Close-Up: How do you keep talent in recession?

Some creative thinking can help agencies avoid making staff redundant, Matt Williams writes.

So, we know we're in the grip of the worst recession since World War Two. Jobs have been cut, salaries have been frozen, hirings have been banned.

But great talent is in short supply, great staff are working harder for less reward, and the "lucky to have a job" sentiment will only get you so far. So what can agencies do to stave off job losses and ensure staff are still motivated even in such tough times?

Bartle Bogle Hegarty, for instance, has asked its staff to take one day unpaid leave a month, in recognition that keeping a fully stocked agency is the most important thing. Almost 100 per cent of its staff agreed and now feel safe in their jobs.

"The only way for us to progress is to continue to invest in building our talent base and broadening our capabilities, so we can't just cancel strategically critical hirings, external training, or our staff welfare initiatives," Charlie Rudd, the BBH managing director, says.

There have already been a number of examples across the industry where agencies have been inventive in their cost-cutting measures, to prevent staff culls.

One London agency could, for instance, save £15,000 per year in bills just by improving its ability to turn off all office equipment at night. Another realised that it could save £1,000 per year by polishing its atrium floor six times a year, instead of the usual 12.

Improvements in technology have also been widely embraced, and can mean agencies cutting down on flying staff around the world for meetings, conducting them from their offices instead.

And while this may seem demoralising for an industry known for its sense of fun and adventure, it's a small price to pay for preserving talent. "All staff understand the climate we're in, so they all seem to be quite sensible about it and willing to help," Jed Glanvill, the chief executive of Mindshare, says.

After all, in this climate, having a job with a few limitations is better than not having a job at all. But such a sentiment is hardly likely to boost agency morale. The tougher the working conditions, the more important it is that staff are motivated and happy. Easier said than done when finances are tight, of course, but that just means agencies need to be more creative than ever when it comes to looking after employees.

Lean Mean Fighting Machine, for instance, ditched its recent plans to hold a big party to celebrate its fifth birthday as it would seem inappropriate. But the agency is determined to hold cheaper activities for its staff every few weeks, such as life-drawing classes for all staff and a contest called Touch the Buck, based on the game Touch the Truck, with the truck being swapped for a creative called Buck.

Tim Bonnet, the chief executive of Tequila\London, also extols the virtues of installing an agency bar just off the main lobby area. He claims that it really enhances agency spirit, yet also allows it to make a small profit. "As we are able to offer a very subsidised bar, staff are far more keen to stay and socialise after work," he says. "And by buying the drink in ourselves, we spend less than we would do if we were holding our agency dos at a swanky bar nearby."

If agencies want to emerge from the recession with not just their finances but also their cultures in rude health, then cuts need to be carefully balanced by new ways of motivating their people.

Agencies that can pull this off will be the ones who don't just survive the downturn but who use it as an opportunity to thrive.

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AD AGENCY HEAD - Charlie Rudd, managing director, Bartle Bogle Hegarty

"It's a cliche, of course, but agencies only have one genuine asset to protect: our people. As well as our offer to staff, we've targeted all non-people costs. In the last 12 months we have changed our travel policies, fixed our energy costs, cancelled building refurbishments, reduced the number of awards shows we enter and renegotiated with our key suppliers.

"Anything to avoid making redundancies and losing our talented staff."

DIGITAL AGENCY HEAD - Nick Blunden, chief executive, Profero

"We've certainly not gone down the route of making any drastic cuts, as I think that giving the impression to your staff and clients that times are tough will just undo any good work that has already been done.

"People need confidence in their agency in order to be creative, so we made a conscious decision not to undertake any radical measures. Instead, we've tried to look at those little things that can be done, such as scrutinising our suppliers, and reassessing how people travel to and from meetings."

DM AGENCY HEAD - Annette King, chief executive, OgilvyOne

"We've tried to keep as many of our staff initiatives as possible in order to prevent any drop in morale, but instead have given them all a slight tweak to make them more cost-efficient.

"For instance, we've always had a monthly company meeting where we recognise the 'stars of the month'. The prize has usually been cash, but now we've asked clients to provide prizes. The prizes are just as well received by staff, the clients also enjoy getting involved, and it saves us money, too."

CONSULTANT - Patrick Doherty, head of cost-reduction, Deloitte

"In the recession, being responsive is paramount. Many companies are having to consider changing aspects of their business that were previously considered untouchable.

"Strategic alliances with competitors are being forged, such as some banks considering sharing IT infrastructure and payment systems.

"Agencies cannot ignore this type of cost-cutting if they want to keep their talent. It is the ones that have embedded cost-management into the DNA of the business that will pull away from the pack in managing their margins.

"In the current environment, it may be the difference between survival and failure."