This post is by Darren Woolley, Founder of TrinityP3. With his background as analytical scientist and creative problem solver, Darren brings unique insights and learnings to the marketing process. He is considered a global thought leader on agency remuneration, search and selection and relationship optimisation.
“Great client / agency relationships deliver great performance”
You hear this said all the time by agencies, consultants and advertisers. It is like a mantra. But when there are millions and even billions of dollars at stake, is it a mantra that needs to be examined in more detail, rather than simply taking it at face value?
Superficially it makes sense that in a business relationship that is influenced so heavily by the interaction between the stakeholders involved in developing strategies, concepts and executions, the better the relationship the better the performance and outcomes of those relationships.
Before I go any further, let me declare that at TrinityP3 we have developed a relationship performance measuring system called Evalu8ing. This system is used to not just measure client / agency relationships, it is designed to measure the performance of the multiple relationships clients have with their roster of agencies including the levels or co-operation, co-ordination, collaboration and trust.
But we have had experience working with clients who have been using one of the major systems available, with varying success. That’s the point, if great relationships were the key to great performance then why aren’t all advertisers using these various relationship systems achieving great performance?
How do you manage a client / agency relationship?
In the past we have reviewed the major relationship measurement systems. Basically the industry models breakdown into the following types:
1. Client score card
Where the client scores the agency against key performance indicators
2. The two way score card
Where the client scores the agency and the agency scores the client against separate key performance indicators.
3. The Gap analysis
Possibly the most common of the structured systems where the client scores the agency and the agency scores themselves against key performance indicators. Sometimes also reversed to have the agency score the client and the client score themselves against separate key performance indicators.
4. Relationship survey
Where client and agency score each other against a common set of key relationship performance indicators
There are literally hundreds of systems and a Google search of the topic yields millions of references to client / agency relationship performance systems.
Many of these are more sophisticated than the simple ‘Client Score Card” and more expensive. But with so many systems and methodologies available do they actually deliver great relationships and ultimately the great performance they promise.
How do you define great relationships?
Before we discuss performance, lets first focus on what is a great relationship. There are any number of perspectives that can be applied, but when you look at many of the criteria and questions asked the focus appears to be about measuring how well the agency delivers to expectation on a number of service criteria eg. Creativity, Strategy, Media etc.
Some go a step further to measure the gap in the perception of these criteria. But few go to the underlying requirements of great relationships such as trust, open and honest communication, alignment of objectives, shared values and the like.
It is as if the criteria of the standard Service Level Agreement (SLA) have been placed into a survey or score card and considered effective in developing and managing a great working relationship between two or more groups of professionals.
This would be fine if the relationship between the client and agency was one of a buyer and supplier. Where the client places the order and the agency delivers. But it fails to acknowledge the interaction and interdependence of the actions of the two parties in the output delivery.
It could be that some client’s simply believe that having the agency meet their expectations is a sign of a great relationship. One where there is no tension as the agency knows and understands what is expected of them and delivers to this expectation. After all, isn’t that what the agency is contracted to do?
The other view is that a relationship built on respect and trust would encourage both parties to challenge each other to achieve greater outputs and greater performance. A compliant agency that simply delivers to the client’s expectations will produce a comfortable relationship, but not necessarily a high performing one.
Just like the grit that irritates the oyster, it is from this irritation that pearls are created.
What is the definition of great performance?
That may be some client’s measure of a great relationship, but does it lead to great performance? Well how do you measure performance?
As the purpose of the agencies’ involvement is to deliver specific needs of the marketing communications plan, and that plan should have specific and measurable objectives against it, then isn’t the measure or performance the effectiveness of the delivery of those needs?
As those needs are developed and delivered by working together, collaboratively or interdependently with the marketers, then the efficacy of the outputs or delivery of those needs falls on both parties and their ability to work together effectively.
We regularly encourage marketers to align their agencies to common goals or objectives and to incentivise the agencies on their contribution to those objectives. But it is equally important that the marketing team is also aligned to the performance and delivery of the same goals and objectives so that the whole team, client and agency, are working together and not against each other.
Perhaps then the relationship measurement should not simply score the agency on their ability to do their job to the expectation of the client, but should be measured in the context of the performances delivered and measures the ability of the agency and the client team to work together in delivering this performance.
This would require criteria beyond capability to measure:
- Open and honest communication
- Cultural and value alignment
- Collaboration and trust
- Strategic and Implementation Performance
These are very different measures to the criteria you would find in a SLA between a buyer and supplier and would more closely reflect the co-creation and collaboration that exists between advertiser and agency in high performing relationships.
Is it just expectation management?
If an agency is delivering to expectation is that a great relationship? It could be considered a good relationship because it is easy and trouble free. But great relationships go beyond good and achieve great performance beyond expectations.
The limitation of expectation is it is only as good as the client expects. Plus it is the expectation the client has of the agency. Interestingly it is rare to see or hear a measure of the agency’s expectation of the client on the same criteria.
Also, if the client expects more of the agency could the limitation be the clients themselves? As the relationship is an interdependent one, could it be that the issue is how the two work together rather then simply the agency alone? How can the agency fix the client?
It is one of the issues I have with the gap analysis approach. If there is a gap in the expectation of the client of the agency and the agency of themselves, isn’t it easier for all concerned to simply lower their expectations to close the gap?
After all, if the client expects less of the agency they will score them higher next time around. And if the agency lowers their perception of their performance it will be more aligned to the clients perception of the agencies delivery.
Is feedback enough or do you need more?
Often we hear from clients who have had a scorecard or relationship management process in place and feel that nothing ever actually changes. This is usually because they are expecting the process to make the changes. But these processes are simply a feedback loop to the participants in the relationship.
Change, and more importantly improvement, requires those involved taking this feedback and agreeing the issues. They need to prioritise the issues and to agree those that can be dealt with and those issues that are intractable.
Then they need to agree the changes that need to be undertaken on both sides and by both sides. These changes need to be specific in nature, measurable in outcome and the parties should be held responsible to the delivery.
It may seem like common sense, but without the discipline to implement these steps, the measurement process, no matter how simple or complex will not make the changes. Just as a blood test will not cure an illness.
Without the therapy you are destined to insanity, to paraphrase Albert Einstein, by doing the same thing over and over again and expecting a different outcome.
Only by using the outcomes of any relationship measuring system to diagnose, develop and implement the therapy required is improvement possible. And not just on an annual basis but a more regular basis to ensure consistent improvement in performance from good to great and beyond the expectations of all involved.
The ultimate measure is actually performance
The smart approach to relationship management is to work towards developing high performance teams. Last year I recorded a podcast conversation with industry veteran, Cam Carter at Navigare, where we discussed the concept of high performance teams and how to achieve them. You can listen to and read a transcript of the podcast here.
TrinityP3’s Relationship Performance Evaluation service measures collaboration and alignment between marketing team agencies, offering insight and recommendation to maximise your collaborative output.
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