Farmer & Company is the acknowledged expert on Scope of Work (SOW) management problems and other strategic issues that affect agency creative and financial performance.
As outlined in Michael Farmer's award-winning book, Madison Avenue Manslaughter, an inside view of fee-cutting clients, profit-hungry owners and declining ad agencies, advertising agencies are caught between fee-cutting clients and profit-hungry owners.
In the meantime, their creative workloads are growing, driven by increased SOW workloads, particularly in digital and social media.
The workloads are out of control, since agencies do not document, track, or negotiate workloads for fee-setting purposes. Instead, they accept whatever work their clients thrust upon them and live with the outcome.
The combination of declining fees and growing workloads puts agency creatives and other people under an enormous strain. How have agencies generated growing profit margins for their owners? Through downsizings, salary freezes and 'juniorizing.'
Agencies have disinvested in their capabilities at a time when their clients' marketing challenges have never been greater. Not surprisingly, ad agency relationships have shortened considerably, as clients now shop around for low-priced agencies, viewing their ad agencies as "commodity suppliers of commodity-like deliverables that are paid at commodity-like rates."
This fundamental problem is not receiving the full attention of agency Chief Executive Officers, who spend most of their time looking for new clients to replace the clients that they are losing at an accelerated rate.
We provide strategic consulting support and technological solutions for agency CEOs -- helping them to restore health and capabilities so their agencies can get back in the serious business of deliviering improved brand results for their clients.