly get caught up in all of that and you certainly are like okay, well if they can afford to pay Kendall Jenner a quarter of a million dollars and they’ve flown all these supermodels down to the Bahamas. And they’re doing, like they did this all for this promotional video to promote the the festival… like, you don’t question that. You don’t say, let me see your financials just to make sure that you’re actually paying these people like you said you were going to. You’re doing the work, you’re finding them the influencers, you’re asking them to do what, you know, they’re going to be paid to do. Like, you don’t… but you also aren’t the ones paying them. It’s going through the client. And so there’s that piece of it. But I think they started to realize… the agency themselves didn’t start to realize that something was wrong until just a couple of weeks before the festival. But when it really hit home, which I thought was fascinating, is they get on a plane and they fly down there, they get off the plane, they can’t get to the festival. There’s no rental car, right? Nobody has sent a car to pick them up. So it’s these four guys that have gone down to this festival for their clients and the can’t get there. So they had to hitchhike!

At that point, you’re kind of going, Oh crap, what is going on?

But do you, like, I don’t know that there’s an onus on them to do, like opposition research or financial digging into financials or anything like that when you have a new client coming on.

Right. And that’s, that’s effectively what their argument was in the documentary, right? That they were, they were as much a victim as anyone else here. And you know, the the one asterisk that we should provide is that the Netflix documentary was apparently co-produced by Jerry Media, so it would be unlikely that it would reveal anything negative about them. The Hulu one takes a slightly different approach and, and does knock them a little bit more but still doesn’t really… it really more just asked the question you know, do they have this responsibility? Should they, should they have pushed back harder, known more, that sort of thing? And, and you’re right I mean, you’re not going to do, and you shouldn’t be doing in-depth due diligence on your clients. Now, that doesn’t mean that you know, you shouldn’t generally check out your clients, right? If you if you’re working for a client you’ve never heard of, can I suggest that there’s this cool website called Google.

There is a cool website. Yeah, it’s pretty cool you can just jot in the client’s name and…

Yeah and it’s relatively new I mean you know, it’s only been around about 20 years now. So you know, it’s possible that there are some folks who are listening who haven’t had a chance to try it out, you know, so give it a shot and when you’ve got a prospect put their name in there, both their individual name as well as the company name. My guess is any media agency that, marketing PR agency that does that here in the future probably is not going to take on Billy MacFarland as a client, right, well, maybe not though, because at the at the end, it turned out that he was running another scam while he was out on bail.

Yeah, but he had some guy running it for him because he was in trouble.

Yeah, right. Yeah. Right. Right. It just, it just boggles the mind and shows you just how sick the individual actually is. But you know it from a from an agency perspective. You know, the Fyre festival is probably a good jumping off point for our conversation. But ultimately, most of us are probably not going to be involved in anything nearly of that scale, right? Where it becomes that big a deal where it makes Nightly News and all that kind of stuff. But, you know, I think most of us certainly have have encountered clients or prospects that may be give us an uneasy feeling. For whatever reason, maybe it’s not an all out scam. But, you know, are they, you know, are their claims, you know, going too far? Are they, you know, do they share the same values that that we have, you know, there are different things. And, you know, particularly for, you know, for listeners who may be in the public affairs space, or do anything tied to causes, you know, that there, it’s very common for folks to say, Okay, look, I’m, I’m not going to do business with the tobacco industry, or the guns or pharma or whomever. And so, you know, people are thinking in general about what it is that their clients are involved in. But you know, what about that, you know, that startup company that’s just, you know, really pushing the idea that they’re going to revolutionize something, but you just don’t feel comfortable? Where do you draw the line? And I think that’s where, you know, most of us probably on a day to day basis, as agency leaders have to think about this a little bit more and have to give, you know, consideration to, you know, what, we’re what we’re comfortable doing, and, and you know, what questions we should be asking?

Well, I, Yes, and I also think they’re red flags, right? I mean, red flags from the perspective of this of the Fyre festival or things like every time somebody said, No, or pushed back, they no longer had a job, there’s that, but also from the social media perspective, they had, they kept getting direct messages and from angry people, like, I don’t know, I’m supposed to fly down there. I don’t have my flight information. Where do I, like they weren’t getting, they weren’t able to provide the information that people needed that they were asking on social media. And so they and then they started deleting comments, right? I mean, so there, there’s some major red flags there. But I see. And to your point that, you know, it’s not we’re not going to have, most of us are not going to have situations that are that big, but I have, and to this day, I regret this. But we, I had a really good friend who ran a very successful business here, and he sold it in 2011, and took the money and started a second business, it was a Groupon me-too, it was right after Groupon was had gone big. And everybody was trying to create, you know, Groupon-like businesses. And, you know, I remember sitting in a meeting and he was a good friend, I remember sitting in one of the first meetings with him and saying to him, you know, I don’t know if this is the right thing to do, everybody seems to be doing this, and everybody wants to be hanging on the coattails of this company. And you know, I just don’t know that this is the right thing for you guys to be focused on. And he turned and he looked at me, in front of in front of my team said, If you f this up, except to use the actual word, I will fire you. And I remember thinking, well, that’s a nice way to start a relationship. But because he was a good friend, I just figured he was under a lot of pressure. And he didn’t like me pushing back. And, but it got progressively worse. And I think we lasted maybe six weeks, but you have to the fact that I didn’t just stand up at that point and go, Okay, this is not right for us is on me, and I should have done that. But you have to be able to respond to those red flags in a professional appropriate way that doesn’t hurt you, or your business or your your team.

Right. And it’s, you know, it is challenging because, you know, first of all, hindsight is 20-20. So, it’s, it’s a lot easier for you to sit here today and say, that was certain you should have gotten up and walked out. But, you know, in the moment, you know, most of us probably are not going to do that, because we’re sitting there sort of thinking about, well, is this is it really as bad as I think it is, you know, what am I missing? You know, there’s other people here, and, you know, frankly, a lot of these situations come about there, you know, sort of the, the boiling the frog situations, right, where, you know, you just the, you know, one little problem here, and then another little red flag there, and, you know, the, but, you know, you’re sort of like, Okay, well, you know, I saw that last one, but we’re still going, it’s all okay, you know, maybe it’s, maybe I’m making too big a deal out of it. And then, you know, when you take a look back over time, like, wow, I really should have seen that. But in the moment as you’re there, particularly because, and you look at this particular example of the Fyre festival, it was a lot of little signs that there were coming up. It’s not like someone came in and gave, you know, a pre-packaged thing to Jerry Media and said, hey, look, guys, this, this is a pyramid scheme. Basically, this whole thing is, it’s a shell game, it’s not going to happen. This is just Billy putting money in his own pocket. You know, nobody ever did that. So, you know, they had to read all of the signals and realize that that’s what was happening. And not just that it was, you know, mismanaged. And, I thought was particularly telling that there was one consultant on there who put on music events. And he basically said, you know, look, pretty much all of these festivals, you know, look like, total clusters before they come together, right? So, you know, did I read anything into it? No, because this is – they all – you think they’re all going to fail right up until the moment when it succeeds. And so I thought that was an interesting perspective. And again, you know, perhaps self-serving, because he knows this is a documentary being made that could make him look bad, right. But, but at the same time, it sort of makes sense. And there, you know, having come from the world of politics, look, you know, there’s been a lot of things in any campaign that you sit there and say, Wow, I never thought we’d actually make it to the end, you know, because it, but also in campaigns, you also have those moments we’re you’re like, I don’t know, I’m a little

uncomfortable with that statement, the candidate made, or that action and, you know, sometimes when you then look back on it over time, like, oh, okay, it was clear, this was a terrible candidate running a terrible campaign. But in the moment was, it just didn’t have enough sleep? And so, I think it is really challenging. And I think the, the solution for agency owners is, is simply that they need to make sure that they’re taking the time to be tuned into these things. And, and actually thinking about them, because I think, you know, too often we are blinded by money, right? And you made that point about, you know, this was a giant contract for, for Jerry Media, perhaps the largest that they had ever had. And, and certainly, you know, I know that the times where, you know, I felt the most uncomfortable with clients, it’s usually because they’re paying a ton of money. And so you’re willing to, I won’t say, necessarily look the other way, but you’re, you’re willing to put the most positive interpretation on bad news. And that gets you in trouble.

It does get you in trouble. And, you know, like them, the music festival consultant that you mentioned, 70% of what he would be paid would be day-of events, so, like…

Which by the way is a stupid contract.


It is a stupid contract. I think that’s how it’s done. And I also will add, anybody who’s ever done events knows that everything that could possibly go wrong does. So there’s that too, but, you know, I think when clients don’t pay their bills, you know, they’re, there is a tendency for us to say, Okay, well, one month is, okay, two months is, okay, three months, we’re starting to go like, Hello, we need to get paid here. And, you know, you can’t let it go on like that. So you still have to run a good business, no matter how sort of starstruck or awestruck you are by the client, his or her ideas, the innovation, the entrepreneurship, all of that.

Right, right. And, look, I mean, you know, I, there are, there are times over the course of my career where, you know, money has made the difference in a decision, you know, where it’s, you know, it’s, it’s a close call, you know, I’m not proud of it. And usually, they’ve turned out badly in the end. So, I got, you know, I got my comeuppance on them. But, you know, I can recall one particular situation where I was, I was in a conference room with a couple of folks, and we were talking about a project that we could all work on together, and I had been resisting it for probably six or seven months as a concept because I just, it didn’t, didn’t feel right to me. And so, you know, we’re sitting in this meeting and on the whiteboard, they’re sort of sketching out the, the model of how it works, and they’re putting dollar values next to it. I’m like, well, well, I mean, would I be willing to take the risk for that dollar? Well, maybe. And so, you know, it was it was not that I, that I necessarily gave in and capitulated, but it was okay, how can I find a way around my concerns? How can I make small adjustments so that it falls within my comfort zone, right. And so ended up doing that, at the end of the day, that made the project frankly, less successful, because in order for it to be as successful with, you know, would require cutting more ethical corners than I was comfortable with. And so it ended up not going where it could have. And so, you know, you learn and you say, Okay, look, you know, it’s, you know, when you have those situations, you know, probably figuring out how to get it into your ethical comfort zone is not the right solution it’s probably better, just not to do it,

right. I mean, but it’s, but it’s tough. And

It is tough!

You know? And particularly with, you know, so many agencies, you know, fighting to make ends meet, you know, we know this from the folks we talk to, on a regular basis and, and saying, you know, Geez you know, I’m going to jettison this client, particularly if it’s a big client – that’s, that’s not an easy call. And so you know, it is really easy to get into trouble but I think that’s you know, if you start, if you sort of keep reminding yourself that that you need to remain within your comfort zone that that it will help. It’s certainly not going to solve it, right but I think that we all have a habit of just getting tied up in the day to day and we don’t take that time to step back and ask ourselves you know, are we doing the right thing. And you know as tough as it is if you do more of that, you know, if you’ve got if you’ve got a trusted team that’s willing to question you as the leader, right say, you know because frankly a lot of these times you know you could have been saved by juniors who are working for you and my guess is even that – you know i don’t know Jerry Media at all so I’m this is pure speculation – but typically the frontline more junior people are the ones who see the problem first. You know they would be particularly when it comes to social media, they’re the ones who are seeing the stream of questions and and and DMs and comments and all that, so they’re seeing it, they’re feeling it, and yet if you’ve built a culture where they’re comfortable coming to you and saying hey something ain’t right with this client , you know, we need to we need to ask a few more questions. Not necessarily, you know, investigate them right that’s not the role of an agency, but you know ask questions and and push. Although in this particular case I’m not even sure how successful that would be because it seems like this Billy McFarland character was just a really accomplished liar, a really… and, you know, the sad truth is that the people who are you know, really good at doing that, it’s, it’s hard to, to catch until it’s too late. And, you know, it doesn’t excuse the people around them. And and in particular, you know, and we talked about this before we recorded but Ja Rule who was his partner…

the fact that he got to walk away unscathed from the whole….maybe he didn’t know. I mean, look, I, you know, I’ve certainly seen instances where business partners have no idea what the other business partner is doing. But there should be a higher level of responsibility.

And I think in this case, he knew, I mean, maybe not to the extent…. but I also think there are other people around, really close people around him that were culpable too because they knew as well. And so I think it’s really difficult to say to an agency that sitting in New York City being directed by the chief marketing officer who’s in the Bahamas, who’s being directed to lie and not tell the whole truth for it’s hard. It’s, it’s not so easy for that agency to be like, oh, there’s a problem here. When you have the chief marketing officer saying, do this, do that, handle it this way, handle it that way. They’re not in the Bahamas, seeing it all fall apart. The chief marketing officer was in the Bahamas, seeing it all fall apart. And, by the way, was willing to go do some very awful things to get Evian water brought into the country.

Yes, yeah, that was a very memorable scene. Go watch it, we’re not going to discuss it.

So I mean, there is there is a lot of a lot of that going on, where those people were there, they were on the ground, they were seeing what was happening. And they even said, like, let’s cancel, let’s push, like, let’s do this, because it’s going to be far better now than when people show up, and they don’t have anywhere to go.

Right. It absolutely is, but you know, it, you know, so, I’ve seen a number of cases, you know, where there are, you know, really aggressive entrepreneurs, and, and, in some respects, a really aggressive entrepreneur, and the line between a really aggressive entrepreneur and a scam artist is not that big, right?

Because, you know, there are any number of people who have succeeded in business by, you know, pushing the envelope, you know, really hard by juggling a lot of balls up in the air, and just hoping that none of them hit the ground. And, and they get lucky and they don’t, and, and, you know, the, you know, one of the, I think at least one of the folks in the documentary even said, you know, sort of, if one or two things had had had fallen correctly, you know, this might still have turned out okay, despite all of this other stuff, right?

Which is true!

Which is true. And, you know, I mean, honestly, as I was watching it, you know, I’m putting on my entrepreneur hat and you know, and problem solver hat I’m like, well, geez, you know, even even when you’ve got that mass of people on the island, there’s like, two or three things you could have done that maybe would have, you know, made it not an utter disaster and just, you know, not great, right? But but but, you know, it seemed like at that point they went into panic mode and particularly when you’ve got people just sort of milling around not knowing what to do, I mean, you got all these tents there instead of doing like Billy did and just saying, hey everybody go find a tent! Which… I mean that’s just never going to work out well, right?

Noooo…and and everybody was drunk, too, at that point so, sure!

Right, right! Yeah,

yeah. For those, I mean you really have to watch this thing because it’s incredible. I mean they basically send all of these angry vacationers, pour, literally pour alcohol down their throats. Literally. Literally pouring it down their throats to get them as drunk as humanly possible, then you stick them out there baking in the sun and saying, um yeah we don’t have any place for you, we’ll get to it and then it gets dark and they basically say, have at it, go find a place to sleep. I mean seriously, at that point if they had simply sat there and just started you know moving through the line and saying okay you’re in tent number one, you’re in tent number two…

you’re I mean

that would have solved a huge portion of the problem, right? I mean just just do that. Is it ideal? No but you’ve now got people in tents. They’re not fighting over mattresses and you know turning into a Lord of the Flies type situation I mean, it’s

Hording rolls of toilet paper. Yeah. It was unbelievable.

right. Just really, really unbelievable. Yeah, but I guess the you know, for me, the upshot is that you know, as an agency owner you need to make sure that whether it’s a prospect or client that you are comfortable with, you know what it is that they’re doing, if if your if your little spidey sense is tingling and telling you something’s off, ask a question. Follow up. Google them. You know, do a little bit to try to just to figure out whether you are on the right track or not. But once you’re in, actually working for the client, if they’re asking you to do things that are making you and your team uncomfortable you need to raise that. And so if you’re being told, delete comments because you know people are speaking the truth but we’re not addressing it – that’s a problem and maybe maybe you do need to walk away at that point or at least you know at least speak up and it didn’t appear that that was really happening in this case. Although I guess you know, perhaps to Jerry Media’s credit that you know they didn’t tell the lies directly. They forwarded it over, they forwarded the emails and messages over and said, look if you’re gonna lie to him you guys do because we’re not in this yeah we’re not in on it. And again, with the caveat that that’s their story, it’s their documentary so you know, who knows. But you know you have to figure out how to deal with those kinds of situations effectively and it is certainly a challenge.

Well it’s a crazy crazy documentary and one thing I will add at the end is

this is part of the reason that disclosure is so important on social media, so when you’re working with influencers please make sure they use “hashtag ad” in everything they do.

Right. Yeah. That’s, that is certainly a lesson that that needs to be learned. I’m not sure that it ever fully will be, but yes please, please do it. If you’re influencing, label it. If you’re asking someone to influence, label it, just label it. Right. I mean it, just it, honestly people who become immune to seeing it, at you know the hashtag and the two letters “ad”, that’s enough your butt is now covered.

And honestly, I don’t think that I personally don’t think that it would have affected the outcome, and I don’t think I mean, because part of what they were saying was well, the influencers didn’t say that this was an ad and so it could have all been avoided and you know, people wouldn’t have been… I don’t think that that’s true. I think even if they had said it was – they were being paid for it, I think they still would have spent $4,000 or more to go down there for this exclusive festival. I mean they even said they had people pulling out of Coachella to sponsors pulling out of that to just sponsor the Fyre festival. So I don’t think it had anything to do, you know, not that it’s right but I don’t think it had to do anything to do with the influencers not saying that they were paid for this. I think it was just a cluster all over.

Oh absolutely. I mean, it’s like as I like to say you know, most of these really bad situations are like plane crashes, it’s no single thing. It’s a it’s a combination of things that all come together at just the right time that that make things as bad as they are. But you know, pretty much it seems like anything that that Billy McFarland touches is is likely headed in that direction. And I did I know we’re we’re going to push ourselves over our self-imposed 30 minute time limit. Sorry listeners. But the, the scam that that he was running afterwards where he was basically, he was selling access to events that didn’t that you couldn’t sell access to. I thought that was I mean, that was particularly special. I thought, you know, and and those are the kinds of things where, you know, if you’re an agency and you’re being asked to market that, you know, and you sit there and say, Oh, I didn’t I didn’t know that you could sell a ticket to the Met Gala. I thought that was invitation only. It is. And again, you can find that out quite quickly from Google. So if you were an agency asked to market that, you know, and you’re like, I didn’t know you could do that. Google it and find out. I mean, you know, again, Google is your friend. It can it can help you make a better pitch. It can help save you from making a bad decision.

Yes, yes. Yes.

And if you google Tom Brady, it will say greatest of all time, six rings. No, no? Okay. Well, you know, I had to to to hopefully end this show on a little bit of a lighter note.

Yeah, you’re not gonna make very many friends out there, my friend.

Well, you know,

I don’t have many friends to begin with. And I’m okay with that. So I just I just want to help them be better agency owners. That’s my goal. If they like me, okay, cool.

But any case, I am Chip Griffin.

I am Gini Dietrich

and it depends.

The recent documentaries about the disaster that was the Fyre Festival raise an interesting question: are agencies responsible for their clients' actions? The recent documentaries about the disaster that was the Fyre Festival raise an interesting question: are agencies responsible for their clients' actions? Chip Griffin and Gini Dietrich clean 32:06
ALP 16: How to benefit from “pick your brain” meeting requests Wed, 30 Jan 2019 12:00:09 +0000 0 Chip and Gini explain how to get make "pick your brain" conversations mutually beneficial. If you’re a PR or marketing agency leader, you have likely had someone ask to “pick your brain” recently.

These requests can seem like a burden. After all, someone wants to get a bit of your time for free. And agencies are used to selling their time.

This topic recently came up in the Spin Sucks Community, and it inspired Chip to write an article encouraging agency leaders to say “yes” to “pick your brain” requests.

Since this topic struck a nerve with many agency owners and executives, it seemed like a good subject for Chip and Gini to take up on the podcast. So they did.


Hello, and welcome to another episode of the Agency Leadership podcast. I’m Chip Griffin…

And I’m Gini Dietrich…

and we are here today to talk about picking your brain.

Pick my brain.

Maybe not your brain, you the listener. I mean, maybe we do want to, but you know, we’d have to see, I guess first, but we’re going to talk generally about picking people’s brains, you know, and particularly as an agency owner leader, when someone asks to pick your brain, how should you respond? And it comes from a particular question in the Spin Sucks Community, which we’ll get to in just a moment. But first, I would like to encourage our listeners, and I haven’t done this in a while, if you haven’t had a chance to go over to iTunes to leave a rating and review for the podcast, we’d really appreciate it, whether you like it or not, just go ahead and give it the score and a couple of comments. And of course, if you’ve got feedback, feel free to share it with us directly as well, because we’re always looking for ways to improve this show. Not that it really needs improvement, Gini, I think

we just have this thing nailed.

Of course we do every week. Yes. There’s never a challenge with the sound or anything. Yeah, we have it.

Exactly, exactly. So in any case, let’s go from there to the topic itself. And Gini, why don’t you share the question that came up in the Spin Sucks Community?

Sure. So this question came up last week. And it was a there was a lot of conversation about it. So the question was, how do you handle “I want to pick your brain” requests. My response to this has evolved over the years, and I’m still trying out different approaches. That’s why I’d love to know how you handle it and what has worked well for you? Do you take people up on it, only offer a short call, charge for a consult, or something else?

And it did lead to some lively conversation in the community. And, and I felt motivated enough by all of that discussion, to actually to write out a blog post on it. I had actually written one, gosh, probably about a decade ago. This is a this is a topic that tends to circulate on social media periodically, it seems like, you know, every 6 or 12 months, so at least in the circle of friends that I have on Twitter, or someone you know, complains about not being paid for their time when someone asked for coffee, or that sort of thing. And people start jumping in and saying absolutely, you need to say no, and I tend to take the contrarian view, which is that you should say yes, and that should be your default answer when someone asks to pick your brain, because I think there’s a lot of value to be had from it. And I can explain more in a moment. But that’s, that’s sort of where I come from. And so to set the table Gini, what’s your, you know, what’s your general reaction when that question comes up?

Well, I,

we, this is going to go to our – I’m laughing because it’s going to go to our slogan – It depends. And I definitely am on the “it depends” side of things, because, you know, for sure, there are situations where I just don’t have time. And, you know, there have been times in the past where I’ve said, Yeah, I’m happy to have coffee with you, or meet you for lunch, or whatever happens to be, but it’s, you know, it’s going to be seven or eight weeks from now. Because just because of how busy I was at the time, and if they’re willing to wait, then I think, yeah, I mean, that’s the least you can do is, is help them out. But if they’re not willing to wait, then it’s not that important. So I think there it definitely depends.

I also, before we get into it, and I think you have some really great advice on this…But I think there’s something to be said for the person asking to pick your brain because I’ve had people say, Gosh, can I, I really could use your help, can I pick your brain and then they want me to travel out to the suburbs, you know, and spend two hours in the car to get to them. No, like, if you want to pick my brain make it as easy for me as possible to say Yes.

Right. And I think that’s, that’s a good place to sort of start with the conversation and I’ll sort of make my overall case for it in a moment. But, but I do think there need to be ground rules, even when you say yes, and I think, you know, some of those ground rules are, if someone is asking you for the meeting, then it needs to be convenient to you and to your schedule. So, you know, that means that it should be close to your office, if you decide to have you know, coffee, I would say generally for “pick your brain”, I generally won’t do a lunch or drinks or dinner or anything like that for “pick your brain” unless it’s somebody who’s, you know, already a connection of mine. You know, most of the time that people raise this, it’s not, you know, for a pre-existing relationship, it’s usually, you know, someone making a new connection, or a very loose connection that you have, trying to upgrade it, you know, that sort of thing. But either way, it needs to be convenient. So, if you’re busy for a couple of weeks, and you need to schedule it, you know, 3, 4, 5, 6, 7 weeks out doesn’t matter, absolutely do that. And you’re right. If people won’t wait for it, then they’re probably, you know, looking for some sort of, you know, easy answer quick when, you know, not the kind of thing that that’s really a true exchange of information, which is what I view pick your brain meeting says, as turning into ideally.

Yeah, for sure. And, and certainly there are times I think – I can think of some situations in my own experience, where people have asked for some help. And it’s been because they’re weighing, you know, two or three different job options, and they want to get an outside perspective, or they’re considering leaving their current position, and want to get a perspective. And in those cases, you know, if it’s a quick phone call, and we can have that conversation, I’m happy to help when stuff with stuff like that. But that I think, then it becomes having that kind of information for the person who you’re who you’re asking to pick their brain, you’re giving them that kind of information, they could easily say, and it’s easy for me to say, Oh, you know, what I can I can slot you in for 20 minutes, let’s just have a conversation, we don’t have to actually get together and go through that whole rigmarole like, let me help you from that perspective. So there are certainly situations where it doesn’t have to be a coffee, and it doesn’t have to be in person. And it doesn’t necessarily need to wait, you know, weeks either.

Right. Yeah, and I, you know, my position is, if this is, if this is someone you don’t have an existing relationship with, I would encourage you to steer it towards a call anyway. You know, I, at least for me, I prefer not to get, quote unquote, trapped in person, if you will, on a first meeting, you know, and, and so you can have that call. And if it if it blossoms into something where you see some mutual value, you can always, you know, schedule a coffee or lunch or something like that after that. But, you know, my encouragement would be for people to steer these, you know, towards being a call initially, unless there’s, you know, some sort of extenuating circumstance of some sort, you know, whether it’s, you know, you may not know that person, but it’s a really good connection of yours, who’s recommended that you talk, I mean, there’s all sorts of different permutations of it. And you just have to use your own judgment. But, you know, the particularly because I think that if you’re, if you take a look at how much time you actually spend on pick your brain meetings, and you try to figure out, okay, you know, what’s, what is the value that I can extract from it, that’s, and that’s what I argue in the article that I’ve written about this, you know, that’s where you can really shift your thinking about pick your brain and how you can realize that, you know, it’s not so much just someone stealing from you, if you will, it’s actually broadening your network, broadening your information base, and hopefully returning more than what the time is that you’re investing into it.

And I think there’s something to be said for, you know, you said at the beginning of this, that it feels like we have this conversation every 6 or 12 months. And we do because I think we we all tend to feel a little inundated by it. And I certainly have have been there. And I will, I’m sure will be there in the future as well. But you get to the point where you’re like, gosh, I can’t get anything done, because so many people are asking to pick my brains. Do I need to charge for these consultations? So I think that that’s part of the reason that it keeps coming up is people do feel a little inundated, and we sell time for a living, right? So you can’t add more time to your day, you can’t duplicate time. So when you’re giving your time away, you have to really think about it strategically, does this make sense?

Right. Absolutely. And, you know, it doesn’t mean there may not be occasions where, you know, I would even encourage you to say no to a particular request. But you know, my view is that if you default to Yes, you will come out ahead in the end. And, you know, while we were applying this primarily for this conversation, to pick your brain meetings, I would, I would expand it to sort of what I would call purposeless networking opportunities, right. So, you know, you’ve got people in your network, maybe you don’t see or talk to them all that often. And so if you’ve got an opportunity to take advantage of that, I always encourage people to, I always try to take advantage of them myself, because you just never know what’s going to come out of them. I mean, the one of the perfect examples of this is this podcast is the result of just such a lunch.

Right! You’re absolutely right.

I happened to be in Chicago, I had no particular point. But I said, you know, hey, Gini, you free we haven’t talked in, you know, a couple years in person or whatever. And, and we were able to get together and just by happenstance, this podcast came together out of that. And so you just don’t know what value you might get out of what on the surface looks to be purposeless and just sort of a general catch up, or just a general pick your brain. So the more of those serendipitous experiences that you can have, the more you’ll start seeing the value and taking those meetings.

And I think there are other two valuable pieces to this, which were not in your blog posts, but I think are important as well. And one is karma. I mean, good karma not, not former employer, CARMA, but karma in terms of, you know, putting good out into the world and helping other people. I think there’s something to be said for that coming back to you tenfold, which whether or not you believe in that it actually does happen. And the other piece is, shoot, I lost my train of thought there was a second piece Um,

well, that’s okay. While you’re thinking about that, I’ll I’ll point out that you apparently fell asleep before you got to the last sentence of my article,

because because the last sentence says that it can create some good carma for you along the way, so….

Oh, it does! And as hokey as it sounds, paying it forward does have benefits and can create some good karma for you along the way. Yes. Okay. Sorry. Fair.

No, no problem. No problem. It’s, it’s, it’s good to know that you really appreciate my writing, Gini.

Well, now I have to figure out what my second one was and if it’s in here.

Um, I don’t remember what it was. Man. And I’m sure it’ll come back to me.

Yeah, I mean, look, I think it while you’re thinking about that, I’ll sort of address a couple of the other things that I want people to be thinking about when these meeting opportunities come up. And part of that is that as an agency owner executive, you’re typically out there trying to meet new people trying to build your network in order to generate new business, right? If you’re at a senior level at an agency, part of your responsibility almost certainly is generating new business of some sort. So if you take a look at, you know, what your hourly rate is, how much time you’re spending on these pick your brain meetings, particularly if you’re able to condense them into phone calls or coffees near your office, so you’re not, you know, you’re not going outlandishly broad with it. My guess is that if you took that and said, okay, you know, I can have say, 10 of these pick your brain meetings a month. And that’s just a randomly selected number, because it makes the math easy. And, you know, if you if you then take a look at that, and blended, okay, maybe six calls, four meetings, okay, so that’s if I’ve got an hourly rate, of 250 bucks. That’s about $1750. And I do all the math for you in the article. So you put a link in the post about this podcast, so that those of you want to see it in front of you, you can see it, but that would mean that you had an annual cost of your pick your brain meetings of $21,000. Wow, that sounds like a ton of money until you say, Okay, well, you know, if out of those 120 meetings, right, hopefully, with 120 different people, because if someone’s picking your brain all the time, that is just, you know, stealing your time that’s getting free advice. So if you talk to 120 new people a year, are you going to generate $21,000 or more in profitable new business? I sure hope so. Yeah, sure. Yeah. So, so yeah. So when you when you start basically, you get one $2500 a month retainer, and you know, you’re all set. And chances are, if you have 120 meetings with 120 different people who actually want your advice. So therefore, even if they’re not directly a qualified client, they probably know another one, you know, you just you’ve expanded your network enough that it makes it worthwhile to do it, even if you look at it in the pure dollars and cents way, which is how most people reject them, right? Because they said, you know, I’ve, I’ve wasted an hour that I could have billed for $250. My argument is, if you look at the math, you probably actually coming out ahead in these meetings. Now, that doesn’t mean every meeting is going to produce revenue. Okay, so there are going to be busts. There are going to be horrible meetings, there are going to be meetings where you’re sitting there and saying why am I talking to this person?

What a freakin waste of time.

Right? Exactly. Yeah, but it happens. Yep. Right. But, but, but why not take advantage of that. And why not find those opportunities to make some money, extra money for your agency, and hopefully yourself along the way.

And not only that, but many of us work from home, and I’m as introverted as they come. So I would rather just stay behind my computer screen and not talk to people. But there’s some value in getting out. And having in-person conversations with people, there just is huge value in it. Because you have conversations where you sort of bounce ideas and you have this in your your blog post too but the brainstorming piece of it, that you bounce ideas off of one another that you wouldn’t necessarily do on the phone or on a video chat. Because you have 30 minutes of allotted time. And, you know, I think there’s some some something to be said for getting out and actually talking to people and having conversations that may or may not result in anything, but could you know, get you a podcast partner co-host or it could get you a guest blog post, or it could get could conjure up some content ideas, or there’s a lot of ancillary benefits to actually having conversations with human beings as well.

Right. And throughout these meetings, there’s the huge potential for market research, which I think is something that, you know, we all ought to be thinking about, you know, how can we learn more about what the marketplace is actually looking for, when it comes to the services that we’re providing? How can we figure out what the challenges are that are really motivating people today? And so by having these, pick your brain type meetings, typically the questions you’re going to get, or how do I solve this problem? Or, you know, what’s the direction of this, you know, here’s, here’s what’s bothering me, these are all incredibly valuable data points. But if you then go beyond those questions, and you ask your own follow up questions, you know,

well, tell me how many sales a month that you’re making, you know, what are you doing now, for your earned media? How much are you spending on Facebook ads? You know, these are all questions that as part of that conversation, because they’ve come to you, they’ll probably answer, much more willingly than if you call them up and said, Hey, can you just tell me what your budget is for marketing? Can you tell me what your annual revenues are, right? But if someone’s coming to you asking for help, they tend to be pretty open. And so you start to build your knowledge of the marketplace. And, you know, maybe they’re using a competing agency, or someone who overlaps you on the Venn diagram, somehow, you can learn more about those things. There’s just so much you can learn from these meetings, if you go into them. And you think, Okay, this is, this is an experience that’s going to enrich me, not necessarily by directly putting money in my pocket, but by giving me information, by giving me ideas, getting my creative juices flowing, expanding my network, it really it, it will change the way that you look at these requests, because I don’t know, it just, it really fires me up. Every time I see this debate take place, and people immediately jump in and say, Oh, yes, you need to protect your time, you can’t waste your time… No! You should look at this as an opportunity. Again, doesn’t mean there aren’t times to say no, but there’s so much value that you can get out of these meetings if you treat them right.

Yeah, and I think I mean, certainly, it depends on the situation, and whether or not it’s somebody who continues to do that to you, you know. And one of the things that just irks me to no end is when a friend will email me introducing me to somebody else without having a conversation with me ahead of time. Hey, I’d like to introduce you to so and so. And here’s why. But instead, that email comes through, and then you feel stuck. Like, I don’t know who this person is. I don’t know why you’re introducing them to me. I don’t know what they want. Thank you for thinking of me – at the same time, like, Can you give me a heads up? So I think there are situations where, yeah, you do have to say no, and I think what somebody said in the comments was, you know, when you say yes to something, you’re saying no to something else. So you also have to think about those kinds of things. You know, if you’re saying yes to a pick your brain meeting, and that means that you can’t meet with a client, probably have to change that around. But I don’t think that saying no to all pick your brain meetings or really saying yes, to all of them makes sense.

Yeah, I mean, I guess what I would say is, that, to me, it’s, it’s more about, you know, when you schedule it, going back to the point we talked about earlier in the show. So, you know, I would, I would say that you should rarely say no, unless it just is clearly a bad fit. You know, someone you know, is coming to me asking for, you know, advice on martial arts or something like that, you know, I’ll immediately send them to Christopher Penn for that. Yeah, yeah, exactly. Exactly. And, and, you know, then, then, you know, they can hash it out. And, but, but to your point, I would email Chris first and say, Hey, you know, just, you know, are you okay if I make this introduction? Because you’re absolutely right. I mean, you know, people who sort of

come out from left field with the, oh, you know, you two should talk. Ah, you know, the only exception I would say is, you know, if you’re referring if you’re making an introduction, and it’s someone who’s looking to buy the service that your friend is selling right, they’re never going to say no to that. In those cases, I may not bother with a heads up, you know, if someone comes to me and says, you know, hey, I’m looking for a media monitoring service. Oh, okay. Well, then talk to the folks at Carma and I’ll just copy the person over there, and good, fine. Yeah. Easy enough. But if it’s, if it’s more just sort of making, you know, setting up another kind of pick your brain meeting, then then you absolutely touch base first, because someone may say, Oh, no, that’s, you know, we’re, we’re already working with a competitor of theirs, I don’t want to tell them that, you know, whatever. I mean, there’s all sorts of different reasons why someone might want to, to not have that introduction made. So do them the courtesy. 99% of the time, they’ll say yes. But, you know, take advantage of that heads-up for that 1%, when it would cause a real problem for them.

Yes. And the very last, if you’re the person picking the brain, say thank you, send a nice note through the snail mail, send a nice email. Just say thank you. Because that’s not I mean, especially if there’s not something that eventually came out of it in the wash for you. And you were truly just giving your time and being helpful. Just it’s, it’s a very simple Golden Rule thing, just say thank you.

And if I can turn the clock back a little bit, the first thing you should do is be on time.

Yes! That’s true. Yes.

And this is this is from painful, hard won experience. I am shocked shocked by the number of people who ask to pick my brain who show up late to the phone call, late to the coffee, occasionally just don’t show at all, which is something that I’ve experienced more with, and I hate to say it, with younger people, recent college graduates I’ve seen this with and, and in part, it’s because, you know, I’ve seen situations where they’re perhaps in another meeting, and they can’t figure out how to extract themselves, right? Which I understand when you’re young, and you’re and you’re, you know, it can be challenging. But, you know, an important life skill is to figure out very early on how to, if not extract yourself, at least say, hey, I need to let my next appointment know that I’m running late, which, by the way, will usually help tighten up that first meeting. Right? Because most people want you to be respectful of other people’s time. But at the very least, give a heads up. I mean, I had one situation this was probably seven or eight years ago, I had agreed to meet with a recent college graduate and he just never showed. And so the next day, he reached out and said, Oh, sorry, I wasn’t able to make it. I was at my internship and I was asked to do something. And and I’m like, you couldn’t text? Email? Call me on the phone, something?

Carrier pigeon?

and and he asked to reschedule. I said, No, thank you.

Yeah, no, sorry.

I’d love to help you. But, you know, you can’t do that to me, and then expect me to reschedule. You know, so, there are, you know, there are, I think very important things and it’s, it’s important that we all realize that, you know, whatever level we’re at, because, you know, I asked to pick people’s brains still on a regular basis, you know, and so, you, you know, it’s incumbent upon me, even at this stage in my career, to be thoughtful about it, make sure that, you know, I’m not scheduling that, for example, right after a client meeting that may run long or something like that. So that, you know, I’m being proactive, and thinking about how to make sure that I’m being timely. And then, of course, that that follow up is the, you know, the icing on the cake, in your way of really acknowledging that that person has, has done a favor for you. You know, these are all I think, valuable things, I think, at the end of the day, if you, if you really sit down and think carefully about it, you’ll find that you’re getting a huge amount of value out of pick your brain meetings, or at least far more value than you thought, hopefully, before this conversation before, we’ve you know, perhaps shared a new way of thinking about it for you that you hadn’t considered before.

Well, and I really love how you break it down, right? The financials, that I mean, I’m a big financial person anyway, but I love how you break the financials down, and you make it really conservative, let’s say that you, you know, convert 1.2% of your meetings, right? I mean, to your point, if that’s $2500 a month, over two years, you’ve made back your investment in time times three. So I love that. It’s a really nice way of thinking about it.

Yeah, and I try to, you know, I’m a big data guy, you know, not as, not as big as Christopher Penn. But, you know, I,

Nobody’s as big as Christopher.

No. I do believe in the power of data. And I, I particularly like using it when it can help flip someone’s point of view, right? Because if I come out and just say, look, you know, you’ll get a lot of value out of it, it’ll feel good, you’ll, you know, you’ll be able to expand your network and sort of speak in general terms, I don’t think it hits home quite as well. So that’s probably a useful lesson for people generally, I think, if you’re able to, to paint a picture with numbers, give facts, you know, really do something beyond just making a rhetorical argument, but really, you know, delving into the evidence, that’s where I think people will realize, Oh, you know, this, this is something I should look at differently. Because, as you say, that the numbers that I used in the, the article, I think were incredibly conservative. And if you have 120 meetings over the course of the year with new people who are asking for your expertise, and you cannot turn that into at least a single $2500 a month retainer, or, you know, whatever it is for your business that, you know, works out to the right numbers, you’re doing something wrong, right? I mean, that’s, you know, if you were doing that on outbound sales, you wouldn’t be happy. So imagine when people are coming to you with their problems.

Right. That’s like not converting any inbound leads. That’s bad,

Right. And, and it’s, and again, it doesn’t even count who they may introduce you to, because my experiences that that when someone picks my brain, they often will tell someone else about it. And so it often leads to another meeting. And so, you know, if you do this well, you’ll end up having a lot of meetings, you’ll have to manage your schedule. And that’s fine, because most people will wait a few weeks to talk to you, if they really see value in having that conversation. So don’t be afraid to push it off if you need to schedule it when it works for you. But at the end of the day, you are going to get value out of these meetings if you do them well.

Amen. So I think the general consensus is say yes, to pick my brain meetings.

Absolutely. And say, yes, listening to the Agency Leadership podcast, But you know, I’m nothing, if not corny, and hokey and all that. So we appreciate you listening to the end of this podcast. Hopefully, you’re still paying attention. Unlike my co-host who apparently stops paying attention at the end of my articles.

Not not at the end – at the very very end.

On that note, that brings to an end this episode of the Agency Leadership podcast. I’m Chip Griffin

and I’m Gini Dietrich

and it depends.

Chip and Gini explain how to get make "pick your brain" conversations mutually beneficial. Chip and Gini explain how to get make "pick your brain" conversations mutually beneficial. Chip Griffin and Gini Dietrich clean 25:54
ALP 15: Building Agency Client Project Budgets Wed, 23 Jan 2019 12:00:48 +0000 0 In this week's Agency Leadership Podcast, Chip Griffin and Gini Dietrich discuss the importance of creating and managing budgets for agency client projects, including both retainer and one-time work. In this week’s Agency Leadership Podcast, Chip Griffin and Gini Dietrich discuss the importance of creating and managing budgets for agency client projects, including both retainer and one-time work.

The discussion was prompted by a tweet by Karl Sakas that urged agency leaders to include project management costs in their budgets.

This topic is something that Chip as written about previously on the Agency Leadership Hub, including why project budgets are important and how to create an accurate client project budget.

Chip and Gini discuss how projects serve as building blocks for overall agency profitability, the challenges in properly tracking project costs, and items that can be easily overlooked when building those budgets. They also have a robust discussion about how to bill for some of the less glamorous aspects of agency work to better maintain the relationship.


CHIP: Hello and welcome to the latest episode of the Agency Leadership podcast. I’m Chip Griffin.

GINI: And I am Gini Dietrich.

CHIP: And we are here today to talk about the importance of projecting project costs.

GINI: Very exciting topic for creative types who always say, I went into advertising, pr, marketing, whatever, because I’m not good at numbers.

CHIP: I find that it is everybody’s favorite topic. And so that’s why I decided to try to work “project” in, back to back project and projecting. Yeah. Uh, and, you know, and we will project our voices as well. So we’ll see how much we can abuse that term over the course of the next 28 minutes or so. But it is critically important because when you, when you think about your agency’s overall success, it breaks down on a project basis, right? Whether that is a recurring project, i.e. retainer or one time project, it’s still something where if you’re not making profits out of all of the little pieces, then you’re certainly not going to be making a profit as a whole. So trying to think about the financial aspects of each of your engagements is absolutely correct.

GINI: You wrote a blog post on the Agency Leadership site that I thought, well you have two actually, but the one that I’m going to speak to first is, you talk about, okay, let’s say that you’re projecting a project. There you go, at $150 an hour for 20 hours. Well let’s say then you end up spending 25 hours your, so you’re overservicing number one, but number two, your hourly rate just went from $150 to, what? Eighty something dollars an hour. So you have to think about it from that perspective and from the perspective of all the hidden costs of things that you do to help clients. Media monitoring, you know, email marketing, software, any kind of software, travel and expenses, any time that you have to outsource or use a freelancer for things, research, entertaining, events, you know, all that kind of stuff. It’s really hard to project some of that. There are some things you can do to get around it, but I think it’s really important to think through all of the things that you might take on for a client throughout a project or a retainer that you end up paying for that you wouldn’t have unless you were doing this work for a client and so yeah, they should. It should be included as part of your fee.

CHIP: The key is first that you have to have that mindset as an agency and that means you have to have that mindset as the owner or leaders, but you also need to make sure that that permeates down because so many agencies have, frankly, relatively junior people who run projects on a day to day basis. Right? Right. You know, you’ve got someone who’s got maybe three to five years of experience and they may be managing the day to day of a client. Not necessarily the full relationship, but you know, they’re the ones who are deciding, you know, how to make sure that they’re executing on the press releases and social media strategy and all that day in and day out. And if those folks don’t understand and appreciate how their costs come into play and particularly the soft costs: your time, which is, which is to me in all the agencies that I’ve been associated with, either

CHIP: as an employee, as an owner, as a consultant over the years, that’s where they tend to get caught up the most. Because if you’re on the front lines, if you’re dealing with the client everyday, your natural instinct is to make them happy, right? Because you don’t want a client yelling at you on the phone. That’s just no fun. And so what you do is you go out there and if the client says jump, you ask how high because you want them to be happy and so you will end up overservicing the client if you’re not careful and if your agency is not properly tracking time and all that, you can get into deep trouble. And that’s where my particular example of even just one hour a week on a project where you’re budgeting 20-25 hours a month. That adds up very quickly and can be a giant reduction in your profitability and nobody’s really even thinking about it.

GINI: No, Ken Jacobs gave a pretty good presentation at Counselors Academy a few years ago where he talked about this phenomenon and he said, okay, well, I mean, to your point, let’s say that you’re doing that, but you overservice 10 hours every month. Well guess what? You just worked for free for the last two or three months of the year. Completely for free. That’s not okay.

CHIP: It’s not okay at all. And you know, one of the things you have to be careful of as an agency leader is the fact that your frontline employees, even if you’ve got a time tracking system in place, they may fudge. Right. And I can say this because when I was a, a very young junior account executive many moons ago, the team that I was working on, even though I was not leading that team, we knew we had a certain budget for our biggest client every month. There was a certain number of hours that we were allowed to spend and we could not go over it. But we knew that we couldn’t get all the work done that we were being asked to do in that time. So all of a sudden we started putting some of our time over to administrative overhead. There was an account code for that or, new business, and I mean I still to this day, I remember the code, 647 was administrative, 925 was new business.

CHIP: I don’t know why I remember these things, but you know, because back then you know, you had to put a code in every time you dialed the phone, you had to put a code into the copy machine. You know, this was, for all the young pups who are listening to us, these are things that you don’t have to deal with so much today, but they were very common 25, 30 years ago. And so you need to be aware that your juniors may be fudging those numbers because they want to keep the client happy. So, you know, it’s not that you want to distrust your employees, but you have to, you know, to sort of have a reality check and if it looks like, jeez, they’re always working on this client, but their time sheets don’t show it, you know, have that conversation because if they understand the importance of profitability to the agency and the importance of managing costs, my experience is they will generally be pretty receptive. But most junior folks just don’t know what P&L even stands for, let alone, you know, how it’s calculated or something like that. So you need to educate your team on these things.

GINI: RIght. So I think there’s two things at play here. One is, is educating yourself so that you can educate your team and what all goes into projecting a budget and I think the first piece of it is, you know, how, how do you educate your junior staff? Because I mean, I worked at Fleishman Hillard and we would have, we had new business meetings where they taught us this is how you network. And they taught you that, but it didn’t really sink in, I think both new business and new business is a separate topic, but both new business and sort of budgeting didn’t really sink in until much later where it was like, oh, and truthfully what made it hit for my peers and I, when we were probably mid to late twenties was using the paycheck analogy and the tax analogy, so taxes and a paycheck and, and once they did that, instead of saying well you know, you’re working for free for three months or that works at the owner level because of course at the owner level you don’t want your team to be working for free for three months because you have to pay them regardless.

GINI: And it makes sense from an hourly rate at the owner level. But at the junior level, from the junior level perspective, you know, you say to them, well now you’re only making, we’re only making $86 an hour and a junior level person is going, but I don’t make $86 an hour. So you have to put it in terms of how they’ll understand it and it’s different than the way that you understand it,

CHIP: RIght, it is, and you know, in order to properly educate your team, you do need to have some level of transparency on the project costs. That does get tricky when it comes to staff costs. So you sort of, you know, you may do more accurate reporting up at a senior level. At the junior level, you may have to use rougher numbers, so that you don’t start causing too much angst, but you’re absolutely right, you know, people will sit there and say, well, Geez, you know, I don’t get anywhere near $86 an hour. I should be getting that. But if you educate them properly and you talk about, you know, all of the things that go into the budgeting and the costs and the overhead and helping them to understand, first of all, frankly, a lot of those up-and-comers in that, you know, their late twenties, they want to learn more because they’re actually interested in career growth and things like that. So I think most owners underestimate the desire of a lot of their team members to learn more and so they say, look, this is going to bore them. They’re not going to be interested in this. Let me just let me spoonfeed them. They may actually, you may find out that they really do want to learn and will eat this stuff up like a sponge if you’re willing to spend the time with them. And frankly it’s time well spent.

GINI: It is time well spent. It’s pretty easy, I think if you just say, okay, let’s take a dollar and what we’re trying to achieve, let’s say we’re trying to achieve 50 percent profitability, EBITDA. So fifty cents of that dollar has to come out because that’s after taxes, everything. We’re going to keep fifty cents into the business and in a minute I’ll explain to you what that fifty cents is going to do for the investment in the business. The other fifty cents now has to be split between: software, general and admin, vendors, internal tools, events, printing. Like you start to break it down from that perspective and you say, okay, three cents goes to this ten cents because of this, and they start to understand where that fifty cents goes and how it applies and so you, you do it from that perspective and then you can talk to the fifty cents that you’re investing back into the business, you know, computers, phones, lunches, whatever you pay for raises, benefits, bonuses, all that kind of stuff. And that’s how that 50 cents is split up that way too. And of course not everybody has 50 percent profit, so it’s 35 or 10 or 15 or whatever, or your profitability is. But then they start to really understand it.

CHIP: Hopefully not 10 or 15 because you’re not gonna be around very long.

GINI: Well, the big agencies are between 12 and 15. So…

CHIP: Yes, fully loaded. I guess you’re factoring in the full overhead costs there. I guess I tend to look at the initial margin on the project, the project specific costs. But yes.

GINI: Yeah. So I think when you make it that simple, they start to understand versus well gosh, we’re only making $86 an hour versus $150 an hour. That’s a little harder for them to comprehend.

CHIP: Absolutely. And then all of this of course flows from, as you said, figuring out, okay, what are all these costs? What are we spending on software, what are we spending on freelancers? So it’s not just the labor time, which tends to be the lion’s share for most agencies, but not all – kind of depends on what kind of projects you’re doing – and you need to sort of think through those things because you know, a lot of times there are are sort of hidden costs that you’re not thinking about when you’re putting together your budgets and therefore putting together your pricing. And the reason why we came up with this topic for the show was because of a tweet from Karl Sakas where he tweeted that you needed to be thinking about adding in, I think he said 20 to 25 percent or, or something like that for, you know, project management and unexpected client meetings, those sorts of things.

CHIP: And you know, the numbers I think will vary, right? Because it depends on your particular business model, those projects and all that. But you need to make sure that you’re building in things that you’re probably not thinking about today. Things like travel, right? A lot of folks, particularly as more agencies are located outside of major urban centers, they may have travel costs to go see clients, you know, whether that’s driving, flying, training, whatever. And those can add up quite quickly. And so, you know, if you know that you’re going to have a quarterly meeting with your client and they’re on the other side of the country, well then you need to make sure that you’re building that cost into your budget because it’s not just magic costs that go away and you can’t just write it off as overhead. It’s specific to that client.

CHIP: If that client went away, you wouldn’t spend it. So make sure it’s part of that client budget. And if you start thinking about, okay, what are all of the things I’m doing, you know, am I, when I go on that meeting, am I going to take the client out to a really nice dinner? Which is again, very common, particularly if you’re traveling and you’ll want to take the client out, well, budget that in because you know, if you’re, if you’re making a cross country trip with a couple of people and you’re having some nice meals and you’re staying overnight, now you’re talking thousands of dollars. And that can make a material difference depending on the size of your project. So if you’re not putting it in and if you’re not building in cushions and things like that for those unexpected meetings or whatever, you’re going to be caught unawares and, and it could really eat into your profit margin down the road.

GINI: So there’s two ways that I’ve seen this handled and I’ve worked for two different agencies. At Fleishman it was handled that it was always just billed back. So your time for travel was included in the budget/retainer, but any, any hard costs, any expense – so software, Bacon’s at that time, Cision, you know, all of that, travel, all of that was billed at cost. So you would submit an expense report. So you didn’t have to include that in your budget, but it was on top of and you had to have it approved. But then the second agency I worked for before I started my own was very much a, hey, we’re not going to bill back client dinners and things like that. So they did work that into the budgets. So it’s just, it depends on your philosophy and how you want to approach things.

CHIP: Yeah. And I would argue that even if you’re billing it back to the client, it should still be part of the budget because you know, at some point, you’re probably going to have a conversation with the client and you know, they may say, so what are we anticipating for expenses on top of the fees, right? So, you want to make sure that you’re putting it down even if you’re going to ultimately bill it back. And, and my experience is you with the exception of all but the biggest agencies, most folks don’t bill back every penny, right? So they often will eat some of the costs. Not always, but you know, so you need to try to figure out, okay, are you really going to build them for everything or not? And so make sure that you’re allocating it appropriately because you know, these are the kinds of things that if you’re not thinking about, you know, they really can change the trajectory of your agency.

CHIP: And ultimately I think we all want to succeed. So we want to have the best information at our hands to make proper decisions about resource allocation and pricing. Pricing in particular, right? Because if you, if you don’t know what a project’s gonna cost, how can you price it effectively, right? Because that’s ultimately all of these budget conversations that we’re talking about. It’s designed to drive proper pricing because pricing sort of sometimes feels like it’s made up out of thin air and well, frankly, sometimes it is actually made up out of thin air.

CHIP: Yes it is.

CHIP: But the more that you can understand what your actual costs are, the better that thin air has at least some method to his madness and you’ll have some sense. And if you’re not, if you’re just going to make up the price, then at least you can reverse engineer it and figure out, okay, this is what I need to keep my costs to. And try to figure out, how do you reshape your project budget to fit within whatever that magic price is that you decided the client would be able to stomach.

GINI: And not just the project budget, but to your point earlier, the scope of work, because if they’re expecting that you’re going to do X, Y, and Z for the project, for the budget, and your team’s going to end up fudging so that they can do all that really, they can only do x and y. you’re going to have to revise the scope of work as well.

CHIP: Right. And I think, I think Karl’s point about project management is something important to think about here too, because a lot of times agencies will underestimate the amount of project management that’s involved. Whether that’s how much time seniors are putting in with the juniors to work with them on it or how much time is spent on internal meetings, particularly as you get to larger projects and larger agencies. And all of a sudden, you’re, and I’m sure you’ve been in the same place where I have where you just happen to be walking by a conference room and someone says, Oh, you know, come in. We could get your input on this meeting. And so all of a sudden you’re really jacking up your costs. And that’s, that’s something that as your agency gets larger you need to be very thoughtful about, because it’s so easy just to say, okay, yeah, let’s, let’s have, you know, Joe and Sam and Kelly all come into the room here and you know, you’re not thinking about the fact that Geez, you know, now we’ve spent an extra thousand bucks because, we put three senior people in the room that maybe didn’t really need to be there.

CHIP: And so you want to make sure that as you’re putting together projects, you know, that whether it’s assigning a fudge factor percentage or, it’s by guesstimating, you know, okay, well, if we pull in, five seniors, 20 times over the course of the year for an hour each, it’s going to be roughly… however it is that you come to that math, you want to make sure that you’re accounting for all of those internal conversations that are taking place because that’s an area where you can easily get caught unawares.

GINI: It is. And unfortunately, we are still in a business where we sell time. So you’re going to be, I mean, it’s going to be, part of it has to be part of your budget. It has to be.

CHIP: Right. And I’ve seen places that, some agencies will actually, you know, they’ll sell the client a bucket of hours and they will include internal meetings in that. And you know, that is one approach. I will say that the challenge of that approach is that tends to antagonize the client. Just straight up, you know, it’s an accurate way of doing it. But, but accuracy is not always the best way to work with clients because, you know, if you sit there and you say, okay, you know, I know we did 20 hours of quote unquote real work for you. But we also did five hours of internal meetings just to sort of figure out the roadmap and the timelines and you know, to sort this out. You know, most clients aren’t going to react super-favorably to that. So if you’ve got a large enough engagement that you can bury those hours, that’s fine. If you’re on a smaller engagement and it is five out of 25, my suggestion to you just up your hourly rate and then eat that cost so that it’s not seen by the client. Telling the client that project management is important and you bill them for it… I get it and it’s a decent message to send, but probably not one that helps the overall relationship over time.

GINI: Right? Because yeah, I mean a great example of that is I sent my attorney an email, he opened the email, he responded to it. That was the end of it, and I got a bill for $964. There was no phone call. There was no him reviewing anything. It was him responding to one email that was three sentences long and I flipped. So you also have to think about it from your – flipped! – you have to think about it from your perspective too. If you’re working with a freelancer or a consultant and they’re saying, I’m going to charge you five hours a month for internal meetings or project management, you don’t feel too good about that either, so you’re exactly right. Figure out how to make it work so that it’s profitable for you, but also keeps the client happy.

CHIP: Exactly. I mean at the end of the day, your invoice, whether it’s a fixed project fee or whatever, however you’re describing things to your client, that’s part of your client communications. And so you need to think about how it’s being received, not just how it’s being delivered and so that oftentimes means be careful about some of these nickel and dime looking expenses. Again, going back to the olden days, it used to be common practice for agencies to charge their clients per page of faxes. Okay. Yes, yes, there was a cost involved in sending faxes because you know as you millennials don’t know, we used to pay by the minute for the long distance calls it would cost so that’s why there are these things called toll free numbers, because long distance calls actually used to cost real money.

CHIP: Now it’s just part of your unlimited minutes that you get on your cell phone. But. So yes, there was a cost, but it was typical for agencies to charge like a dollar a page for faxes that they sent through. I can tell you that page did not cost anywhere near a dollar to send and it would oftentimes as the recipient of that bill at the end of the month, you know, you were charged $300 for faxes. Gosh, really? It just, it feels nickel and diming and so you know, as you’re thinking about how you bill your clients, how you describe your costs, how you manage your costs, think about how it’s perceived by the client because you know you, you may be being penny wise, pound foolish. You may be able to recoup your cost for certain activities better, but you may also be antagonizing the client unnecessarily.

CHIP: So try to find other ways to, to cover those expenses typically by raising your effective hourly rate, rather than going and sending them some outrageous bill for project management or faxes or phone calls.

GINI: Or reading an email.

CHIP: Right, right. Or there was a PR agency that did work for many, many years ago and they used to send me bills for like $5 Mcdonald’s lunches that they would have as part of a travel. Like, seriously? I mean, I get it, you know, where were you coming to see me and so you had to stop. Yes. So technically it’s part of the retainer agreement that we were covering your travel expenses but, but really you couldn’t just buy your big Mac by yourself? And frankly in the past I’ve had employees who have expensed cups of coffee. Again, I get that you’re in the airport and you got stuck there, but you know, expensing a cup of coffee?

CHIP: I’m going to cover it because I’m not a cheap SOB, but it’s really not sending the right message because you were probably going to have that cup of coffee no matter where you were.

GINI: You were going to have that regardless.

CHIP: That’s always been my test with expenses and things like that. You know, if I was going to spend the money anyway, I’m not going to expense it. If I had to incur that expense unnecessarily, then yeah, okay, that should go on the expense report. But in any event, the key of all of this is really just to make sure that you as an agency owner, as a leader, that you’re thinking about these expenses and that you’re working with your team to help them understand the importance of it because ultimately that’s how you control costs and if you control costs, what do you do? You make a profit and we like profits.

GINI: I like profits. I like to make money. I like money a lot.

CHIP: In fact, I don’t know any agency owner who doesn’t like prophets, some more than others. Generally speaking, the ones who say they don’t like profits, it’s because they haven’t figured out how to make them yet.

GINI: Well, I thought your blog post that you published last week was really, really valuable and we should definitely link to it, but I’m just gonna roll through it really quickly what you included. So staff costs, outsourcing and freelancing. Freelancers, media monitoring, media analysis and PR measurement, media databases and PR distribution, primary research, travel – and not just hotel and flight, but all the other miscellaneous things. Client entertaining, printing, events, internal tools and software, management of social advertising, other vendors and expenses, and then a percentage or share of general and administrative expenses and then you bring it all together. So I thought this was really well outlined and drawn out with examples on how agency leaders can use this.

CHIP: Just to build upon that, I think everything up until the share of G&A, those are the things you need to hold your actual project managers accountable for. So you need to put together the budget and you need to say, okay, here it is and if they’re going to go outside the bounds of whatever the agreed budget is, they need to be able to explain and probably get approvals depending on what level they’re at and who has budget authority, but they need to be able to explain, you know, why it is that they had to go outside of it. The G&A piece, you know, it’s very difficult to have a, you know, a junior or mid level manager be responsible for those per se. So they need to be included in the budget so that you have them for pricing purposes.

CHIP: But if those fluctuate over the course of the year, that’s probably not the individual project manager’s fault. That’s probably at the executive level and you need address it there yet. But the, all of those project expenses, you really need to hold those teams accountable for. Because that’s the only way that you’re going to be able to truly control costs. Because if they feel like they just have a blank check, they’ll spend like they have a blank check. Sort of like kids do, you know? And, as the parent of teenagers, I can tell you, they seem to think that money just grows on trees.

CHIP: That’s not good, but money does not grow on trees and neither do clients. So keep the clients happy, keep them profitable and your agency will thrive. I guess that’s my closing message. Do you have a closing message, Gini?

GINI: I agree with you for a change.

CHIP: You know, it turns out we actually agree more than we disagree, you know, we’ll have to find a show where we just go head to head and have a violent disagreement about something. Not with real violence, of course, made more difficult by the fact that we’re hundreds of miles separated. But in any case, on that note that will bring to an end this episode of the agency leadership podcast, I’m Chip Griffin.

GINI: And I’m Gini Dietrich.

CHIP: And it depends.

In this week's Agency Leadership Podcast, Chip Griffin and Gini Dietrich discuss the importance of creating and managing budgets for agency client projects, including both retainer and one-time work. In this week's Agency Leadership Podcast, Chip Griffin and Gini Dietrich discuss the importance of creating and managing budgets for agency client projects, including both retainer and one-time work. Chip Griffin and Gini Dietrich clean 27:48
ALP 14: Non-traditional agency revenue streams Wed, 16 Jan 2019 15:18:42 +0000 0 In the latest episode of the Agency Leadership Podcast, Chip and Gini look at how agencies can go beyond retainer and project revenue to find opportunities in education, training, products, software, equity partnerships, and more. In the latest episode of the Agency Leadership Podcast, Chip and Gini discuss non-traditional revenue streams for PR and marketing agencies.

First, the pair address tax law changes related to meals and entertainment expenses — something that will impact many agency owners.

Next, Chip and Gini look at how agencies can go beyond retainer and project revenue to find opportunities in education, training, products, and software.

They also explore the pros and cons of partnering with startup companies in exchange for equity.

Automated Transcript

The following is a computer-generated transcript. Please listen to the audio to verify accuracy.

CHIP: 0:00
Hello, and welcome to the agency leadership podcast. I’m Chip Griffin

GINI: 0:04
and I am Gini Dietrich

CHIP: 0:05
and we are here today to talk about non traditional revenue streams for your agency. But before we talk about making money, we want to talk about spending money for just a moment. And

GINI: 0:18
maybe not money you want to spend necessarily. But exactly, you know,

CHIP: 0:21
it might be that you want to try to, to find ways to spend money and then have it be tax deductible, a lot of agency owners are interested in minimizing their tax burden while maximizing their fun. And one of the ways to do that is with meals and entertainment expenses, something that most agencies I’m sure are already deducting and using to their tax benefit. But there are changes taking place in 2019. And there was some discussion about this in the all important spin sucks community recently. And so we thought that we, before we jump into our broader topic of revenue, we would just touch on this for just a minute because it’s it’s, you know, it is an important area and it is something that most agency owners have done for years and years. And so the fact that there are changes now taking place, you know, what isn’t, is not deductible is something that you should be paying attention to.

GINI: 1:16
So the article that actually makes it super easy to understand is from bench bench is the accounting firm that we use a love bench, they keep things updated super fast. This is not a commercial for them, however, but it was on bench and it talks about the type of expense the old rules of 2017 in the new world, and 2018. And the two biggest things that have gone away or declined is entertaining clients. So concert tickets, sporting events, golf games, things like that used to be 50% deductible now at zero percent deductible. And the other big thing is office snacks and meals. Meals used to be 100% deductible. And that’s now for 50% deductible. So when you’re thinking about, you know, entertaining clients, or bringing food in for your employees, keep that in mind that it’s not either not deductible anymore, half of what it used to be

CHIP: 2:12
right. And there are there are different guidelines when it comes to employees, for example, as far as the percentage of your staff, they’re engaged. So, you know, like everything with the IRS, it’s not simple, it does require a little bit of education. You know, I think the the biggest thing that will hit at least some agencies, probably the larger ones are things like season tickets, luxury suites, those kinds of things that you know, that the bigger agencies tend to spend more money on, obviously, smaller agencies, little bit less likely, but, you know, may have season tickets to sporting teams and those sorts of things that they’ve used for client entertainment. And that’s I think that’s probably where the pinch will be felt the most it you know, there’s been some discussion about impacting on travel and client meals generally, for the most part, most rules seemed to be pretty similar. Obviously, we’re not accountants, so talk to your own accountant, which is the sort of upshot of the segment we think that it’s important that all agency owners are having these ongoing conversations with their professional tax and bookkeeping advice to make sure that they are both tracking things correctly, as well as, you know, being prepared at tax time to properly document any of these expenses. so that in the event that you are audited, you can explain Yes, Mr. IRS man, we did this properly.

GINI: 3:34
Yes, Mr. Iris, we

CHIP: 3:37
want to be sexist here. I mean,

GINI: 3:38
air Yes, please. IRS, IRS person. And, you know,

CHIP: 3:42
I mean, you know, IRS audits are are certainly not something you look forward to. But as long as you are maintaining your records appropriately, and not doing anything outlandish, you know, they shouldn’t be a huge deal. I’ve certainly been through various government agency audits, including one IRS one nice little random check on my retirement program for my firm, few years ago, that was, that was fun, because they were just, it was the first time they had ever started auditing small business retirement plans. And I said, well, it’s the fidelity simple IRA. So you’re kind of going to have to talk to them about the details of how

well we’re the plan documents, you’re going to have to ask fidelity I went on the fidelity website and click Sign up. So that, you know,

GINI: 4:33
it’s funny you say that because

I have our 401k administered through our accounting firm, because they also do that. And she sends me paper files every year and says, put this somewhere where they can be found. And I’m like, Can you send it to me digitally? No. So I have paper files of them all in my little book, that if it ever happens, I can just say, here they are.

CHIP: 4:57
And you definitely want to hold on to those because that that has become an area of emphasis for the IRS in recent years, is monitoring retirement plans. So unfortunately, we were we were one of the first small businesses in New England to be subject to this part is probably five or six years ago. And the the guy who was doing it had never audited a small business retirement program before. So it was all he was learning as he went

on, on us. And, you know, so he was certainly, you know, nice enough, but he was he was used to, to auditing, you know, thousands of employee retirement plans, right, you know, self administered the whole thing where we’re, a lot of these issues do come up. And, you know, when you when you got a 401k, you know, there are more issues, like I said, in our case, it was a simple IRA through fidelity. So, couldn’t get any simpler than that. So that’s about all you can do at the simplest level. And, and so he just wasn’t quite sure what to do when we said call fidelity, fidelity because we said look fidelity, much more likely to answer your phone call than ours. So

GINI: 6:03
Exactly. Yeah, you’re exactly right. You’re exactly right. That’s what

CHIP: 6:08
we ended up resolving. It wasn’t no huge issue there. But, you know, certainly I’ve been through that I went through one for auditing independent contractor statuses. Again, it was a random audit, not a targeted thing, very simple, you know, kind of just made tread the documentation, but you want to make sure that you always have your documentation in place, so that if you get selected for random or not so random on it, you are ready to deal with it. And in this case, with the change in the meals and entertainment, because it’s something that so many agency owners are probably taking advantage of, you know, you want to make sure that that you all are thinking about it and aware of this change. So,

anything else on fun tax matters before we move into?

GINI: 6:48
No, that’s my least favorite topic. So let’s move on.

CHIP: 6:50
I wouldn’t say it’s my least favorite, but pretty close to it. I think employment laws probably is probably my least favorite.

GINI: 6:58
That’s, that’s I’ve been there too. I would agree with that. All right.

CHIP: 7:02
Anyway, Alright, so let’s talk about making money. instead. Let’s talk about

GINI: 7:05
Yes, I like I like to make money. Let’s

CHIP: 7:07
talk about non traditional revenue streams. And we’ve previously talked on this show about the importance of diversifying your revenue streams not being reliant upon just one thing as an agency, and really finding ways to smooth out cash flow, accelerate growth, etc. And some of that through traditional means. In other words, mixing up projects with retainers, but increasingly, agencies are finding non traditional revenue streams, things like courses, webinars, products, even software. And, and one that you and I have talked about offline before is equity, which is sort of it’s a, it’s an alternative form of compensation in one sense, but it’s also an alternative revenue stream, depending on how you structure it. So there’s a lot of different ways that agency owners can generate revenue these days, and I thought it would be fun to sort of talk about some of them, and how we view them, and how agency owners might be able to take advantage of them.

GINI: 8:06
Yes, I like to make money, that is my favorite topic,

CHIP: 8:10
and finding ways to to make money while you sleep, which is even better, a lot of agency owners are either consciously or subconsciously looking to do that, because you can only do so much by selling your own time. And so if you’re able to look to some of these non traditional revenue streams, so that, you know, instead of being a one to one revenue generator, maybe it’s a one to many or, or alternative ways of getting money in the door, it’s worthwhile thinking about. So let’s, you know, let’s talk about some of the some of these. And, you know, one of the ones that I know, has become particularly popular with a lot of agencies lately is courses or trainings. So in the old days, agencies would do trainings for an individual client, right, or their teams. But, but increasingly, I think we see folks who are starting courses, you know, either online or in person to train groups of people. And this has a two fold the fact that you can generate revenue directly out of it. But it’s also a way to build your reputation, get in front of more people show your expertise.

GINI: 9:20
And we have found that so we have an agency on our program that teaches agency owners how to build passive income and how to market market it and sell it just based on our last five years of our doing it, what’s worked and what hasn’t, and, you know, we help them through it. But we found with those clients is that there’s a third piece to that, which is you, you can have a conversation with the prospect, and now you have, you know, one or two, you have several different paths to take them down. So while you’re having a conversation with the prospect, you can say, Oh, well, we have this online program that teaches you how to do XYZ, let me tell you a little bit about that. And it’s five thousand dollars, or the client the prospects like, Oh, that sounds awesome, but there’s no way I can do that myself, I really need an agency with arms and legs, great, we can do that we can do exactly what you’ve just detailed. And it’s $20,000 like, so if we find that ancillary benefit, where it You may be talking to somebody about your online program, but come to find out, they really need you to do the work, or vice versa, you may be talking about to them about doing the work, and they don’t have the budget to spend for you to do it. So you have this program where they still get you, but they’re, you’re teaching them how to, you’re teaching them how to fish instead of doing the

CHIP: 10:37
right. And I think that that what you’ve described there is great because it, it expands the, the breadth of prospects that you can reach out to, right. So you don’t necessarily have to limit it to just a small swath that is, you know, right, for your highest end solution. Although, certainly you want to get them there, if you can, you know, there’s ways to, as I like to put it, you know, to give them the money you and let them decide how much they’re going to pay you and, and still make money all the way all the way along the process. And, as you say, also find ways to upsell them. Because, you know, it’s the magic of sales is, it’s always easier to sell to an existing client than it is to is to find a new one. So if you can get someone in the door with a lower cost, but not cheap training program, you can then move them up the ladder and into some of your other opportunities, particularly if you paint that picture. And they realize, geez, I can’t really do this on my own. But, you know, you really convinced me that this is the right path.

GINI: 11:42
And I mean, to your point, people get really accustomed to working with you. And the idea of flying on their own without you is scary for people. They’re like, Okay, I know, you just taught me this. But what happens when, when I do that, and then this happens, and they, you know, know, I mean, there are some people who are like, yeah, I’m good, thanks for all that. But there, you know, I would say 70% of your clients on the online program side of things will say, I need to keep keep working with you, can you keep coaching me as they’re like, so that you, you’ll be able to find new quote unquote, products to continue to work with people because of what and based on what they need because of what they’re telling you. And it’s significantly easier once they start working with you to keep them on as a client for very good.

CHIP: 12:31
And I think what you’ve identified there is really the trick to this, which is in the course of your conversations with clients with prospects to identify what the real need is there. And if you’re doing a good job of listening, then you’ll be much better situated to figure out what solutions you can offer, using the expertise that that you have, that you’ve developed the processes that you’ve created, and try to find additional ways to capitalize them. capitalize on them, so that it’s not just, you know, limited to the traditional agency construct.

GINI: 13:08
Yeah, I mean, it’s, yeah, you have to listen, you can’t do that, do all the talking, and you will hear things repeatedly. So there are two things that we’re launching this year, just based on what our clients told us last year. And they, both of them were not things that we had even considered, but because we were listening, and we’re like, oh, oh, that makes a lot of sense, let’s do that. And so, you know, I mean, we still have to sell it, right. But so that’s, that’s still to be seen. But it’s an it’s a really good opportunity for you to start to create, I hate the word product, because it’s not really a product, it’s a program, it’s training based on your intellectual property. But it is product ties from the perspective that you create at once, and then you sell it, I mean, it’s not like, I mean, it’s, it’s sort of like having a widget, you build the widget once, and then you’re just keep manufacturing it sort of, it’s the same idea. It’s also a different business model. So there’s that too, but it’s a significantly easier to scale a business when you have this type of revenue stream, because it’s not reliant on a person,

CHIP: 14:15
can you say it isn’t product per se, but in some cases, it actually is it particularly for digital agencies, or more digitally minded agencies, you’re increasingly seeing them perhaps create a tool for internal use, and then they realize, hey, this actually, you know, there’s a market beyond my own clients for this, and they turn around and they sell it, whether that’s, you know, a WordPress plugin, or a standalone platform or whatever. I mean, you know, I, I go back to thinking about custom scoop. When I created that 20 years ago, I, you know, I, I was doing the traditional agency consulting thing. And I had built, I was using sort of traditional paper clipping services and realize that that wasn’t great. I had built this other program to grab headlines for a political newsletter that I wrote, and we said, Hey, wait a minute, this is something that we could use more broadly than our own clients as a way to gather online news clips. And so suddenly a business was born. And, you know, we’ve seen that I think, increasingly in recent years, particularly as the the barrier to entry to creating some of these software, products, Software as a Service, etc, has become much lower, it’s much easier for agencies to get involved with this. So you know, it take a look at what you’re doing, and say, you know, is there knowledge? Is there process? Are there tools that I’ve created that I can find an additional source of customers for, you know, can I can I go beyond my existing customer base with it,

GINI: 15:49
that’s a really good point. And, you know, coverage book was created that way, because they were trying to figure out how to build a better coverage reports for for their internal audiences, and did it that way. And then they were like, Wait a second, there’s a, there’s a business out of this. And then Iris, the same thing, Allie sacks, ran an agency in Phoenix, and they were trying to figure out how to better track results for Media Relations and built this tool internally and realize, wait, wait, there’s something here, we could actually go to other agencies and sell this as a media Media Relations results tracking tool, and they’ve done extraordinarily extraordinarily well, they’re doing right.

CHIP: 16:27
And actually, if memory serves correctly, base camp was born that way,

Unknown 16:30
right? Yeah, yeah, you’re right. You’re right. What

CHIP: 16:32
was originally developed as a product project management tool. Yep, for a design and development agency. And then they said, hey, look, turns out, other people can use us, and they ended up going down that path. So, you know, there’s, there’s a lot of different ways that you can get there. Now, Jenny, you also mentioned something that’s important, and I think that that agency owners need to consider is, this is a different way of doing business, right? This is a different business model. So they may not be right for everybody. And so you need to think through Okay, is, is this really something that I want to pursue, because, you know, while you know, we think it’s great to have additional revenue streams, they need to be ones that are a good fit for what you’re trying to build for your ability to manage. I mean, managing a software development team is far different from managing traditional communicators, right?

GINI: 17:23
And even read up a different Yeah, even managing a team where it is intellectual property, and you’re doing training, it’s completely different. Because you have, you have a traditional sales team, you have, you know, inside sales, you have coaches like you, it’s, it’s different than hiring a team of communicators, where you have the skill set to be able to help them evolve and grow. And when you’re building a team, where and bringing on people that have varying skills, a you don’t have those skill sets yourself. So you don’t know if they’re, you know, are they doing a good job? I think so. I don’t know, right? So there’s a lot of that that goes into it to where you you are, it is a different business model,

CHIP: 18:08
right. And so it may be that, you know, you have this great idea, and you realize that you’re not the best fit for it. So, you know, that may be an opportunity to look at creative business arrangements to, you know, do you do you partner with somebody else, maybe you’ve already developed a relationship with another firm, and you say, Hey, you know, the, you know, we could work well together, our intellectual property, your existing sales team, whatever, there are there other ways to do it there, there are risks to that as well. And something that, you know, you want to be aware of, you want to make sure that if you’re engaged in that kind of joint venture, that you very carefully document it. Because otherwise, you know, the possibility that someone decides that down the road that they own something fully, when perhaps that wasn’t the initial understanding, put them in, put these things in writing, yes, flush them out, think about think of it. But it’s also as I’ve always said, most of these agreements, it’s the process you go through, that’s just as important as that the paper that you end up with. So, you know, it allows you to start thinking those things through with your potential partner, whether that’s an individual or another company, or whatever, and, you know, find those those, you know, possible synergies find the potential potholes at the same time, so that you can identify those early

GINI: 19:24
which I think leads to the equity conversation. And you and I’ve had this conversation on spin sucks the blog in the comments,

but I think there is it certainly not for every client, and maybe not even for clients at all. But, you know, finding yourself

really finding yourself in front of an organization that you really believe in, that you think is going to go big places, you figuring out a way to work in equity

in exchange for quote, unquote, sweat, sweat, so you know, time inside, helping them from a PR marketing perspective, and you get equity out of that the way I’ve always I’ve done this three times now, where I’ve been on boards that have sold, and I’ve had equity, I’ve always, I’ve always done it, so that anything that was my time, so it was strategic, forward thinking, helping with messaging, helping with crisis, kind of that kind of stuff, that all went into my equity piece, but if it required execution, and my team, then there had to be a retainer for that. So I’ve always worked out a deal on on in all three instances where if the team was doing, you know, content, and social and media relations, and all that kind of stuff, then and it was truly tactical execution, then there was a retainer for that, but the high level strategic thinking, media training, that kind of stuff that all went into my equity. And so I was essentially at the time, quote, unquote, giving my time away from free been in all three instances, it worked out on the back end quite well. And I ended up making more money than I would have had we done a retainer and I had built, you know, for my time,

CHIP: 21:11
yeah, look, so I am, I am a big believer in having equity in growing businesses, right, I love it, I think it’s great. I’ve invested in a lot of companies, either through sweat equity, real equity, whatever, over the years. So I, I think there’s huge upside potential. Plus, at least in my case, I also just find it fun, you know, I, I enjoy sort of the startup mentality. And typically, this is a startup culture kind of family, this is not typically something where an established business is going to look to, to compensate you with equity, it’s not unheard of, you know, there are, there are pivots that companies may make where they might do it, but by and large, it’s the startup world that would do it this way. So I, I’m a huge fan of it. At the same time, I think that when I look at it from an agency comp perspective, it you have to put it in the category of very advanced techniques. And, and I would say, not even just advanced techniques, but very advanced, because if you don’t know what you’re doing, you can get yourself into a whole lot of trouble. And so if this is something that you are interested in, if it’s something that you’re thinking about, you know, some of the things that I would advise you to think about, first of all, don’t view this as a just as solely a way to replace cash, right? Which is how a lot of times this conversation starts. A lot of times, it’s a startup that just doesn’t have cash, and they’re like, Well, you know, how can I just give you equity instead? Nope, no, you want to be very, very cautious, to the point of almost absolutely saying no to that. Now, this is something that was very popular during the first internet bubble 20 years ago, and a lot of professional service firms, both PR and law firms, in particular, took a bath because they ended up with all sorts of worthless equity. So you want to you want to make sure that if you’re going down this road that you’re doing it because you see value that you can add beyond the mere transactional. And so I think the way that you thought about it, and the way you’ve structured it such that your time that equity execution involves the rest of your agency, that’s that’s straight cop, right. That’s, I think that’s, that’s a useful way of thinking about it. But the other pieces and, and, you know, we’ve talked about this ad nauseum on the show already, even though we’ve only been around for a few months so far. But you need to get professional advice, because the, the number of things that you can get tripped up on here are incredible. And you want to make sure that you know what, all of the consequences, particularly the tax consequences are, because you can get yourself into a whole lot of a financial mess very quickly when you’re taking equity. Because depending on the stage of the company, and valuations and all that kind of stuff, if you’re getting actual equity given to you, in other words, actual shares of the company that may well be a taxable event at that time, even though there’s no cash, so you may owe taxes on it. So be very, very careful in how you do this, and how you structure it. And in all likelihood, the company itself is going to be thinking about this. And if they’re not, that’s probably a warning sign to right. If, if, if they haven’t given thought to what the tax consequences are there, they’re probably not thinking through all the issues they need to as a business. And so you want to be very careful, because you don’t ever want to have equity turn into a negative, right, yeah,

GINI: 24:42
and I will tell you, you can, you can negotiate that in there. So I’ve always been negotiated the you’ll pay, you’ll send me a check for my task, my taxes that are due. And so that that becomes a quote unquote, cash event, because they do send you a check or wire transfer for the amount that you’ll Own your taxes. But it’s just as a straight turn around,

CHIP: 25:04
right. And anytime you’re dealing with equity in any fashion, whether it’s, you know, you’re you’ve got partners in your agency, or you’re doing it as part of a revenue stream, or whatever, you know, you always want to think about those tax consequences and how you handle tax payments, because any good agreement that you have, you know, will will address how taxes getting handled, particularly if it’s a pass through taxable event, which is very common within the agency itself, a little less so on the equity side, but it can still create taxable events. And so you want to make sure that that everybody’s on the same page as far as how that gets paid for.

GINI: 25:39
The other thing, the other two things I would I really think through is, number one is if you’re going to do time, in exchange for equity, especially as the leader of the organization,

make sure that you have a board as a board seat for that, because that makes a big difference when the company has sold. The other thing, Do not Do not Do not ever, ever, ever, ever, ever trade equity for results on your communications program, or any program do not do it. I have made that mistake, I made it one time, I caution everybody do not trade any compensation in exchange for results.

CHIP: 26:27
I was just about to jump in and say, don’t just limit it to equity. You never, ever ever watched your car? No, no,

Unknown 26:35
no, never. Never. Never. Never. Never. Never, ever, ever

CHIP: 26:42
unless the performance of your own agency. But and frankly,

GINI: 26:46
you can control it. And it Yeah, the performance of your own agency that’s different. But when you can’t control how money is being spent, or what profit looks like, do not do it.

CHIP: 26:55
Right. Right. And, and you should always, anytime you have and I think we addressed this a little bit in the employee compensation side of things. But, you know, anytime that you have anything that’s incentive based, whether it’s equity, cash compensation, I don’t care what it is, you always have to assume that that your upside is zero, right? And so are you happy if you if you never see a penny of it, for whatever reason, and this goes for whether you’re selling your business or, you know, getting a employee bonus, any of these things, it’s, you always want to be assuming that it’s going to be a zero in that column. And if you’re still comfortable with it,

you can think about it. But But, but as an agency, you should never allow your agency compensation or to be or no, no, no, never. Never.

GINI: 27:44
That doesn’t even depend. Never know.

CHIP: 27:48
Hello. I mean, everything depends, right? I mean, it It is, it is the motto of this show, you know,

which I’m not sure anybody’s really noticed. Because, you know,

Unknown 27:59
I think some people having I’ve had a couple mentioned.

Unknown 28:03

CHIP: 28:04
it’s, it’s always nice when people listen to that.

GINI: 28:07
I mean, I think final list was, but

CHIP: 28:09

yes. But you know, more than that, to start the show, we just don’t know how many of you finish. So,

GINI: 28:16
right, that’s fair.

CHIP: 28:19
So in any case, that does actually bring us to the end of this show that we’ve managed to go on for quite some time here. And we always keep this show under 30 minutes for your listening pleasure. And because, well, that’ll help you if you’re on the treadmill, you know, your 30 minutes are up on our show is done.

GINI: 28:35
Now, you’re now you’re you know, you’re almost finished with your own

CHIP: 28:37
and so we will let you get off of that treadmill and on the treadmill of life


So on that note, this has been another episode of the agency leadership podcast. I’m Chip Griffin.

GINI: 28:53
and I’m Gini Dietrich

and it depends

In the latest episode of the Agency Leadership Podcast, Chip and Gini look at how agencies can go beyond retainer and project revenue to find opportunities in education, training, products, software, equity partnerships, and more. In the latest episode of the Agency Leadership Podcast, Chip and Gini look at how agencies can go beyond retainer and project revenue to find opportunities in education, training, products, software, equity partnerships, and more. Chip Griffin and Gini Dietrich clean 29:54
ALP 13: Managing your time as an agency owner or executive Wed, 09 Jan 2019 17:04:44 +0000 0 In this week's episode, Chip and Gini talk about how to safeguard your most valuable resource: your time. In this week’s episode, Chip and Gini talk about how to safeguard your most valuable resource: your time.

From setting aside time to work on growing the business to avoiding being consumed by last-minute client meeting requests, this show has lots of actionable ideas.

The co-hosts emphasize the importance of finding the right rhythm for your own work habits to ensure maximum productivity. And Chip points out that time isn’t something you can borrow from a bank, so you need to focus on managing it effectively to be successful.

Automated Transcript

The following is a computer-generated transcript. Please listen to the audio to verify accuracy.

CHIP: 0:00
Hello, and welcome to another episode of the agency leadership podcast. I’m Chip Griffin

GINI: 0:05
and I am Gini Dietrich

CHIP: 0:07
and we’re here today to talk about managing your time.

GINI: 0:11
Yes, good topic.

CHIP: 0:15
That’s something that Chicago Bears had a little bit of trouble today. No, no, no, I shouldn’t do that

GINI: 0:20
job. He has one job. Kick the ball through the uprights, that’s all you have to do. One Job did that. He did that during a time out

CHIP: 0:29
he did during. I mean deadpan right down the middle during the timeout Unfortunately, when the clock was actually running, not so much

GINI: 0:39
one job but

CHIP: 0:40
yeah, it’s just been it’s been a tough little period of time for Chicago sports but

Unknown 0:45
it’s always a tough time for sports

GINI: 0:50
we’re very good at saying there’s always next year

CHIP: 0:54
well you know Chicago is an interesting place right the I over the holiday break I just covered shameless have

Unknown 1:02
such a good inappropriate, but so good,

CHIP: 1:06
insanely inappropriate and, you know, probably have to change the rating of this podcast simply to mention that I you know, I cannot believe that it’s been on eight years, and I didn’t even Honestly, I didn’t know anything about it until about three weeks ago. Oh, yeah. Great. When my wife said, Oh, yeah, I watched a few episodes. That was pretty good. I’m like, Okay, and so I and now like every free moment, I’ve got an episode running in the background. You really i do i do

GINI: 1:32
it. Like, there’s the there’s the line and then they the first season they sort of jumped over the line. And by the eighth season where I think they’re in the 80s. And now it’s like, so far past the line that you’re, you’re, you’re like, Okay, wow, wow, they really did that. That.

CHIP: 1:49
Yes. They really have no boundaries. None it is. But shameless is an absolutely appropriate name for that show. But it is it is very entertaining. And I do particularly enjoy the character, Carl who is clearly a psychopath and yeah, so.

GINI: 2:08
Oh, you wait, you wait. But yes, it’s based in Chicago on the south side.

CHIP: 2:13
Yes. That’s that’s what made me think of it obviously, because I the Darren a whole lot of shows that are set in Chicago except for that one night did NBC has now right? That’s all Chicago all the time,

GINI: 2:23
right? Chicago PD, Chicago ft. I don’t even know I’m making that up. Chicago Med.

CHIP: 2:29
Right. Right. Yeah, no, no shows about New Hampshire out there that I

GINI: 2:33
know a manager not know.

CHIP: 2:35
I mean, the the Animal Planet channel does have something about the new hampshire fishing game. North North North Woods law. It started out in Maine. They they, you know, they, they would chase the the the folks who are chasing hunters and that kind of stuff

coming after wildlife. And so they, they branched out. And so now they have episodes that feature New Hampshire, fish and wildlife. So

Unknown 2:59

GINI: 3:00

CHIP: 3:02
not nearly as exciting as Chicago, though.

GINI: 3:04
That’s true. We have everything here. That’s true.

CHIP: 3:07
In any case, you know, I think we’re not doing a very good job of managing our time. We’re not gas because we’ve managed to waste about two and a

GINI: 3:16
half minutes on Chicago is

CHIP: 3:18
absolute nonsense. That has nothing to do with agency owners and executives. So how about we manage our time more effectively by talking about our topic of the week, which is ironically, managing your time.

And this is yet another topic that’s come out the spin sucks community, you know, it’s thank God for the spin sucks community. Otherwise, we’d probably have absolutely nothing to talk about here, Jenny,

GINI: 3:39
and you have in a sauna board full of ideas. So we could go to that

CHIP: 3:44
we could. But you know, it’s just it’s so much more fun pellet picking real world topics.

So this is one that came up recently in the spin sucks community. And it was someone who wrote about 2019. And one of the goals being to keep her diary a better plan and avoid ad hoc throw ins. And right out of the gate, at the start of the year, she got a message from a client asking to meet the following Monday at noon, and she was still on vacation. And so she had to get back to the client and say, Hey, you know, I really need Monday to catch up in the office. And, you know, can we talk at a different time basically, compressing, and a lot of people chimed in and said, Absolutely, you need to set boundaries, and you need to manage your time effectively and all that. And so I think this is a good jumping off point for us to talk about managing your time generally, but certainly, specifically in relation to clients. Because it’s a challenge that basically everyone in the agency world has not just agency leaders, but you know, the rank and file because, you know, a client calls up and says, Hey, I want to meet and the natural instinct is to say, absolutely, yeah, whenever you want, right? And because the client Yep. But that’s not necessarily best for time management, is it?

GINI: 5:05
Well, no, I mean, it’s the what’s the, the phrase is your emergency is not necessarily mine, right? At the same time, we’re in a service business and their service business means we’re serving the clients. So yeah, I mean,

especially for those of us in the agency world works sort of brought up or Todd that were at the clients whim. If that’s what they want, then that’s what they get. And it certainly leads to all sorts of challenges. You know, I I worked for the Fleishman Hillard so I worked in a big global agency for many, many years. And that, I mean, that’s what you did. And it didn’t matter if it was weekends or nights or, you know, the middle of the night, you responded and you got them what they needed when they needed it. But I also think that that leads to burnout and, you know, not wanting to be as helpful and, you know, all those other things that come along with it. So, there certainly are I, I don’t know if it’s necessarily boundaries, but it definitely is, you know, being able to be confident and not feel guilty about saying, hey, I’d love to meet with you. Monday is really bad for me, can we do Tuesday? Or can we do Wednesday?

CHIP: 6:15
Right? I think it’s a ultimately it’s a balancing act, right? Because, you know, I, I’ve seen people go to the opposite extreme, you know, instead of saying, yes, absolutely, they almost become difficult to reach, right. And, and so, you know, you don’t want to be in that situation, either. Because, as you say, it is a service business. So, we need to find a way to be accommodating. And, and in part, you know, at least from my standpoint, I’ve always tried to judge it based upon, you know, my perception of the level of actual emergency or urgency, you know, combined in a bit with the client, right? If this is a client who never says, Hey, I need to be immediately, okay, if they’re asking for it, then, you know, maybe I’m more likely to accommodate it from someone who, you know, calls up every other day and says, Oh, my God, I’ve got a crazy I need to talk to you in three seconds. Right. Right. So, you know, part of it becomes managing the individual client and making determinations there. But, you know, certainly you need to be prepared to push back on on clients and try to find times that are, you know, mutually agreeable and not simply, you know,

say yes, absolutely. To everything I asked for

GINI: 7:22
well, and I think there’s also it’s, it’s an it depends situation, because it’s, you know, you could be, you could have a client who’s doing something that you’ve asked them to do, whether it’s reviewing content or, you know, pulling together some, some materials for you, whatever, and they happen to be in the middle of it, and they just need you really fast to say, Okay, how about this? Or what about that, you know, that I think that’s different than, hey, I need you to drop everything and ignore the rest of your life and be here at noon on Monday. And to your point, does that happen consistently? Or is this a one off kind of thing,

CHIP: 8:00
right? And it’s, you know, I think, you know, part of it is, is judging, okay, you know, what, what’s actually going on? And in this particular case, it was indicated that it was the, the individuals boss at the client who was actually requesting it. So, you know, I would also then throw into that mix. Okay, well, how often does the the, you know, the clients boss actually want to get involved in? So, does that, does that signal something to me? Should I be more responsive, if the bosses you know, particularly, you know, sometimes as an agency will see a new boss come in, you know, those are situations where you may want to be extra responsive and juggle your own schedule, because, you know, that oftentimes, when you bring in new personnel can be an indication that, you know, there may be a change looming, and so, you know, trying to be extra responsive in periods like that can be helpful, but it’s, you know, it really, I think it does fall into that it depends category because it’s all about relationship management, and trying to figure out, you know, what’s the best solution for that particular case. And I don’t think you should have a one size fits all rule in either extreme direction, totally

GINI: 9:02
agree. We had a client A few years ago, who was let’s just say, challenging. And I knew that if she got me on the phone, it would be two hours, it didn’t matter. It didn’t matter if it was 5pm, it didn’t matter if it was noon, it didn’t matter what time of day or night or weekends, if she actually got me on the phone, I would not get off the phone for two hours. And because of that, we instituted a this is your designated time every two weeks. So like, one to two every Monday, whatever happened to be every two weeks. And so I I implemented that with her. And I was very strict about sorry, you don’t get me outside of that, that time, you just don’t. And she got really mean about it. She was like, you know, for as much as we’re paying you, I should be able to reach you all the time. And it’s one of those things where you want to respond. Yes, but I don’t have two hours every day to talk to you. And of course, I didn’t. But I was very clear about you, I have I have slotted this time for you. So that, you know, you can you can I’m like 100% focused on you on your business. And, you know, eventually she got used to it and kind of stepped down a little bit. But it was really challenging for me in the beginning, because she was she got nasty about it.

CHIP: 10:19
Yep. Well, and I think if you do have to condition clients to some degree, and I, I’ve been in similar positions where I have those those clients who you know that they want to, I’ve got the one client that I had in the past, who would follow up every single email with a phone call. And if you if you didn’t pick up the phone call, would follow that up with a text be like, okay, slow down,

I sent the email, give me an hour or so at least to perhaps look at it. And oh, by the way, it’s not even really an emergency. Okay, so it’s not, oh, my God, I’ve got a crisis, it’s just some generic question or, you know, just relax. And so, you know, so, for clients like that, you almost oftentimes when I have a client like that, even if I can respond to an email, immediately, I will, I will set a timer and say, okay, you know, respond. And I generally pride myself on being very quick to respond by email, mostly because I want to condition clients and frankly, everybody else to send me email rather than calling her here texting me, or those kinds of things. And so if you respond to that will generally guide them to that place. But you if you become a slave to it, then they always expect that. So it’s, you know, that you have to try to find a way to balance these things out. I’ve got, you know, one agency owner, I know who has a client like this, and this agency owner, she often does work in the evenings. And so when she gets a one particular client who will send things that say, nine o’clock at night, she may do it at 10 o’clock at night, but won’t actually send the completed item until the morning. So that individual doesn’t become a customer to getting basically same night service. Yeah,

yeah, I mean, so it’s it, but it really it’s managing that individual relationship. And, you know, one of the things that came out of the sort of the back and forth discussion in the the spin sucks community on the original question was sort of, what do you tell the client, right? And so, you know, this, this individual, I guess, initially was, the instinct was to tell the client, look, this is my first day back from holiday, I need to get caught up. And some people push back and say, well, don’t Don’t say that, just say you’re on available, don’t, you know, don’t don’t over share on, you know, your rationale for it. And, and I certainly fall into that, you know, there, there’s no reason I mean, unless you’ve got something that’s a really good, interesting explanation of some sort of, you know, just just say, Look, I’m not available, right, you know, and, and certainly saying, you know, I generally need to catch up. I usually wouldn’t advise that because that doesn’t sound it may be important, but it doesn’t sound right. Yeah, you know, I mean, if you could say, Look, I’m going to be, you know, having surgery. Okay, cool, right? That sets important. No, yes, that’s important. You can give that reason if you so choose, you know, I’ve got to work through other things on my to do list,

Unknown 13:14
probably not,

CHIP: 13:14
yes, message probably wouldn’t go with that one, I would probably just say I have a conflict at that time, or whatever. And, you know, there’s, there’s, you just don’t need to over share, you know, doesn’t mean you need to lie, you know, don’t tell them you’re going in and having surgery. If you’re not, first of all, it’s bad karma. But bad karma that it will, it will probably come back and bite you at some point. So don’t do that either. But the, you know, you can sort of fudge a little, you know, when I’ve had those clients who, you know, maybe enjoyed the two, three hour conversation, you know, I may have been known to say, Oh, I forgot, I have a four o’clock I have to go, Yeah, for sure. You know, and do I have a four o’clock? Well, I do now,

GINI: 13:58
I used to make the my assistant book calls an hour, like meetings an hour after, just so that I had that excuse. So I could say, another meeting to go right.

CHIP: 14:10
And I i proactively will do that, if I if I know, I’ve got a conversation that’s just going to drag on and I know, it’s not going to be productive, you know, whether that’s where the client or someone else, I will often schedule something. So I have a forced reason to get off. But, you know, usually I’ll, I’ll just say, I have to get off anyway, if it’s just running on too long. Because, you know, look, it’s, that’s not useful for anybody. But there are, there are certain people who like to just talk and talk

GINI: 14:39
and talk, but you know, what your, your advice about what your your client is doing, where she may actually do the work at 10 o’clock at night, but not send it until the next morning, that’s really applicable to, and that’s something that I had to enforce with my team. As I said, Okay, it’s fine. And most of my team likes to work, you know, from five to 7am, it’s fine if you want to do that, because, you know, nobody’s around to interrupt you. And it’s distraction free, and all those kinds of things. I’m a big fan, but set it up so that you’re you can delay your email. Or you can delay the sending it over to the client. Because as soon as they realize that you’re doing that, then they’re going to start working at that time to and all of a sudden, now you’re working for the client from 5am until 7pm instead of 8am to 5pm, right. So there’s a lot of that conditioning that I think we have to be really good about as well. And I’ll tell you what, send later in Gmail best tool, we have best tool because you can schedule it, you have it done but then it doesn’t go into business hours.

CHIP: 15:41
Right. And I should use things like that more often. Because I I tend to do something and then say, Okay, I’ll send that in the morning and then forget forget Yeah, but I I’ve never really been a big fan of the the Send later thing because I sort of put that into the bad karma category to right because you know well what if you know what if I break my leg in it there was there for clear I couldn’t have sent it or you know, whatever. I don’t know for some reason I just

GINI: 16:04
I have no problem with that. It’s like scheduling for media no problem.

CHIP: 16:08
I know I should I should look at it that way. But it you know and having the technology to do those kinds of things is is certainly valuable. And you know, the other thing you want to think about and I used to have this when I did a lot of ghostwriting was I happened to be a pretty quick writer most of the time. And so I would often be able to turn out a piece very quickly. But I would say to myself, well, wait a minute, if I turn that piece around too quickly, they may, you know, not see the same level of value as if they think it’s taking a you know, a really long time. So, so. So think about the message you send with regard to value. If you know, a client request something whether it’s you know, but piece of writing content or something else, even though you can do it quickly. You may not want to, because then they you know, they may get the wrong impression. And it just because you’re able to do it quickly. That may be because of your expertise. Right. Maybe, yeah, providing something higher value. And you know, you shouldn’t under undersell it, because someone says, Well, I only took you five minutes to do clearly that’s

GINI: 17:08
Yes, I’m not spending 20 $500

on it, or whatever happens to be

Unknown 17:12
right. Right. You know, again, it’s like

GINI: 17:16
the people who are like, I don’t understand why it costs so much to have you come speak, it’s only an hour of your time. Actually, it’s not only an hour of my time on a plane, I have to prepare I’m out of the office for three days. Like Yes, I’m only on stage for an hour. But there’s far more that goes into it,

CHIP: 17:34
right. I mean, anything that involves travel is, is much more time intensive than that appears, and frankly, much more time intensive than, than we probably calculate ourselves, right. You know, it’s, you know, you, you tend to overlook all of the additional burdens of travel and the time that he eats up, and the opportunity cost and those sorts of things. And as someone who, you know, I used to do a lot of international travel. And you know, that that’s the kind of thing that can throw you off for days afterwards, as you’re adjusting the time zones to right. So you need need to factor those things in, you can’t obviously build a client or a speaking venue directly for that. But you’ve got to, you know, to think about it when you’re doing your pricing for whatever kinds of work you may be engaged with.

GINI: 18:18
Yeah, so I think it’s really about setting expectations, you know, if I mean to end exactly to your point, they don’t need to know, it’s because it’s your first day back back from vacation, and your you need to get caught up that you just have a conflict, you know,

it’s setting the expectation, if, if you know that you’re going to have a squeaky wheel client, then set the expectation that these are the times they can get ahold of you. And don’t waver outside of that. I think one of the things that she also said is, why am I feeling so guilty about this? And I think that’s why is because we’re trained in a service business that we are at the clients whim. And that’s not necessarily true,

CHIP: 18:55
no, not at all. And, and again, I think that the key is to find that balance, because I do get concerned, you know, when I see people swing too far to the sort of what I would call the negative end of the spectrum, right, you know, no, I’m not available. The other the other, the other one of my pet peeves, and it’s not, it’s not directly on point here. But, you know, with, with folks who want to pick your brain, right? You know, that’s, you know, periodically, we get these these posts on social media, if you want to pick my brain and have coffee, and I’m going to charge you 250 bucks. Okay, well, take a deep breath. And, you know, at least for me, you know, when someone’s picking my brain, whether that’s on the phone, or over coffee, or whatever, if I’m doing it, right, I’m getting as much value as I’m giving. Yeah, right. Because you get to learn that in the process. You might get a client, you know, you might get a podcast co host, you know,

that this, this show in this form came together because we have lunch one day, you know, there was there was no particular agenda was just, hey, let’s catch up. And, and, and so, you never know. And that was not awesome. The agenda and it just, it just happened out of it. And so, you know, to me, I always will, if I got the time at least I will always take those phone calls those coffees those lunches, because, you know, you’re, you’re doing market research, you’re learning what’s going on now, if someone calls me every week to pick my brain, right? Okay, well, that’s all the different story, right? I mean, not now, you’re gaming the system, right? You’re trying to get free consulting at that point. But if it’s, you know, if it’s twice a year or something like that, you know, I mean, so what? Yeah, it’s a so so, you know, you have to balance that, you know, protect your own time, manage your own time, you know, with making yourself accessible because accessibility is is very important in the service business if you want to continue to grow and thrive.

GINI: 20:44
Yeah, totally agree and just set set expectations but be firm about it.

CHIP: 20:50
The other thing I thought was was interesting was someone suggested, you know, sort of setting aside blocks of time for you know, sort of ad hoc calls and meetings and and honestly that’s something I do it myself you know so I’ve I think I’ve mentioned it on the show before I use calland Lee, for my scheduling with with other people. And so I send them accountable a link. And the calendar link does not show the full scope of my availability, it shows the blocks that I have open that I’ve set on my calendar for taking phone calls, right. So it makes it so that, you know, I know, there are certain windows where I’m more productive, doing things other than phone calls, and certain windows, you know, when I prefer to do phone calls. So that’s what I’ll generally set. Now someone sends back, hey, none of those times work, okay, fine, we’ll work something else out. But, but, you know, nine times out of 10 or more those blocks work. And so setting aside blocks on your calendar for this is the kind of stuff I want to do in here can be very helpful, and can be a good way to, you know, focus those kinds of, of items. So that there, they have the least disruption to your day, right. And, you know, if, you know, there’s times a day where you’re better writing, block it off for writing, if there, if there are times a day where, you know, you just, you’re grouchy and you don’t want to talk to people don’t schedule your calls there,

Unknown 22:08

CHIP: 22:08
Yep. On the other hand, you know, I like to schedule calls in the afternoon, because, you know, I tend to sort of fade out a little bit and, and being on a phone call instantly turns me on, and, you know, and re engage me. Whereas, you know, sitting it at three o’clock in the afternoon and try to write is not usually my best slot, you know, because I’m morning writer. So, you know, different people have different rhythms. And if you find your own, and you’re able to try to shape your schedule as much as you can, understanding, it’s not always possible, but as much as you can use that will help you manage your time more effectively as well.

GINI: 22:43
Yeah, I mean, blocking time, I’m a big, big fan of that. So I totally agree with you.

CHIP: 22:49
And I would also say, time tracking, right? So, you know, if you’re going to be managing your time, part of that is understanding how you’re spending your time already. And so using something, whether it’s, you know, a notebook or an app or a spreadsheet or whatever, so that, you know, how you’re actually investing your time, both with clients, and for other purposes, that will help to write because, you know, maybe, maybe you think you’re over servicing a client, but when you look at the the actual hours spent, maybe you’re not, right, so maybe, maybe you don’t need to say no, quite so quickly, when they’re asking for something, you know, or push them off. You know, maybe, maybe you look at it, you’re like, Okay, I thought I was spending 30 hours a month on this client, I’m only spending 15, you know, okay, maybe I should be a little bit more available to them. You know, whereas if you see that you’re spending 50, and you think you’re spending 30? Well, that’s a problem. And you need to try to address that, too. So, so understand how you’re actually spending your time and that will help you shape things as well. Because your time is should be budgeted. Just like your finance.

GINI: 23:53
Yeah, yes, that’s a great way to put it. Yes.

CHIP: 23:58
I mean, if you’ve got a budget, you say, okay, you, you know, I spend, you know, 25% of my week on business development, 50% on client service, and 25% on management or, you know, whatever your breakdown is, those are totally made up numbers, please don’t use them as rules of thumb, anything like that. They were literally just made up on the flyer but, but understand what it is that you’re you’re targeting and, and try to shape your calendar around that because you know, that of the resources you have your time is, is the one that is most finite, right. You can’t go to a bank and borrow time. So, you know,

figure out how to use it effective.

GINI: 24:36
Yeah, that’s a great way to put it. Budget, your time and, you know, blocking your time helps you do that Cal Newport’s book deep work was really valuable and helping

helping me think about, you know, exactly to your point when my best time of the day is to do deep deep work deep thinking and to block that time off

getting things done is another really good book to think about, you know, block time blocking and how to, to manage that. And then I think it’s, it’s just setting expectations, that’s just being confident with clients to say, I would love to help you with that. Can we do it tomorrow at between this time in this time, you know,

CHIP: 25:16
with all of these book recommendations that you’re giving each week, we’re going to start like a Book of the Month Club here. As I think every every episode,

GINI: 25:24
I recommend one or two.

CHIP: 25:28
So I unfortunate I’m terrible at remembering which ones I’ve read in which I come from which one so

I should get better at that. But no, I mean, it Look, I think it’s great. And a lot of these books do have good ideas. You know, of course, not to get off on too much of a tangent. But a lot of these books are really just long magazine articles that then have an extra 50,000 words attached so that it can become a book.

But in any case, you know, I think that all of these have good ideas and, and getting things done is one that I would certainly say just at least for a good heavy scam. I think there’s there’s a lot of excess verbiage there as well. But But, but, but the whole concept that’s in there, as far as you know, if it’s, if it’s a quick and easy task, don’t put it on, let’s just get it done. Like I think that’s tremendous advice. Because, you know, the number of people that I see, you know, put down all I need to work on and like the amount of time it took them to write down the task was about the amount of time Yeah, right. Because, and like I even even knowing that and sort of pounding that into my own brain and giving it to other people’s advice. You know, I still screw up sometimes and say, Oh, yeah, I just don’t feel like y’all with the cable company right now. or whatever, whatever the thing is, that would be very nice. I guess. cable companies never quick, but

which is why I’m getting rid of them. I decided that for January one. I was gonna be a cord cutter. There

GINI: 26:51
you go. We did it a couple years ago. Don’t miss it.

CHIP: 26:56
No, I you know, it’s we are going on week number two of YouTube TV instead of xfinity. And the whole family’s doing just fine. They were more nervous that I was

GINI: 27:06
but don’t miss it. I mean, you can watch the Golden Globe you can watch the bears. Not when they’re wild card game.

CHIP: 27:15
They didn’t. When I missed that

GINI: 27:17
there, you really don’t miss it at all.

CHIP: 27:21
So um, any other tips on time management?

GINI: 27:26
Um, there was one thing I thought of while you were talking about shoot, I lost it. You had a really good point

CHIP: 27:35
I have so many. But then I decided to run my mouth about non time management things and

she got infused You

GINI: 27:43
must not have been important or as my mother would say, it must have been a lie.

CHIP: 27:48
I would never think that you would lie. So I think that’s unlikely to be the case. But we will help manage our listeners time by drawing this episode agency leadership podcast to a close and so thank you again for joining us. I’m Chip Griffin

GINI: 28:03
And I am Gini Dietrich.

CHIP: 28:05
and it depends.

In this week's episode, Chip and Gini talk about how to safeguard your most valuable resource: your time. In this week's episode, Chip and Gini talk about how to safeguard your most valuable resource: your time. Chip Griffin and Gini Dietrich clean 29:12
ALP 12: Getting help from assistants, VA’s, and other resources Wed, 02 Jan 2019 12:00:35 +0000 0 For the first episode of the Agency Leadership Podcast for 2019, Chip Griffin and Gini Dietrich discuss how to use a virtual assistant, in-house help, or other solutions to relieve the burden of repetitive tasks. For the first episode of the Agency Leadership Podcast for 2019, Chip Griffin and Gini Dietrich discuss how to use a virtual assistant, in-house help, or other solutions to relieve the burden of repetitive tasks.

Agency owners and executives need to maximize the impact of their own time, which means prioritizing which tasks they need to do themselves versus those that can be delegated or outsourced.

Unfortunately, bad help is sometimes worse than no help at all. So understanding what to farm out — and how to manage those resources — represents an important skill to hone.

Chip and Gini share some of their own experiences and the lessons they have learned along the way.

Automated Transcript

The following is a computer-generated transcript. Please listen to the audio to verify accuracy.

CHIP 0:02
Hello and welcome to another episode of the agency leadership podcast. I’m Chip Griffin

GINI 0:06
and I am Gini Dietrich

CHIP 0:09
and we’re coming to you with the first show of our podcast for 2019. So Happy New Year everybody.

GINI 0:16
Happy New Year

CHIP 0:16
So did you have a good New Year’s Eve? Not too much to drink or anything like that

GINI 0:25
during our five year old, you know?

CHIP 0:27
Yeah, that’s true. That’s true. Ladies and gentlemen. We’re completely faking this. We are recording this actually before Christmas. Christmas.

Unknown 0:35
So we have but I

GINI 0:35
tell you, it will not be that exciting.

CHIP 0:39
Yes, I I can tell you that that we are having friends over but I will probably still go to bed before midnight. Because Well, that’s what I do. I am cool and that much fun

GINI 0:51
getting all this fun.

CHIP 0:53
But it’s it is but it’s better than the alternative. Right? So that’s

GINI 0:57
a really good point. Yes.

CHIP 0:58
No matter how many pains I have in my ankles, my knees and everywhere else. And and this time of year. I have plenty of those because it’s basketball officiating seasons out there blowing the whistle running up and down the court. Yeah. Getting getting very important missives from the state head of officials today. Got one in my inbox that reminded us all that the official score needs to wear a black and white striped shirt while sitting at the table. The church should not be folded in merely placed in front of them. These are these are the important things that we deal with as officials in the state of New Hampshire.

GINI 1:30
Does that mean that you kept it folded in front of you and didn’t wear it?

CHIP 1:35
No, I did not know this was a statewide missive so you know, so I’m one of the on I’m on the floor. But this is the official score sits at the table and keeps the score book and they’re supposed to by rule wear a black and white striped jersey now it turns out that most people who sit at the table just don’t want to do that there. Yeah, I can understand that. You know, because basically, they don’t own one themselves. So this is a shared one that the school provides. Some of them do like these like Final smocks that you tie them. I mean, sort of like they’re really just hideous. But you know, I’m sure they never get washed or anything like that. So. So needless to say, a lot of folks just stick them in front of themselves at the table. But but we’ve been lectured. We’ve been told so apparently somebody somewhere complain some old fart, you know, said these guys aren’t enforcing the rules properly. And clearly, it impacted the outcome of the game. So I

GINI 2:31
can’t can’t keep score if you don’t have the jersey on.

CHIP 2:34
No. But in any case, I’m sure folks did not tune in to listen to my rants about the officiating process in the state of New Hampshire. But instead we’ll we’ll talk about important things, things that will help people get off to a good start of the new year, because I’m sure that is people took time off over the holidays, they spent a bunch of time thinking about how they could make even better, right,

GINI 2:55
yes, I’m sure. Well, I certainly will be doing that. So yes, I’m sure that’s the case.

CHIP 3:00
And one of the things that you do when you do that is to say, How can I be more efficient? And so I got a question from someone recently about how to use assistance, virtual assistants in house assistance, other administrative help, effectively, how can they actually make a difference in your productivity in your efficiency. So I thought that would make a great topic to start out the new year with what do you

GINI 3:24
agree, um, I read virtual freedom two or three years ago. And in it, it suggests that you write three lists. One list is things that you’re really good at doing that only you can do and that you enjoy doing. One is the things that

you maybe don’t enjoy so much. But you should be doing maybe you can delegate it but you know, not on your super super duper I have, I’m the only one who can do this, these are my strengths list. So in that middle, and then the last list is things that you absolutely should not be doing and maybe that’s social media scheduling and you know, posting things in PR Newswire and looking at brand mentions, and, you know, all media monitoring and all that it’s stuff like that, that maybe you shouldn’t be doing that somebody does need to do that. And everything that’s on that list of is is doing but shouldn’t be doing is the stuff that you can delegate, and typically it it’s not one person, right, so a lot of us go, Oh, well, I’ll just hire a virtual assistant. And the virtual assistant can do this, and this and this, and this. And it’s not something that all those things are not in that person’s skill set. So you want to take that list and then bucket it, maybe it’s content and social and truly admin stuff. So you have the, the truly admin stuff, yes, can be a VA, and maybe it’s, you know, 10 or 15 hours a week instead of 40 hours a week. So I really, I use that as an example. And if you haven’t read the book, it’s really easy read. Plus, you can go through and just flip to the three list section and figure out what it is that you’re supposed to be writing down. But it really does help you think through what it is that you should be delegating and to what kind of person what their skill set is because a VA doesn’t typically or an in house, an admin or somebody like that doesn’t typically have all of those skill sets that you would need to delegate?

CHIP 5:17
Well, I think that I’ve not read that particular book. But I’ve received similar advice in the past and given some more advice. And, and, you know, periodically try to do a similar exercise where I, you know, sort of chart those things out I’m not tribe done the buckets and exactly that fashion. But roughly, and I think it is a very useful way of thinking of it. But you’re absolutely right, that it’s it is rarely that you can find one person to dump all of that stuff onto that you should not be doing. And so trying to figure out how to do that efficiently and effectively. You know, that’s where the rub is, right? That’s where the that’s where the real challenges and I fall into this trap numerous times myself over the years I was

years ago, I used to call myself the Murphy Brown of assistance, because I would I would go through one every six months or so. And I just kept saying to myself, Oh, my gosh, you know, I just I keep hiring the wrong one. If I just find the right one, I’ll be all set. And, and what I eventually realized was that I was trying to dump all of my stuff off on one person. And there is no one person who could do all of it. Like I was hiring a junior me and, and honestly, Junior me didn’t want to be an assistant. Right, right. So but but, you know, fast forward a number of years, I was working in an agency and I had a real deal, high level executive assistant that I shared with a colleague, and this was someone who actually, I mean, she was an EA, she was not an admin assistant, she was not somebody just. And so she, she basically managed my professional life. And at that made a world of difference that also came with a very high price tag that most listeners, you know, are not going to be coming comfortable with. And frankly, at the time, I was doing 20 meetings a day traveling around a lot, trying to coordinate with a lot of colleagues in a large global agency, you know, it made a lot more sense. And today, I don’t have that. So today, I, you know, I try to parcel out little bits and pieces as needed. But, you know, I’ve moved away from the central single system model in recent years.

GINI 7:22
Well, two things to that. And I agree, number one, you can typically find an EA for a lot less than you used to be able to, because they can take on two or three people like us because we’re not meeting having 20 hours or 20 meetings a day and traveling all over the globe late so they can you so you can almost split it with you know, two other agency owners and have that that same level of experience but also you know that today we have software I mean there’s schedule once there’s woven, there’s calland Lee, their stuff that you know, helps you manage all of that from a, from a software perspective, instead of having a person do it. So what you really want your assistant to do, may not be managing your professional life like it was for you. And, I mean, at Fleischmann I hadn’t, they hired us all of executive assistants, which was amazing,

but you know, maybe it’s editing or its report gathering or it’s, you know, pulling together weekly reports for clients, it’s, you know, that it’s that kind of stuff versus travel and meetings and, you know, making sure your time is protected and all that

CHIP 8:31
when and when you talk about software I mean, you make a great point with that, you know, you can offload a lot of these tasks on to technology now so instead of thinking about your your, your virtual assistant as a person, your virtual assistant might actually be the technology and you know, I’d love to give a completely uncompensated plug for calland Lee, because that has changed my life that that has saved me so much time, so much back and forth, it allowed me to have more meetings to get more easily schedule podcasts, all of those things, because it’s just a link, I send somebody and people can choose from my available slots. And I can tailor it. So you know, different time the links, different cushions, it’s really fantastic. It’s amazing. Yeah, it’s amazing. So, you know, trying to find ways so that you’re not doing it. But it’s not necessarily another human, you know, that’s also a solution. So, you know, as you as you look at this list of tasks of things that you shouldn’t be doing, you know, try to think of creative ways to solve those problems, too. It’s not all about just replacing your hours with somebody else’s.

GINI 9:37
And if you are traveling, I don’t remember the tool. But Jay Baer was interviewed in the New York Times earlier this year, about a tool that he uses for his travel. And like Jay Baer I mean, he travels every week, and he’s using software for his own travel and, and then it automatically read books you have things are cancelled, and, you know, alert you or put you on a different flight, if it’s delayed or later, you know, it does all of that from an API perspective. So I think there is a huge opportunity today, to be able to use robots and software to do some of the things that a human would have had to do even just two or three years ago.

CHIP 10:15
Absolutely. And, you know, and scheduling travel these days is so much easier than it used to be, particularly if you’re doing it pretty regularly. So, you know, because I, I do travel a fair bit for business, I, you know, I have become, you know, almost my own travel agent. And so, I, one of the challenges I had in the past was offloading that someone else because it’s hard to get someone to understand all of your preferences for every mutation. Yeah, and particularly with last minute changes, you know, I mean, I got pretty good at, you know, you know, you’re at the airport, you kind of just, you have almost a second sense about when, you know, flights about to be delayed or something like that. And so, you kind of just, if you do it enough, you learn how to, to seize those, so that you’re not playing, you know, when, when they do the musical chairs, there at the end, you’re not the one left without a seat or without a hotel room, or whatever it is. So, you know, but the technology makes it so easy. I mean, you know, when I go to New York, I rarely book a hotel, before I’m sitting on the Amtrak train on the way down, I just pull out my phone, and, you know, book, whatever the best rate is that I can find at that moment, because a lot of times, you can get a better rate on the Mariana app at the very last second, you know,

but it depends it you know, those are things you just learn as you go and, and you have to be realistic, if you’re going to farm out tasks to an assistant unless you’re going to micromanage them, they’re going to make mistakes, they’re going to do things that you don’t necessarily want. So you need to be thinking of things that you can offload that don’t require a whole lot of independent judgment, right? Because the independent judgment tends to be where you fall down when you outsource.

Unknown 11:54
Yes, well, or in

CHIP 11:56
source. And I have, you know, this is sort of the intersection of travel and, and assistance, but I had an assistant years ago, and when I would travel for speaking engagements of those sorts of things to cities that I didn’t go to regularly, she would typically book me a car service from the airport to the hotel, because, you know, 1520 years ago, you never quite sure what you’re going to get, you know, taxis and all that kind of stuff. And, you know, you didn’t know what they’re caught. So anyway, so it was it was a general practice. And so I was out in San Diego. And so I flew in and there was a, you know, guy holding up the sign Griffin and, okay, so I follow the guy, and, and I’m going to the Sheraton San Diego Marina or something like that. And so we we walk out and I, I look across the parking lot, I see a giant shared and sign. And so I decided I’m going to be a funny guy. And as I say to the driver, I say, Oh, that must be the Sheraton we’re driving to. And he says, Yes, sir, it is.

I said, Hold on hold. I said. So just so I’m clear. You’re going to drive me across the parking lot? Yes, sir. I am.

So just so I’m clear. Now. I’m going to be $100 for the privilege of going across the parking lot that I could have just walked. No. He said, No. Yep. He said, it happens more often than you think.

GINI 13:21
No, no.

CHIP 13:23
Like, this is just so needless to say that I got in at night. And so the next morning I was on the phone to my assistant saying in the future, can you please find out how far the ride is?

Unknown 13:36
Because booking me to go 500

CHIP 13:38
yards and paying $100 it just it really, I mean, frankly, paying anything. There’s there’s I mean, there was a free shuttle. I could walk there were any number of of options for me to get to that hotel.

GINI 13:52
So did he really drive you eat it? Oh,

CHIP 13:56
wow. I mean, at that point, I’m like, I paid for it. So I

Unknown 14:00
can you take me around town. It was it

CHIP 14:02
was it was a big and you honestly, it I mean, I guess in fairness to my assistant, at the time, it was it was called the marina was in the name of the hotel. I forget the exact name of it. But you know, you would not naturally think of Marina and airport hotel being one of the same right there. And if there’s that same, the airport hotel and, and she had booked me the ride? Okay, well, then that would have been much more egregious. But, but my point is, you know,

those are, those are the kinds of things that will happen. I mean, over the years, I have done a lot of technology work, and I’ve outsourced to programmers overseas and all that. And it’s not quite the same as assistant. But the same principle, you often end up doing as much work to instruct them as it would be to just do it yourself. And so you need to empower them, whatever you’re using your outsourced help for, whether it’s a VA or otherwise, that that you really are receiving that benefit. Because if you spend more time going back and forth on explaining the task and and checking on it,

what have you accomplished? I

GINI 15:06
still laughing at the parking lot. I can’t

CHIP 15:10
I can’t top that one. I mean, it is it is one of the the the oddest experiences that I’ve had in, you know, all my travels, you know, it’s, it’s not the kind of thing that would happen today, right? Because now everybody takes Uber Lyft or something. And, and right. But still, but yeah, I mean, that was that was special. Now, I mean, it you know, I also I blame the car service company as well, because they should have said, but

GINI 15:34
yeah, why wouldn’t they say, you know, this is across the street.

CHIP 15:38
I mean, it was a, it was a national car service from so that, so whoever’s doing the reservation may not even know No, no. So, you know, because, because I just had an account with one of the national, our company, so, whatever,

GINI 15:54
but it’s a your point. Exactly, we, you, you have to find the right fit,

CHIP 15:59
right. And, and, and, and really, you know, the other thing I really want to harp on, and I mentioned, if humans go is the judgment piece, right. So if you can give someone a checklist, or, or which we’ve talked about before, or, or very clear set of instructions, and that is sufficient, right? There’s nothing in there that says, well, but, you know, if you sense this, or that, then take a different path, that’s where you’re going to fall down, right? I mean, it you know, that that’s really need somebody who really is with you, for a while, gets to know, you, it’s trained, you know, and that is a different animal. So, you know, the, the sad reality is, for a lot of us, if we’re running a smaller business, we may end up doing things on that list, that third list that we don’t want to be doing that we shouldn’t be doing. But there isn’t really a good alternative. And because a lot of it goes back to, I think something else you sort of alluded to earlier volume, right? You know, you need to have enough volume of these things that it’s worthwhile parceling it out. And it’s volume, the same kind of task. Because just because I spend 30% of my day, doing garbage

doesn’t mean that I can find that one person. So by the time I split it up, if it’s, you know, 2% of someone’s time, I may not be able to find somebody who’s interested in that piece of work, or who can do it cost effectively format. So, it’s a it’s tough, and that’s why as, as groups, as companies scale as agency scale, they, they find it easier to offload these kinds of activities from senior executives, because you have enough of it that you can have a dedicated ops person or a dedicated assistant or a creative department or, you know, whatever it is that that will make your life easier.

GINI 17:40
Yeah, and they can make your life a lot lot lot lot easier. But, you know, like my, I have an executive assistant but I would even say she’s become more I mean, if we had an office she would be more an office manager than an EA you know, she had before she joined us she had facilities management experience along with the experience so we we’ve been able to sort of mold her into a different role than I think most assistants have so you know, look for those kinds of things to and it doesn’t have to be somebody full time there’s lots of organizations like just Ostroff business, don’t panic management out of I think they’re on the East Coast, but they have VA is across the country, they’re great, you know, and, and most of her vas work for several clients. So they’re able to do things in bulk and, you know, maybe even get you discounts on things and stuff like that, because they have, you know, they’re working with five or six instead of just one. So there, there are some opportunities for you to work some of that as well.

CHIP 18:38
Absolutely. And, and it’s and when their experience when they’re working with a bunch of people, you know, they know the shortcuts they can take, they know the resources to go to, so they can often be more efficient than you can. So if you if you get the right one, and it’s the right fit for you. And, and they’ve got the knowledge, it really can make a huge difference in your productivity. But I think it’s more difficult than most people imagine, to find that right fit. And it the role really has evolved over the last 20 years. I mean, I you know, when I first started out in business, you know, it was very important to have someone who would answer the phone well, right is right in a completely inconsequential roll out for the most part, right? I mean, yes, you know, I was, I was cleaning out a box in my office the other day, and it had a stack of those old pink while you were out message slips from one of my Dad, I’m sure, you know, I used to have the little, the little poker thing on the middle of my desk, you know, where you sit on your desk. And as soon as you return the call, you smack it down on, you know, and yeah, it felt really satisfying to do that

Unknown 19:45
you should leave those free.

CHIP 19:47
Well, you know, I tell you, I was I was in a hotel couple years ago with my kids who are, they’re both teenagers. Now, at the time, I think the younger one was maybe 11 or so. And we were, it was the first time we had gotten to hotel rooms that were not a joining. So my, my boys around Rome, and, and my wife and I were down the hall, they just did that hotel didn’t have adjoining rooms, we decided they were old enough that, you know, we’re going to live with that, because, you know, we just needed more space, because there’s two teenage boys. So that’s Yeah, yeah, of course, of course, any like, so. But we said, okay, you know, make sure that you know, how to call our room in case you need something. And, you know, for whatever reason, your cell phone is melted down. I don’t know, whatever. I mean, they never put the things down. So I can’t imagine would have been an issue. But sometimes they forget to charge them. So anyway, so So, you know, show them how to make the phone call calls down to my wife. Great. And phone calls over and he’s holding the phone. And he says, What do I do with this now? Okay, because he had never seen a corded phone.

Unknown 20:48

CHIP 20:49
it’s like, Where do I put this? I’m like, back in the cradle. Like, just just Yes, I mean, it was. And this is the, this is the, I have two sons, this is the one who actually has common sense, the, his older brother doesn’t,

but we happen to get a new TV remote earlier today. And, and to watch the 17 year old trying to put the battery cover back on was really

Unknown 21:16

CHIP 21:18
Yeah, yeah. Like, you realize you’re going off to college, and about a year and a half, you’re gonna have to figure out how to do be

GINI 21:27
gained some common sense. Yeah, probably not

CHIP 21:29
going to happen. But yeah, but but so. So the, as these roles evolve, as folks are, you don’t have to call a travel agent, they’re not sitting on the phone all day, they’re not sending faxes, or making photocopies, you know, the role of assistance has changed substantially. And, and some of that for the better. And some of it is, it just means that it’s harder to find that critical mass around that role, right. Because it’s, you know, you don’t have I mean, my dad had a law firm when I was growing up, and he had someone who would do all this typing for him, Well, we all type for ourselves. So, you know,

it’s more difficult to find someone you know who has enough of it, that they can make a full time go of it. So you you really need to think creatively about how you outsource those those tasks on list number three, in order to be effective. And, and I think if you if you’re thinking about humans, in house, virtual plus a combination technology, plus, you know, frankly, looking at that list and saying, What doesn’t need to be done at all right, I mean, I right, I think I think a lot of us are doing things that just simply do not need to be done. Or if they theoretically need to be done, they’re not returning the value. So maybe we just say, okay, you know, we’re not going to do that anymore. And so, so look at that third list and, and really try to figure out how to do less of it. But the way you do less of it may not be the way you first think when you go into it,

GINI 23:00
love that. And also check out places like up work up works my favorite because you can find people for the kinds of tasks that we do editing content, you know, WordPress, all that kind of stuff, you can find really talented people who are typically freelancing on the side of their full time jobs, so you can get them inexpensively and delegate some of that. And for certain repetitive tasks. Fiber can actually be pretty good as well. You know, I’ve

CHIP 23:27
sort of some mixed results there. But, you know, if you if you do have a truly repeatable task, you know, that’s a place to look. I mean, they, they can do things even, like, you know, the podcast editing, right, you know, so somebody can, they can do the splicing of files together, I happen to be able to do it pretty quickly. So I’m not sure that that I would necessarily get the value out of that particular function. But there’s a lot of folks out there who are thinking maybe I would like to do a podcast by, you know, I don’t really know what to do. Well, I mean, look on fiber, there are people who, for 15 or 20 bucks, an episode will splice together your intro intro and your recorded Skype call

done, right. So, you know, think about how you can leverage all those different services out there. And if you’re not sure, the particular one that will solve your particular challenge as someone else, you know, most of us have gone through it. Yeah, you know, so, whether that’s in the spin sucks community or on Twitter, or Facebook, or wherever it is that you hang out with other professionals, even if they’re not in the agency field, just say, how do you solve this problem? And I bet you’ll get some great suggestions on how you can be more effective and efficient.

GINI 24:31
Yes, and if you do it in the spin sucks community we can all learn because I’m sure there’s selfie when you and I don’t know, you know,

CHIP 24:38
I honest I, you know, I honestly, I learned something new every day. I i and i think that it’s, it’s, it’s useful, even if I think I know the answer. Or even if I do know the answer, it’s useful to see what what answers other people are given. So that I have a sense as to what other options are out there. Or frankly, what bad advice being given that, you know, I can try to find a way to

Unknown 25:03
counteract nicely say, Yeah,

CHIP 25:06
well, because, I mean, let’s, let’s face it, I mean,

I hate to say this, but you and I probably give bad advice. Sometimes it’s rare.

GINI 25:14
It’s rare, probably. Yeah. I mean, we don’t. Yeah, I mean, free advice is free advice, right? We don’t have we don’t have the insider knowledge that’s probably needed to make those kinds of crushed

CHIP 25:24
and frankly, even paid advice. I’ve been a consultant for a long time Have I ever regretted advice I gave to a client? You betcha. Because sometimes it turns out that, you know, it didn’t work out the way I thought it would, none of us have a crystal ball. You know, we, we all give the best advice. And, you know, I came from the world of politics where, you know, you you can make certain suggestions and, you know, but the, the way that that it plays out, you know, may not be the way you expect it and and today even less so, because there are no rules and politics anymore. At least when I was in politics, we have rules and you sort of

felt pretty calm if a happens then be will happen now, if they happens then see happens and be maybe never does. Who knows. So in any case, but hopefully that’s been some some useful advice for those of you who are hoping to go into 2019 and be a little bit more efficient with your time trying to figure out how to get that extra little bit of help in order to maximize the value of what you’re contributing to your own business yourself. And if we’ve given you a food for thought, Well, I’m happy about that

GINI 26:33
as a mine.

CHIP 26:34
So with that will come to the end of the first episode of the agency leadership podcast for 2019 again, Happy New Year everybody. I am Chip Griffin

GINI 26:42
and I am Gini Dietrich. Happy New Year

CHIP 26:44
and it depends

For the first episode of the Agency Leadership Podcast for 2019, Chip Griffin and Gini Dietrich discuss how to use a virtual assistant, in-house help, or other solutions to relieve the burden of repetitive tasks. For the first episode of the Agency Leadership Podcast for 2019, Chip Griffin and Gini Dietrich discuss how to use a virtual assistant, in-house help, or other solutions to relieve the burden of repetitive tasks. Chip Griffin and Gini Dietrich clean 27:45
ALP 11: Going from being a small team to an agency Fri, 21 Dec 2018 11:36:45 +0000 0 In the final episode of 2018, Chip Griffin and Gini Dietrich discuss what it takes to move from being a solopreneur or small team to becoming an actual agency. In the final episode of 2018, Chip Griffin and Gini Dietrich discuss what it takes to move from being a solopreneur or small team to becoming an actual agency.

They cover some of the mindset challenges, the process work needed, and other advice on overcoming the hurdle of becoming a “real” business.

Automated Transcript

The following is a computer-generated transcript. Please listen to the audio to confirm accuracy.

CHIP 0:00
Hello and welcome to another episode of the agency leadership Podcast. I am one of your hosts, Chip Griffin.

GINI 0:06
I am the other host, Gini Dietrich

CHIP 0:09
thought we’d mix up the opening there a little bit, just because you got to have a little bit of variety in your a right. And you know that that way, we sort of see if people are paying attention right off the bat. And, you know, for the fall asleep engine. So there you go. That’s good. You know, as long as you and I are paying attention that probably will improve the quality of the podcast. So what else will improve the quality of the podcast? Well, that’s telling you what the topic is. And today we’re going to talk about scaling or really, in particular, how do you take your what I would call your mini agency, your freelance agency on steroids, your nucleus agency, what however, you want to phrase it and turn it into a real agency business? Is that Is that a fair way of describing the topic?

GINI 0:54
I would say so.

CHIP 0:56
So it’s, you know, I think in future shows, will talk about other aspects of scaling. And, you know, going from maybe a small agency to mid agency. But for now, I think if we can focus in on, you know, what advice do we have? And t his is a topic again, that that came out of the spin sucks community a spin sucks, can

GINI 1:14
they think? And so,

CHIP 1:19
Gini, since it came out of community, once again, I’m going to let you have the first word and anything else you want to say about the original question.

GINI 1:26
Yeah, I think I mean, I think I have a little additional knowledge because it was from Catherine Mason , who’s a client of ours, and I talked to her this morning, so I have some extra context, but she’s going from you, I think it’s four employees, including herself to, you know, adding probably doubling size next year. And on my counsel, she she read, Built to Sell, which, by the way, is something that everybody should read, especially in the business that we’re in, because it talks about how to create passive income and create process out of our intellectual property and do it in a way that will provide you some generational money if you decide that you want to sell your business later. And it doesn’t require you to go with the business, which I love that that whole idea. So if you’re not, if you’re not read it, I highly, highly, highly recommend it. But that’s she had just finished it and was really trying to figure out, you know, how do I create process and structures so that a, I can build something that’s beyond me, and my expertise and my thought leadership and be that will allow me to create additional revenue streams I saw, I think that’s the genesis of her question is, what does that look like? And how do you Where do you start,

CHIP 2:45
right? And I think, you know, one of the, I saw this phrase somewhere recently, which said, you know, the owners goal should be to be needed, but not necessarily. Yes. And I think that’s a, I don’t know, who came up with this. My apologies for, you know, forgetting it’s, you know, it’s probably john wall again, you know, from

my seat stealing from marketing over coffee,

GINI 3:09
black mango, you can tell chip, it was Yes. Marketing.

CHIP 3:13
Exactly. Yeah. So, that’s, you know, that was very helpful. Look, if you’re listening, and, you know, where I come up with half of the things I say, feel free to let me know. But I read and listen to a lot of things. And my apologies for not being able to quote accurately In any case, the point is, is, is key. Because as we turn something into a real business, it’s important to have all of those systems and processes in place. So that I mean, frankly, at a very basic level, if you as the owner, want to, you know, take a two week holiday, you can take a two week holiday, right. And, and so often when we’re just starting a business in those early stages, you know, that’s very difficult to do. I mean, I remember with, with my first agency a couple of years in small groups, and I went overseas, this was before, you know, Wi Fi, and I’ll add and, and I went to Ireland for 10 days. And I was in in a panic and was so excited to get back to Logan Airport. So I could use the payphone there to call into my voicemail and see, you know, what, what hell it happened over the last 10 days, fortunately, you know, people can be much better connected now. So, it’s, it’s a little bit less of an issue. But, you know, you still want to be able to, to step away. And and I think a big piece of that is thinking about the business itself, and how do you operationalize what you’re doing such that it’s not just all in your head,

GINI 4:35
right. And I mean, you don’t want to, I don’t like necessarily like this term recipe, but because you don’t want to create something that’s cookie cutter that works for every organization, because, of course, you’re going to customize programs based on goals, and all those kinds of things. But I do think there are things that your agency does in on the back end, that should be products are created, you should create a recipe around and those could be creating reports, it could, you know, client reports, it could be setting up automation for, for those reports, or for data that you collect, or, you know, even using different types of software and how to do it. And I leave until you some of the things that we’ve quote, unquote, done systems and processes around is anything that’s repetitive, we have video tutorials on so that, you know, if we bring on an intern, they know exactly how we use co schedule to do our editorial calendar and set up our social schedule, our social media, they know exactly because, and it follows the same exact process so that externally, nobody sees a difference in what’s happening. And it doesn’t require one of us to continue to have those conversations every time and we do, you know, interns every quarter. So that would be a lot of conversations, you know, how we use different tools, how we,

even how we’re editing videos, in movie and things like that. So it’s just, it really gives you an opportunity to automate a lot of those things without you having to be doing, you know, teaching all the time and onboarding consistently, but they can come on and have those videos available. So they can watch them over and over again, as they get into the habit versus Okay, here’s everything, go for it, you know, sink or swim. It really provides a great way to be able to do that,

CHIP 6:26
right? I agree. And, you know, I’m personally a huge fan of checklists, I wrote an article about this not that long ago. I mean, there is a reason why pilots use checklists before they take off. It’s because when you do something all the time, it’s very easy to start slacking off carbon corners, say, Oh, you know, but I know what I’m doing here. And, and the reason you have a checklist is no matter how experienced you are, you may forget things. And so I have a checklist for publishing this podcast, for example, because it’s the same steps every week. Now, a couple weeks ago, I managed to follow all the proper steps unfortunately, use the wrong audio. So So anyone really paying attention for about 20 minutes, we had a duplicate episode up with just a whole different name. So it’s important to pay attention to the details, folks,

GINI 7:17
I didn’t eat That’s amazing. You know, for

CHIP 7:19
Fortune, I caught it before any, any listener did. It was one of those things, you know, after I posted, I’m just like, something was gnawing at me. And, and, and so finally, I went back and I looked, I’m like, oh, oh, look, Episode, whatever it is, eight and seven are exactly the same. I don’t think that’s likely. But you know, it just happens, right? Because, you know, you’re just, you’re thinking about so many different things. And it all feels new, and, you know, whatever. So, so having those checklists, it’s useful, frankly, for existing employees. But it’s really useful as you scale up and it’s useful to make sure that you have your way of doing right exactly right. So that so that when people you know, hire Armand Dietrich, or they are hire Griffin strategy for the higher whomever, you know, there is a way that we do it. And it’s, it’s probably not exactly the same way as somebody else. But, you know, just like, when you go to a restaurant, they follow that same recipe, you know, it’s the same sort of thing. You know, if someone refers business to you, they can be comfortable that you’re going to follow the same basic recipe, right, tweaked for that individual’s personal tastes, needs and all that. But so really, really helpful to have those in place.

GINI 8:28
Yeah, and it’s, I mean, it really today is so much easier to be able to do that we, I just use loom which ELO Am I think the web URL is used loom, but it hasn’t a browser extension. And so I can just click the browser extension, it goes immediately to my camera, and I can I can screen share, I can do me on video, whatever it happens to be, normally, I just do a screen share, and I show the process. So you as you’re doing it, you just create that video, and then you have it at any time anybody needs it, or, you know, you’re delegating, or whatever happens, are you bringing somebody new on or whatever happens to be, then you have that video, just send them the link. And voila,

CHIP 9:08
I think the video is an excellent suggestion. Because it you know, it allows you to, instead of, you know, having something that says, click on this box here, you know, people actually see where is that box and, you know, with web apps today, you know, some of them got pretty fancy. And so, it may not be intuitive if you’re reading and text were to click, whereas if you’re watching a video, you know, you can figure it out, at least until they decide to change their interface up, right. But it and and I think a lot of people overlook the, the, the utility of video because they think it’s too difficult to do. But oh my god, there there are so many tools out there that make it easy peasy. And you have to keep in mind, you know, whether you’re doing it for internal external video doesn’t have to be absolutely perfect, right? I mean, know, if you’re, you know, maybe NBC or CNN or something like that, well, okay, great, you know, you the bars as much higher. But for most businesses, if the audio is clear, and the video shows what you need to see your golden and there’s so many tools that let you do that you really should incorporate that into both your internal and external communications.

GINI 10:14
I also think there’s a I mean, this is a total sidebar, but so I use loom I think there’s a gmail plugin for video as well. And Wisteria has one called soapbox, it is a it’s a freemium product. So you get a certain amount, and then you have to pay for it. But you can check out loom and the Gmail plugin as well, which I don’t know the name of, I just learned about it. But it’s really, really, really easy. Really,

CHIP 10:40
yeah, and there are other things too, I mean, I’ve used camp Asia for a long time that that’s not cheap. But it’s, it does a really nice job. I think that’s what Chris Penn uses for a lot of his videos as well. So, you know, there’s any number of tools out there, and it’s really just, you know, finding the one that works for you. But the, you know, as far as building your agency into a business, that the key is just to just sort of take that information that’s maybe in your head or, you know, your partner’s had or whatever, and, and get it down so that everybody can be on the same page, because, you know, the first piece of growing your business’s is nailing the client service angle.

GINI 11:20
Right. Right. And, and I would say, even on that aspect, you know, there are certain ways that we do things from a client’s service perspective. And I, I expect every single person in my organization to treat claims the exact same way that that I would, and so we’ve created process around that, too.

CHIP 11:38
Yeah, and a lot of it is, you know, setting sort of what the standards are, you know, one of the things I’ve done all my businesses set, okay, you know, here is the expectation for how fast you respond to a client, right? Yep. So, you know, what are the guidelines and, you know, sit and same thing for prospects or what have you, you know, that there should be, you know, basic standards that you operate under, and basically approaches I mean, in the old days, when, you know, we used to get a lot of incoming phone calls, you know, there was a lot of thought given to, how do you answer the phone, and, you know, what, you know, what are the words that you say, so, that that’s, you know, a repetitive process as well, less important today, because most of us aren’t getting unsolicited phone calls from anyone other than sales reps. But, you know, nevertheless, it’s, you know, having all of these things nail down so that you have that consistency will make a huge difference to your success.

GINI 12:28
Yeah, and thinking I mean, I love the Catherine’s thinking about it now, versus, you know, and she has 10 or 15 employees, because it’s going to be far easier now than it is later. You know, one of the things that we’ve done, we did really early on is we implemented a support, this is on this side of support, email address. And, you know, in the beginning, it’s still came to me, but as we’ve scaled, it’s allowed us to put Zendesk in. And then, you know, create rules, so that the support email goes to whomever on the team at should go to. And if we were, if we had implemented that, this year, instead of five years ago, it would have been much hairier, and much more cumbersome, and probably even expensive, because we would have had some had to have somebody come in and actually implement it, where we just boom, done, you know, install it, and it was done. So, you know, thinking about that future stuff is as well, you know, if, if we, while we may not need a support email address right now, we could very well needed three years from now, five years from now. So let’s implement that structure now and get people used to it so that we can implement it at a higher level later.

CHIP 13:37
Absolutely. I mean, that, that being proactive and thinking ahead is, is really critical. And, you know, let’s face it, most of us haven’t done that most of us end up creating these things when when something goes wrong, right. So the, you know, we implement a process because something blew up right now, we posted something for a client that wasn’t approved, we, you know, we screwed up and, and, and broke someone’s WordPress installation. You know, I mean, most employee handbooks, the policies come about because you had a bad situation with employee Oh, we need to add a section for this, right. And, and it’s if you think about them ahead of time, you will save yourself a tremendous amount of heartburn. Tremendous. And, and, and, and that’s, I think the, you know, what I sort of touched on there, too, is, don’t just think about this. As far as setting up processes from a client service standpoint, think about them from your overall business. So how do you do billing? Yep. Right. I mean, that’s an area that a lot of agencies fall down on, because in the early stages, you know, the, it’s okay, oh, you know, I gotta deal with invoices this weekend, or, you know, whatever. And you really need to have a process and say, okay, you know, we’re going to send all invoices out on x day. And here’s the process we go through. And here’s how we make sure that we’ve, you know, cross our T’s dot at her eyes, we didn’t, you know, because a lot of times, particularly for doing project work, or, you know, hourly billing or anything where it’s an inconsistent amount, from month to month, it can be really easy to screw it up and not build the right amount. And usually that’s in favor of the client. Usually the mistakes that agencies make her billing too little, not too much, right. And, and so that puts you in a bad place down the road. So make sure that your billing in a timely fashion. And keep in mind, you know, if you invoice two days late, you’re going to get paid two days

GINI 15:26
late. Absolutely.

CHIP 15:27
So just be consistent with that, you know, think about it, I talked about employee handbooks, think about it, as soon as you start hiring employees, employee number one, you should have at least a rudimentary employee handbook in place, because it will, it will provide you with all sorts of tools that you can use down the road to deal with particular situations. And, and so, you know, think about all of the different aspects of your business, and just make sure that you’ve got the clearly defined process and it can start simple and then you, you know, expand over time as your business becomes more complex, for

GINI 16:02
sure. When I start, yes, and I would even treat it like you do crisis planning, assuming that everybody has experience with that, but it’s the scenario planning, right? It’s the, okay, we know, these things are going to happen, we know these things might happen. And these things might never happen. But we should probably be prepared for them. So same kind of thing. Like, we know, we have to have process for these things. We know we’ll eventually have to have process for these things. And maybe, maybe not, but let’s put that on that list as well. So that then you can start to plan and prioritize what you need to create now versus later. And maybe never

CHIP 16:41
Right. I mean, a simple guideline to think of is that the processes and paperwork are designed to prevent problems or deal with them when they happen. Yes, right. And, you know, if you think about it, in those terms, you know, processes and paperwork no longer become bureaucracy and busy work, and you no wasted time, but really, it’s an investment in the future. It’s an investment in in a better future, or at least a less bad future. And so, you know, those are the tools that you want to be thinking about, frankly, pretty early on and, and you’re going to miss things that there will be things that come up that that that aren’t covered by whatever processes you’ve already thought of. So be it, you know, it least if you’ve if you’ve done the legwork on a number of areas, you will reduce the problems that you have.

GINI 17:32
Yeah, totally agree. Um,

and I also as you as you add, even if its full time contractors, or part time contractors, but even as you add colleagues, have them write down a list of things that they do every day, because those are the kinds of things that a you can create process around and be eventually automate or use robots to do for you.

CHIP 17:57
Right. Well, and the other thing is, you know, years ago with my company, custom scoop, I, most of the company’s technical knowledge in the early days existed solely in my brain, right? And so, you know, if something went wrong, I was the one who fixed it. Okay, well, that’s fantastic. Yeah. But, you know, then what happens if I get hit by a bus?

GINI 18:23
Well, we like to say, what happens if you win the lottery now, sure, bus

CHIP 18:27
but but, but I literally created a document called hit by a bus

GINI 18:31
by bus. And,

CHIP 18:33
and it laid out all of the different because look, stuff happens, right? Right, right. You know, someone quits someone, someone does something, and you have to fire me have no choice. If, if that information goes away, what do you do? So anyone, and this is very common in the early days of an agency, that you’ve got one person who knows how to do something, right? As you get bigger, you tend to be you know, there tends to be more knowledge sharing, just by happenstance, everything else. But when you’re small, you’ve usually got the one expert in this, or the one person who knows this client. And so you need to make sure that you’re, you know, you’re taking down what, you know, what processes are they going through, particularly if it’s customized for an individual client, again, you know, going into the sort of the custom scoop example, we had folks who were producing Daily News briefings for clients, something that many agencies do for their clients, well, each of those tends to be tailored for the individual recipient, right. So, you know, you need to make sure that your whoever’s working on it has put that process pen to paper and says, okay, every morning, this is what I look at this, these are my sources, you know, whether I’m using just my monitoring service, but then, you know, perhaps doing some manual searches, or, you know, whatever it is that you’re doing, here’s what I do, here’s how much I generally find, you know, whatever guidelines they can give, so that if, for some reason they were super second couldn’t come in the next day, someone else can just take a look at that document, put together something that’s, you know, pretty good, you know, they’re not going to be exactly the same as someone who does it every day. But, you know, they need to be good enough. And then they will improve over time if they act to actually take it on, but don’t let any knowledge reside only in one person’s head.

GINI 20:17
And I would also add to that really think about, you know, I mean, going back to your hit by a bus document, does somebody have access to your bank account? Yes, you know, if, I mean, God forbid, something like that were to happen, you know, how, how does how does somebody access that get the information they need, and and truly dole out the finances appropriately.

CHIP 20:39
But, and this is a touchy subject, right? And so I glad you brought it up, because agency owners and most business owners, in my experience, are super reluctant to let anyone have access to the bank account of themselves, right, oftentimes, including their spouse. Yeah, for various reasons, right. And, but, but you need to make sure that you are not the only ones with the keys to the kingdom. Yes. Right. Because, I mean, think about it this way. And, you know, again, you’re dealing with bad situations. But I mean, let’s say that you are in a car accident and you’re laid up in the hospital, you would like someone to be able to transfer money to you, actually, you can pay your own bills, right? So think about it purely selfishly, don’t worry about it. Just think about it, those terms, and you’ll be much more willing to give up some control.

GINI 21:29
And it can be an ex outsource bookkeeper, it doesn’t have to be, you know, your account executive, it can be somebody like that,

CHIP 21:35
correct? Yeah. And you have to make sure, obviously, that you know, it even if you don’t like looking at numbers that you’re looking at the numbers. Yeah, because anytime someone else has control, you are incurring a risk, right? I mean, there are, Yes, you are. And, and, and you can always spot it. I mean, I, I had a good friend years ago, who ended up, it turned out he was embezzling money from business, I, I had no suspicion of him whatsoever was not my business. But, you know, nevertheless, it caught me by surprise, I know, caught his boss by surprise. So, you know, look, these things happen. And so you need to, to make sure that you have safeguards in and, you know, probably will have a show at some point, talking about finances generally, because I think there’s a lot of things to talk about in that regard. But, you know, important to think about, you know, sort of all those what ifs, and, you know, if this happens, what do we do? And it will help you think about which processes you need to put in place.

GINI 22:31
Yep, and then prioritize them. So, you don’t get overwhelmed. Yes, it may take you a year. And that’s okay.

CHIP 22:38
Absolutely. I mean, and, you know, you’re not going out at a time, don’t, don’t, don’t try to some people like to, say, boil the ocean, you know, there’s, there’s, there’s no reason why you have to address everything all at once, you know, sort of take it, give it a good thing can say, Okay, here, the thing is most likely to go right. And you may juggle it over time, you may have a list of 20 things. And, you know, item number 25 all of a sudden pop up because, you know, we’re feeling a little squeamish about him, and, you know, this employee over here, and, you know, maybe they’re looking at another job opportunity, maybe, maybe I need to focus on what they do, and get the processes there, or whatever I mean, so, you know, make sure that you’re flexible in your planning process as well.

GINI 23:18
Yeah, and I think you’ll find as well that once you, once this is in your brain, you’ll just automatically start doing videos or writing down process or creating checklists or, you know, however you want to handle it, you’ll automatically start doing that, and it’ll just become habits. So, get it in your brain and start building the habit now, and it’ll become lots easier.

CHIP 23:39
Absolutely, it really does. I mean, anything is better as, as it becomes a habit. But in this particular case, you know, focusing on what I would consider a little bit more of the drudgery side of the business, frankly, if you can make drudgery, a habit, you know, you’ll, you’ll get there a lot faster. I mean, it’s, you know, it’s like anything else, you know, the things that you don’t want to do do those first in the day, you know, take take 20 minutes and work on process in the morning before you’ve got distracted, and you can give yourself a good excuse for not working on it.

GINI 24:12
Client fires today.

CHIP 24:14
We all do it. We all do it. Yeah. I mean, you know, I, every morning I put together my list of 10 things. And when I’m being a good boy, I deal with the things that are quick. And I I liked the least first, but when I’m not being a good boy, I’ll get to that around three o’clock

after I record that podcast. So Jenny, that’s, that’s what I’m going to get to that item there. And then, you know, I mean, everything can come up. And at the end of it, I’m like, Oh, geez, I don’t I’ll put that after tomorrow. Right? Don’t do that with these process things. Because it will save you heartburn, but it also save you time and make you money. And, and the the last area that I would that we haven’t touched on yet that needs process, business development.

I mean, agency owners have this almost mystical belief in just building relationships, whatever that means. And talking to people, we need a process, right, you need to actually lay it out, you need to know who it is, you’re talking to, what you’re talking about, follow up schedules, you know, whatever it is, but, you know, particularly if you’re, if you’re interested in scaling your business, start putting processes very early on around how you’re doing business development, because part of it will keep you accountable to yourself, but part of it will help you identify, okay, you know, let’s not just let’s not talk to chip, just when we feel like it, let’s let’s actually have a rhythm here, you know, based on based on this conversation, what’s my next step? And it may be that they’re not going to be a client for 18 months or 24 months. But, you know, think about, you know, how do you keep those contacts going and target very specifically to that individual. Because, you know, if you if you just expect that you’re just going to talk to people in business, this is going to fall out of the sky, that’ll work for the first couple of employees, perhaps, but after that, you can’t scale a business without a business develop process, you cannot. So process around everything. Process process process process.

GINI 26:15
Yes, yes, yes. And yes. And I will repeat that if you’ve not read Built to Sell, I highly recommend it because it definitely helps you think this through.

CHIP 26:26
And with that, hopefully, we’ve given folks a lot to think about, we’ve certainly given them a lot of resources to look at and, and work on their own processes, and both from a thought process as well as from an actual implementation process. So pleased after you’re done listening to this, start writing down some of the processes that you don’t have that you need. Think about those things and that’s a that’s a good homework assignment for our listeners. homework assignment. Yes, yes. So And on that note, I guess that will bring to an end yet another episode of the agency leadership podcast cast. We appreciate all of you being with us, and listening right through to the sweet end at the bitter end, the Sweden and so I am your host, Chip Griffin,

GINI 27:10
and I am Gini Dietrich

CHIP 27:12
and it depends

In the final episode of 2018, Chip Griffin and Gini Dietrich discuss what it takes to move from being a solopreneur or small team to becoming an actual agency. In the final episode of 2018, Chip Griffin and Gini Dietrich discuss what it takes to move from being a solopreneur or small team to becoming an actual agency. Chip Griffin and Gini Dietrich clean 28:19
ALP 10: Get your agency off the proposal-writing treadmill! Wed, 12 Dec 2018 20:30:36 +0000 0 In this week's podcast, Chip Griffin and Gini Dietrich explain why agencies might want to avoid the prolific production of proposals for prospects.  In this week’s podcast, Chip Griffin and Gini Dietrich explain why agencies might want to avoid the prolific production of proposals for prospects.

Instead, Gini lays out the example of how her own agency handles the business development process to build stronger client relationships.

Along the way, the co-hosts explore a range of challenges in the business develop, client relationship, and proposal creation process — along with practical advice on how to handle them. And a few funny stories along the way.

Automated Transcript

The following is a computer-generated transcript. Please listen to the audio to verify accuracy.

CHIP: 00:35 Hello and welcome to another episode of the agency leadership podcast. I’m your host, chip Griffin, and I am Gini Dietrich and we’re here today to tell you why you shouldn’t write proposals. This is something that every pr agency, owner and executive has done countless times in their careers, whether on their way up or in their current positions, and yet neither one of us are huge fans of proposals, but I think you’re even more violently anti proposal than I am. So I’ll give you the floor first, Gini.

GINI: 01:08 Well, here’s the thing with proposals, we tend to, and you know, I came from the big agency world where this is what we did. We tend to say sit with a client or a prospect, I’m sorry for maybe an hour and we asked them all sorts of questions and they may be very smart questions like, what are your business goals? What are you trying to achieve? Have you worked with a PR firm in the past? What was your experience? What did you like, what you like? You can ask really smart questions and then we go back to our office and we take all the information and we write a proposal and we give all these great ideas and some of them are creative and smart and some of them are based on experience that we’ve had in the past with similar companies are in the same industry or things like that.

GINI: 01:46 And then we put forth the proposal and then one of two things happens. Either they hire so they don’t and if they hire us they then expect us to execute on that proposal because that’s what we’ve done and we’ve budgeted based on that proposal. Right. But we really don’t know enough about the client’s business to be doing that. We don’t. We don’t have enough information. And so what we find happens is we get into the organization and we start to execute on some things and it’s very tactical because it’s not. It wasn’t based on something strategic. It was based on ideas. We find, you know that things aren’t exactly as we thought they were or we didn’t ask, we didn’t know which questions to ask. We didn’t ask the right questions or maybe the prospect embellished or didn’t tell the full truth because we weren’t, weren’t undone under NDA or whatever happens to be and suddenly we’re stuck executing this proposal that we put in this program that we put into a proposal that doesn’t make sense for the client or not everything does or it’s not strategic or it’s not measurable or there’s a lot of different reasons, right?

GINI: 02:49 So I am vehemently opposed against it. And the other thing is, is why are we giving her our ideas away for free?

CHIP: 02:57 And I feel like you’ve had your caffeine Geneva that really feel strongly about this, but I think that may be the longest monologue you’ve yet had on leadership podcast. So. So while Jenny calms down just a little bit pops a valium or whatever. Yeah. So look, I, I agree with just about everything that Jenny said. I think to me it comes down to too often we’re writing proposals without listening and that may be because the client didn’t give us a chance to listen or it may be because we jumped the gun. I was involved with an agency a number of years ago and one of the things that they love to do was to go into pitches based on a conversation with a friend or a contact there and they would put together a full campaign proposal and it was before they’d even talked with the decision maker once they simply had a little bit of Intel that they maybe had some inkling of what it was that they’re looking for, but they had no idea of scale, scope, budget, goals, motivations, anything.

CHIP: 03:57 And I think too often we’re so excited at the prospect of potentially getting new business that we just want to sit down and we want to write out that proposal. We want to dream up the cool things that we could do. The fun things we’d like to execute on that we think might help that client and of course plugin the dollar figures that we’d love to receive for it, but that is not the foundation of a good relationship. Even if you do win the business, you’ve probably set expectations all wrong, but more often you’re just not going to win the business because you didn’t really understand what they were really trying to achieve.

GINI: 04:32 Yes. And, and there’s always the situation where you meet or you meet with a prospect and they say, well, you know, we’d like to do this and we’d like to do that. We’d like to do this. And you say, great, what’s your budget? And they go, well, we’re not really sure how much it’s gonna cost. I mean we have some money and then you go back and you write the proposal based on what they told you they wanted and you never hear from them again because usually it’s way too freaking expensive

CHIP: 04:59 and, and it’s, it’s probably based on tactics, right? Because typically, typically clients want to talk to you about tactics. Like they come to you, you know, I’ve got a lot of experience on the digital side of the equation, so people will come say I need a new website right now. I need to get involved in social or what will fantastic, why, why? And you really need to get to the why. And that really comes down to understanding not just what your primary contact but the actual decision maker is looking for because your primary contact may be just looking to relieve an individual pain point pain point. I’m tired of getting yelled at by senior leadership over my ugly website or the fact that we don’t post a twitter enough or that they didn’t like some posts on the blog. And then these are all real examples by the way that I’ve seen in real client situations.

CHIP: 05:44 And oftentimes that has not a wit to do with what they’re really trying to accomplish as an organization. And so if you’re not able to tie it into that, you’re going to write drivel anyway. So why write dribble? You know, let’s, let’s start building relationship. And I, I really liked the way that you sort of teach people how to get beyond the proposal and sort of put that in the rear view mirror and say, okay, that’s the old fashioned way of doing it and instead there’s a better way. So, so why don’t you tell us a little bit about that. And I know that you’ve got, I, you’ve got a whole webinar on this, right?

GINI: 06:14 We do have a whole webinar on it. We do. Um, yeah, because I mean, I really, really strongly believe that it’s probably, it’s been four years, maybe five that, um, may, maybe it’s five in January. Um, we said, okay, we’re not doing this anymore. I’m tired of being ghosted. I’m tired of prospects saying, well, I don’t know. We don’t know how much it’s gonna cost. Why don’t you tell us what it costs and you know, you put all this time and energy into a proposal and then you never hear from them again. Or they try to negotiate you down to $2,000 a month but still want to keep everything that they wanted. And it’s like a, you know, $50,000 a month program. So we stopped doing that and instead we would have a meeting with a process or are we still. We have meetings with the prospect and we talk about all the things that we would anyway.

GINI: 07:00 And then when you know, in the last five or 10 minutes of the conversation, we say, okay, the way we work is this, we come into your organization and depending on you know, what you need, I’m there or my team goes, just depending on the needs and who is involved. But we come into your organization, we spend two days with you and here’s what we do. We dig into your business goals, were to dig into your data. We dig into all this kind of stuff and we figure out what makes most sense for your organization. And we can’t do that because it’s, we, we, we can’t do that without spending that time with you because otherwise it’s not going to be strategic and it’s going to be based on our experience with competitor or industry or whatever it happens to be. And that that cost is x.

GINI: 07:46 If Jenny’s in the room, it costs $10,000 more. If Jenny’s not, then you know, so you can negotiate that. So you get a decision right in that meeting of whether or not they want to proceed with that and you don’t have to go back and go through all this rigamarole. So instead you say, okay, it’s, let’s say it’s $10,000 to actually we charge more than that, but we, I think we started at 10 and we’ve slowly over the years increased it. It’s $10,000 for us to do that plus expenses to come to you. And they either say, Gosh, you know, that’s really great. Yes or well that was really outside of my budget or that’s all I, that’s all the budget I have. Do I really want to spend it on this? And then you can start to have a real conversation, right? So you see.

GINI: 08:32 And if they say, yeah, that sounds great, then you go back to your office and you have a template id piece that you put together. It talks a little bit about the process. It talks a little bit about what you’re going to do. It gives a, a sample agenda, it tells them who you want in the room and we always make sure that the key executives are in the room for at least two hours at the very beginning and two hours at the very end and in between you, those bookmarks, you can have the marketing team or whoever needs to be, but you have, you have to have the executives for two hours on the front end and two hours on the back end and during that time you create all that stuff. So now you either have, you have a decision that’s been made in your initial meeting, so it’s not the right the proposal which takes a couple of weeks and send it off and then have another phone call you like, you get a decision and your sales cycle goes from six months to one day.

CHIP: 09:24 I think this is a great approach that you take. It’s not quite the same one that I’ve done. Um, and actually before we proceed that I’ve got sort of an honest engine question for you, which is, have you, in the last five years, have you written any proposals or have you exclusively done this? So you’re exclusively completely faithful to this? I have to confess that I, I, I am weak sometimes then sometimes do end up doing proposals, uh, in certain cases where it appears to me that that’s the, the route of that particular organization. Usually large organizations, um, uh, will take, but you know, you never know, uh, I could be wrong, I could be too soft and if you’ve managed to go five years without, that’s, I think that’s fantastic. But let’s, let’s dive a little bit deeper because I think that, that, since you’ve got such a structured process for someone who’s interested in sort of replicating it, I’m not looking for you to give away all of your secret sauce, but you know, roughly how do you structure that, that onsite engagement, you know, obviously you’ve said that you had the senior leadership for the front and the back end, but you know what, what percentage of that is sort of them making a sort of a presentation.

CHIP: 10:27 You have what they’re interested in, what they’re doing, how much of it is q and a, you know, kind of walk us through to give us a little bit more flavor.

GINI: 10:33 So what we want from the executives are real business goals, what they want to achieve in the, in the next, in the next 12 months. And also what the longer term goals are. And in, in every case that we’ve had, except one, um, they’ve been really forthcoming and willing to share that. And part of that’s because by that point, you’ve signed a nondisclosure. You have, you know, you have an agreement, they’ve already paid your expenses to get to wherever they are, so all that. So they’re willing, much more willing to share than they would in an initial prospect. They’ve made a real investment and they want to make sure that they’re getting a return on that. And, and, and we don’t get on a plane until we’ve been paid,

CHIP: 11:12 by the way, for anyone who’s contemplating this, that is key. Never, ever, ever do an engagement like this without getting paid upfront.

GINI: 11:19 Ever, ever learned. Learned that one the hard way. Yes. Yeah. Yeah. So by this time, you’re right, they’ve made an investment so they’re much more willing to give you the information that you want. So we asked those questions. What are you trying to achieve? Um, what are your business goals? We get dig into revenue. We have dig into profit because part of what we do when we measure our work is that as we show a percentage of what what we’ve done from a return on investment standpoint has attributed to revenue and profit. Um, we ask about cell cycle and I mean every, everything that you could possibly get out of an executive into ours and then we take that information and we start to dig into the marketing with the marketing or communications team, so it’s target audience, brand personas, all that kind of stuff in day one.

GINI: 12:08 And then day two we really work. We start to work with putting the plan together and dividing up responsibility and we also by that point have a really good idea of what their budget is. And so we can then say, okay, if your budget truly is only five grand a month, then you guys are going to have to do these things internally, these 10 things and we can take these 10 things, you know, whatever happens to be. So we really work on that. But the biggest thing that we have found is that they always spend more money from a month to month retainer basis than they would have if we had just done a proposal and said this is how much it’ll cost.

CHIP: 12:46 No, I think that’s a great point. And part of that, I suspect is because you’re able to align what you’re suggesting more closely to what it is that they’re trying to achieve and you’ve also got enough ammunition that you can paint the picture for exactly the kind of difference it’s going to make sure that those are things that are very difficult to do after, you know, you have the typical, you know, hour or two conversation with the prospect where you spend half the time just talking about the prehistory of your organization as an agency and uh, you know, you, you, you shoot the breeze about the local sports team. And then, oh, by the way, maybe you get 15 or 20 minutes of real substance. Right? So the, I think that, you know, putting, putting yourself right there in front of them and, and you know, frankly, as much as, as you and I love virtual and I think we just had a show recently about running a virtual agency.

CHIP: 13:31 There’s, there is no replacement for that in person. There’s no repeatedly with building the initial relationship with the client. It really makes all the difference in the world. Um, to have that, so even if you’re not following this overall process, I would encourage you to make sure that you’re seeing your clients in person. Um, and, and you know, a lot of our agency listeners, I’m sure have remote clients that they’ve never met in person. They may be seen on video chat. Uh, and that’s, that’s, you know, it’s not the end of the world, but you’re going to be so much stronger in your relationship with that client and be able to get through any difficulties down the road and make them stickier if you’ve had that in person connection.

GINI: 14:10 You know what, that’s such a great point because we’ve actually tested it different ways and we’ve found that when we do the in person like that, it forces them to be focused. It forces them to actually show up. And we get started with the execution much more quickly because what happens if you don’t do something like this at the front end, you know, I mean, we’ve all had this experience. You have your first onboarding call, which is an hour, and then you do this in about six weeks later. You start to execute where this, you have the two days, it’s intense people’s brains, Phil, Phil, they, they feel like their brains are going to explode. Um, but they are so much more invested in you and in the success of whatever program you decide on together because of it. So it’s such a great point. And you’re right. I mean, I love the virtual piece, but it just doesn’t work as well.

CHIP: 14:58 No, and it’s, uh, you know, I think a lot of it is that is that human connection that you make, you know, so apart from just the information, it’s, it’s building that personal bond that you can do and you know, of course sometimes that backfires. Sometimes you find out that there really is no chemistry. Although I would argue that it’s better to find that out early on in the relationship. Absolutely, absolutely. Road. But, you know, I’m thinking some of the larger agencies I’ve been in where, you know, perhaps I don’t own the client relationship where I parachuted in late, um, or, you know, been a replacement for someone else, depending on what the situation was. You know, that that first in person connection is so much different than the conference calls and even the video chat because, you know, I mean, frankly, if you’re in a larger agency environment, you’ve usually got, you know, a half dozen people and their side, half dozen people on your side, you know, everybody’s stepping on each other to talk, you know, there’s all sorts of peacocking going on, on both sides and so you don’t really have a chance to sort of nurture the relationship which, you know, in person you can even just during breaks, you know, you just, you know, you go to the coffee machine together or something like that.

CHIP: 15:56 And um, and I’ve found that that’s incredibly beneficial regardless of the situation that you’re in to, to have that, that bond, you know, one of the things that strikes me is, you know, it sounds to me if I’m listening to your process correctly, that, that essentially, you know, by day two you’re already sort of presenting your solution. Is that, is that an accurate assessment?

GINI: 16:17 Yeah. I mean, it’s not a, it’s not a what we would consider as an industry, what we consider a full on plan, but it’s definitely two pages that says, um, here’s what we’re going to achieve together, here’s, here are our goals compared to your kpis, all that kind of stuff. And then, you know, we’ll figure out the tactical piece of it, how, how we execute and later, but there’s definitely a two. It’s a two page document that they get that’s, that shows exactly how it is. So yeah, we figured all that out and then we’re ready to go and I mean then you start to get your, your creative ideas going because now you know from a, from a key performance indicator standpoint what you’re trying to do.

CHIP: 16:57 So is that something that you and the team sort of get together on on night one at the hotel after you’ve done with the client and sort of piece it together and, and how much of that is based just on Day One? How much sort of a homework have you done, if you will before you go in? Let me, I’m, I’m, I’m sure like me, you do a, as much research as you can before you go on site with somebody, but you’re kinda kind of give us a flavor for um, you know, as you go into it, you know, what kind of preparation you may have done.

GINI: 17:24 So we have a list I’d say of maybe 20 or 25 things that we asked for an advance and that includes everything from access to it to google analytics and their crm to, you know, pass marketing pieces. Um, we always ask for access to their website, you know, stuff like that so that we can start to dig into the back end stuff. Um, and that really helps. So usually that right after signed a contract and sent in the sentence, the check or wire transfer to whatever, um, then we send them that list. So within the first week we have all of that and we tried to do the first that meeting within the first two and a half or three weeks depending on schedules, but we have all of that information and then we can go in and do all the research on stuff that’s actually inside their organization, not just on the stuff you can find externally.

CHIP: 18:18 That’s key. I think for any kind of onsite meeting, you want to make sure you’re doing preparation, but particularly in a case like this, making sure that you’re asking for things up front. First of all, it it, again, it’s sort of a step in that demonstrating the seriousness of the relationship and you’ll start to learn very quickly will you know if the. If the prospect or client is not providing you with certain things that you’ve asked for, that you know that that’s a nice big red flag that you want to address right out of the gate. Because you know it depends. If it’s a large organization, it may be that they simply don’t have access to some of that thing and they’ve got to fight an internal turf battle, but you want to know that, right? Because, because how you’re going to solve it know if the group you’re working with doesn’t have access to Google analytics and whoever has the password won’t give it up.

CHIP: 18:59 Well, you know, better to know that going in then, you know, then after you’ve gotten on site, and there are a lot of things like that where if you’re able to extract the information in advance, it will make that session, you know, so much more productive. And, and too often I see, uh, you know, agencies are frankly other organizations not put in the homework for these kinds of onsite meetings there, you know, the in and you typically see this out of people who are more, I guess I would say relationship focused, right? They’re, they’re just, they’re the kind of folks who say, look, I, you know, I can charm anybody, right? I, I, you know, I’m just that guy or that gal and that’s fantastic, but, but, but if you come in with a little bit of information, I bet you can apply that charm even better and so, so make sure that you’re doing that homework in advance because you want to make sure that that meeting is as productive as humanly possible and again, you know, bring out those red flags in advance because it’ll allow you to craft your strategy for how to deal with them as you move forward so you don’t get into a bad relationship, a bad situation.

GINI: 20:04 Yeah. And I think that also allows you to find red flags that may made them in straight that they might not be a great client for you. So that’s the other thing I love about this process is at the end of two days a, you’ve been paid for it. So you’ve been paid for your ideas, you’ve been paid for your strategic thinking, you’ve been paid for all of that. And B, you get to, you get to quote unquote date. You get to decide if this is a great client for you. And if it’s not, you just very politely say, and there you go, good luck, and you’re on your way and you know, if it is, is going to be a great relationship for you, it is an ideal client, then you can continue working. So it’s, it does that as well.

CHIP: 20:43 In your experience, how often do you end up walking away from your perspective after, so not they didn’t have budget or they didn’t feel it was a company. And how often do you go into that and say, Oh God, no, no, no, no, this isn’t happening.

GINI: 20:55 Well, twice in five years. First the first time was with the client who were, they were great and I would have loved to work with them, but as we started to dig into their financials with them, which by the way, they’d never done. We discovered that they had spent all of their marketing budget on those two days. So in the first two hours we discover that. And um, so it allowed us to have the content up to date and realize that no, nope, they didn’t. Yeah, it was a large organization or was an association that was run by people who had full time jobs.

CHIP: 21:32 Oh, okay. Yep. I’ve been there, done that. Having come from the public affairs space, I’ve dealt with a lot of associations, many run by volunteers and yeah, that’s not really that surprising that now that. Yeah.

GINI: 21:43 Yeah. So we,

CHIP: 21:45 for those of you who deal with the association space, just be aware, you know, if, if it’s all run by volunteers and they haven’t hired association management firm to, you know, to, to actually run the show.

GINI: 21:57 I wish you all the best of luck. Yeah. So there’s that one. And then the second one was about a year ago we started in, in, you know, because I’d done all the homework and prepared and I talked to the CEO several times. We were, I thought that he had a good understanding of where we going and about an hour and 15 minutes in, he asked to see me outside and we go outside and he just laid into me. He told me he didn’t want his team to know what the financials were. He didn’t want them to know what the goals were. I mean he and he used the f word like 20 times and I just stood there and I looked at him and when he finished I said, I’m really sorry that this won’t work out. Let me go back upstairs and get my purse and I’ll write you a check for what you’ve paid. And I wrote him a check and walked away. Wow. Yeah. He didn’t like that very much. But at the same time he didn’t want to share anything with his team. So. And his team was in the room. So

CHIP: 22:58 yeah, no, that’s a, that is a huge red flag know. I mean, look, I mean a particularly in smaller organizations, you know, you tend to see a lot of sensitivity around financial numbers and, and how you share them. But there are ways to share that even for the most uncomfortable individual where you can do it, you know, since you’re not disclosing salaries or things like that.

GINI: 23:20 And we, he and I’d had a conversation about what I wanted to do and he clearly either wasn’t paying attention or was distracted or something because we could have had that conversation before his team came in the room. But yeah.

CHIP: 23:33 Wow, that’s a, that is unfortunate. And hopefully that will mean that for those of you listening out there who may be new to the agency world, that is not a normal situation. No,

GINI: 23:41 no, no, no. And like I said, it was one time in five years, I mean. Right, right. But I think the,

CHIP: 23:46 you know, the, the, the bottom line is that if you can adopt, you know, whether it’s, you know, a beautiful process like this or even something, you know, minimally approaching it and get away from that, you know, hey, I’ve just had a conversation with somebody who might be interested in let’s, let’s, let’s rush up, proposal out the door, you know, the sooner I can get them something the better. You know, I think the overall summary of our advice would be take a deep breath, find a way to work with them if you can work with them strategically in this kind of environment where you’re developing a plan, preferably in person and you’re getting paid to do it, that is going to lead to a much more fruitful, sticky, profitable relationship that parties will be happy with that. The traditional, you know, send, send the proposal over the transom as quickly as possible. Right. Right. At now I’ve got find it so much better, so much better. Well and, and I think, you know, at least amongst the agency owners I’ve talked to you, you’ve probably gone the farthest and bend the most rigorous and sticking with this, right? You know, it’s

GINI: 24:48 Oh yeah, we’ll turn business down if they don’t want to work her process and we’ll say okay, well I mean I will say that’s our process and if that doesn’t work for you, that’s fine. Right? But I’m not going to pursue it.

CHIP: 25:00 Right. And I, I think we’re not the right. Whatever your process is, agency, you know, whatever your approach is, whatever client you’re looking for, you, you just need to know what it is that you’re willing to do and stick to it. Right? It’s the, it’s those, those last minute. Oh sure. I’ll make an exception kind of things that tend to come back and bite you. You know, they may feel okay in the moment, but over time those are the ones that match. And you sit there and say, why am I doing this? So if someone wants to get off of the, uh, the proposal treadmill and, and is interested in learning more about this process and, and um, uh, you know, we talked about you have a Webinar. If they’re interested in the Webinar, how do they find out more about that? Probably

GINI: 25:41 best way just to ping me because it’s very, very targeted specifically to agency owners. So we don’t have anything on the web about it. So just get, just get in touch with Junius. Yeah. Get in touch with me

CHIP: 25:53 and she’ll give you the super secret handshake so that you know how to create code and it is worth. It was worth. It is. It is. It is a lot more detail on what you just talked about. So in any case, I think that will bring us to the end of, of yet another episode of the agency leadership podcasts. We’re up to double digits now. Jenny, can you believe it? That’s amazing. I don’t know. Time flies, doesn’t it? It does mean when we, when we started, the cubs still had a future. Come on. Sorry. No, no. It’s not enough for the holiday spirit there. So yeah, just you thought I,

GINI: 26:31 we passed it at least until catcher and Pitcher, but here we go. Pitches and Catherine. Thank you. Yeah, no problem. I understand cubs fans, you know, backwards. Dyslexic.

CHIP: 26:44 Alright, well on that lovely note, I guess we’ll wrap things up. I’m Chip Griffin and I’m GiniDietrich and it depends.

In this week's podcast, Chip Griffin and Gini Dietrich explain why agencies might want to avoid the prolific production of proposals for prospects.  In this week's podcast, Chip Griffin and Gini Dietrich explain why agencies might want to avoid the prolific production of proposals for prospects.  Chip Griffin and Gini Dietrich clean 27:23
ALP 9: Profit-sharing for agency employees Wed, 05 Dec 2018 20:50:29 +0000 0 Should you provide a profit-sharing program to benefit your employees? If so, what should it look like? These are the questions that Chip Griffin and Gini Dietrich explore on this week's episode of the Agency Leadership Podcast. Should you provide a profit-sharing program to benefit your employees? If so, what should it look like?

These are the questions that Chip Griffin and Gini Dietrich explore on this week’s episode of the Agency Leadership Podcast.

The co-hosts start by discussing what profit-sharing is, then they explore the pros and cons of different approaches.

Automated Transcript

The following is an automatically generated transcript. Please listen to the audio to confirm accuracy.

CHIP 0:00
Hello and welcome to another episode of the agency leadership Podcast. I am Chip Griffin [and I am Gini Dietrich] and we’re here today to talk about profit sharing, profit sharing and profit sharing is something that tends to get people talking although I’m not sure that everybody is always on the same page with exactly what they mean when they say it, right? It’s it’s one of those those topics that can mean many different things to many different people.

GINI 0:26
Right? So what do you think of when you think of profit share, I think of, if their profits at the end of the year that you share them with your colleagues,

CHIP 0:37
so you’re a literalist, you like I am

GINI 0:39
and literalist. Yes,

CHIP 0:41
you believe that words have meaning

GINI 0:43
like I do as a communicator, I am appreciative of the words that have meaning.

CHIP 0:48
So I would agree with you. But before we sort of dive into our shared belief in the meaning Why don’t we touch a little bit on what other people might mean when they say profit sharing? I know this is a topic that’s come up recently in the spin sucks community. So I know it’s and it was clear from that discussion that the different people did perceive it differently. I mean, some people think of it is, you know, a 401k is a profit sharing. Yep. Which in its most literal sense, it is not. It is simply a retirement plan. There are different ways you can determine what contributions to put in. But it’s not it’s not necessarily a profit sharing plan. It may be a profit sharing vehicle of some sort, you know,

profit sharing can also mean discretionary bonuses. And I’m sure we’ll talk about that a little bit because, you know, there is a way to share profits where it’s not totally formulaic

there are like, it’s what are some other things that people might mean when they say, Hmm, those seem to me, the two big

GINI 1:46
or one K’s bonuses raises,

then, like there was a whole conversation about how I worked for an agency that would give us hams a ham, you know, there’s nothing wrong with him know if you’re vegetarian. Nothing wrong with that at all.

CHIP 2:07
Okay, we’re just we’re not going to go down that road.

GINI 2:11
Yeah, it was mostly bonuses raises and 401k is is where it netted out.

CHIP 2:18
Yeah, I think for foreign keys tend to be the one that that most people confuse in with in the mix here. And I think it’s really important understand that that profit sharing and retirement plans are not necessarily one in the same and in fact that they are in most cases not the same at all

GINI 2:33
correct. That said, we have about profit sharing program that is directed through our 401k. So if there are profits at the end of the year, you can divert that your, your percentage of the profit through your 401k. And yeah, you don’t get the the cash, but you also don’t get taxed, and you can save it for retirement. So we do direct it through our 401k that way. And, you know,

CHIP 2:56
I’ve seen over the course of my career and working with different agencies, a whole bunch of different methods of profit sharing. So let’s talk about some of the different models that we can think of just to get them out on the table. One is, you know, a straight profit share, where each, each employee has a certain number of points, or Phantom shares in the pot. And so let’s say, you know, there’s $100,000 in profit, that hundred thousand dollar pool would get divided up based on

the specifications for, you know, how many points or shares each individual has. So that’s totally formulaic, you know, in advance what percentage of the pie basically, you know, once you fend off attrition, and things like that, that may take place over the year, new hires. But essentially, you can sort of formulaically know exactly what you’re going to get. So that’s, that’s one model. Another model I’ve seen is where you do a percentage of the overall agency’s profits goes into a discretionary pool that then as part of the, the bonus process and handed out so you can argue whether that’s truly profit sharing or not, it is that the pool fluctuates based on profits, but it is not in that it, it is discretionary. So, you know, the agency could have a fantastic year, and you might get out of the pool, if your performance was not judged to be great. On the other hand, it may perform less well. And then, you know, you may end up performing better than the average bear in that scenario. So, there’s, there’s different ways to do it that way. So those are two. The third one is where it might be limited, just to senior leadership, where senior leadership might get a percentage of agency profits. And they may or may not, it may not be pooled, it may not necessarily, you know, be divided up amongst all the senior leaders that may just be okay. You know, as, as the CEO, you get 2%, or, you know, whatever numbers great, too. So, that’s, that’s another model, what are it Can you think of some other legacy, I mean, you’ve got your model, which is an interesting one, I think you touched on a little bit, but if you want to share more, you could

GINI 4:59
you it just goes through, and it is true profit sharing, however, you have to be, you have to participate in the 401k program, which not everybody in my team does. So that there’s a downfall from that perspective, so that if you know, we have a really good year, then you don’t get the extra. So it also encourages people to participate in the 401k program, which I think is

extremely smart of people to do. And so it was one of the things that we implemented to encourage that, because I think at the time we had, maybe

maybe 10% of our team was had was part of it was part of 401k.

So it’s not discretionary, from the perspective of do we do or not, if their profits, then their percentage, it is pooled, and then a percentage of it as goes into that, and then it’s divided up based on how much you you yourself are putting in. So if you put in 5%, then you get 5% of the pool. So we do it that way. So it not totally discretionary and it’s not, you know, a complete share of all the profits, because, of course, we do things like invest back into the company and provide raises and, you know, higher hiring and all those kinds of things. So, that’s how we handle it.

But, you know,

CHIP 6:15
so So in that case, just let’s pursue that just for a moment. So, do you decide in advance, what percentage of profits is going to go into that versus what you’re going to retain for investment? Or is that a decision that you make at the end of the year and say, okay, you know, we had 100,000 in profits, we’re gonna, we’re going to hand out 50 k of this and the other 50 k we’re going to Ambassador or what have you, I mean, how do you think about

GINI 6:38
that tried to new 20% in in previous years has, it’s gone a little bit higher, we have, I don’t think we’ve gotten more than 25%, and in some years, Great Recession, it’s gone significantly lower. So but which we aim for 20%

CHIP 6:52
Yeah, so you have sort of in mind a set percentage from the get go. Because in other cases, it may be that, you know, management towards the end of the year and says, okay, you know, this is we feel comfortable, you know, putting into the bonus pool, sort of looking ahead at things like cash flow, and, and all that sort of thing. And I think I think that’s one of the important things for agency owners in particular, to think about, as they’re putting together bonus programs, you know, think about it, particularly if you’re going to share details of it with your employees, which is, you know, one of the main reasons frankly, to do a profit sharing plan, right, you want you want to be transparent about it, because it theoretically invest some more in the agency. And we can talk about the truth or falsity of that in a moment. But your your your want to make sure that when you’re structuring it, if you’re going to tell the employees, this is our formula, think about what that looks like, you know, even if there’s a hiccup over the course of the year, have you given yourself enough flexibility to work with that, so that you don’t end up you know, inadvertently turning a positive into a negative by going to the employees at the end of the year and saying, hey, just just, you know, we foresee we’re going to lose this client early next year. So we’re not going to give you the percentage we said, so, you know, if you want to build flexibility into it, make sure that you do and that you communicate that so that the employees are on the same page, because there’s nothing worse from employee perspective than thinking, Hey, you know, we’re going to get this big share of the pie only to have the rug pulled out from under you at the end, it’s better not to have a carrot in front of you, right? If yes,

GINI 8:22
absolutely. So, you know,

CHIP 8:26
and I think that, that, that’s one of the things that I’ve seen a lot of agencies trip up on frankly, is, is not building in that flexibility. Because, particularly, you know, my view profit sharing tends to work better with established agencies with a track record where you, you know, that they tend to be a little bit more predictable. Now, no agency is fully predictable, but, you know, the, the longer you’ve been around and, and the more critical mass you have that the easier it is for you to sort of forecast, you know, whereas if you’re a small agency, you may have a lot greater difficulty in making those projects. So, in those cases, I would argue, you would want as much flexibility in your profit sharing as possible, because otherwise put yourself in, in bad shape. Because as we all know, you know, sometimes there’s a blip that may cause profits to spike, you know, over a short term project or something like that, that that’s not repeatable business, if you will. And so, you know, if you put yourself in the box of, Okay, I’ve got a handout, you know, some preset portion of that profit, I may put myself in a bad position for 2019. So, you know, make sure that that when you’re structuring these you think about those issues, it’s, it’s sort of like when we talk about legal documents, you know, think about you know, not when times are good when times are bad. Same thing with your profit sharing, think about, you know, the the oddities that might happen, and, you know, how you would feel about it at the, you know, in the future point in time.

GINI 9:50
And I also think the discretionary, guess bonuses, not true for profit sharing are usually received a little better, we try to do both, we have the profit, quote unquote, profit sharing through the 401k. And then we do discretionary bonuses based on perform individual and team performance. And those tend to be a little better received in the past, we’ve done things like cash, which I don’t love, because it’s taxed so high. So like, if I give you $1,000, you’re usually and get 500 bucks of it, which kind of sucks or we give expensive gifts that we that people wouldn’t necessarily buy for themselves, especially if they you know, if we gave him 500 bucks would they go Are we give them 1000 bucks when they go out and buy an iPad Pro for themselves? Probably not, they probably pay off a credit card or something. So we try to do some stuff like that, which tends to be really well received. But again, that’s all discretionary bonus type stuff, not profit sharing.

CHIP 10:46
Yeah, and I will say those, you know, those kinds of unique gifts can work very well, it is important to talk to your tax advisor because usually those are considered to be taxable income to the employee. So you want to make sure that you’re handling appropriately you know, which may mean that that you have to provide a true up payment so that the employee

doesn’t end up paying a percentage of the the gift in tax on their their next w two statements. So you but I agree with you, just from a from an employee morale standpoint, if done right. Those can be extremely well received, you know, but it is important to sort of think about it because you also want to make sure that you know, that that the gift you’re giving are not things that you think are cool, but that the employee will think

I’ve seen that as well where where employers or give something in the employees that will you know, I don’t want this I can him what what like like a hammer. Yeah, that would be that would be certainly the example that was shared in the discussion I’ve seen, I’ve seen some employers give out wine to nondrinkers

GINI 11:54

CHIP 11:54
totally unintentional on their part. They just, you know, they don’t know their employees well enough to know, hey, that person as either not a drinker at all, or not a wine drinker? Which is, which is quite common that someone I’m not one of them. But you know, there are people who do not drink wine, they prefer beer,

I don’t say. But yeah, yeah. So, so make sure that that you, you, you think about those and, and it shouldn’t be a substitute for proper compensation. It’s really it should be, you know, an add on extra that you do just to get some some warm fuzzy is from your employees typically around the holidays?

GINI 12:27
Yes. So, yeah, I thought, you know, Greg Brooks had some interesting an interesting perspective about it in the spin sucks community. He said, you know, a mixture of objective based bonuses for managers and discretionary bonuses for lower level staff tend to work really well. But, you know, make sure that you have

draconian rules in place so, people don’t talk about their bonus comp because, you know, or you do it, you know, do the same across the board for everybody, that tends to also and cause morale issues. So, But to your point earlier, at the beginning of this there’s a difference between discretionary bonuses and probably aren’t

CHIP 13:06
and i think it’s it’s important that there be a some sort of discretionary bonus even if you have a formulaic one, because if you rely too heavy, too heavily on a formula, you can easily end up over under compensating somebody inadvertently. And, you know, you want to make sure, I mean, discretionary bonuses are a great tool to use as far as encouraging employees, encouraging retention and, and simply, frankly, rewarding extra effort. So, you know, you want to make sure that you have that as a tool in your toolkit. I’ve seen some agencies go where they just it’s totally formulaic. And I don’t think that is a good idea for all sorts of reasons.

GINI 13:45
Yeah, yeah. I mean, you’re going to have good years, and you’re gonna have bad years. And you’re exactly right, there could be a crazy blip in the middle of the year, because you had a really big project, that’s not a retainer that’s not coming back next year. And so yeah, there I think you have to be Yes, flexibility is a very good word in this case. And, you know,

CHIP 14:04
and I think, you know, probably on another show, we can go more in depth on the notion of transparency, that that that Greg has inadvertently raised, you know, from the flip side of right, keeping it secret. And I will tell you from experience, employees talk about compensation period in the story doesn’t matter what rules are, what those are, what culture you have in place, they talk about compensation. So, if you think that one employee doesn’t have some idea what another employee is making, you’re deluding yourself and frankly, you know, putting in place you know, harsh rules for disclosures. I I’m not a big fan of putting any kind of draconian policy in effect in your business, they tend to backfire and generate moral will then problems being solved. But

GINI 14:51
and you can’t really prevent it.

CHIP 14:53
No. Well, then there’s also the legal question of, of, you know, whether or not you truly can do that. But that’s, that’s a topic for another show, as well, you know, but it is, I think, you know, having these different tools at your disposal can be helpful. And I think that leads to what I alluded to earlier, when we talked when I talked about the truth or falsity of profit sharing, truly incentivizing employees. And, you know, from my perspective, I, I enjoy profit sharing as as part of a sort of setting the company culture. But I don’t necessarily view it as a direct incentive

GINI 15:32
and new never.

CHIP 15:34
But a lot of people I think, do confuse it in that way that, you know, if I put in profit sharing, that’s going to incentivize employees to go and I will tell you two things. First of all, company profit share agency profit sharing is just it’s too nebulous for to truly be a motivator. If you start getting into individual employee bonuses, profitability on projects, or, you know, their line of business within the agency, what have you, you know, those can have more of direct effect. But honestly, more often, I think they have a negative effect. Because people have a tendency to seek their bonus by whatever means necessary. I’m not talking about an ethical, but they will make decisions to maximize their own bonus, which may or may not be in the best interest of the business. So, you know, I think that a, the profit sharing doesn’t work as an incentive and be it shouldn’t work as an incentive

GINI 16:25
well, and it goes to Daniel Pink’s whole point in Drive, which is people when it comes down to it, once the basic necessities are covered. Money is not a motivator, never is

CHIP 16:35
I think that’s true for a large number of employees, I think there are certainly some who are,

GINI 16:41
I’m motivated by money. Yes,

CHIP 16:42
I am, as well, you know, we, we are on the other hand owners as opposed to employees. But nevertheless, I think, you know, that there are, there are any number of employees who are motivated by comp. But these days, you know, and as you’re thinking about compensation for your agency employees, there are so many different things that employees are interested in, they may be interested in extra days off or comp time, or, you know, the ability to have, you know, I mean, the company could put in a vacation allowance or something like that. So, it’s direct, there’s all sorts of creative ways that you can compensate employees today. And most of the research seems to suggest that particularly millennials, as much as they give us all who are older than millennials, heartburn at times, you know, they, they are interested in many things other than money in their compensation plans and value other things, even things like working from home, which obviously a virtual agency, that’s not as important now, because you get to do that every day. But if you’re in a traditional agency, you know, if you’re allowed to work from home one day a week, that can be a real incentive for employee. So I encourage all agency owners to think about their total compensation for employees across the board, not just financial, but everything that you’re doing for them. And think about how you can can, you know, maximize the return on your investment, because there are, you know, many things like allowing someone to work from home one day a week, that may cost you nothing, or very little, but in fact, yet dramatically improve the satisfaction of your employees does matter.

GINI 18:14
And you brought up vacation, and I will say, that even spoke posted in the community that they’re thinking about introducing a program next year with vacation fund. So it’s an employer match travel savings plan, where you, they’ll match what you put in, which is kind of a fabulous idea, I think, I don’t know, they she said, they’re just they just been exploring it. So haven’t implemented it yet. But you know, I have a team full of people who with wanderlust, and the the idea that I would be able to give them vacation and as a virtual organization, it’s really hard to get them to take vacation. So if we did something like that, I think it’s, it would be pretty compelling.

CHIP 18:53
Absolutely. And those of you know, those are the kinds of creative solutions that you can, you know, really changed the company culture with wells. Yeah, instead of just being that, you know, the, the boring cookie cutter agency, you know, you’re able to have something that stands out and makes people more loyal to you, and more interested in coming to work for you, if they don’t already. So, and, and ultimately, that’s what compensation is about, it’s about attracting and retaining top talent. So, you know, whether that’s with something like profit sharing, or something, you know, a little more creative, or you can even mix the two, you know, you could take a percentage of your profits and say, Okay, we’re going to put this into our vacation matching fund. Yeah, you know, those, yes, you know, you can combine them in different ways, obviously, you want to be careful to make things too complicated, because, you know, then the employees may not understand might not understand the compensation, you might box yourself in our pack, you might even confuse yourself. And

GINI 19:46
that has been known to happen,

CHIP 19:48
I’ve seen some people come up with these, you know, really complex schemes, and, you know, they backfire because, you know, even management can’t necessarily figure out what the number is that supposed to go, right. And, and part of that is, you know, just making sure that if you put together a plan like this, that, that, you know, you sketch out, even if it’s just for yourself internal guidelines, with good specificity in advance, you know, what you plan to do, you may only share a subset of those with employees, just to make it simpler, but I think, you know, making sure that you’ve sort of, you know, run the traps, and you say, okay, you know, it’s going to be a percentage is going to be based on cash or accrual accounting, or whatever, it’s going to be, you know, factor in whatever caches in the bank, in addition to whatever we made on paper, you know, there’s a lot of different things you can put in there. But if you spell it out better in advance, you know, you’ll be better prepared for it. Yeah. And you’ll end up with better results. Because ultimately, that’s, that’s really what you’re trying to achieve here. You’re not just willy nilly giving away profits, I hope?

GINI 20:46
I hope not.

CHIP 20:48
That would be a very bad idea.

GINI 20:50
It’s a very bad idea. Please don’t do that.

CHIP 20:52
It’s if you do that, you will not be listening to this podcast for very long because no longer being your executive. So

you’ll have no need to listen to Jenny and me,

which would make us very sad.

GINI 21:08
It would make us very sad. So please don’t do that.

CHIP 21:11
No, you know, I think, you know, when we’re when we’re talking about profit sharing, I think that, you know, the other thing you have to think about is, you know, going back to my point of being the Debbie Downer, you know, what happens in the bad years, you know, what, what is your plan for that year where you you barely turn a profit or Egads. You know, on paper, perhaps you don’t even make one. And this is obviously situation as an agency, you generally don’t want to find yourself in. So you tend not to think about it. But, you know, that is something that you want to think about. Because there are lean years for all of us, there are always, you know, unexpected challenges that have come up from time to time, there may be investments that we make in, you know, new hires to pursue new lines of business to grow the business or what have you, and that may have an impact. So, you know, think about how those things might impact because you don’t want to end up with, you know, small pool that it’s almost embarrassing, right, you know, they say, okay, we’re going to put aside 10% of profits. And, you know, your total profits are $10,000 and dollars, right. Well, yeah,

I was trying to be generous and using them in there.

Yeah, I mean, can you imagine taking that and dividing that up over the employee base? You know, it’s $1

GINI 22:19
for you, $1 for you, everyone.

CHIP 22:24
Yeah, I would advise against that,

I would, I would tell you that that is more likely to breed animosity from your employees than anything else. So

Unknown 22:35
yeah, don’t go

CHIP 22:36
down the path. But, but seriously, you know, I think, you know, everybody gets excited about these kinds of ideas when times are good. And they don’t, right? Yeah, what’s, what’s the flip side of it, because you want to make sure that whatever kind of planning, you’re doing it, it works

in both cases. And, frankly, you also want to think about it in those cases where, holy cow, I made a mammoth process this year, right? You know, for whatever reason, you know, something abnormal happened, you know, do I really still want to give 10% of that away, because, you know, if it’s not sustainable, I may be better off taking that and reinvesting in the business to give Stanley for the future. So, you know, it’s, there’s, there’s, as with everything else, it depends, there’s no one size fits all you need to think very carefully, though, about how these different plans pay out. And the other thing that you want to think about when you have these plans is timing. And traditionally, these are tied to calendar years, although some agencies operate on tax years, that may not be calendar, so they may skew it for that reason, but and sometimes there’ll be a lag, you know, you may do it on the calendar year, but not give the bonus until, say, February or March or things like that. But, you know, one of the things that you have to keep in mind is whatever kind of bonus program you have, whether that’s profit sharing or discretionary, it tends to have the effect of causing a delay in resignations and a spike.

GINI 24:03
Yes. And I was going right. So yeah,

CHIP 24:06
people if they know that, okay, our bonuses always come in the second week of February, guess what, yeah, nobody’s going to resign in January, right. Nope. However, you may have a spate of people who resigned in the second half of February. So it can have a real impact on you know, your hiring plans. And you need to be thinking about that, particularly if you’re an agency of any size, right? I mean, if you’re, if you’re a very small shop, that it’s much less likely to have an impact, it might, but you know, typically, you know, you’re, you have a better finger on the pulse of your team, if you’re, you know, a 10 person or under agency than perhaps if you’re, you know, 3040, 5060 people. And, and those are the cases where you can all of a sudden just see a bunch of departures right after you hand out bonuses, or people whose heart really isn’t in it anymore. sticking around, which, yep, so you know, that there are, there’s not an easy way around that one, though, because, ultimately, you know, most agencies or other businesses will have a bonus season, you can, if you want, you can get around it by just doing bonuses throughout the year, you know, there are some businesses that will give you an annual bonus, but pay it out over, you know, a couple of payments so that that

changes the behavior, but ultimately, all that really does is just delays departures again. I mean, it’s, you know, so whatever program you have, if you’re, if you’re doing annualized compensation like that, in any fashion, you know, you’re going to have those

hills and troughs to go through. So keep that in mind when you’re setting up these plans.

GINI 25:41
Yeah, and I think, you know, spacing it out or doing it a different times of the year makes sense. Of course, a lot of people will do it, a lot of business owners will do it at the end of the year to get the cash off the books, but spacing it out is really smart from that perspective, especially if you’re, you know, there aren’t other things that you’re doing, like letting people work from home, you know, one day a week, or other types of incentives where they’re just, I mean, I think we’ve all we all have friends who are like, yep, I’m holding out and I get that bonus, and then I’m out of here.

CHIP 26:08
Oh, absolutely. I mean, I’ve had that conversation with any number of people

over the years, I best of my recollection, I don’t think I ever found myself in that situation for variety of reasons. But, you know, certainly it’s the kind of thing I would have kept in mind. if, if, if that’s, you know, be foolish not to, you know, I mean, if you’re, if you’re looking to leave, and it’s January, and you know, that the payments coming in three or four weeks? Well, shoot, yeah, yeah, particularly, if you’re in a place where the bonuses are fairly large, it certainly can be a motivator to stick around and, you know, so, I mean, you could do these on a quarterly basis, I think that adds frankly, more headache than it’s worth to have to manage such a program that frequently you know, but that would spread it out enough that that very few people would make departure decisions, you know, based on it but i

GINI 26:56
right and i think it’s just all good food for thought. I mean, figure out what makes sense for you and work that way

CHIP 27:03
it’s it’s all about planning thinking ahead and thinking about the good times and the bad and if you do that, you will end up with a good profit sharing or other incentive compensation scheme I mean, scheme in the most positive

GINI 27:16
in the nicest way possible. Right.

CHIP 27:19
Well, hopefully this has been a profitable conversation for our listeners we’ve we’ve shared I hope, some profits with them in some fashion that a little bit to torture, they’re probably

GINI 27:32
but profit profit. Anyway,

CHIP 27:36
on that note, do you have anything else to add?

GINI 27:39
No, I think that I, I mean, some really good food for thought even this a couple of things that we haven’t thought through. So yeah, I think

CHIP 27:46
it’s certainly, you know, got my brain thinking. And I’m sure that we had a bunch of things we haven’t touched on. So if any listeners have any feedback, or follow ups or anything like that, feel free to drop us a line. We’re always interested in the feedback and so that will bring us to the end of this episode of the agency leadership podcast. Once again, I’m Chip Griffin,

GINI 28:05
and I’m Ginny Dietrich

CHIP 28:06
and it depends

Should you provide a profit-sharing program to benefit your employees? If so, what should it look like? - These are the questions that Chip Griffin and Gini Dietrich explore on this week's episode of the Agency Leadership Podcast. Should you provide a profit-sharing program to benefit your employees? If so, what should it look like?<br /> <br /> These are the questions that Chip Griffin and Gini Dietrich explore on this week's episode of the Agency Leadership Podcast. Chip Griffin and Gini Dietrich clean 29:14
ALP 8: Running a virtual agency Wed, 28 Nov 2018 18:14:52 +0000 Chip Griffin and Gini Dietrich discuss the pros and cons of running a virtual PR or marketing agency, including how to overcome common obstacles. Chip Griffin and Gini Dietrich discuss the pros and cons of running a virtual PR or marketing agency, including how to overcome common obstacles. Chip Griffin and Gini Dietrich discuss the pros and cons of running a virtual PR or marketing agency, including how to overcome common obstacles. Chip Griffin and Gini Dietrich clean 29:42 ALP 7: The pros and cons of RFP’s for agencies Tue, 20 Nov 2018 16:45:38 +0000 In this episode, Chip Griffin and Gini Dietrich discuss the pros and cons of responding to RFP's as a way to win agency business. In this episode, Chip Griffin and Gini Dietrich discuss the pros and cons of responding to RFP's as a way to win agency business. In this episode, Chip Griffin and Gini Dietrich discuss the pros and cons of responding to RFP's as a way to win agency business. Chip Griffin and Gini Dietrich clean 24:37 ALP 6: The value of good legal and accounting advice for your agency Mon, 12 Nov 2018 16:07:43 +0000 In this week's episode, Chip Griffin and Gini Dietrich discuss how important it is to find -- and use -- a good lawyer and accountant to advise your agency. In this week's episode, Chip Griffin and Gini Dietrich discuss how important it is to find -- and use -- a good lawyer and accountant to advise your agency. In this week's episode, Chip Griffin and Gini Dietrich discuss how important it is to find -- and use -- a good lawyer and accountant to advise your agency. Chip Griffin and Gini Dietrich clean 25:27 ALP 5: What to do when agency revenue isn’t enough to make ends meet Mon, 05 Nov 2018 14:28:56 +0000 In this episode of the Agency Leadership Podcast, Chip Griffin and Gini Dietrich discuss what to do when the business revenue isn't enough to meet payroll or personal obligations. In this episode of the Agency Leadership Podcast, Chip Griffin and Gini Dietrich discuss what to do when the business revenue isn't enough to meet payroll or personal obligations. In this episode of the Agency Leadership Podcast, Chip Griffin and Gini Dietrich discuss what to do when the business revenue isn't enough to meet payroll or personal obligations. Chip Griffin and Gini Dietrich clean 26:22 ALP 4: How much revenue do you need per agency employee? Mon, 29 Oct 2018 15:14:19 +0000 This week Chip Griffin and Gini Dietrich discuss how you can figure out how much revenue your agency should have in order to support hiring a new employee -- whether it is your 1st or your 101st. This week Chip Griffin and Gini Dietrich discuss how you can figure out how much revenue your agency should have in order to support hiring a new employee -- whether it is your 1st or your 101st. This week Chip Griffin and Gini Dietrich discuss how you can figure out how much revenue your agency should have in order to support hiring a new employee -- whether it is your 1st or your 101st. Chip Griffin and Gini Dietrich clean 26:58 ALP 3: Finding focus for your agency Mon, 22 Oct 2018 14:00:03 +0000 In this week's podcast, Chip Griffin and Gini Dietrich discuss why your agency should have a focus and how it will make you more successful. In this week's podcast, Chip Griffin and Gini Dietrich discuss why your agency should have a focus and how it will make you more successful. In this week's podcast, Chip Griffin and Gini Dietrich discuss why your agency should have a focus and how it will make you more successful. Chip Griffin and Gini Dietrich clean 25:20 ALP 2: Why you need to work ON your agency business, not just IN it Mon, 15 Oct 2018 14:44:57 +0000 In this week's episode of the Agency Leadership Podcast, Chip Griffin and Gini Dietrich discuss the difference between working in and working on your agency -- and why it is so important. In this week's episode of the Agency Leadership Podcast, Chip Griffin and Gini Dietrich discuss the difference between working in and working on your agency -- and why it is so important. In this week's episode of the Agency Leadership Podcast, Chip Griffin and Gini Dietrich discuss the difference between working in and working on your agency -- and why it is so important. Chip Griffin and Gini Dietrich clean 27:54 ALP 1: Starting your own agency Mon, 08 Oct 2018 12:50:47 +0000 In the debut episode of the Agency Leadership Podcast, co-hosts Chip Griffin and Gini Dietrich discuss some of the things that new and prospective agency owners should be thinking about. In the debut episode of the Agency Leadership Podcast, co-hosts Chip Griffin and Gini Dietrich discuss some of the things that new and prospective agency owners should be thinking about. In the debut episode of the Agency Leadership Podcast, co-hosts Chip Griffin and Gini Dietrich discuss some of the things that new and prospective agency owners should be thinking about. Chip Griffin and Gini Dietrich clean 26:11