This article is making the rounds...
#AgencyLife – The Big Agency Lie
Agencies, by and large, sell hours. Unless they find a way to productise intellectual property or build a clever piece of proprietary technology, agency businesses scale by adding staff as they add clients. Win a client, hire people. Lose a client, fire people.
Somewhere between starting and selling an agency you realise that the only ways to make better than average margins when billing hours is to exploit staff, or manipulate clients.
Because many agencies are deeply insecure about their ability to show tangible results, awards become their primary differentiator. This fuels the unhealthy dynamic between clients and agencies even more. Work is done because it wins awards, not because it achieves business objectives. Choosing an agency primarily on its awards is like choosing an intimate partner based on the car they drive.
"Win a client, hire people. Lose a client, fire people." This has contributed to today's practice of not working for a company until you retire, the acceptance of layoffs and the crazy high turnover rates in companies. They can't keep their best employees because they don't have to.