As marketing expenditures continue to take bigger bites out of automotive budgets, automotive boards of directors are getting more aggressive about demanding return on investments from marketing costs. Not only are in-house marketing executives taking the heat; they're now demanding better value and quality from their marketing suppliers - steps similar to those automakers have taken with component suppliers.
Rick Sherwood, vice president of Campbell & Co., a marketing firm in Dearborn, Mich., that supplies services such as event management and product marketing to auto clients that include Ford Motor Co., discusses the challenges facing marketing companies.
Now let me see if I've got this straight. You want this marketing communications outfit to adopt a quality-assurance system like they use in places where they make widgets?
Those were my thoughts when a major auto manufacturer invited a small group of its marketing services suppliers to participate in a pilot quality-certification program in 1996. The quality-assurance program in question had been implemented more than a decade earlier to right manufacturing quality wrongs. But injecting a manufacturing-oriented quality system into a marketing communications firm? Come on!
Well, that was five years ago. That was thousands of dollars in staff time and out-of-pocket expenses ago. That was before we hired experts and created a quality department. That was also about 18 months before we conducted a simple ceremony to signify our becoming the first of the pilot group to earn the quality program certification.
In the years since, two things have become crystal clear:
1. Establishing a legitimate quality system is not cheap.
2. It appears doing so can be a measurably profitable venture. For example, our overall revenue has increased 300 percent; productivity gains and operating cost reductions have allowed us to hold most fees steady for five years; employee turnover has been reduced.
But that's only part of the story. Is it the right thing to do? I'm thinking it is.
Campbell & Co. was founded 18 years ago as a motorsports promotion agency. Today, there are 175 'Campbellites' in Dearborn, Mich., and affiliate firms in Los Angeles and London. We're handling a diverse mix of business from basic public relations projects to sophisticated marketing communications programs.
The company that originally motivated our quality interests has set strict goals to reduce the number of its suppliers. In this environment, qualifying standards become very important for those who consider such continued partnerships valuable.
Widgets vs. ideas
I can just feel the vibes from those of you out there who are questioning - or outright rejecting - this exercise. Viscerally, it's difficult to rationalize widget quality control with marketing communications. I sympathize.
At the heart of widget quality programs are data. Data are crunched and become metrics. Metrics reveal trends. Bad trends are attacked. Overall quality improves.
At the heart of our business is subjectivity - ideas, concepts, creativity. These abstract processes can't possibly be counted accurately, valued properly or trended reasonably.
There's another thread running through the fabric of our businesses: entrepreneurial leaders. They didn't get where they are by pensively reflecting; they got there by acting fast, and often.
So how do you impose an environment-driven, objective-based quality process into a subjective business run by impatient entrepreneurs? The answer is, you don't - impose, that is.
What you do, or at least what Campbell & Co. did, is identify the processes related to those intangibles and improve them in ways that better support creation, development and delivery of the inherently subjective products for which we are being paid.
25 key operations
In preparing for our original quality certification, we identified 25 core processes deemed critical to the success of our company. Sixteen related to the effective implementation of a quality system. The remainder related directly to the way we do business, and none is more important, or more comprehensive, than the project management process.
The project management process is an umbrella under which our thoughts on proposal development, project implementation and project evaluation are documented. Its intent is to provide a friendly, consistent framework in which to operate to assure success for our clients and for Campbell & Co. The process pays special attention to things that traditionally cause friction between marketing communications firms and their clients. For example:
1. Preventing accumulation of non-billable hours because of failure to reach a clear understanding of needs, expectations, tactics, budgets, etc., before beginning to write proposals.
2. Making sure payment terms, conditions and schedules are developed and agreed on, and that they are signed and in place before work begins.
3. Requiring regular status reports and frequently questioning clients to identify problems early, and to resolve them immediately.
4. Requiring evaluation based on quantifiable objectives, which are prescribed in the proposal development stage, to improve the objectivity of results.
So what's so earth-shattering? This is nothing more than standard agency account practice, isn't it? Well, yes. But if your firm is anything like Campbell & Co. used to be, standard account practice varies widely.
This is not to say no variance from the Campbell & Co. project management process is allowed. It is to say that variances from the process will be detected; the reasons for the variances determined; and, if the variances are prevalent and valid, the process will be altered for the good of all.
In the end, this is what any quality system is really about: continuous improvement. There is no end once you begin.
Which brings me to the ISO - the International Standards Organization and its internationally recognized quality standards. ISO 9001 is going to be a requirement in our business, especially for those of us whose client base includes auto manufacturers and their major suppliers. If you intend to grow and intend to do so by serving this increasingly sophisticated client base, you'll probably want to reckon with quality in some fashion now.
This is most important for the small or mid-sized firm. Don't wait to get bigger before taking the leap. Costs associated with adopting a quality system are directly proportional to size, since most cost is tied up in required staff training.
I consider marketing communications a serious business and believe the time-worn acronym RACE (research, action, communication, evaluation) is a valid road map for delivering good work.