The sheer magnitude of the health and economic challenge facing every agency leader right now can be a bit overwhelming. The solution is to take it all in manageable chunks instead of solving every problem all at once.
In this episode, Chip and Gini review some of the things that every agency leader should be thinking about and doing in the near-term.
The following is a computer-generated transcript. Please listen to the audio to confirm accuracy.
CHIP: Hello, and welcome to another episode of the Agency Leadership Podcast. I’m Chip Griffin,
GINI: and I’m Gini Dietrich,
CHIP: and we’re here today to talk to you about next steps. What should you be thinking about after the current lockdown house arrest, whatever you want to call it, it’s called and look ahead to better times in the future and how you can prepare yourself for that now. Yeah, I think it’s it’s challenging right now, because everybody’s trying to figure out how to maintain optimism, especially when their teams are freaking out, which is understandable. Because you’re probably freaking out too. So trying to maintain that optimism and positivity is, is a real challenge right now. But I also think we do need to be thinking about, you know, six months from now, what does this look like? We’re hearing in Chicago, that is probably going to be July before we can leave our homes. That’s a really long time. That’s four months that will be shelter in place. And so maintaining some sort of optimism and positivity and being able to look forward is challenging right now. But I think as leaders, it’s something we need we need to have on the forefront of our brains. Yeah. And I think, you know, I mean, obviously, we’re continuing to deal with the uncertainty over when things will turn around and and what, what that will look like. Sure. I think July is likely for a lot of folks, but I think I think we’re on the as we record this year on April 10. I think that in the next week or so, we’re going to see increasing pressure to at least loosen some of the restrictions as early as May one. And so then, you know, that may put some agencies in the position where they need to think about, you know, how are they going to react, you know, if they’re, if their jurisdiction or the jurisdiction where their employees are, loosen the restrictions? Are you going to, you know, loosen your own restrictions, you’re going to keep some in place. You know, I think folks also need to be thinking about when people do return to the office, whether that should make July September whenever right right what what kind of policies are you going to put in Place? Are you going to be taking temperatures of employees when they come in the door? Are you going to be making everybody wear a mask in the office, even if your local jurisdiction isn’t requiring it? There’s, there’s a lot of those logistical things there. It’s worth thinking about now. It’s worth having conversations with your professional advisors about to see what is permissible and not. And I think we’re, frankly, we’re an environment that’s a little bit more permissive now, overall, but you know, I mean, six months ago, if you if you came to me and said, you know, is it okay to ask my employees if they’ve got a fever? Or if they’ve been sick recently? I would say Hell no,
GINI: right. Yeah.
CHIP: Do not ask if they’ve had COVID-19. Because you don’t want to know that. But now, we’re in an environment where I think, you know, the government’s going to be encouraging, if not requiring employers to ask a lot of those questions. But you still want to make sure that you’ve cleared that with your own professional advisors to make sure that it’s permissible under the rules that you’re living under.
GINI: I think one of the things that That’s going to be a real challenge is, as of this recording five states, I think, have said that the kids won’t go back to school the school year. So even if your jurisdiction has loosened up and you can reopen the office, what do you do with your working parents who still have kids at home? And that’s very top of mind for me right now. You know, now they’re saying there might even be summer camps. So what do you do? I mean, that’s what these are, these are real challenges that we’re going to have to think through and have a plan for. And also, I’m really sensitive to the fact that non working parents are not people who don’t have who don’t have children don’t think it’s fair that working parents get certain breaks that they don’t get and so you had I’m I’m super sensitive to that. So you have to think through those things, too. Like you can’t, you can’t say well, you don’t have kids, do you have to come to the office and those who do have kids don’t have to you can’t do that. That’s that. So you have to think about balance and fairness and all those kinds of things at the same at the same time.
CHIP: Right. And I think you know, It is important, you’ve got to deal with the here. And now you’ve got to deal with the challenge that you have today. But it is worth taking some time to devote some brainpower to thinking about these decisions that you have to make so that when they pop up, you’ve already given the thought you’re not scrambling to say, Oh, my God, they just said, you know, we can open up next week, you know, what do we do now? What are right, right? So, you know, you want to be thinking those things through you want to be thinking through, you know, are you going to do extra cleaning? Do you, you know, some agencies that are small, do their own cleaning? Do you want to have someone come in and professionally do it so that you’ve got a little bit more, you know, professional sanitizing, if you will? Is that even going to be possible? Because you know, that that’s, that’s probably a business if you’re not in it’s worth getting into right now. Because I think there’s gonna be a lot more professional cleaning going on than in the past. But you know, so think about those things now so that you are prepared and, you know, the biggest thing you obviously have to think about is your team and what are you going to do with your team and a lot of folks will A lot of agencies that I know are hanging on to a lot of staff right now. And they’re hanging on because the government here in the US as well as other countries is strongly encouraging them to keep staff on. And they’re in fact providing stimulus money in the form of the paycheck Protection Program. Sort of Yes, that’s right. Yeah.
GINI: They say it’s available,
CHIP: correct. Yes. There there is theoretically a program out theoretically. And but but but businesses agencies are making decisions based on the assumption that it is there, right. Yeah, for sure. So so I know a lot of agencies are hanging on to staff that is right now underutilized. Yep. Because it’s getting paid for and and if you let the staff go, then you get turns into a loan and you you don’t get forgiveness for it. So you know, and people don’t want to be saddled with the debt out of this, which is correct. You don’t want to know. So you need to be thinking about, you know, what are the steps you take, and I’ve been encouraging people, and I think I may have said this on a previous episode, you need to look at this government funding as a runway to give people the the time to make their own personal decisions, but you need to let them know if you’re not going to need them in two months time when the money runs out, let them know now don’t Yeah, don’t don’t wait treated as garden leave treated as severance I, you know, keep on the bugs for government purposes. And so they’re still getting their their pay. But, you know, let them know that when this is the spigot is turned off, you know, it hurts you, but you’re gonna have to part company because you don’t want to be in a situation where the government funding runs out. And then you’re laying people off because that means you’re then either doing it with no severance, or you know, or you’re having to dig deeper for it. And so use this, use any government funding that you get or private funding or whatever as runway to implement change, not as a way to put off making those decisions.
GINI: The other thing I will add is you also do need to be thinking about traveling to clients. So if if the state of Illinois for instance, loosens and New Hampshire doesn’t, you know, what does that look like if you’re a client of ours, you know, or New Hampshire does, but we don’t. And you’re like, we need you here for the strategy meeting, but I can’t leave. You know, there’s so you have to understand as well, not just what’s going on in your state in your city, but what’s happening for your clients, too, because that’s going to affect and then at the same time, here, we’ve been having this conversation among friends on Facebook, but it’s, do you feel are you going to feel comfortable getting on a plane immediately? I don’t think I am. Are you going to feel comfortable being in a crowded restaurant? Are you going to feel comfortable being in a hotel? And and if you’re not, then you can’t ask your team to do those things, either. So those are some of those things you have to be thinking through that as well.
CHIP: Right. And, and I think, you know, as you’re, you’re thinking about these things, it’s always better to be to err on the side of caution, at least in the near term. And so, you know, it’s it’s sort of like when a new software release came out in the old days, folks will would tend not to upgrade? Yeah, you’re right. When you’re kind of you’ve kind of wait, let someone else be the guinea pig and see, okay, is this gonna fail on their system? And and if so, you know, then then you don’t install it. Or you, you it may be worth taking a similar approach here and you know, letting other folks go first. You know, and I think that you made a great point about understanding your client’s situation, not just your own jurisdiction. It not only affects things like travel, but obviously it affects how your clients are working and the decisions that they’re going to make going forward. You know, I think anybody who thinks that the money that’s been put on pause is coming back anytime soon. That is kidding themselves. It’s not it’s not I agree. Yeah. The, you know, I think you have to assume that any money that’s put on pause at this point is actually gone. You can win it back at some point, but you are gonna have to win it back. So, you know, that doesn’t mean that everything’s doom and gloom. You know, we’ve talked in previous episodes that there is opportunity out there. So, you know, some of looking ahead to the future is not just the mundane things about reopening, but you know, thinking about how you’re going to make those adaptations we’ve talked about to your positioning, to your messaging to your tactics in order to try to start winning business again. And so you want to dedicate some of your time to that kind of looking to the future. And some of that will be nearer term. Some of that will be longer term. You know, but you do want to be thinking about that as well.
GINI: Yeah. And we’ve also talked about, you know, online types of things. How can you package your intellectual property and it’s not passive, but provide income that doesn’t require you and your team to execute the work and this is, I can’t I keep seeing the hustle meme, go around. And it’s like, if you if you don’t come out of this with new ideas, new revenue, blah, blah, blah. Like, I’m gonna be the first one to admit that. There’s no extra time right now. If my kid wasn’t home from school, I would have extra time right now, but there’s no extra people don’t have have extra time right now. So I’m not suggesting that you create something out of your intellectual property right now. But we’ve been talking about this for several months, it is something you should have, at least in the priority list for coming out of this. How do we create income that other types of income that isn’t reliant on clients and as we’re coming out of this and kids do go back to school, and you you haven’t gotten that you haven’t gotten that income back, even though it’s been paused and not terminated? That will be a good time to start to, to execute for free some of this new stuff.
CHIP: Right? Well, and I think that you need to you do need to rethink your service offerings and look at them in terms of, you know, how can you make things less risky for clients more bite size, right, probably in the near term, more project oriented the retainer based and you know, because there are, you know, folks are going to start dipping their toes back into the water. sooner rather than later, frankly. And if you’re able to help the people who just want to dip their toes and you don’t turn your nose up at those toes, you know, you’re going to be in a better position than some who will, you know, hold fast to their, you know, existing way of doing things. And in fact, this is something I’m seeing a lot of discussion areas, right now, agencies as well as other businesses and folks talking about, you know, not reducing rates or discounting or those kinds of things. And I think, honestly, that’s, that’s, it is too, you know, you need you need to be careful, you don’t want to get to a place where you are devaluing your your time and you are compensating yourself less than you need to in order to, to, you know, to be a productive member of society, but at the same time, you got to be realistic here, budgets are going to be smaller out of this. This is not a small economic hit. This is a big economic hit. And if you say, you know, look, I am I’m going to continue to be a $500 an hour person, a 500. thousand dollar a month minimum, whatever it is, that’s nice. But you’ve, you’ve got a much smaller pool of potential clients now than you even had before. And there’s also a lot more competitors. I think I’ve said it, I’ve seen some of the webinars I’ve been doing, but you know, there’s supply and demand here, folks. Yep. And there gonna be a lot more people. And so you know, price pressure is higher, you know, and the way to get around that is not necessarily by just by straight up reducing your rates, but it’s finding some of these simpler projects to do that you can do at a smaller fee or breaking large projects up into small manageable chunks. There are ways to do this so that you’re not undervaluing your your time and your services but still de risking it for clients. So you know, spend time now, thinking about what those are planning them, test them and talk to some people about them. Talk to your team, get your team to be brainstorming on this you’ve got chances are, you know, unless you are in one of those handful of industries that is booming right now. You’ve got excess time on your staff. Try to take it down Have that to get them to be thinking in their non client time about, you know, what, what are their ideas? What do they think that you should be doing? What are you know, and you should do this at all times anyway, it’s just it’s a good practice to get your team engaged. But right now, they’ll be even more motivated to help you figure out what that path forward is for your agency business.
GINI: And I think to that, you know, thinking through so I’ll give a really good example, I have a client who’s spending money right now, and that we need some marketing things done that my agency doesn’t provide. And so I’ve put a couple of projects out to bid and it’s been fascinating to watch to see how how people are responding. Some people have been like, yeah, this isn’t worth my time to go to bed. And I’m like, okay, so 20 it’s $20,000 cash, you could have been all right. And other people have said, Hey, listen, if you buy a package of these five things, and you pay for it up front, we’ll we’ll throw in this other stuff for you. And so we did we paid $20,000 upfront. So that agency owner got $20,000 in cash this month that they didn’t have before. The other one got zero and it just it, you know, we weren’t, we weren’t saying you have to do it for less or anything like that. We were saying, we have this budget, what can you do for that? And they told us it was not worth getting out of bed for No, it’s like, Okay, well, I would take $20,000 right now, so. So be thinking about those kinds of things. You know, can you get cash in the door fast, you know, by providing a discount or adding in a new, you know, onto the project or things like that. There are things you can do to get the cash in the door because that is the most important thing right now. cash, cash, cash, cash, cash.
CHIP: Yeah, look, I think that it’s, you know, I think anybody who says things like it’s not worth my time getting. I mean, I think that’s short sighted in the best of time. short sighted, it is certainly short sighted right now. I do see some of that thinking, and look at Everybody’s in a different circumstance, you know, there are some people who are in a position where they can ride this out for, you know, six or 12 months and they don’t really care. That’s very few people. Most people can’t take that big hit for that long and unfortunate a lot of people are going to take something close to that kind of hit for that long right now. You know, I think that it is things are likely to get worse still, before they get better for most agencies. I think so too. I think that there are you likely have some clients that look like they’re doing okay, right now who are still likely to pull back on budgets. You know, I still do some legacy consulting work myself and I have a client who’s doing absolutely fine financially and there’s no prospects that they’re going to have serious issues, but they’ve had to pull back just out of caution. Not had to, but they just decided to pull back right. And I mean, in there and some of the agencies that I work with are are in the same boat. You know, I’ve put projects on hold, not because the agency themselves aren’t still in a strong position just by taking some revenue losses but because they’re being extra cautious and great, everybody needs to exhibit that extra caution like now so that you’re in a position that if it does get worse, you know you’re you can start to handle it so you need to sort of think through those things. You should be looking at your you know, your your budget for the year, I think you should throw out any budget that you’ve had for the year. Yeah, there’s really no point yes, editing the one that you
GINI: finally did that. I was like, Alright, I’m just throwing this out.
CHIP: Oh, chuck it overboard. Now, I mean, first of all, it’s depressing to look at that point in most cases, but beyond that, it’s just it’s not useful. It’s it’s a faster better exercise to start from scratch because not only has your baseline numbers change, you’ve got fewer clients your cost basis different, but the circumstances the the forecast is different. So start start from scratch. Take some time to build a new budget based on what you know today. You’re probably still going to have to update it because there is still so much uncertainty. But I think that, you know, one of the challenges that a lot of agency owners a lot of people just generally have right now is that they have not necessarily unused time, but idle brain time. And they allow their minds to go to bad places because of it. Yes. So I think that to the extent that you can, yes, you can try to swap up some of that negative energy by trying to figure out your plan for the future. I think that’s, that will help you psychologically, it’s difficult to get into it because you’re like, Oh, I don’t, I don’t really think about what things are going to look like, you know, August or October or wait, because we just don’t know and it could be really, really bad still. But you need to start thinking about that because it will at least give you you know, some some greater level of control over your brain, if not the actual circumstances.
GINI: Yeah, I totally agree. And It’s It is hard. I mean, I remember at the beginning of this when Italy went on on lockdown, and there are people in our in the Spin Sucks community who are from Europe and one, one guy from Italy, he lives in Rome said, your cognitive energy is going to be taxed. And I remember him saying that and thinking interesting. That’s interesting. And he’s right, your cognitive energy is taxed, and so and it takes twice as long to do anything. So trying to to be proactive and think through these things is challenging. You know, I keep saying that. This is really hard because one day is great, and the next day completely sucks. And there’s no real rhyme or reason to it, except that the day ends and the letter Y there’s literally no rhyme or reason to it. So when you have those good days, you know, jot things down in a notebook and you know, highlight things that you’re reading or paying attention to or bookmark or you know, whatever, whatever your process is. do that so that when you are having those down days because you will and you do it It helps to propel you into the future a little bit better.
CHIP: Yeah, and look at me, your team members are having those same kinds of days. And so you need to understand and appreciate that and, you know, as a leader, it’s your job to keep them informed, but also keep them motivated. Yeah. And so, you know, trying to find the right balance between, you know, sharing with them, you know, the potential bad things that are on the horizon so that they’re not surprised by them. But also, you know, working with them to help give them hope by by involving them in that planning process by starting to think through, you know, what does that future look like? Because you really, if you wait until things start to get better before you start making plans, you’re, you’re going to be much slower to take advantage of what’s out there. Sure. And so, you know, you need to be thinking you need to be talking with your team and see, okay, you know, they’re probably reading different news sources than you are they’ve got a different outlook on the world, you know, talk to them and say, okay, you know, what do you think about travel, you know, when, when when things are loosened up? Are you going to be? You know, one of those folks who says, Yeah, look, I’m just so I need to get out there. I need to go out to eat, I need to go get on an airplane or stay in a hotel or whatever, take a cruise. If they say take your cruise, probably want to be right. start questioning their judgment a little bit. Sorry, to my friends in the cruise industry, but never been a cruiser. But anyway, uh, you know, I think that you want to try to tap into that combined brainpower to try to come up with your own predictions about what the future looks like, what is it? You know, look at your industry, you all probably have some expertise in certain industries that you serve, try to guess what’s going to happen to them, you know, are they going to be fast to come back out of this? Are they going to be slow, you know, immerse yourself in the business side of your industries in a way that you may not have done before in order to try to help figure out what that path forward is, you know, you need to think about that. Like events, you know, I’ve talked to a number of agencies, because most agencies have some degree of involvement with events, you know, they either put them on or they attend them or sponsor them or those kinds of things. So, you know, very few people are untouched by the challenges that the event injures industry is facing. But you know, my own personal view is I don’t think there are likely to be any large in person events for the rest of this calendar year.
GINI: Oh, no, I don’t think so either.
CHIP: Yeah, I think and I know, a lot of folks are still planning on them for the fall. I think you need to take a real long, hard look at that. Yeah. Because I think that even once some of these social distancing regulations are eased, you know, I don’t think we’re likely to go back to 50 plus person events anytime soon. Yeah. And so I think that it is it is prudent to start thinking about how do you address that in the future? Now, instead of again, you know, wait, you know, saying, well, we’ll just you know, we’re just going to postpone this to the fall. Or we’re just gonna you know, we’ll if we have to, we’ll do it as a virtual event or something like that. You need to start thinking Much more creatively about how you’re going to handle events. And you also have to deal with, are your staff going to go to events with you know, will they be comfortable even if it doesn’t involve travel? Right now going back to the that question of people feeling safe, are they going to feel safe going to that event, because you don’t want to be in a position where you don’t have folks who will show up? I mean, that’s one of the problems they’re having, I guess, now in some nursing homes, that staff are just refusing to show up, because those are becoming, you know, such a hotbed for the virus, you know, so you have to deal with the fact that no matter you know, yes, people are concerned about their jobs, they want to do their jobs well, but at some point, personal fear can override that. Sure. And so, you know, you need to start understanding how your team is viewing those things. And don’t assume that their view is the same as yours, whether you tend to skew towards the more afraid or the more, you know, tech with I’m doing whatever I want end of the spectrum.
GINI: Yeah. And I think the moral of the story is, start to think about it and be prepared. You don’t want To come out of this looking desperate, so have a plan. And things are not going to be okay. In the short term, but in the long term they will be.
CHIP: Yeah. And I think I think it is that that short and long term those are the two things that you need to be planning for you need to plan for when things start to ease but then also when things start to truly improve economically. And those are those are not things you want to wait for. Those are things you want to dig into right here right now. And it will be beneficial to your business, but I think it’ll also be beneficial to you psychologically, even though I am not, in addition to I’m not being a lawyer and accountant. I am also not a not a shrink. I’m not a therapist, a psychologist. I didn’t even take a psychology class, ever in my life. So take that with a grain of salt, but I can tell you that I feel better when I start planning for the future. So for sure,
GINI: for sure.
CHIP: And if not, I’ll refund all the money you paid to listen to this episode. Oh boy, you And on that note, we will draw this episode to a close and I’m Chip Griffin.
GINI: I’m Gini Dietrich,
CHIP: and it really really, really depends