Episode Transcript

Hi, folks! My name is Kevin Dunn and welcome to Agency Unfiltered, a biweekly web series and podcast that interviews agency owners around agency operations, growth, and scale. Nobody knows how to scale agencies better than those that are already doing it and they're happy to share an unfiltered look into what has worked and what hasn't. Today, we have Etienne Turner, co-CEO of digitalJ2, an agency based in Charlotte, North Carolina. His team has created a set of health scorecards that track progress towards top KPIs across the agency's operations, marketing sales, HR, and client performance. We talk about how he prioritizes and sets his agency's goals, where granularity fits into the process, how others can set and track their targets, and which pitfalls to avoid. Accurately track your agency's performance with health scorecards with "Agency Unfiltered" starting now. 

KD: Etienne, thank you so much for joining us today. We're excited to have you on "Agency Unfiltered".

ET: No problem, thanks for having us.

KD: Of course, man. So we were talking about a very interesting operating framework, an operating model that you guys use at digitalJ2. I'd love to dig into it a little but more. Correct me if I'm wrong, it's a health scorecard or a company scorecard. So let's just kick things off, dive into exactly what this framework is and what it allows you to do.

ET: Cool. Ultimately, what we were looking to do is how can we quickly determine on a weekly basis, monthly, quarterly basis, are we on track to hit goal? Because often, what we found was we would do this annual meeting, we'll say, hey, this is the target that we're going to go after, and then we'd forget about it. We'd have no idea are we on track for it, what are the main areas that are affecting us from not hitting that, and so we really came down to we need to really break that out to KPIs and goals from the top all the way down to the bottom. So one, everyone has clarity and focus off of how they impact our growth as a company and whatever direction it is. And then if we are off track, where are we off track? So we could zoom in and actually handle it within a week or two weeks that then keep us back on track for that growth. So it's really helped us stay focused, make the pivots when needed to keep us on path.

KD: So what does this scorecard actually look like? So how is it shaped, how is it built, where does it live? Basically, just to understand the format of it.

ET: Yeah, so right now, we use Databox for it. Essentially what it is, we have 15 top KPIs from operations to overall customer churn rates to marketing sales or how many NQLs, sales calls, proposals sent out even to HR. So what's the forecast to the amount of time that's coming into the pipeline, relative towards the company utilization rate of when's the next hiring you need to take place. So we try to limit to 15 KPIs and they all are against the actual goal. So we'll be able to see relatively very quickly what is it and to the goal that we're at, that then determine are we up or minus, and then if need to, then we can drill into the specifics.

KD: How did you narrow down to 15? So what was the decision making process that picked the 15 ultimate KPIs to track?

ET: I read in a book and they said 7-15, and so I stuck with that, yeah.

KD: How about the goal-setting process? Is there any processor, a prescriptive way you go about setting goals?

ET: We really liked the EOS Model traction. We really liked the mythology of looking and doing an annual plan and then having your quarterly sessions and your 10-minute week meetings. And ultimately, it's just looking at, where's our vision, where's our 10-year vision, what's the three-year plan, and then how does that break up into this year? And it's all relative towards being realistic or not. It took a little bit of time to actually build that realistic ability. Sometimes we get to hey, we want to do this but do we really know what that means? So by implementing all these KPIs and numbers, it's really helped us understand what are the steps to get to that. So then we can then take the day-to-day, the week-to-week, the month-to-month, the quarter-to-quarter steps to actually hit those longer-term visions and goals.

KD: So to help provide a more strategic roadmap to your point, day-to-day, week-to-week, month-to-month?

ET: 100%, yeah. It's big time, big time.

KD: I think you alluded to this, but as we were talking, there's multiple levels to it. So you have this company scorecard but are there also department-based pieces? Does it go all the way down to the individual? I'd be interested to hear how the stack just shapes out.

ET: Yeah, so that goes back to creating more focus for everyone. So we want to time metrics to every single individual person within the company that ties into it. So yes, it's broken down by company initiative. If it's a sales issue that we notice, we can click in, we can zoom into the sales, what's happening in the sales side of the department, and if we want to zoom in to actual one-individual person, we can. What's really helped out with that is, like I said, the clarity and the focus, but when we want to get people to do certain things, having a number and understanding that they're being tracked on it really helps with that. And one of the things that we've done to go further to ensure that we get the actions that we want is that it's tied to their bonus as well. So if they're not hitting the relative KPIs, we can crawl back certain bonus structures off of that. So that really then helps us control the actions we want to then help us ultimately hit our long-term vision goal.

KD: So there's performance-based benefits, rewards if they meet, hit, exceed the KPIs and the scorecards?

ET: Yeah, 100%. The mythology that we look at is we understand that growing a business isn't just us, it's going to take all of us. And so, I really try to have the mythology of this is our company and if we succeed, we want everyone to succeed. So we actually have pretty strong baseline salaries and then they can make up a lot of money as long as they are able to be able to manage x amount of revenue.

KD: Yeah, that's great. So we have it in Databox, but how does it synthesize or how does it spread itself amongst the organization? Is it brought up on a monthly basis? Company meetings, team meetings, one-on-ones? Where else does it live and breath so people are thinking about it each and every day, week, month?

ET: So generally, we have it in different cadence. We do a weekly meeting where we'll review the weeks and then say, okay, here is our week numbers. Some numbers are just on a month to base. We don't record it, so even for accounting purposes, we have that number in there but we only report it at the end of the month so the number is stayed there. But on the week-to-week numbers, we review on our week-to-week, and we'll do to-do action items. If we see that metrics are falling down, a to-do item would be you need to get this done this week because it's relatively quick. Now, we do review quarterly initiatives which we call rocks which are ultimately a longer cadence plan that needs to be executed. But there's always ownership off of that, so again, it's relative to is the issue leads or is the issue that our clients have to, satisfaction score has gone down. Can we do that within a week or is that going to take a quarter? And there's always ownership against that to say hey, we're falling off a plan, we'll speak as a leadership team what are the movements and pivots that we think should take place and then the one person whose ownership of that then has to go fulfill that. And then we are always looking at that on a weekly to quarterly to annual basis.

KD: And then is that a team-wide strategic planning session if something short of a goal or—?

ET: So what we'll do is annual, it's always leadership, quarterly is leadership, and then weekly, it's company-wide.

KD: Got it. Got it. How long has the scorecard been a part of your operating framework?

ET: It’s been about a year now.

KD: Nice! Obviously, I think providing a better roadmap, allowing you to strategically plan to hit goals in the future, is critical—but are there any other major benefits, positives that you've seen come out of leaning on this scorecard process?

ET: Yeah, I mean, to me, I want to know how to run a company effectively, because I'm just a big picture person. I need to see the steps that we're taking to get there and I feel that if I don't have that, where are we? Are we on plan? Are we not? And then also, I think, it sounds so simple and I think a lot of people say it, but focus is huge. It's a thing what Dharmesh said is lining all the vectors. I think when people understand the number that they need to influence, you're aligning that vector with the long term plan, and that's been what really is helpful to a person who is just executing on our account management side to understand what they need to do to influence that. And that's a thing that's invoked fire within our company is people are enthralled with the growth. They're enthralled with the mentality that they could see their fingerprints off of the bottom line and understanding how we're growing. They get really, really involved with that versus just here's my clients and I'm over here. They're learning a lot of business aspects by seeing these data boards and reviewing them on a constant basis.

KD: I'm just imagining your own flywheel, having ownership towards how you influence these numbers and must apply force to the process but then having just clarity and transparency around which numbers are the most important reduces a ton of friction in your own processes.

ET: Yeah, big time, because oftentimes what happens is if we didn't have that clarity on an annual or a quarterly basis, you lose sight on what we're doing, because we make a annual plan and then we would be like three months, six months down the road, what were you trying to do again? I know it was growing revenue, but what were the steps we were going to take? It often just fell apart. And so by just having all that there, it's just straightforward where we're going from there.

KD: That's great. So one year in, let's just say, okay, I'm an agency, I want to try and learn or create some sort of operating framework similar to yours. What are the steps to get me there? What's my situation now? What's the biggest red flag I should look out for? I'd be like, wow, this is something I need, what are the steps to begin building my own scorecard?

ET: I think the first step is just understanding the direction you want to go. So I think that what are you trying to do as an agency? Are you trying to grow by revenue? What is the main focus? And so, I think you first need to understand the direction you want to take and then you need to start by breaking out what are the top 15 KPI that you think that you could look at and quickly understand the pulse of the company. Well, sometimes, we'll change some numbers up but we're now starting to get a good fine-tune of “we believe this is the foundation”. But what are the top three or four KPIs that very quickly are going to understand are we healthy or not healthy in operations? For us, we have client satisfaction scores. We're looking at average project timeliness, we're looking at quality execution ratings so if we want to ensure our quality ratings, and then overall, just the satisfaction of the IMMs themselves through that site, so—

KD: IMM is?

ET: Inbound marketing manager for us. I think once you understand what the minimal numbers between each department, then you can then ask yourself, okay, if I wanted to zoom in to operations, what are the key metrics that I want to look at? So we're structuring the pods. So we have a pod leader, and then they have the pod individuals, inside are the project managers, and we'll be able to actually break out the different, separate pod numbers. So if operations, let's just say isn't going the direction that we want, We could zoom in to the operation scorecard and then say, is there a specific pod that's holding us back from that? Then we can zoom into the specific pod and see what is the actual individual that's holding us back? And then there's a coaching opportunity there to then say, hey, your efficiency ratings are low or you're not putting any time or xyz, but there is a great coaching opportunity for the manager to then help them get to where they need to be.

KD: So now your coaching conversations are more intentional because the data is backed by the numbers on the scorecard. One year in, I'm not sure how iterative of a process it is, but had anything in the initial rollout process gone wrong? Are there any pitfalls that you would avoid if you had to start all over again?

KD: Yeah, I mean, one of the things is just ensuring that your data's right.

ET: Yeah, that's a thing that's often overlooked is whatever tool you're using to measure is actually accurate. Sometimes people take a face value of this is accurate data and when you start rolling it into all these micro boards to the top, it just becomes a mess, so then you're actually really not, it's not informing you of anything if it's not correct. So the first thing is if you are utilizing Databox or integrating with different areas, like an accounting platform, integrating with a HubSpot, or whatever it may be, just make sure your numbers are right first. And then once the numbers are right first, you could play around with the metrics that you're going to use to get the actions that you want your people to be going after. So it's the thing that we didn't ask ourselves first. We did try to add too many metrics, and then, we were doing the opposite of clarity, it was more confusion. So less is more off that side and sticking with it and just keep it. I think a lot of companies could say this model sounds great, do it, and then leave it. You gotta keep the pulse, keep moving.

KD: To optimize it, yeah. How often do you look to reevaluate, optimize? Do you ever swap out KPIs? How often does that occur?

ET: Anytime we see actions if we have our managers say, hey, I'm seeing that I'm having a hard time getting the inbound marketing managers to do x, I say find out a way that we can measure that and then we're going to put that part of the bonus structures where we can crawl that back out and now that becomes a KPI there, and then we can ask ourselves does that KPI worth to be in the operations department one, or does it worth being there? We'll just depend. But we'll always try to find interactions on how to get people to do what we want through that.

KD: All right. So here's the gap in our reporting, help me find the metric that'll help shed some light there, and then find the exact place that it needs to live.

ET: Yeah.

KD: What does the future hold for the reporting scorecard, the health scorecard?

ET: We do have some manual processes still in it, so I think anytime you introduce manual process, there's room for human error, and then, again, data could be messed up. So the future for the scorecard is we are looking to move into an all-in-one agency platform where time's being tracked, you have your efficiency ratings being tracked. Right now, we're calculating a lot of things manually to then input that data. It's not just pulling in directly from source. So one initiative is to move into an all-in-one agency platform to where we can just pull that data out versus manipulating it.

KD: Have you already picked the tools, the software, the systems to help get you there?

ET: Yeah, so I've looked at three major ones. It was Workamajig, Mavenlink, Accelo, and ultimately we looked at Accelo. So I think that's the one we're going to move forward with.

KD: Cool. Final question for you. I ask this to all the guests. What would you say is the weirdest part of agency life?

ET: I would say we have a very young staff, and so it's not common to have footballs being flying, Nerf guns being flying. We do have dogs. Can I share a little story actually?

KD: Yeah, yeah, go ahead, yeah.

ET: We moved into a new office space. And again, this whole agency life is you have dogs, you have Nerf guns, which is fun, we enjoy that, but we had one of our team members get a new puppy. Not really a puppy, the dog is like this big.

KD: Okay, big puppy.

ET: Big puppy. He was gone and she went and she peed on the floor and we just moved into this place and we have wood floors, it's a large, large office space, and we didn't think anything of it. I was like, "Hey, let's clean it up." And we get a call from our landlord and they say, "Hey, is there a leak in your office?"

KD: What floor are you guys?

ET: Well, we thought we were only on the first floor, and so we end up finding out that there is a tenant underneath us.

KD: Oh, man.

ET: So some of the pee went on down to the other tenant under there.

KD: That's very unfortunate for the garden-level tenant to be like—

ET: Yeah. It's definitely weird and fun to have so much young life but you definitely have some of those challenges of that type of stuff happening.

KD: And check to see if you have neighbors below you.

ET: Yeah, we didn't know.

KD: And now you know.

ET: If you look at our place, you don't know that there's a second floor, so yeah.

KD: All right. Well, that's it for us. Thank you so much. This has been a great episode. I appreciate you again for coming on.

ET: Awesome! Thank you for having me.

Yeah. Thanks for tuning in to another episode of "Agency Unfiltered". If you like what you saw, heard, or read, make sure to subscribe to our playlist on YouTube, our podcast on Spotify or Apple Podcasts, or our newsletter on agencyunfiltered.com. Alongside episode launch notifications, the newsletter also comes with a ton of other helpful, strategically curated agency content from yours truly. If you want to keep the conversation going or provide a counterpoint to this episode's discussion, tweet me at @Kevin_Dunn. I'll see you again in two weeks, but in the meantime, keep it unfiltered and let's all grow.