What are the New Rules for Madison Avenue’s Makeover?

Madison Avenue Manslaughter is the industry standard game.  Most clients and agencies are playing it, using a self-defeating playbook.  This game sees brands that do not grow; CMOs who come and go like White House staffers; clients who abuse their agencies (declining fees; ad hoc Scopes of Work, vendor relationships); agencies who abuse their staffs (overwork, downsizings, lack of diversity, depressed salaries, unattractive career paths); cost reductions positioned as agile initiatives; executives who follow rather than lead, and greater creativity described as the solution, even though no one knows what it takes when funds have dried up.  Profit margin, not creativity, is the real god, and all is sacrificed on its altar.

What are the rules followed by The Makeovers?

1. Relentless problem-solving for clients. The Makeovers know that clients are obsessed with the need to improve their business/product growth rates, margins and share prices -- and having budgets and plans that will reliably get them there.  This is not easily done.  The default situation for most companies is chronic, average underperformance -- the outcome of management’s best efforts over time.  Corporate executives and managers are like undisciplined rowers in an 8-man shell, pulling like hell to move the boat but thrashing the water and one another instead.  Rewards are there for executives and agency/consulting partners who can help them focus and synchronize their efforts in an effective way.

2. Client problem-solving is a mission and discipline for The Makeovers. Their professionals are trained in the art and science of client performance turnarounds.  What does it take?

• Understanding the nature of a client’s underperformance today. The Makeovers ask:  Why are brand growth rates stagnant?  Is it pricing?  Distribution?  Product features?  Competition?  Technology?  Customer experiences?  Image?  What explains today’s unexciting performance?  The Makeovers analyze, communicate and sell their findings to the client’s management organization.  This underperformance analysis defines the starting point for a performance turnaround.

• Defining a client’s full performance potential if certain actions are taken.  How much better could a client be if a different course of action was taken?  What new plan of product development, distribution changes, media spend, media mix and Scope of Work deliverables will lead to improved results?  Why?  What will it cost?  What’s the potential return?  The Makeovers put their professional reputation on the line, tabling a new vision of what can be achieved, with all its supporting evidence.

• Gaining agreement to implement the full-potential plan and becoming a well-paid performance partner for its execution.Strategy and implementation go together. The client and its Makeover partner work hand-in-glove throughout the year to review and redefine the full-potential plan.  What is working?  What is not?  What changes need to be made?

3. The Makeovers are active, not passive partners.  They do not “provide good service.”  They fight for their right to be heard and to be in relationships that take them seriously.  They have a POV.  They negotiate their relationships at the top -- with CEOs, CFOs, CIOs, CMOs, CPOs -- to have the necessary air cover and support for their turnaround efforts and to weather the inevitable conflicts and disruptions that a turnaround will create.

The management consultants, of course, have the edge as Makeovers because they have unceasingly focused on hitting home runs for their clients to justify 5x billing multiples for their highly paid, A-list professionals.  In 1973, Bain & Company was the first to articulate a corporate mission to “redefine the management consulting industry to focus on delivering client results, not just producing reports.”  Its clients, over time, outperformed the S&P by four to one, setting an example for others in the consulting industry, where it is now standard for a consulting firm to position itself as delivering improved results.  Since consultants have been adding media and creative capabilities to their product portfolios, they are increasingly capable of carrying out full-potential plans for major advertisers -- and they’re winning at this game.

Media and creative ad agencies, by contrast, continue to work by Madison Avenue Manslaughter rules, letting clients take all the key initiatives: defining and arbitrarily cutting their fees, growing their undocumented Scopes of Work, moving SOWs in-house, etc.  Agencies are far from being considered performance partners by their clients.  That used to be the case, back in the ‘60s and ‘70’s, but those days are long gone.  Today, agency client heads hang on to what they’ve got, fearful of client losses; the notion that they should be responsible for defining and implementing a client’s full performance potential is completely alien.  “The client does not give us this role.”

There are new rules for Madison Avenue’s Makeover and a few insightful players are positioning themselves to dominate the game.

And the others?  They’re receiving and giving a thousand small cuts, slowly over time, but every year is worse than the one before.  They’ve learned to tolerate the pain, and they’re soldiering on to provide service and creativity, even though it’s not changing the outcomes.

One day it will end, sooner rather than later.  The Makeover game is the only winning game in town.

Cartoon courtesy of Michael Farmer.  Used with permission.

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