This post is by Michael Farmer, Chairman of TrinityP3 USA and author of Madison Avenue Manslaughter: an inside view of fee-cutting clients, profit-hungry owners and declining ad agencies, which won the Axiom Gold Business Book Award for the best marketing / advertising book of 2016.
Account managers were giants of accountability during the Mad Men era, when agencies were paid by media commissions and it was important to convince client executives, up and down the line, that high media spending was good for brands.
Everyone benefited from this. TV advertising was effective, so clients and brands benefited from this account management salesmanship. TV advertising unleashed the agency’s creative capabilities and allowed creatives to flourish and do their best work.
Senior account people sold the agency’s creative ideas to their clients, acting as intermediaries (for better or worse), solidifying account executives’ credibility in the eyes of their clients. Although there were plenty of turf wars between the “suits” and the “creatives,” the overall process assured a high degree of unity, purpose and intimacy with clients.
Finally, and not insignificantly, agencies made a lot of money — much more than they earn today.
How different it is nowadays! After the shift to fee-based remuneration, account management lost its media sales role, and with it credibility for advising on the health of brands. Social and digital innovations provided a coup de grâce — account managers were as confused about media choices as their clients.
Subsequent years of fee-bashing, agency downsizings and juniorisations demolished account management departments. The hiring of strategic planners and project managers took away key responsibilities, leaving account managers as notetakers, responsible for doing what clients asked.
Account managers no longer had pro-active responsibilities to plan and sell-in Scopes of Work, since clients assumed these responsibilities. Clients (and agencies) ceased using account managers as gatekeepers for creative work; creatives worked directly with clients.
Where does this leave account managers today? What are their roles and responsibilities? Defining their jobs falls squarely in the laps of agency CEOs. What do CEOs expect from account managers? Helping clients achieve improved brand performance? Negotiating fair fees for existing SOWs? Winning growing fees for growing SOWs? Eliminating out-of-scope work? Restoring AOR status? Safeguarding relationships from competitors’ incursions? Achieving longevity of relationships? Retaining, rather than losing their clients? Meeting defined profit targets? Keeping clients happy?
Agency CEOs think, but do not say, “We expect them to do all these things. That’s what their job is.” According to former Saatchi & Saatchi CEO Kevin Roberts, “a creative agency needs to operate … like an ant colony, where every ant knows its job and has the freedom to do it.” The account management ants, though, are not trained for their freedoms. Unlike ants, they are not genetically coded. Their performance is not measured or reviewed. In any case, there are no usual metrics to measure their performance, and as we’ve all heard, you can’t manage what you don’t measure.
Scopes of Work are a good example. Account heads and their teams generally know what their Scopes of Work are for a year, but no one above them has the same knowledge. There are no agency systems to document and measure Scopes of Work. Account heads are expected to use whatever system their clients use, whether it be Excel, PowerPoint, Decideware, Word, emails, texts, phone calls or cocktail napkins.
Managing Scopes of Work goes with the account management job, like ant leaf-cutting, food foraging and larvae feeding, but it is not a management priority within an agency to know what the SOWs are or whether they are aligned with fees and assigned headcounts.
How can account managers be accountable for the health of their relationships when no one above has the slightest idea about what work they are doing – or even whether it is the right work to improve client brands?
Agencies create, develop and produce deliverables in the tens of thousands each year. Departments crank out massive numbers of strategic studies, creative deliverables, produced pieces, published content and “work.” None of this is measured or diagnosed. Account managers are isolated and stuck with a huge unmeasured responsibility. They are not mobilized by management to improve fees or operations. They are left alone to sort things out as best they can.
In subscribing to a philosophy of anthill management, agency CEOs abdicate important managerial responsibilities.
The manager [should] establish targets and yardsticks — and few factors are as important to the performance of the organization and of every person in it. He or she sees to it that each person has measurements available that are focused on the performance of the whole organization and that, at the same time, focus on the work of the individual. The manager analyzes, appraises and interprets performance. As in all areas of this work, he or she communicates the meaning of the measurements and their findings to subordinates, superiors and colleagues. — Management, Revised Edition, Peter Drucker, 2009
Agencies will not pull out of their current remuneration nightmare until account managers are held accountable and measured for the alignment of SOWs, fees and agency resources. To do this will require new disciplines, like the documentation of SOWs, the use of new metrics that measure SOW health and sophisticated client negotiations that are the outcomes of agency group problem-solving.
Agencies are not anthills, and account managers should not be isolated as they are today. It’s never too late to begin putting accountability back in account management. The first step, though, must be taken by agency CEOs.
Cartoon credit: Leo Cullum, The New Yorker, The Cartoon Bank. With permission.
This post was first published at Media Village
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