Talent management in advertising
The other day CNBC’s Storyboard had an interesting debate on ‘Talent Management in the Advertising Industry’. Based on the Deloitte Rewards Survey (conducted among 15 agencies) the debate covered a topic that has long been touted by the captains of the advertising industry as the ‘most important challenge’: attracting and retaining the best talent. Unfortunately, it has remained just that – a challenge, for quite some time now. What I liked about the show was the plain-speak of the participants, the variety of issues touched upon and the interesting nuggets of information. Here is Part 1 (26MB) of the show:
Some of the points emerging from the survey (not entirely unknown to the industry) and discussed on the show are worth repeating:
– this is one of the lowest paid industries compared to other ‘progressive’ industries like, FMCG or IT/IT Services
– the salaries at entry levels are really low; it shoots up at the top resulting in a huge gap
– the HR departments among the surveyed agencies are not ‘competent enough’; they don’t get the support of the CEO or second in line; they don’t have processes in place
– designations are invented resulting in artificial levels; roles are not clearly defined
– poor compensation from clients results in profitability squeeze which in turn affects the ability to hire the best talent
All valid and worth debating. More importantly, worth finding solutions for. The issue isn’t simple and there are wheels within wheels, with many interconnected problems. My $0.02 on this and related issues:
The crux of the problem is how agencies are positioned in the clients’ minds: as trusted, long term business partners or as vendors of a service. Over the years, consultants and other specialists have come to be valued more by clients on strategic inputs compared to ad agencies who are seen as script developers. Client’s are not going to up the fee if they don’t see added value. And agencies can provide added value only if they have talented, motivated, trained people on board. Which costs money. Agencies too have brought this situation upon themselves through under-cutting rival agencies, displaying total lack of unity and not elevating the client-agency equation to that of a partnership. In order to simply get a business, many agencies have agreed to low commissions and retainer fees. It leads to a cyclical effect of being unable to service the business with good people who value-add.
Irrespective of the squeezed margins, the fact is most agencies don’t have processes & systems in place. When a fresh recruit joins, it is very rare that he or she is put through the paces in terms of a structured training. It may happen to batch recruits from a B-School but when someone with say, 2-3 years experience joins an agency in the middle of the year he is most likely to be thrown straight into the job. There is hardly any effort made to convey the agency’s philosophy & culture to a new recruit in a structured manner. If there is a credentials presentation he is likely to go through it on his own. This is only an indication of the lack of processes and how everything is people dependent in most agencies.
As an aside, I asked for thoughts on this issue on Twitter and got some interesting responses:
The sentiments expressed here – low pay at entry levels, lack of succession planning, training are pretty much echoed in the Deloitte survey too. Clearly, there are deeper, far reaching issues which is perhaps fodder for another post.
Would love to have your comments.
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