How do you manage a successful transition to a new agency?

The right choice has been made, the decision has been approved and the contract signed. You have a new agency or marketing supplier on board. But as with any new relationship there are some short-term hurdles to jump, including the issue of exiting from the incumbent in an organised manner to ensure continuation of service during the transition.

While the euphoria of the new relationship hangs heavy in the air, there are some very real concerns facing marketers:

  1. Do you have the internal resources to ensure the smooth transfer of knowledge from a disgruntled incumbent to an enthusiastic but currently under staffed supplier?
  2. Can you ensure all of your valueable IP and data is transferred to the new agency?
  3. How do you minimise the disruption to the day-to-day workflow during the transition period

The cost of transition

Our benchmarking shows that the appointment of a new agency requires a 20% increase in resources in the first three to six months, depending on the size and complexity of the business, to deal with transition issues. On an account of one million dollars in resource costs, this equates to a cost of between $50,000- $100,000 to your business.

The other major costs to business during transition are loss of valuable IP and the legal risks when migrating third party agreements for on going communication.

There is often confusion regarding payments to the incumbent, identification and dispute over the transfer of IP ownership and the decoding and embedding of existing processes both internally and within the new supplier.

Combine this with the time and resources required to induct and coordinate the change management process and the difficulty in obtaining detailed information on the previous and new supplier’s processes.

Collectively this contributes huge hidden costs and potential risks and the larger the change the greater the costs and the risk. But with careful planning these can be managed and reduced.

The transition process

Our experience here is based on helping marketers transition a full range of agency types, including media, digital and creative. We have even assisted transitioning a call centre. Our team of subject matter experts have not only managed the process, in most cases they have experience with the transition on the agency side.

The Transition Process is based on a series of filters to allow an organised exit and entry plan. Depending on the requirements of the advertiser, there are 8 broad stages:

1. Detailed transition planning

It is essential to establish the scope of the transition. In a recent media agency transition, the new agency was replacing a relationship spanning almost two decades and a huge number of campaigns, especially in the digital space. It required detailed planning up front to ensure all stakeholders, timelines and milestones were agreed.

2. Identify and arrange transfer of IP

Intellectual property is created by the agency on behalf of the advertiser. In most cases the agency has agreed to assign this IP to the advertiser. Therefore at the time of transition, it is important to identify the IP and determine if it is worth transitioning to the new agency, before you even look at the practicalities of the process, including the legal requirements and the physical requirements of the process.

3. Technology compatibility

Most of the data and intellectual property will be stored in databases and systems. While increasingly these platforms have the ability to share this information through APIs and XML formats, it is still important to detail the various requirements from the incumbent to the new agency systems to identify the issues and to engage the appropriate expertise where issues arise.

4. Process transition

The marketing team has been working in a specific way with the incumbent for the duration. The new agency can either adapt to the existing process or provide their-own process. The other incumbents on the roster will also have specific ways of working with the marketing team and each other. Therefore to achieve alignment of process, it is important to make a decision on either transitioning the existing process to the new relationship or create a new process with the new agency. Either way it requires a process to capture and transition or create the process.

5. Contract cost resolution

There are financial implications when ending one contract and starting a new one. It is important to completely understand the implication of the contract agreements and manage the process compliant with the contract. Issues will arise in regards to the new agency, but often more difficult is resolving the issues that arise with the incumbent who can sometimes be looking to maximise their exit payment.

6. Induction process

The induction process brings the new agency into alignment with the marketer and the roster of agencies. The induction process should be comprehensive and documented to ensure all stakeholders are engaged and involved in the process to deliver the alignment. The problem is induction is often overlooked in the rush to commence work with the new agency.

7. Hand over period

While the overall transition period can take many weeks, the actual hand over should be focused and ideally be no more than a week. This means that the two agencies minimise any duplication on existing projects. To achieve this takes planning up front to ensure it is as seamless as possible.

8. Identify training requirements

With the addition of the new agency, it is a worthwhile time to identify the gaps in the knowledge base of marketing and the agencies. Engaging the agencies in this process creates the opportunity to ensure all stakeholders are equally informed and aligned. It is during this time of disruption that the appropriate up-skilling within the organisation and the roster can create alignment.

The benefits of managing transition

The fact is that making the decision to appoint a new agency is only half of the process. The management of the transition of the new agency is essential to:

  • Deliver greater efficiency in time, resources and cost
  • Identify issues upfront and develop solutions before they become problems
  • Provide security and trust during a disruptive period with an accountable and structured process
  • Maximising the value of the new agency by minimising miscommunication and alignment to expectations
  • Minimise costs related to the exit strategy with the incumbent
  • Create positive relations with the professional management of the departing incumbent