Without a Well-Defined Scope of Work Nothing Works Well

A precise scope of work is the underpinning of a working relationship. It is critical for defining priorities, staffing and compensation and for providing agencies with the ability to achieve and maintain their desired margins. But marketers, seeking more “business-like” agencies claim they are challenged when developing precise scopes, protesting frequent changes within their companies and the marketplace make it difficult to deliver the precision being sought.

Roth Associates understands the push from agencies and the pull from the marketers. We believe despite the likelihood of change within a given planning cycle, a clearly defined scope can be developed. If necessary, a buffer can be built-in to accommodate projects that pop-up and require immediate, unanticipated attention. If material changes in direction continue, a staffing review is appropriate.

1. Marketers should list all the agency work anticipated for the coming year including needs for initiative leadership, strategic insight, creative development and execution, integration and activation.

2. The agency should list all the work they expect or recommend for the coming year and include staffing by number and level.

3. Agency and client should align the two lists of work.

4. Staffing and resulting compensation should be developed for an aligned scope.

5. Staffing and compensation should be benchmarked against experience and marketplace pricing.

6. Priorities should be determined by affordability and strategic importance.

Without a sufficiently specific scope of work it is difficult to determine fair and mutually satisfactory compensation – the bane of most client/agency relationships. The above process should become the basis for arriving at the appropriate scope. While it may seem to be a time consuming annual activity, in practice it is not. We have often coached our marketing clients, along with their agencies, through these steps with gratifying results from the agencies and the appreciation of procurement for a process that yields mutually acceptable agency compensation.

A precise scope of work becomes even more of an imperative for marketers and agencies seeking incentive-based compensation arrangements. A specific scope of work can assist marketers and agencies in identifying high priority projects, campaign goals, and desired behaviors that could be included as incentive based compensation components.

Roth Associates is expert in delivering scopes of work and compensation strategies which are mutually satisfactory to both the agency and the advertiser. Our ability to benchmark agency costs and our understanding of staffing optimization is unmatched. We leverage extensive intellectual property, a broad, deep and proprietary agency cost data base and more than 20 years’ experience serving marketers of all sizes across all categories.

The Roth Associates team will be attending the ANA Masters of Marketing Conference in Orlando in October. If you are planning on going, and have questions regarding scope, compensation or any other aspect of agency relationships, we would be delighted to spend 15 minutes chatting with you. Let us know if you are interested and we will figure out how to find you.

If you have questions, please ask. Or visit us on the web at www.askroth.com.