Continuous Professional Development - Key to Commercial Success in Advertising

AMV BBDO

Continuous Professional Development – Fancy Window Dressing or Key to Agency Commercial Success? Andrew Pinkess, Director of Business Innovation / Co-Chair of IPA PDG

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• Introduction to Professional Development

• Making the Case for Talent

• What the Numbers Tell Us • Real-life Examples

- Hunter Lodge - M2M - AMV BBDO

• What This Means for You and the IPA

Agenda

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Introduction to Professional Development

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• The IPA’s Professional Development Group champions training and Continuous Professional Development (CPD)

• We promote a culture of learning in member agencies as a platform for business success • Our courses and qualifications enhance individual careers and set benchmarks for best practice across the advertising,

media and marketing communications professions • Courses have been running for more than 15 years; 10,000 certificates awarded

• Leading the debate on Talent and CPD at the IPA

Introduction to IPA Professional Development Group

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The IPA Professional Development Team

Director Patrick Mills and his team

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IPA Continuous Professional Development Career Wheel

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Our courses and qualifications

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Measuring success – CPD Gold

25% revenue

increase due to

CPD

65% pitch conversion

rate

£123k saved in

recruitment fees

85% staff retention v

70% industry

average

64% organic growth

87% positive client

ratings

94% client retention

20% Improvement in

margin

11 new business

wins due to CPD

initiatives

48% increase in

digital revenue

Source: Averages taken from 2013 IPA Gold submissions

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Making the Case for Talent

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Should We Invest in People?

Source: Max Blumberg et al

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Talent Adaptathon

Fifth strand in Ian Priest’s APADT agenda Strategies to attract, develop and retain the right talent and skills Competing amongst ourselves, but also with other industries and countries 150 people from IPA member agencies and beyond Mix of expert presentations and 3 x Adaptlabs: - Filling Future Skills Gap; Retaining Talent; Making the Industry more Diverse

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Mastering Complexity – Max Blumberg*

* = CEO Blumberg Partnership; Research Fellow Goldsmiths, CIPD Consultant

‘Human capital plays an increasingly important part in generating shareholder value’ ‘One asset most difficult to copy or replicate in business is human capital’ ‘But organisations are not necessarily as important to talented individuals’ ‘High impact learning culture and personal growth opportunities are key to agency success’ ‘Investment in training and development could be a differentiator between competing companies’ ‘Challenge to agencies: Track your investment in human capital as a % of revenue’

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Investing for Growth – Sydney Hunsdale*

* = Former COO/ CFO of international agencies (DDB, Razorfish, VivaKi)

‘We are all in a relationship business and without people we are nothing’ ‘People are a critical asset and a financial liability – we can influence but never control’ ‘Cost of staff turnover in media/ advertising = £184m (20 weeks+ to reach peak productivity)’ ‘Replacing senior level staff can cost 200-400% of salary; mid-level = 150%; junior = 30-50%’ ‘Hidden costs of staff turnover could wipe out 5% of profits’ ‘Finance and HR Teams should be joined at the hip’ ‘Reducing churn should be a mandatory management KPI’ ‘What if agencies could reduce turnover by reinvesting some of churn costs in training?’

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Relationship between CPD and Income Growth

What the real numbers tell us

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IPA Commercial Team Research

Objective To establish if there is a relationship between agency commitment to staff training and income growth Hypothesis Those agencies that show the greatest level of commitment to CPD through external courses and qualifications have greater levels of growth than their counterparts

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How we answered the question

1. Gross Income growth between 2010/11 and 2012/13

2. Number of CPD hours based on successful completion of IPA qualifications and

courses over 3 year period

3. Agencies are split into 3 x gross income groups using 2010/11 income as the base

(<£5m; £5-15m; £15m+)

1. Agencies include: media; creative; digital; integrated

Source: IPA Commercial Team

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Gross Income Band Number of IPA Member Agencies

1. <£5m 97

2. £5-15m 26

3. £15m+ 32

Total 155

We collected data from 155 member agencies

Source: IPA Analysis

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0

10

20

30

40

Up to 50 51-100 101-200 201-500 500+

# Agencies

# Agencies

1.1 Agencies with <£5m Gross Income

Hours CPD

Total agencies

= 97


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0

10

20

30

40

50

60

70

Up to 50 51-100 101-200 201-500 500+

% Showing growth of 10% or more



Hours CPD

All = 48.4%


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-5

0

5

10

15

20

25

30

Up to 50 51-100 101-200 201-500 500+

Median level of growth %



Hours CPD

All = 9.7%


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1.4 <£5m Gross Income - Summary

Hours of CPD Learning No of Agencies % showing growth in income

of 10% or more Median level of growth

Up to 50 37 40.5% -0.8%

51 to 100 21 52.3% 16.1%

101 – 200 18 55.5% 21.8%

201 – 500 13 46.2% 10.3%

More than 500 8 62.5% 26.3%

All 97 48.4% 9.7%


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0

5

10

15

Up to 250 251-500 500+

# Agencies

# Agencies

2.1 Agencies with £5 -15m Gross Income

Hours CPD

Total agencies

= 26


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0

20

40

60

80

100

Up to 250 251-500 500+




Hours CPD

All = 50%


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-30

-20

-10

0

10

20

30

40

Up to 250 251-500 500+




Hours CPD

All = 13.7%


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Hours of CPD Learning No of Agencies % showing growth in

income of 15% or more Median level of growth

Up to 250 11 27.3% -20.1%

251 - 500 5 40.0% -11.9%

More than 500 10 80.0% 36.0%

All 26 50.0% 13.7%


2.4 £5m - £15m Gross Income - Summary

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0

2

4

6

8

10

Up to 500 501-1500 1501-3000 3000+

# Agencies

# Agencies

3.1 Agencies with £15m+ Gross Income

Hours CPD

Total agencies

= 32


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0

20

40

60

80

100

Up to 500 501-1500 1501-3000 3000+

%Growing by more than 15%

%Growing by more than 15%


Hours CPD

All = 53.1%


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0

5

10

15

20

25

30

Up to 500 501-1500 1501-3000 3000+




Hours CPD

All = 15.7%


AMV BBDO

Hours of CPD Learning No of Agencies % showing growth in

income of 15% or more Median level of growth

Up to 500 8 12.5% 4.6%

501 - 1500 9 44.4% 14.4%

1501 – 3,000 7 71.4% 28.4%

More than 3000 8 87.5% 23.5%

All 32 53.1% 15.7%


3.4 >£15m Gross Income - Summary

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Conclusions

• Agencies that invest more in CPD and training through IPA courses and qualifications have greater levels of income growth than counterparts

• Agencies that invest less in CPD and external training deliver lower levels of income growth, particularly in middle tier

• Irrespective of income group, the more agencies invest in CPD hours, the faster they are likely to grow

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Income Growth

Training/CPD

Income Growth

Training/CPD

CPD + Income Growth = Virtuous circle

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Real-life examples

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1. Hunter Lodge – Smaller integrated agency

2. M2M – Medium-sized media agency

3. AMV BBDO – Large creative agency

Putting it into practice

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• Integrated agency with 20+ people based in Rickmansworth

• Creative, digital, media and strategy

• Key clients include: Action for Children, Canon, Cats Protection, NFL, Post Office, VWFS

• All staff have IPA Leg Regs & Touchpoints

• All client facing staff have IPA Commercial Certificate

• Agency staff with >1 year tenure average 200 hours of CPD per annum (8x IPA agency average)

• Gold accredited at IPA CPD awards for 7 consecutive years + Platinum for 2

• ISO 9001 accreditation + Investors in People Gold Award

• Agency re-brand based on ‘Unquenchable Thirst for Knowledge’

• £16 return on every £1 spent on CPD

Hunter Lodge ‘CPD is bedrock of our success’

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Hunter Lodge ‘CPD is bedrock of our success’

“Holding qualifications such as the Eff Test and Advanced Certificate means

our staff are hard wired to only suggest solutions that will generate the

highest possible ROI and payback. With business results such as these, it

is not hard to see why CPD plays a pivotal role in our business

development strategies”

Robert Hunter, MD & Founder,

Hunterlodge Advertising

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M2M - ‘Long term commitment to people development’

£180m

Billing

120 people

(30% growth

y.o.y)

100% client

retention

2014

Recent

wins

Scale

clients

Awards

success

Shortlisted for Media

Week’s Agency Of The

Year in 2013 and 2014

People development is founding tenet

Increasing L&D investment YoY

Mix of IPA/ OMG/ M2M courses

Applied for CPD Gold in 2013 & 2014

Achieved both years!

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To help build a case for investment, we take time to understand the ROI from CPD.

Looking at: 1. Initial Feedback 2. Learning demonstrated 3. Behavioural Change 4. Specific results

STAFF RETENTION

85% target met

NON CORE MEDIA

INCOME

Targets more than

exceeded

IMPROVE

OPERATIONAL

EFFICIENCIES

IPA Commercial

Certificate pass

rates measured

CLIENT RETENTION

100%

E.g. 2014

Objectives

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Alistair MacCallum, CEO

“Amongst many points of pride, the CPD Gold Accreditation ranks very highly.

We understand the importance of a culture of continuous learning and development in

sustainable business success. But it is more than that. It is also about our founding

principles and vision. We have always existed to deliver motivating and rewarding

experiences for our people alongside long term relationships built on shared success with

our clients.

Therefore, to receive formal recognition of what we see as a long term commitment to our

people and their development, was celebrated hard.

It’s a key success metric for us””

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• UK’s largest creative agency with 400+ staff

• Key clients: BT, Camelot, Guinness, Mars, Mercedes, Pepsi, Sainsbury’s, Walkers

• Full range of strategic, creative and production services across all channels

• World’s most successful agency in strategy and effectiveness awards

• Part of BBDO Global network – Most creatively awarded in Gunn Report

• Long-standing commitment to CPD produced IPA Platinum

award this year

AMV BBDO Using CPD to stay on top

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• 99% of staff in client-facing roles have 24hrs+ CPD

• All grads take IPA Foundation Certificate

• All grads attend AMV Academy = 100+ hours of training for >100 staff

• All Account Directors take IPA LegRegs

• 70% of Account Directors take IPA Commercial Certificate*

• 100% of Commercial managers receive negotiation training

• All job functions attend Spark Masterclass to promote full range of agency services

• High performers attend BBDO/ Omnicom University alongside international peers

• Training partnerships include: Google, Facebook, YouTube, Decoded, National Theatre

• Specialist sessions on data, coding, UX, leadership, understanding client business

• Internal and external mentoring

• Charity and good causes (AMV Bud, AMV Grow)

AMV’s CPD & Training programme Using CPD to stay on top

* = Colin Fleming, AMV BBDO COO, helped to develop this

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“CPD plays a big role at AMV BBDO and helps ensure we maintain high

standards across the agency. We are committed to encouraging a learning

culture and ensuring that everyone is given the opportunity to develop and

build on their strengths, in both client-facing and non-client facing roles.

CPD not only encourages and supports the talent within the agency, but

also provides added value through increasing knowledge, skills and

experience.”

AMV BBDO Using CPD to stay on top

Richard Arscott,

Managing Director, AMV BBDO

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Implications for You and the IPA

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• Research shows clear link between investing in people and business growth

• IPA provides strong training backbone and access to best practice – blends well with in-house courses

• Agencies can merchandise training investments to win and retain business

• Track and measure ROI for CPD investment to maintain virtuous circle

• Use median figures to check if you are outperforming competitors

• Commercial teams to ask: ‘Are we spending enough on training’?

• Senior management support is key

Implications for Agencies

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• Position training and CPD as part of wider challenge about finding, retaining and motivating talent

• More investigation of link between training and financial performance (eg, profitability)

• Connect training and CPD investment to agency and client business success

• Keep refreshing and developing the training and CPD offer

• Drawing on the best brains and talent from across the industry

• Promote closer collaboration between commercial and talent groups

• Celebrate success through CPD Gold and Platinum awards

Implications for IPA

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Talk to Patrick Mills or Tom Lewis Patrick Mills, Director of Professional Development, IPA Direct Line: 020 7201 8208 Mobile: 07954 357 087 [email protected] Tom Lewis, Finance Director, IPA Direct Line: 020 7201 8215 Mobile: 07785 612 779 [email protected] Andrew Pinkess Director of Business Innovation Direct Line: 0203 787 0148 Mobile: 07967 460 586 [email protected]

Is it time to up your investment in CPD and training?

mailto:[email protected]



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Thank you

Date post:	14-Aug-2015
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