Making COVID an opportunity

We are inundated with COVID news each day. It’s getting too overload. The communication in itself has become a pandemic; a communication pandemic. But it’s also an opportunity to look at your business from different perspectives. Take advantage of COVID.

On a trip to San Francisco we visited the Walt Disney Museum and came away with a completely new take on Walt Disney. One of his quotes is very applicable today:

“All the adversity I’ve had in my life, all my troubles and obstacles, have strengthened me. You may not realize it when it happens, but a kick in the teeth may be the best thing in the world for you.”

COVID is certainly a kick in the teeth. While trying to work out how to manage the way out for a studio we are mentoring I realised we needed to go back to basics and develop a balanced scorecard.

The balanced scorecard was first proposed by Robert S. Kaplan and David P. Norton in a 1992 issue of HBR.

The Balanced Scorecard can be very complicated to develop and use. We have devised a simpler way to do it for small design agencies.

There are four perspectives needed to get a balanced view of your business. Once you have this viewpoint you can plan with more certainty.

The four areas are:

Financial perspective
Internal business perspective
Client perspective
Innovation and learning perspective.

If we take a look at each of these we can set some areas we need to mange.

Financial perspective

The first and major area is cashflow. We need systems that constantly manage our cashflow. Think of it as your runway. You need plenty of runway if you want your business to take off. Three months is a minimum runway, six months is desirable. At the basic level there are Excel spreadsheets you can use to project cashflow. Many studio management systems will give you cash flow projections based on the jobs you have in the system.

The second area is job profitability. While you carefully monitor your monthly and quarterly profit and loss there is a more granular area in job profitability. The discipline of pulling a job P+L before invoicing can put dollars to your bottom line. Finding those job creep tasks that need to be invoiced back to the client can feel like a bonus come invoicing time.

Internal business perspective

The key area here is performance. Daily, weekly, monthly and quarterly performance needs to be measured. At a 70% performance rate each designer should be able to bill 1288 hours per annum. That’s 26 hours per week. Do you have a system that checks this? It’s not about recording time; it’s about hours worked and billed back to clients. Most studio management systems allow you to allocate this time and then track it has been done. They also allocate the hours back to the job which shows up when invoicing.

Performance means nothing without new business development. NBD should be an allocated task that has a budget for time spent and expected returns. It needs to be a constant allocation of time; not just something that gets done when things are quiet. This area needs a clear strategy that defines the clients you want and how to reach them.

Client perspective

This requires strategies to Gain, Retain and Grow clients.
Gaining new clients can be through referrals or pitches. Referrals are by far the best approach. Use exiting clients to give referrals. Try to make them as direct as possible by using LinkedIn. Look at who your current clients are connected to (if they fit your profile) and asking for a referral. Getting to pitch to a client as a total unknown is a long game. Use LinkedIn to build your profile with the preferred clients. Build up content that appeals to that client and respond if you get likes or comments.
Retaining existing clients requires empathy. Understand their pains and gains to put together an empathy map that allows you understand their pains and offer solutions that give them gains.
Growing existing clients requires you to look beyond the existing relationships you have. Can you get into HR through a workplace safety approach? Can you get into Operations by showing how design can aid communication and ultimately refine the operations?

Innovation and learning perspective.

Innovation and learning go hand in glove. To innovate you need to learn new approaches. Are you observing changes in the industry? What have digital, AI, VR and AI done to the operation of the ‘normal’ design agency. How is design being integrated throughout client businesses? What skills and knowledge are needed to cope with these changes? This will involve developing a strategy to start the discovery process needed to stay on top of all this.

The take away

While these are four perspectives that should be examined you also need to look at the interconnections. What will innovation and learning do for new business development? And how is the projected new business development plan going to aid cashflow? How will increased cashflow allow you to learn and innovate. By examining all of the linkages you will start to unlock the real value in your business. You can turn COVID adversity to your advantage.

Greg Branson

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Want more?

Here’s more information on design maturity:

1. Walk a day in your clients shoes – empathy mapping
2. Understanding a client to develop new business
3. How design mature are your clients.

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