Go fast, even if the finish line is unclear: Bain

When it comes to the how-to of innovation, I am very big on short simple iterations: questions and answers, testing and learning, planning and doing, goals and metrics. So in September, when the World Economic Forum and Bain (WEFB) came out with their study "The Digital Enterprise: Moving From Experimentation To Transformation", I was happy to find it well-organized and filled with next-steps.

What does this have to do with Marketing Services companies? Quite a bit I think. Not directly; agencies are not profiled and marketing is not mentioned in the study. Rather, it focuses on the steps (and traps to avoid) for businesses to mange forward in the roiling disruption of technology. And we love steps, so we love this article. It is my goal in the next few posts to try to apply the framework and checklists from the WEFB report to the business of marketing services agencies.

Digital Strategy, or where your business should be going, even when the endgame is uncertain.

Agencies (legacy, internal and new digital natives) mostly overlap in their value proposition to clients. It’s the subjective that sets them apart: quality of strategy, creative, account management, technological innovation, scale, etc. Yet the WEFB study doesn’t at all mention these as central to our clients’ future digital business strategy calculus. Rather, it is speed. Speed to test and learn, speed to adapt and dream while doing.

How can you begin to divine your agency’s future? The WEBF has some suggestions:

Maybe agencies should be supporting their clients by forgoing the usual multi-phase engagements, and instead operate on a basis of short finite stages: phase 1 first, and allow the results to dictate what phase 2 should be. Maybe the client’s vendor/partners should change and budgets & schedules shift from one phase to the next -- and quickly. Agencies need to support this new reality for clients.

Is that a business for agencies? It is as long as overhead is both low and focused on the client’s immediate needs.

Agencies are organizations of incredibly imaginative ambitious people. They have a lot of momentum, usually built-up over years if not decades of projects and pitches. As clients adapt to their markets in faster and faster cycles of test-and-learn, so must their agencies, which can lead to a lot of uncompensated experiments. Remember Augmented Reality? Now VR & programmatic and social eCommerce, and soon AI? Keeping up with client experimentation (and transformation) is table-stakes for agencies, but will the investment in knowledge and technology pay-off in the long-term? Yes, in different ways for different businesses.

Producers of digital content will excel. Creativity and story-telling technology (for production value) are differentiators that are unlikely to be internalized by clients. Although publishers (T-Studio, for example) and platforms (Facebook and Google for example) now provide marketers directly with creativity and technology further diluting the role and budgets once owned by agencies, there is still plenty of room to compete on content.

Per the WEFB study, “the sheer volume of noise generated by digital technologies threatens to become a distraction.” This is very true of agencies pursuing competency if not expertise for their own relevance in the market. So agencies must dream, while doing, while cutting. A tall order with many potential pitfalls, like:

In 10 years, agencies may well be competing as part of non-exclusive partnerships and networks. There will only be a small group of qualified multi-discipline leaders, able to harness (and guarantee) the work of other unaligned specialists around the world: one specialists for strategy, another for a campaign idea, another for its execution and media planning – expertise in whatever the client needs for only as long as they need it.

Looking ahead, perhaps the digital strategy for marketing services agencies is to be an expert helmsman on the pitching ship our clients, sourcing, leading and guaranteeing the work of bespoke crew, working in phases, quickly, ready for changes and opportunities for their clients’ advantage. It does not seem that exclusive networks and holding companies, bedeviled by legacy overhead and a plodding process, will be nearly as dominant.

If speed, adaptability, trial and error, and dreaming while doing are lighting the road ahead for our clients, then agencies with a similar strategy, culture and capability for innovation will surely be more competitive. As this strategy unfolds, the “agency capability” will become concentrated in fewer individuals who move easily from client-side (for stability and magnitude) to agency-side (for the lifestyle and entrepreneurial potential).