Aligning Recruitment to Your Agency Growth Plans

Posted on: 10 Apr 2017

Almost a third of agencies have plans to grow their financial turnover by more than 26% this year. And two-thirds plan to increase their headcount by the same amount. These stats come from the 2017 Wow Agency Survey, sponsored by Adam. But does aiming for a 26% increase in turnover mean you need to raise staffing levels by the same amount? We caught up with three top agency owners who gave us their expert insight into what to consider when aligning recruitment with your agency growth plans.

Be Flexible About Your Expansion

You can’t plan your headcount without knowing the type and volume of work you aim to secure. Expanding into new fields means recruiting new skill sets. Delivering more of the work you do now could mean hiring more of the same kind of people you already have on your team. So how can you hire with certainty for the future? Justin Eames, Co-Founder of Fish in a Bottle tells other agencies owners to be brave: “Be brave with your hires, be flexible with your plans and find ways to say “Yes!” to hiring someone you know will be amazing for your business”.

In other words, build the team for the business you aspire to be.

Be Prepared for Growth and Shrinkage

Whatever your business growth forecast, be warned; the survey found that business growth plans don’t always translate into actual business growth. In 2016, 35% of creative agencies planned for 11-25% revenue growth, however, only 22% achieved their target. And, while 1% of agencies expected reduced turnover, one in ten experienced a decrease in earnings.

Ingram Sanders, Co-Founder of Goldsand Digital recommends taking a cautious approach: “Don’t hire for work you hope to come in. Be prepared to deliver on new contracts but don’t hire people in anticipation of hitting your stretch targets.”

Paul Stephen, CEO at Sagittarius, shared his strategy: “Hiring the right talent is not just a matter of skills but agency fit. We are in a service industry, so whilst we may ‘plug the gap’ with short-term contractors for web-development staff, for client-facing roles, like Account Managers, we try to be over-resourced. This gives us a team that’s large enough to bring in new business and be in post when we win the work.”

Further control costs by keeping your finger on the pulse of market pay rates to ensure you aren’t overpaying when hiring. Working with a recruitment agency will give you the benefit of their market rate knowledge and ensure you set the right budget to get the best talent. Sanders recommends that you, “listen to advice from the experts and understand that it’s massively competitive out there. You may need to pay more than you hoped to get good people. However, if you do find someone for a lower salary, if they’re good they’ll be asking for a raise soon enough.”

Understand Your Team’s Capacity

For a rounded view of your current position, blend your business plans with an understanding of your team’s capacity and how your billable rate is being spent. This is all about understanding work volumes, not checking up on people. Use timesheets, online time tracking systems, like Toggle, or the built-in time monitoring tools in project management systems like Asana to help you identify any issues.

If your team isn’t stretched, cross-reference development plans with new work to provide people with suitable opportunities to build their skills and experience. Take Sanders’ advice and broaden your team’s skills mix by being “open to people outside of the normal talent pool. Discover what drives them, uncover related skills demonstrated by their out of work interests and consider how you could mould them into the person you really want and need them to be. We like people who are prepared to roll up their sleeves and get the job done.”

Your team will be more likely to work late if it improves their skill set and a one-off performance-related project bonus could be a cost-effective way of getting new business completed. This certainly isn’t a long-term fix but it’s an option that could help you through a busy patch or when hiring new people.

Make Best use of Existing Employees

If you plan to add additional services to your business, conducting a skills audit will uncover any hidden skills within your existing team. It may be possible to use team members’ previous experience to deliver new business wins; if so, you’ll need to change people’s job roles to maximise these new-found assets.

Eames says, “I know that it’s the people I hire who grow the business, not me. We have a saying here, “roles for people, not people for roles”. When we find someone who we know will be an asset we try to hire them, whether we were looking for them or not. Then we develop our studio and our business plan around them.”

Another way to free up expertise is to take administrative tasks away from people with specialist skills and allow them to get on with value adding work. Administrative roles are generally more cost-effective than technical roles which mean you could save money and have a happier workforce too.

If you need to hire more senior roles, it’s good practice to promote internally. However, if you don’t have the right internal candidate or you want to bring a fresh pair of eyes to your organisation, an external hire could be a better choice.

However you hire, Sagittarius’ Stephen recommends “recruiting based on cultural fit first, aptitude second and experience third. The team are always going to work harder, longer and be more effective if they enjoy what they do and get along with each other. If you have that right, then most skills can be trained and learned.”

Understand the Competition for Roles

If you’re planning to hire new account managers or creative/design roles, then you’re in for some stiff competition. According to the survey, your competitors plan to recruit these roles too and Eames agrees: “It can take months to find the right person, so it’s not always easy to resource a sudden increase in demand. To be confident of delivering work we have to flex everything from resourcing to client deadlines. Get the best people by starting the recruitment process well before you need someone in-role.” You’ll need at least a three-month lead-in to:

  • prepare the job advert and job description (1 week)
  • advertise (2-3 weeks)
  • sift CVs and invite to interview with at least one week’s notice (2 weeks)
  • interviews and decision (1 week)
  • offer, acceptance and contractual paperwork (1 week)
  • notice period (4 – 12 weeks depending on seniority)

These timescales are based on all going well and a single interview. Add in needing to re-advertise because of poor quality applicants or a second round of interviews and the timeline stretches even further.

Goldsand Digital’s Sanders says, “we plan six months in advance and then start looking around 3 months from the desired hire date. We expect to see a lot of people to find the right person to fit the role as each new hire needs to be right for the business.”

A recruitment agency can significantly reduce timescales. They’ll quickly get you to interview stage and may be able to provide candidates who have recently finished contracts removing the need to wait for a notice period to expire.

Revenue per Head (RPH)

As you grow your business, you need to keep an eye on the revenue generated by each chargeable member of your team. To calculate your current RPH, divide your fee income (less direct costs like media spend) by number of fee-earning team members including full time freelancers. Data, from the 2017 Wow Agency Survey, sponsored by Adam, shows that agencies are producing the following average RPH:

  • Up to £250k revenue > £40k average RPH
  • £250k – £1m revenue > £62k average RPH
  • £1m+ > £83k average RPH

These figures give you something to aim for and can be indicative of headcount figures required. However, bear in mind that agencies in a growth phase often have a lower RPH figure. If your business is growing and you’re already hitting these RPH figures, either bottle what you’re doing and sell it, or check to see whether your team is under massive strain.

How to Target Talent

Level the field with your competition and ensure you’re using the right platforms to target new hires. Our survey showed LinkedIn is the most popular recruitment platform, followed by an ad on your website and networking. Of these approaches, the most successful is networking which proves the saying, ‘always be recruiting’. Eames remarks, “We constantly recruit to ensure we have the right talent in place to deliver contracts. This week, we’ve interviewed five people, some on a speculative basis.”

By keeping a range of suitable candidates warm for speculative roles, you’ll be ready to make an offer when the time comes.

For support with talent management in the digital sector, contact Leon Milns on 0207 871 7665 or at leon@weareadam.com.

Share This Post

Twitter Twitter LinkedIn Email This Job

Tweets

A Day in the Life of a Content Marketing Manager at TopRank Marketing - https://t.co/f7WygSUcm0

5 ways to monetize your social media followings - https://t.co/YaGatlF50D

Careers
at Adam

We are always looking for driven individuals to join our team.

We’re recruiting »