Beware of your final form
The modern agency aims to run a tight ship.
Ideal Customer Profiles, Statements of Process, automation, support from virtual assistants soon to be teams of AI agents.
Clients on retainer, low churn, high rates, time fully utilised, fully optimised.
This is your business in its final form. No more striving to get there, it’s done.
Nothing needs to improve, nothing needs to change.
But the closer you get, the more you realise the drawback.
Same clients with the same problem, delivering the same value for the same budget.
No room to improve, no room to change.
You will run in this form until you stop being valuable or stop feeling fulfilled, then your business will cease.
This aspirational final form, which you achieved by being good, will actually be your end.
You have to build in space for evolution, innovation, and experimentation. Growth stalls when your system takes over. Everything naturally hardens and becomes resistant to change.
So, how do we bring innovation back into the fold?
Ditch The ICP
The first method is to abandon your Ideal Customer Profile (ICP).
Rather than focusing on who you serve (which locks you into the same people with the same problem and budget) concentrate on the core transformation you provide. Then, identify who else might benefit from that transformation.
Your transformation can be applied outside your ICP, opening new, higher-value opportunities.
Take my agency, for example. We helped businesses decide on their initial product experiment. We charged £2,000 for a two-day workshop: one day for brainstorming, another for prototyping. Our initial ICP was new startup founders. Our transformation was defining the feature set for an MVP.
We soon realised that startup founders were not the only ones concerned about the risks of launching new products. Innovation teams within larger enterprises faced the same issue, and they had significantly larger budgets. Armed with proof from our startup work, we began collaborating with enterprise innovation teams.
It was the same value, just a different context and bigger budget.
So, forget your rigid ICP. Pinpoint your core transformation, then seek out other areas where that transformation could be valuable.
Run experiments to network with and market to those new audiences. Learn about new problems you could solve.
New audiences keep you growing and bigger budgets give you space to invest in that growth.
Are you stuck on how to identify your niche beyond your ICP? Sign up to the newsletter, hit reply, and I’ll share some prompts to help you move forward.
Don’t be 100% retainer
Regular revenue is not to be sniffed at but shouldn’t be your only model.
The very nature of it being the same every month, doing the same thing and charging the same money, hopefully results in stability. But if you max yourself out on stability then where is room for innovation?
Growth needs uncertainty; it needs new people and problems. More of the same problem is scaling, and all scaling has a ceiling (your final form).
Alongside your retainer work, always look to help with something new. If you have capacity for 10 retainer clients, consider taking 8 or 9 and leaving room for a wild card project. The perfect project work causes big change in a short time frame rather than the slow improvement delivered by a retainer.
Big changes are big value and will cause change in your business too.
If you do design, this could be prototyping a new idea for an existing client. If you run marketing, it could be a set of strategy workshops for a larger business that doesn’t know where to start.
If you don’t want to stay the same, leave room to work on things that are different. Don’t max out on retainers.
Hire Different
Hire interesting people.
How you hire will take your agency in one of two ways. Hiring for your system will deliver your system; hiring to shake your system up will take you somewhere new.
Growth opportunities do not always come from new clients; your team will deliver them too if you have a culture open to it.
By the time my agency found its growth, our positioning was enterprise product UX. But that wasn’t the only thing our team could do. We had designers who could do a bit of branding and others who could code front-end components. This made us more interesting, it made us different, it revealed new opportunities.
When clients needed those things, we could provide some value. Although we were never going to scale those offerings, it opened doors and got us working on projects we wouldn’t have normally.
A system with documented processes is easy to staff. If you've perfectly defined a role, it's straightforward to find someone to fill it, follow your processes, and deliver the work.
That person will operate entirely within your existing system. They are an employee of the final form.
However, when you hire someone different, or someone with a skill in a new area, you force change. Can you adapt your business model around that person's strengths?
The person might suggest new ways of working or fresh value they could add. Client interactions with this individual can uncover new opportunities. Their unique skillset and energy can differentiate your business.
It is difficult to predict the exact impact they will have, but change will inevitably occur.
This can unlock new value, open new avenues for billing and grow you.
Price It In
Of course, to make all this happen, you need to price it in (an article for another time).
The time spent experimenting, lower utilisation, and more interesting people all cost money.
Were you expecting to grow, without assigning a budget for growth?
I’ll leave you there.