Everyone knows that it’s common for creative agencies to have a high turnover of staff. Many people in the industry just accept this as a fact of life, thinking that there’s not too much that can be done about it. However, the most successful agencies show that this doesn’t have to be the case. They retain their people for longer, and in turn build a strong company culture. But why is staff retention in creative agencies so poor, and what can be done about it?
Contrary to popular belief, the main motivation for staff to leave their current employer is not to earn more money. There have been a number of surveys done over the years about this very topic. The large majority of them found that leaving for a better salary actually appears quite low down on the list. Instead, the biggest reason for leaving was cited as lack of opportunity and bad line management.
I believe that hiring staff is a long-term investment. To get the most success, you need to see it as an ongoing process of nurturing and development. It doesn’t stop at a job description and a desk! This goes for practically any industry, but it’s especially important for creative agency owners and managers, where staff turnover tends to be particularly high.
Why is poor staff retention in creative agencies an issue?
As I’ve already said, many people in creative agencies tend to accept the high turnover as a fact of the industry. But, I think the issue runs far deeper than this. Replacing staff regularly is not only bad for company culture and morale, but it is also very expensive. As well as the potential recruitment fee, there is the time it takes to find and interview candidates, on top of the time the new employee needs for onboarding. In fact, it can take at least a couple of months before they are truly settled into their new roles and performing at their very best. As creative agencies often don’t make hugely high profits to begin with, this can be an expense that really eats into the cash flow to the detriment of the wider business.
How can staff retention in creative agencies be improved?
I believe that improving staff retention doesn’t have to be a difficult or drawn-out process. The first step is just genuinely listening to any concerns that your people may have. This can take any form that you wish, from informally checking in on them every week, or doing it formally through a regular appraisal. I would recommend a combination of the two. This is because most agencies aren’t bad at the informal check-ins. It’s the formal appraisals that they don’t tend to do very well. This leaves their people confused about their objectives, feeling that they haven’t been properly listened to, and even concerned about career advancement opportunities in the organisation.
Personally, I think that formal appraisals work best when they’re done in the first quarter of the year. This is so people know what their objectives are for the year ahead. It’s important to bear in mind that an appraisal is not a pay review! Instead, it is an opportunity for the employer and employee to discuss role concerns and career paths. A pay review should then follow the successful completion of the individual’s objectives at the end of the year.
But what’s the best way to carry out these appraisals? I recommend that agencies start by deciding who will do the appraisal for each team member, and book the time in the diary in advance. It shouldn’t be less than an hour, and ideally should take place outside of the office environment to avoid any potential distractions. The appraiser should also try their best not to move the date or time, as this undermines the importance of the appraisal to the individuals being appraised.
Appraisal forms, for both the appraiser and appraisee to fill out in advance of the meeting, are also a good idea. For example, this form could follow the key tasks from a job description with a scoring system. I tend to believe that a number system from one to five works best, with one meaning further development required, and five meaning everything is great. But, if another system works better for you, definitely go for it, as it’s all about finding the method that helps your agency best. Bear in mind that there should also be a section for objectives and any further comments.
Before the meeting, the appraiser should seek 360-degree feedback on the individual that they will be appraising. This should be from a line manager (if they’re not the one doing the appraising), a peer, and a subordinate if applicable. The appraiser will then attend the meeting with their form and scores filled out in advance, based on the feedback they have received. The appraisee should also have their scores ready, based on how they personally feel that they’re doing.
At the meeting, it’s time for both parties to review their forms together. If both have scored highly, then there is no need for further discussion, but it’s always good to acknowledge the success! But, if both have scored low, or if there is a mismatch between the scores, then a further conversation will be needed to talk about the next steps and how things can be improved.
Then, at the end of the meeting, I recommend setting a clear set of objectives, ideally following the SMART goals format, together with a development plan going forward, that might involve additional training. The appraisee should also be given a typed-out completed form or letter to ensure that there is no ambiguity surrounding the next steps. Going forward, I usually suggest that another, more informal, catch-up takes place a few months down the line (usually around August or September time). This ensures that the appraisee is on track to meet their objectives, and gives them a chance to request any further assistance if it’s required. If a formal appraisal is done correctly, with clear objectives, it will prevent any difficult end-of-year conversations with regards to pay rises if the appraisee has not met their objectives
SMART Goals for staff retention in creative agencies
When setting goals to help staff feel listened to, supported, and on track, I believe that the best method to use is the SMART goals method. This is a common goal-setting method for good reason. It genuinely works to help you set goals that are realistic but also help to move things forward. So, let’s take a closer look at this method and how it can help staff retention in creative agencies:
- Specific – This means that goals should target a specific area for improvement, so that the appraisee knows exactly what area of their performance they need to focus in on. In turn, this minimises the risk of confusion and keeps everything crystal clear.
- Measurable – Both parties should be able to quantify the goals, or at least suggest an indicator of progress. This helps appraisees to know when they’re on track and achieving their goals, keeping them motivated and, again, reducing the chances for confusion.
- Assignable – This essentially means that the goal specifies who does it, so that the whole team knows what is whose responsibility.
- Realistic – Goals should state what results can be realistically achieved, given the available resources and time frame. This ensures that nobody is given more than they can handle, and goals are fair and reasonable.
- Time-related – Finally, goals should specify when the result(s) can be achieved by, helping to keep the appraisee motivated and setting out a clear path for progression in front of them.
Setting SMART goals should help creative agencies to combat both of the most common reasons cited for leaving a current employer. Firstly, it helps overcome bad line management by taking a proactive approach to management instead, and setting goals that can be measured and managed. Secondly, it also helps provide more opportunities for employees to progress in the company, by setting them firm goals and targets to work towards. So, if you’re looking to improve your staff retention rates, SMART goals are a good place to start. Furthermore, it also supports any new employees that do come on board, so that they feel listened to and valued from the outset.
It doesn’t matter what size your agency is, there is no excuse for not having an adequate onboarding process and a formal annual appraisal for all staff. I have been very fortunate to have worked at some great agencies over the years, so I know what makes them tick and keeps their employees happy. The very best were the ones that truly did see their people as their greatest asset, and didn’t just say it as a token gesture. As a part of this, they spent a significant amount of time on developing the careers of their people and ensuring that they were satisfied in their roles. Many agency owners are put off by this, as it takes time and money to set up. But, in reality, it will eventually save both of these in droves, by improving staff retention in creative agencies and improving the overall company culture.
I work with agencies in the creative sector to overcome their unique challenges and grow as a result. If you think that your agency could benefit from my services, I would love to hear from you! Please visit my website for more information, or get in touch today by clicking here.