The Real Reasons That Agency Projects Go Over Time And Over Budget

Posted by Deltek on May 19, 2020

Ask any agency operations manager, PM or head of creative services what’s causing creative projects to go off track, and the chances are they’ll start blaming clients. Deltek and UK ad industry bible Campaign recently surveyed agencies across more than 30 countries and found the number-one issue agency professionals were concerned about was “over-servicing or scope creep”. Over half (51%) of the respondents worldwide were struggling with doing too much for their clients. Meanwhile the most common reason for projects being delayed or going over budget – reported by nearly three-quarters (73%) – was “client expectations changing mid-project”.

Reasons for Project Delays and Going Over Budget

Bad clients – or bad project management?

This chimes with earlier research we carried out with Campaign, which found that the number one challenge for most agencies was “managing ever-increasing client expectations for cheaper, better and faster work”.

Our survey suggested that many agencies aren’t equipped with the right tools to help their operations teams get the job done under pressures. Two-thirds (66%) of agencies admitted that it was “somewhat” or “very” difficult for resource managers to adjust their plans if new work comes in or priorities change.

How successful agencies are keeping their projects on track

The most popular strategies for keeping projects on track both rely on good internal monitoring of operations. Over half (55%) of survey respondents were actively monitoring hours/costs spent, and adjusting their plans to ensure things stayed on budget. A similar number (53%) were using past data to build accurate 
estimates for new projects.

It’s perhaps not surprising, then, that around 80% of the agency professionals we surveyed were using some type of integrated agency management system to manage workflow.

The advantages of an integrated management tool didn’t just include improving internal productivity and efficiency (the number-one area that most respondents wanted their agency to improve on). Anecdotally, these also provided the transparency that agencies needed to accurately monitor and review projects with their clients.

Robert Steers, partner and head of digital at Sydney-based strategic marketing agency Step Change, spoke for many who took part when he noted that projects go awry when “the deliverable and time frames are not accurately tracked and conveyed to the client”.

Given that the top three reasons cited for projects going off-track were all client-related (“client expectations changing mid-project”; “too many rounds of revisions” and “the client takes too long to review/approve work”) – having management systems in place to track that happening (in real time) allows agencies to be more upfront and more transparent with clients about progress. This not only helps manage their expectations for a project, but also gives you the evidence you need to justify any additional charges for delays or extra revisions.  

Greater transparency – your new best friend?

If you’re dealing with tricky clients, being more open with them about some of your processes and workflow may not come as second nature. But for Robert Steers, as for other industry insiders who contributed to the report, integrated agency management systems – and the greater transparency across project and client teams they bring – are a useful tool for client negotiation: “The transparency helps with client expectations and deliverable, and when projects are delayed, clients can see why that is the case, as well.”

However, given that only a quarter (27%) of agency professionals are currently satisfied with their integrated agency management system, and 20% weren’t using one, it seems there is still plenty of scope for agencies to improve the tools they are using to manage operations.

Agency Management System

So if your agency tends to point the finger at clients for everything that goes wrong, it may be time to stop client-blaming. Instead, start thinking about how to manage them more proactively, so that everyone takes full ownership of their part in the creative process.


 

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Read more insights from agency experts worldwide in our full report A Global Snapshot of Agency Trends,carried out in partnership with ad industry expert Campaign.