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Managing Marketing: Artificial Intelligence Improving Agency Productivity

Shane_and_James

Managing Marketing is a podcast hosted by TrinityP3 Founder and Global CEO, Darren Woolley. Each podcast is a conversation with a thought-leader, professional or practitioner of marketing and communications on the issues, insights and opportunities in the marketing management category. Ideal for marketers, advertisers, media and commercial communications professionals.

James Zipeure is Group Chief Operating Officer (right) and Shane Mitchell is the Chief Product and Transformation Officer (left) at Exact A.I., an artificial intelligence platform.  Exact A.I. is designed to connect the many diverse technology platforms media and marketing agencies work with to automate the low-value work, allowing people more time to invest in generating value for their clients and the agency. In a world of increasing technology-driven complexity, they are providing a technology solution to help advertisers and their agencies focus more on what drives value.

You can listen to the podcast here:

Follow Managing Marketing on Soundcloud, Google Podcasts, TuneInStitcher, Spotify and Apple Podcast.

Transcription:

Darren:

Welcome to Managing Marketing, a weekly podcast where we discuss the issues and opportunities facing marketing, media and advertising, with industry thought leaders and practitioners.

Today, I’m sitting down with James Zipeure, Group Chief Operating Officer at Exact A.I. Welcome James.

James:

Thank you., Darren. Nice to be here.

Darren:

And also, joining us is Shane Mitchell, Chief Product and Transformation Officer at Exact A.I. Welcome Shane.

James:

Thank you, Darren. Glad to be here as well.

Darren:

Well look, Exact A.I, exactly what is Exact A.I? I think that’s a good place to start, don’t you?

James:

It is. So, what Exact A.I. is depends who you speak to. Because obviously there are different answers for different people in different roles. But to simplify it, we take lots and lots of complex and admin [advertising] tasks that people in agencies, brands, and suppliers do, and we automate them with a SaaS system.

So, we make sure that we can take away all of the time that’s used through “value-capture or admin roles, and this leaves more time for productivity. So, as we call it, we “take the robot out of the human”.

Darren:

Okay, interesting. So, this is not about creating an AI to replace media and creative agencies or agencies generally. It’s more about making them more efficient and productive?

Shane:

Well, I think there’s been a lot that’s been spoken about the role of AI within agencies. A lot to do with the creative output, the variety and the role of data in producing that content. But that’s not our focus. Our focus is about the types of work that people do in agencies and in marketing departments that don’t really add any value.

So, a simple way of describing it is:, the things that add value, the new ideas that brands can use to grow or new ideas that media agencies can use to be more effective. They involve a lot of thinking, creating, synthesising, strategising, communicating, testing – those sorts of tasks add a lot of value.

The tasks that don’t add value are the things that involve matching, checking, reporting, looking, finding, copying, pasting, all of that. So our software works with people’s existing platforms and software to get rid of those tasks and free people up to do more interesting things.

Darren:

So that’s interesting because you hear all the time in the advertising industry, how hard it is and the long hours people work. I mean, it’s not unheard of for people to claim they work 60 hours or more a week. So, what you’re saying is that there’s actually a lot of opportunities in there to sort of speed up that process and give people more time.

James:

So, I think there’s two issues that arise within the industry itself. So firstly, it’s become more complex. I think from a “front facing” towards the marketplace perspective, we’ve been really good at innovation. So, lots of DSPs, lots of trading technology that helps us do lots and lots of really good stuff.

The problem is, that’s made admin a lot harder. So, the hours that it takes to facilitate that admin has started to increase.

Secondly, the added admin comes with a lot of wasted time. So, people waiting for reports to run, people hanging around to try and get those reports while speaking to their managers.

We’re currently working with a business in the UK and every morning they spend two hours downloading reports. So that’s 20% of their whole day that is spent literally watching a wheel go round on media data systems that they have to download into a CSV file and then try and upload and then send it to their clients.

So, if we can make that quicker and we can take it into an automated place where in the morning they get in and instead they get the information, they send it to their client, that client has that information. Then they can spend more time being productive. And productivity, obviously, can either be creating more value or it can be from a financial point of view.

Darren:

James, that’s crazy because one of the promises of a digital world was that it was going to make things more accountable and more trackable. And that everything was going to be so much easier to work with. And what you’re actually saying is the complexity and the huge amounts of data that we hear about is actually making everyone less efficient.

Shane:

When you look at a typical media agency, you might be unsurprised to learn of the plethora of systems that people are using. And just think about our day-to-day lives. So, think about your day, Darren and the software that you use. Everything, you might be using Slack to communicate and email to send messages. And you might be using Dropbox to store files.

So, what’s happened now is what used to be all in one place, often within an office network, is now spread across a whole variety of really useful productivity tools. And it’s no different in agencies. We speak to mid-size agencies who are using upwards of 30 different systems in one working day.

And so, there’s a huge cost, isn’t there? You have to switch from one thing to the next thing. You have to switch your train of thought. You have interruptions on top of that and all of this accumulates. And so, what we’ve done is we’ve accumulated all of these different systems and platforms and we’re now buckling under the weight of those systems.

Darren:

So that’s the complexity that you’re referring to, in that it’s not just the huge amounts of data, it’s also the huge number of communication channels, the huge number of technology platforms.

I mean, we did some work with a client and their preferred way of communicating with their agency was actually WhatsApp. And it was because they could actually reach their agency at one o’clock in the morning using WhatsApp.

It always worried me that how easy it would be to miss a vital piece of communication when you’re using such a random communication platform. Can this integrate all of those?

Shane:

Well, it’s interesting that you raised this blurring between work time and personal time. I think that’s a conversation in of itself, particularly as now more and more of us will be working from home. And we’re having to adapt to this idea that in the future, the time we spend in the office and the time we spend at home, those ratios are going to be in somewhat of a flux as we come out of the pandemic.

I think what’s important to understand though, is not many organisations really understand how time is spent within their organisations. So, on the one hand, we’re having conversations about how work-time works, or in your scenario, customers reaching us out of hours or at times that are considered unsociable.

But at the same time, do we really understand – if I was to talk to a media planner – what that person’s day or week or life looks like, and what tasks they’re actually doing, and indeed what things are adding value?

Darren:

Sorry, I want to stop you there Shane, because you would think that in an industry where primarily fees are paid based on the work people do or the number of hours they do, that there would have been an infinite amount of work done in actually capturing the time that it takes to do these tasks. Are you telling me that that’s unusual?

Shane:

Well, in terms of the customers we’ve spoken to, yeah, highly unusual. I think there’s a tendency within our agencies that we use common tools, we have common tasks. We’re doing a lot of the things that are the same as people move from one organisation to another. And actually, that’s a good thing because when we’re familiar, there’s mobility within our industry because we tend to do things the same way.

The danger of course, is people then become accepting of that. We’ve seen this creeping rise in the number of tasks and platforms that people need to use. And I think that, in some ways, it’s been like boiling the frog, the analogy of boiling the frog. Where the temperature has risen on us, and we haven’t really noticed it happening.

So, the point now whereas you’ve described here, people are putting in extra hours so they can fit everything in. And as leaders, we’re kind of accepting it. So long as the job is getting done. We’ve become very task-orientated rather than actually focusing on the outcome we’re trying to get to.

James:

So, just to add on to that. I think if you go back 10 years ago, we had five or six or seven pieces of key media, which meant if you were a TV buyer, you knew you were a TV buyer and you can chop up your day into the five different parts of TV buying. And then you can manage your time accordingly.

I think what’s happened is, as we started to evolve and we have more media channels and technology channels to manage, the understanding of addressing those complexities hasn’t caught up.

I mean, if we look at other industries, particularly the banking sector back in 2008, they had to do address legacy complexity. You know, obviously there was a downturn in the market, a lot of banks went under, so there was a big push to automate. But not just automate, to do the research that goes before that, which is understanding productivity.

So, “who’s good at what?”, “why are they good at that job?”, and “can we facilitate a role that’s built around them rather than trying to push a square peg into a round hole?”. And I think that’s not where the ad industry is yet. I think we’re probably five years behind banking. And I think we’re just about starting that research process.

I mean, there’s also the issue around we’re still working to an old model, which is charging-out full-time employees. So, when contracts are done between procurement and agencies, that is still the central point of discussion.

Darren:

And I think that’s probably the real point here, isn’t it? In that, most agencies have very similar structures to what they had 20 years ago. What they’ve done is just built more silos in there based on the various channels. You’ll have the digital buyers versus the TV buyers or non-digital buyers.

And the other thing that’s happened is that all of these platforms, all have their own ways of recording performance, don’t they? Data’s coming off all of these in very different ways. Television has their own, magazines – well, if there are any magazines – and newspapers have their own data, radio has their own data.

And then you’ve got the whole range of digital from the walled gardens to open programmatic. It must be just like a fire hydrant turned on full for the agencies.

Shane:

Well, what you mentioned is true, and of course, it’s just the tip of the iceberg. So, imagine you are an agency and you’re working in television now. Say, you’re in the UK. You have all the same tools as some of your competitors do. So, we’re getting the same overnight TV rating data, you’re processing it in similar ways.

But what sprung up is a plethora of other organisations who have got different data sources. They’ve got shopper data, they’ve got other survey data. And agencies then say, “Okay, I’m going to use that data, apply it to the data I’m getting from the mainstream platforms, and to come up with a unique insight.”

So, the challenge is, is you’re right. It’s not just that we have all of these different channels and different data sources, but underneath that, you might have four or five other organisations who are adding additional insights and data into it.

So, your poor TV planner has got to somehow gather all of that information into one place, turn it into something that’s meaningful, extract insight from that, change his strategy or her strategy, get their customer buy-in, and then execute it. And most of that task is around the very manual task of literally finding the information, gathering the information.

In fact, what our research has shown is somewhere in the region of 20% of anybody’s time, is just in getting information, putting information in one place, sending information; none of which is adding any real value.

The bit that’s really interesting, which is, “Hey, I’ve got a great idea about how we could do a different form of targeting in the middle of this campaign to boost performance,” that’s a very, very small part of the job now.

Darren:

Because one of the things we’ve been doing for a long time is actually measuring productivity. The problem with the traditional retainer model was about retaining resources without actually linking that to what those resources did.

It seems to me that what you’re talking about here is a way of connecting the various complex paths to actually make those resources more productive. Because we’ve actually seen an increase in productivity, agencies are doing a lot more bits with the same number of resources and for less money.

So, this would have to be a panacea in some ways of solving the problem the agencies have of seeing reduced margins against those resources, or not?

James:

I’m sure Shane will have his view on it. But so, I think if we go to look at things agencies are doing to restructure like centralisation of offices, – a lot of the operational stuff, the non-commercial side of the agency business is now obviously being centralised. I think if we look at WPP – and a lot of the other holding groups – is now putting all of that into one place.

The big issue with centralisation is it’s a short-term game because the majority of centralisation strategies look at financial, not productivity value. So, without that productivity value, you’re looking at effectively what’s going to happen in the next year, rather than what’s going to happen in the next five years.

So without that productivity information, it’s really difficult to work out whether you should be cutting full-time employees or actually moving people around to different parts of the business to do different jobs because you know they’re actually going to do a much better job over there in a shorter space of time.

The other issue is more sort of an emotional point to consider around centralisation. What centralisation does do, is it takes away empowerment for people’s jobs – decision-making, creating pessimism about the growth of the company or at their actual job and whether that job is still going to be there.

So, both centralised and distributed structures have their positives and negatives. But I think the change in that structure has been very much driven by a financial process rather than a full rounded financial and value productivity process.

Shane:

And herein lies the trap that people need to be – the agencies need to be very careful not to fall into. If all one does is focus on, “Hey, we can actually reduce the amount of time it takes to do the same things that we’ve done before, or put everybody in one place to do that in the centralisation strategy” – we have to be very careful that that doesn’t actually have an impact on the prices you can charge customers.

So, on the one hand, agencies are saying, “Well, hey, we want to reinvent ourselves as organisations that provide more value for our customers that have unique data insights, who can produce content at scale, who can create innovations for our customers.”

But on the other hand, the temptation is to say, “Okay, we’re going to take all these savings and we’re going to put them to the bottom line or are we going to reduce the amount of headcounts we do.”

Darren:

Yeah. And look, I think the answer to that is in the fact that the single biggest dissatisfaction that we hear from advertisers is that they’re not getting the level of thinking and insights.

Now, listening to what you’re saying, it sounds like that’s because all of those resources, the resources that the agency can afford to put on that business based on the fee that was agreed, are busy doing a large percentage of their time non-value added.

Shane before you said, it’s coming up with new ideas, new strategies, new opportunities – is where value is created. Moving bits of data from one system to another is something that is dead time.

Shane:

That’s right. And I’m sure clients don’t want to pay a lot of money for that.

Darren:

But here’s the problem that I’ve had is that when we have these conversations with agencies, they go, “How can we recoup the cost of being more efficient?”

And I’ll give you a very simple example, and that was creating digital display ads. The agency was still producing it in a manual way because the client paid them for the number of hours it took to do the job. Rather than automating it, they said they wouldn’t be able to account or recoup the cost of the automation because it would no longer have hours against it. It’s pretty short-sighted, isn’t it?

James:

It is. I think that the one thing that stands out from that example is I think people forget that it’s not really about saving costs. So, if you wanted to automate making banners, you could still charge the same amount of money, but you would shore up 50% of productivity.

So surely, shoring up on that 50% productivity which can then go back into helping that client come up with some really cool ideas: creative innovation, technological, data-driven ideas that actually are going to have an add value to that particular campaign or client.

And I think that aim is being pushed aside. Particularly now, we’re going to … it’s going to get worse before it gets better. So, there is a short-term recoup of finance first and foremost, rather than looking at the future, which is what the industry was built around, which is creativity.

Darren:

But they they’re already behind the game, aren’t they? Because most agencies are running incredibly thin. You know, the resources are very thin on the ground. And the fees of – you know, we’ve tracked fees from media agencies since 2007; the effective fee per unit of productivity has dropped about 70%. So, agencies are really in a position of having to play catch up, aren’t they?

Shane:

They are. And I suspect that a lot of the inertia that we talked about earlier, James mentioned that in many ways, our industry, when it comes to our operations within our day-to-day work are some way behind other industries. And we mentioned banking, for example.

Bank of New York Mellon back in 2010, created a centre of excellence with a strategic mandate just to focus on how they could automate what were seemingly impossible processes to be tackled. And they found various tools to enable them to be doing that.

And they found a tool that didn’t involve them having to rip out all of their IT, which for many organisations is the barrier for them, is the existing legacy IT that runs slowly and doesn’t do what it needs to do. But the cost of replacing legacy IT both to the business and for the risk involved is simply not worth it. So, they found a solution to do it. So that was all the way back in 2010.

You’ve got organisations like Vodafone in the UK, a telecommunications company where almost every part of the business has some level of automation and it has indeed become agile. Can you imagine an agile HR department, for example?

In many ways, it’s a product of how we’re set up as an industry. So we may have big brands within the landscape, but we actually have lots of small companies. And so, it’s very difficult for those smaller companies or business units to affect the change.

Darren:

So, just to elaborate on that Shane, what do you mean? Because we do have big brands, we’ve got big holding companies, and they’ve been able to invest significantly in technology platforms, such as programmatic and digital asset management or digital DMPs. So, they cannot invest in huge technology projects. What’s stopping this?

Shane:

So, there’s a couple of ways that you can digitally transform an organisation. The classic one is that you invest in innovation, you create a separate area of innovation or you buy an innovative company. And this kind of the idea that somehow that innovation and that change of way of working somehow comes back to the main core business and it transforms it.

But that actually hasn’t been the case. Digital profits have been fantastic for agency groups. And in many ways, it’s put a little bit of a fig leaf over what has been some of the challenges in their legacy business, which hasn’t really changed since the late nineties or early two thousands; both in terms of approach and technology.

Large organisations, and I mean large organisations like banks and telcos may have 150,000 employees and they have one centralised decision-making point, who is empowered to affect change.

It’s a bit trickier when you have an agency holding group structure, both in terms of how the financials works, but also in terms of how decision-making works. You also got legacy technology that isn’t the same. So, everybody’s doing something differently.

So, it’s almost like herding cats in order to be able to make large scale changes across an organisation.

So, as you said, the simpler thing to do is to go, “Right, well, we need to invest in innovation, we’ll do it separately.” We can’t do that anymore. We’ve got to now find a way of innovating and automating our core and legacy businesses to create some room for innovation.

Darren:

James, do you think one of the problems is that agencies have not changed the way they work with their clients? Because a lot of agencies will say to us that they’re “inefficient” because the client’s inefficient. And so, in some ways, they have to make up for that inefficiency.

James:

I think that if we look at the ecosystem – supplier, agency, and brands – I think one party’s issue then gets passed on to the other. So, when one part of the process is inefficient, obviously that has a knock-on effect all the way through to the end.

To your point, yes, I think there is an issue with client’s inefficiency. Again, that’s based on both technology growth, not just within agencies, not just with suppliers, but obviously from a marketing, a brand’s perspective too. There’s some figures, I think Shane will probably give some more figures.

But these figures are from a procurement perspective. There’s more inefficiencies from a brand marketing perspective, purely based on the growth of brands buying marketing technology in a much shorter space of time than agencies took to come up with DSPs and DMPs, which has had a knock-on effect to marketing cost base. So that new technology inefficiency in itself has had implications all the way through that client-agency ecosystem.

But obviously, I think the core to this is making sure that we can take away a lot of those high touch admin roles, high touch admin tasks, complex admin-based tasks that people are spending a lot of time on, to spend more time doing the really good stuff that they enjoy.

And if agencies want to keep staff, you need to find a solution to that. Otherwise, the work it’s just going to be an admin role that will be taken over by either technology or a lot of it will be moved in-house.

Darren:

Yeah, it’s interesting because we’ve seen the demands from marketers have increased on agencies. And then when the agency hasn’t been able to deliver, the marketers, then say, “Oh, we’ll take it in-house” to pick up on your point James.

When in actual fact, almost every organisation that’s tried to take it in-house realizes how much more complex and difficult it is. It always is easier when a supplier’s doing it, isn’t it?

Shane:

I think that agencies don’t necessarily want their clients to know about what their operational challenges and difficulties are and the legacy tech they have going on in the background.

In fact, when we talk to brands, they haven’t heard of a lot about the ERP and other systems that agencies use to produce the information that comes to them. What they see most mornings or afternoons in many cases, is an Excel spreadsheet or a PowerPoint presentation, or something else that’s been synthesised.

The great irony of course, is that they can take that data in that Excel spreadsheet and try to find a way to put it into their systems, which are completely different ones than the ones that the agencies use.

So, I think, it’s interesting that what brands think they need and what they actually want, which is performance, are two very different things. And so some of the agencies we’re talking about are having very strenuous conversations with their clients and saying, “Look, you’ve got an amount of money you want to pay us to achieve a service, pay us that amount of money and let us worry about how we’re going to achieve that.”

And that creates that opportunity to change technology, change process, move people around as James has described, to affect that outcome. So, I think agencies need a little help from brands. It needs to be a dual approach to actually unlock that potential.

Darren:

Well, there is mutual benefit, isn’t there? If they can actually work together to find ways of producing more productive outcomes. Now, I’ll say that again; more productive outcomes — then that benefits both the advertiser and the agency, doesn’t it.

Shane:

Absolutely. So, we’re working with a client in the UK and one of the tasks that they have to do is they have to prepare a report in the morning for one of their eCommerce clients who are going to use that over the course of the day. And the complexity means it gets done about lunchtime.

Now, the client doesn’t necessarily need all that information (it varies), they just want it all in one place. So suddenly, you’ve got this huge administrative task. And by working with both the agency and the client, we can actually look at ways and you can say, “Well, how can we get that data out of the agency system (which is divorced of yours) into a form which makes sense for you as a client? Across to you as the client and then into your system in a way that you can work with.”

And it’s those types of conversations that need to be happening to remove these administrative hurdles, which are standing in the way of doing the more interesting work.

Darren:

Because you mentioned before, Excel spreadsheets. I mean, there was a complaint from clients that what used to be post-campaign reports or even real time campaign reports, would just turn up as thousands of pages of Excel numbers that were largely impenetrable for a lot of clients.

And they talk about wanting the insights; what should I be doing rather than what’s the data that that’s based on?

And yet do you remember, we went through a period where every media agency was offering their client a dashboard? And almost always it failed because it would end up taking forever to create the dashboard in the format that the client wanted. And then ultimately, they would never look at it anyway, because all the dashboard did was give the numbers in a different way. It didn’t give them insights.

James:

I think one of the points you’ve raised before, which is about this, this idea of a connected data ecosystem. So, there’s a EU-created system in – actually it’s been launched in Australia. I think it’s a good thing – called PEPPOL, which is effectively e-procurement. So it’s been launched in Italy, the UK. The UK, it was around the NHS.

So, anyone who wants to work with the NHS from either a supply perspective or marketing has to align with PEPPOL. And what it is, is primarily a routing system. So, we send you out an IO, a PO, it goes all the way around to delivery and it goes back to their finance system and it’s all automated.

One of the problems that we’re currently facing to your point, is that we’re not connecting the dots. So even if you’ve got a nice reporting system that comes across and you’ve got lots of numbers and you know, flashing lights, it still won’t tell you the whole truth.

And the reason for that is the dots aren’t connected all the way through to the data you want, the real data that needs to be pulled from all of those systems every morning when it’s done on a manual basis, that then has to be fed into another system, then it has to be sent to your client.

So, until that whole process, the admin process is taken away from the people who can actually add value to that particular business through what we class as insights – we’re still going to have a very clunky, slow process with probably the wrong data.

Darren:

And yet, in actual fact, what we want is to package the data and put it in front of the people that can pull out the insights more efficiently.

Shane:

Or better still, given the weights that marketers now have in terms of the work that they have to do with other data within their organisations and the platforms that they’re coping with.

In fact, I think a recent Gartner report was saying that something like a quarter of marketing budgets is spent just on the technology and the costs of the people that are required to run all that is great. So, marketing departments have exactly the same problem as agencies.

The clients just want to be told what to do because just presenting the information or insight is not the same as a recommendation, and what marketers are telling us is they want their agencies to synthesise that information, make a realistic and reliable recommendation for action, whether it’s a short-term campaign change or something that’s more long-term and strategic.

Darren:

But Shane, that’s what I was saying before; clients, their single biggest issue is the agencies are not giving them what they want. They’re giving them data, but they’re not giving them recommendations. They’re giving them reports, but they’re not giving them insights.

Is Exact A.I an opportunity for agencies to free up some of that intellectual power that exists within the agency to fulfil more on the client’s needs?

Shane:

Absolutely. I mean, we were talking about television buying earlier and not everyone who’s listening will be doing TV buying, but I use it as a good example because it’s been around a very long time.

It might surprise people to know that a TV buyer might spend half their day doing basic administration and using software tools. So, let’s imagine for a moment that that work was automated and they didn’t have to do it at all. Then all of a sudden, that time could be used productively for that client.

Now, we talked earlier about how clients are paying per head and you used the example, I think you were talking about an agency being paid to transform banners. That client didn’t want banners, they wanted effective advertising. So, in the case of TV, what you would hope is that the client wouldn’t turn around and say, “Well, you’re only spending half as long on my work, I’ll only pay you half as much.”

What you really want is the client to say, “I’m happy with what I’m paying and I’m excited to know that that person now is spending their time differently in servicing my account or going off and finding new and innovative ways that they can service my brand.”

Darren:

And this is one of the things that we’ve been pushing, is rather than paying for the inputs of the number of hours that the whole industry should be moving to outputs. What does the agency actually produce for the client, and ultimately, what are the outcomes of that work?

So, if we can eliminate all of the – how did you put it before James? All of the admin, the non-value admin; if we can minimise that, then all of those people who would be in the agency on a retainer or under the fees, would be working towards delivering ultimately the client’s desired outcomes through outputs, right?

James:

Yeah. I think again, it goes back to the original point, which is we’re still working on a very old legacy-based model and that needs to change all across the board. We need to look at the output, which is, “Am I working to delivery of product sales for a particular client? Is it creative execution? Am I working with a creative agency on a new campaign that’s going to allow us to deliver on a number of different KPIs?”

That’s increasing evermore, because platforms are increasing evermore, technology is increasing. The bit in the middle that needs to be looked at is the different skill sets with the organisation.

Example, we were doing some work with a company in Asia and we were looking at their productivity and how many full-time employees they can save by automating. We looked at a lot of the triggers that they have with regards to admin, how much time is wasted, all the way through to how much time they were spending with their clients on communication. And I think we worked out something in the region of about 10 to 15 full-time employees they could save by automating a process.

So, they had two options. One, they could take those full-time employees and then take them off the books, or they could use them to be more productive. So, the outcome is making them more productive over a two-year period, they can make four times more money than actually taking away those full-time employees from the business.

Darren:

Well, sorry, James, there’s a different way to look at that as well. Because we’re talking about FTEs and this is the thing that drives me crazy. Because procurement will talk about an FTE, as if the managing director and the most junior person are all just one FTA each, right?

And yet, we’ve seen in the industry what I call the juniorising of agency staff. You will see structures that are incredibly flat because agencies and especially media agencies have ended up recruiting a huge number of graduates into the agency to do these menial tasks, to literally transcribe data from one source to another, which is a huge number of people counted as an FTE count.

And yet, very few senior people, if anything, if it allows you to – within the same fee, have fewer people but more senior, then you’re going to get a higher quality because you’re going to be dealing with the experience rather than people that have entered the industry to transcribe numbers from one Excel spreadsheet to the next.

James:

I think there’s a perceived issue with moving or having to integrate large systems into businesses. Shane used to work for a large media company in Asia. And I think he said, it took him three years to integrate a SaaS system. And he had 20, 25 people working on that business. And it still wasn’t integrated after three years.

So, the cost or the perceived cost in changing that process has not been outlined to the business, or they’re not willing to understand how to then suddenly change, particularly when they’re not going to see, or they perceive they’re not going to see, an outcome for two years.

What we know now is they can see outcomes using automation within two to three months.

Darren:

Because you’re not talking … Exact A.I is not about putting in a whole new system, is it? It’s actually about linking existing systems to work together more effectively.

Shane:

So, to think of it this way is, we are the last strategic lever that companies pull. So, when people are trying to create efficiencies, they’ll often standardise processes across lots of departments. They will often centralise them into one place and they will offshore the lower value work.

And in fact, I think I’ve just described three-quarters of WPP APAC’s current strategy as they’ve described it in terms of operational efficiency, but that’s nothing new. This idea has been around for a very long time.

What other organisations have realised – once you’ve done all those things, what other strategic levers are left to you. And this idea that we have all of this legacy software here that’s so essential to running our business and is irreplaceable – this idea that you can get software instead of people spending time on it is very, very important.

The idea that you don’t have to throw the baby out with the bathwater … and let’s be very clear, some of the most important software that’s used in agencies is almost irreplaceable. They have thousands of data connections, hundreds of agreements with suppliers for the sharing of data, dozens of really important connections that come into it. To replace that, for a competitor to come in and replace that, next to impossible.

In fact, they’ve made it impossible because the biggest companies have bought all their competitors. So, it’s very, very difficult.

So, this idea is rather than having spent all of your time working that software, that you can have this idea – we call them digital workers who are working the software for you.

And the great thing is, they don’t care if data comes in at 2:00 AM, they don’t take any holidays. They don’t get sick, they don’t have calls from childcare, they don’t get interrupted by phone calls from other departments, and they just get on with doing their work. So that’s the last strategic lever that most major organisations are really focused on.

And in fact, this idea, this automation … we call it in various forms, robotic process automation, service automation, intelligent automation, all sorts of labels for it – but it all means basically the same thing. It’s the fastest-growing category of software for major organisations around the world.

Darren:

Interesting that time has gone so quickly.

I want to ask … first of all, thank you, James, for coming by and having this conversation and too, you, Shane. Just we need to wrap up because we’ve run out of time. Maybe we should get an AI to make this conversation more efficient.

But I just want to ask, what is it that you found is the single biggest obstacle stopping people, companies embracing better ways of working?

Ideal for marketers, advertisers, media, and commercial communications professionals, Managing Marketing is a podcast hosted by Darren Woolley and special guests. Find all the episodes here

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Darren is considered a thought leader on all aspects of marketing management. A Problem Solver, Negotiator, Founder & Global CEO of TrinityP3 - Marketing Management Consultants, founding member of the Marketing FIRST Forum and Author. He is also a Past-Chair of the Australian Marketing Institute, Ex-Medical Scientist and Ex-Creative Director. And in his spare time he sleeps. Darren's Bio Here Email: darren@trinityp3.com

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