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Scaling Your Agency: A Roadmap To Guide Your Way  (Part 3)

leadership & management

Welcome back to the final article in this series. Last time, we covered some of the most common problems you encounter when scaling your agency from “small” (5 or fewer employees) to “boutique” (10-15 employees), and how you can avoid them. If you missed that instalment, you can check it out here.  

This week, we’re going to look at the next stage in the process – moving from “boutique” to “medium” (10-15 employees to 25-30 employees). Just like the last stage, there are certain challenges that routinely crop up as you start to add more employees into the mix. Let’s examine those issues in more detail.

Stage 2: Boutique to Medium

Scaling your agency from 15 employees to 25-30 employees is not as simple as stacking more and more people on top of existing infrastructure. As we discussed last week, a dysfunctional foundation will collapse when it’s put under too much stress. Similarly, if your agency doesn’t run well when it’s small, it’s unlikely that things will improve as you get bigger.

However, the single biggest issue that holds back agencies looking to make the leap from boutique to medium-sized isn’t infrastructure. If you focused on putting the right systems & processes in place earlier on in the process, you should find that most of your systems scale up readily to accommodate new employees. Sure, there may be some hiccups, but overall, intelligent design and selection of your internal processes will serve you well.

Anything you neglected to reinforce earlier on (e.g. IT systems, finances, communication) may come back to bite you here, so make sure to take the time to strengthen these systems now, before they can cause real problems.  

Neglected system upgrades notwithstanding, the principal obstacle you must overcome at this stage relates to skills.

Overcoming the Skills Gap in Your Agency

When scaling your business from solo to small, you had to grapple with making your first hire. Here, you had to make good choices and bring on employees that possessed the skills your agency needed.

As you continued to scale your business from small to boutique, your attention shifted away from people and onto systems. Making good hires was still important, but you also had to ensure that your infrastructure was robust enough to sustain your growing operations.

And now that you’re looking to scale from boutique to medium, your focus returns to people. But it’s quite possible that the skills you need at this stage in the journey are different from those you needed earlier on.

Many agencies are top-heavy when they start out. If you have multiple owners, it’s likely that you’re all doing a substantial amount of work. When you take on a few employees, the work starts to get more dispersed and your time frees up. The top-heaviness of the agency decreases as more and more lower-level employees join the ranks. However, this leads to a growing gap between top management (i.e. you and the other owners) and junior staff.  

This gap can cause problems, particularly as you endeavour to scale your business further. Making strategic business decisions and focusing on the future of your agency requires the space to do so – breathing room from the everyday hustle and bustle of managing operations. Without being able to safely delegate your duties, it can be hard to get this time to work on the future.  And this can be compounded by the fact that your key clients all expect YOU to be working on their account!

If you’re not careful, you can be caught in between roles: not stuck in the business, but not free to work on the business either.

The solution to this problem is twofold:

  1. Ensure that you have the right functions filled in the agency
  2. Bring in more senior staff (maybe a general manager) to oversee day-to-day operations

Let’s look at these two areas in more detail.

Functional & Managerial Capacity

Simply put – if your skills/expertise are integral in delivering great client work, you won’t have the time you need to focus on scaling the business effectively.

There’s nothing wrong with having an input into the work, or being in a position to guide your team. But if your valuable time is spent doing work that someone else could be doing, you need to consider introducing more senior experienced staff into the organisation.

The best way to determine if this is an issue in your agency is to look at your current employees. Consider the following:

  • Is there a clear skills gap between top management, your few star employees, and the rest?
  • Is there an obvious bottleneck individual in the business (someone who needs to sign off on work, or is frequently sought out to get things moving)?
  • Are you overly reliant on “Jack of all trades”, or do you employ a number of specialists?

With reference to questions like these, it should soon become apparent if you have issues in this area.

If you’re still required to oversee day-to-day operations and closely manage employees, your time is still being used up IN the business, so who is working ON the business?

The lines between your competing delivery, managerial and leadership roles blur as your agency scales. It can be hard to grow the business effectively when you have so many demands on your time.

When scaling your agency from 15 employees to 25+, you’ll probably find that there’s an awkward transition period. The demands on a handful of vital core staff (e.g. yourself, or some key employees) increase dramatically, which can then lead to decreased performance, slower delivery, and even burnout.

The solution is to identify these issues before they can cause real problems. You know you need to invest in people, but what does that look like?

  • You may need to restructure your business. For instance, this could entail the promotion of existing employees to higher positions, then making an additional hire or two to fill their old positions.
  • You may need to train up existing staff (i.e. for a leadership role, or even just a different functional skill to reduce over-dependence on key employees).
  • You may simply need to make hires in some area. Perhaps you need additional client-facing staff, support staff, or a middle manager.
  • You need to get comfortable with your new more ‘hands-off’ role as you focus on guiding the agency forward.

Whatever the case may be, you have to invest in people at this stage in your journey. The systems you put in place previously (when growing from small to boutique) should serve you well, but remember to proactively improve matters in this area too.

Conclusion

This is the final article in this “Scaling Your Agency” series. When moving from ~15 employees to 25+, it’s rarely systems that hold you back. There’s little difference (conceptually speaking) between the infrastructure required to run an agency of either size. Payroll, communication, IT, finance… unless you’ve seriously neglected one of these areas, it’s unlikely to be your primary stumbling block.

Instead, the obstacle you must overcome at this stage relates to skills. Whether you restructure your business, hire new employees or train up existing staff, you have to ensure your agency possesses the skills required for growth.

As you continue to scale, you need more time to work on the business, not just in the business. If you’re trapped in a functional role all day, you won’t have the time or energy to make smart strategic decisions. For the good of your agency, you have to step back from day-to-day operations (in both a functional and managerial capacity). Take care of this, and your journey towards building a bigger, more profitable agency will be a whole lot easier.

Do as I say not as I do

Leadership

We know all the great leaders lead by example; inspiring their staff and exhibiting great management skills but sadly that isn’t always the case in every SME business. So what happens when senior managers expect their managers to show strong leadership skills but don’t themselves? What are the consequences when someone like me is brought in to deliver some leadership & management training yet the senior managers don’t participate because they think they have all the skills already themselves?

This happens to me occasionally where the leaders are endorsing and/or organizing the training; believe they have excellent leadership skills themselves so don’t take part. Yet the reality often is, that they exhibit the worst leadership skills because they are running around doing 1001 tasks so ‘don’t have time’ to manage. And the managers quickly identify this as an issue – “it’s great that we are learning these skills and techniques but our managers really need to be here too.”

Let’s explore the consequence of this:

Lack of a consistent management approach

Managers will gain some new skills, tools, techniques and language that they can implement with their teams. Yet if their managers haven’t attended the same training then we already have an issue of differing management approach in the same organization. The most likely outcome will be confusion from team members and the good work the training did, quickly dissipating away.

Cynical lower manager

This in turn will create cynical managers because they already know that their managers aren’t great so wonder why they are not attending the training.  Senior managers derail the good efforts of the managers by showing the hypocrisy of asking them to attend management training whilst not attending themselves!

Lack of delegation

Strong management is a huge part of creating a successful motivated and cohesive team. Weak managers don’t delegate because they believe “I don’t have time” or “it’s quicker/easier to do it myself”. Those senior managers who didn’t attend the training and are running around doing 1001 things will be the ones who don’t take the time to successfully delegate thus increasing their own workload and creating demotivated teams. A lot of my time is spent training and coaching managers around the art of good delegation. Not something that comes naturally to everyone.

So if you are in charge of management training or are one of those senior managers who doesn’t believe leadership & management training is for them. Think again!

Does everyone share your vision?

Look ahead to your future

If you are a business owner/leader and have a clear vision for your business, then does all your team share in your vision and buy into it as much as you do?  I explain to clients that a vision is a like a desert island in the distance. Once we have decided that is the place we want to get to, we have to be sure that our team all want to get there too.

However, it’s worth remembering that business leaders are usually some ways ahead of the business and can typically be ALPHA-type characters, which means they lack patience and assume everyone understands, as they do.  Not the best combination!

I sat through a presentation recently of an MD presenting the vision to the business and there was definitely a disconnect between the excitment of the MD and the audience’s reaction to the content being presented.  The issue was the MD was ahead of the business in her thinking and wasnt ‘standing in the shoes’ of her audience.  This was the feedback I gave her afterwards, when she was dissappointed that the team didnt seem to share in her excitement.

Sharing that vision with others in a way that compels them to act is the secret to a successful leadership vision yet to do this you have to have strong empathy with your team and acknowledge that not everyone cares as much as you or has the ability to think in a ‘bigger picture’ way. Which also means that you might need to cut down on the bigger picture and present in more manageable chunks – chunks that team members can relate to and therefore buy into.

To create that inspiring vision, ideally leaders need to create a process that involves everyone, that allows people to contribute to a shared view of the future, which is powerful and engaging for all. It’s simple – but it isn’t easy.

How do you fulfil your vision? Design a plan that focuses everyone’s efforts solely on its achievement. As a coach, this is an area I work with many business leaders on.

Now comes the tricky bit… Live, breathe and role-model the vision every day. Successful leaders never assume that their organisation is ‘on board’ with the vision – they go on and on and on about it. This is the primary job of leadership – not the day-to-day detail.

Concentrate on clearing obstacles to fulfilling the vision. Every person needs to understand why they’re doing what they’re doing, and why it’s important to the overall vision of the organisation. Don’t do people’s jobs for them, or chase them to do their jobs; clear the way for them to do their own jobs effectively (see my last blog post on perfectionism and delegation).

So make sure you’re the type of leader that is not only excited about the vision but shares and excites everyone else, so they can deliver it and you can all arrive together on the desert island.

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