Project Management & The New Business Process (With Peter Levitan From Saatchi & Saatchi)

Read The Transcript:

Ben Aston: Welcome to the DPM Podcast where we go beyond theory to give expert PM advice for leading better digital projects. Thanks for tuning in. I’m Ben Aston, founder of The Digital Project Manager.

Now, having run a new business team and an agency, I know as well as anyone how tough it can be. It’s hard to position the agency, right? It’s hard to pitch well, and it’s really hard to win new clients, and that’s before you’ve even tried to deliver anything. So love it or hate it, the new business or sales process for any agency really is its lifeblood. But it’s a pretty good barometer for how well an agency is doing, so we’ve got to get it right.

It’s important then as project managers that we find a way to work with new business and sales teams to help them win more work, to help win new projects for us so that we can then deliver them successfully. But the thing is for many project managers, even the talk of new business can give them the shivers. Projects can often be underestimated. They can be too loosely scoped, and then they’re just tossed over the fence for the project manager to deliver.

So, today, I really just want to talk about a better way of doing this. There’s got to be a better way for new business and for us project managers to work with sales more effectively, and that is what today’s podcast is all about. So keep listening to find out how you can start working better with your new business and sales teams to help them win more and get projects that you can deliver successfully.

So today, I’m joined by a man who could help us bridge this great divide between new business and project management and delivery, Peter Levitan. Peter is an agency growth consultant. He’s ran the business development at Saatchi & Saatchi. He’s owned his own shop, and his clients included Nike, Montana Lottery, and LegalZoom, and he’s bought and sold three ad agencies as well. So, hello Peter.

Peter Levitan: Good morning or good afternoon, good evening. Who knows? Sometimes people listen to these things at midnight, 3:00 AM. So wherever you are, hello.

Ben Aston: Peter, thanks so much for joining us today. I wonder if we can start by just if you can tell us a bit about yourself just … I gave you a top line overview of your résumé. But what is your story? How did you get to doing what you are doing now?

Peter Levitan: It’s a path. I started life as a professional photographer in San Francisco. I had a studio out there and did work for companies like Mondavi, which obviously was a lot of fun because you could drink the product when you were done. Always nice to work on wine. I woke up one day, and I said, “I do not want to do art for other people.” I moved back to New York where I grew up. I joined an agency called Dancer Fitzgerald Sample, which some people have heard of, most haven’t. It happened to be the largest agency in New York.

Massive clients like P&G and Toyota and Saatchi & Saatchi bought us. So, those were the, I got to tell you, the good old days. We made a lot of money, and we had fun, and it was even mentioned on Mad Men, so that’s nice stuff. I went to Saatchi, and I worked there in New York on various accounts. I moved to London to run business development and to run J&J across Europe. That was fantastic, couple of years living in Notting Hill. I then moved back to New York for the last year of the original Saatchi & Saatchi when Maurice and Charles ran the agency. It was a strange year, but I ran business development there.

I left after I had figured out about halfway through my last year in advertising that there was this digital world, and that was CD-ROMs and the birth of the Internet. I went to a very large media company called Advance Publications, which owned Condé Nast, et cetera, Random House, and started to put their newspapers online. I did that for a few years, and then I started a company called ActiveBuddy, which was really one of the first companies that allowed people to talk to having an interaction with a computer, person to computer, a really early stage SIRI.

That died in 2002 when the Internet fell off the cliff, the first cliff fall. And for some reason, I said, “All right. Let’s all move to Oregon,” and I bought an advertising agency. I sold that about six years ago. Now, I do three different things, one of which is consult with advertising agencies around the world using my business development skills.

Ben Aston: Good stuff. What are the other?

Peter Levitan: Ah, the other. I’m back into my photography. I have a multiyear … I’m thinking five, six, seven-year global program I’m doing. You can see it at peterlevitanphotography.com. I’ve photographed people around the world, and then I am a small angel investor, just keeps my brain cranking.

Ben Aston: Nice. So, in terms of the kind of challenges that you faced then as an agency consultant, you must see … Well, I’m intrigued. Do you see the same things coming again and again year after year? Or do you see things shifting and leaving as time goes by and people find different issues that they’re all tackling?

Peter Levitan: Well, the background for agencies, and I mean all types whether it’s PR or advertising, design, digital, is that there are multiple factors that have affected the ability of agencies to grow. I’ll just name two. One was the birth of digital, which of course increased the workload because there are so many options and platforms to think about versus the days when it was TV, radio and print. I mean, just imagine it’s crazy. Then the other, the recession from the late 2000s really affected clients and their decision-making in respect to, frankly, how much money do they want to pay agencies to do the work.

So you’ve got these … Anybody in the agency business knows this in particular project management. You’ve got competing worlds. One is clients want to spend less and at the same time they want to do more. So, it creates a … We’ll call it … interesting world for agencies. Now-

Ben Aston: Carry on.

Peter Levitan: Yeah, go ahead.

Ben Aston: Yeah, sorry. Carry on.

Peter Levitan: Well, at the same time, I think every advertising agency, and I’m going to use advertising agency as the global defining words, because there are lots of different kinds of agencies now. They all understand that they should be doing sales 24/7, but they all don’t do it, and there are many, many reasons why not, and not the least of which is that it’s hard work, and a lot of agencies just really do not understand B2B marketing. So that’s the world I live in.

Ben Aston: Okay, So from a project manager’s perspective then, as they’re trying to help new business win more work but also trying to help themselves not get shafted in the process by winning work that they can’t deliver. What do you think are the biggest challenges for new business that project managers need to understand?

Peter Levitan: Well, I think the agency itself has to have a very clear process and a very clear understanding of the kinds of business that it wants and the kind of business that it might win. One of the issues I talk about, and I talk about it both at the beginning of the new business process and by the time an agency gets into the pitch, is really understanding who you should be talking to, why you think that clients should be hiring you, and how you’re going to run a process to manage the business development system.

So I cannot imagine a smart agency not involving product management in developing a system from scratch and having that system be a set in place before the agency does any business development or deals with any incoming. I think that they have to have a major seat at the table and the agency has to have a program and a system that is repeatable, that makes sense, it’s a template, and it’s run in many cases through the PM person. So what that does is, one, it makes the agency smarter and much more efficient, and it hopefully reduces the anxiety at the product management level.

Ben Aston: I think for many project managers, it can be hard for them to get a seat at the table where the new business process is often quite disconnected. Sometimes, it’s even outsourced. So you have a team of people who are responsible for winning the work and all they care about is their KPIs are often … Okay, how many new clients did you win? What’s the value of the accounts that you’ve won this year? But profitability is rarely an important … one of their KPIs that they have marked on.

So in that kind of scenario where for someone who might be listening, they’re a PM in an agency with a new business team that they’re quite disconnected to. How do you think that they can get themselves a seat at the table to do what you’re talking about? Because I think it’s totally valid. And hey, project management needs to be at the table with new business in order to help steer the ship. But any kind of pointers on how a PM can earn that seat at the table? What can they do to help new business see the value in what they would be doing?

Peter Levitan: I think that in many cases, the issue is coming down to … And I’m not suggesting an agency have a P&L for each pitch. But they need to have some sort of financial tracking system to manage the pitch, and I think that’s where the PM comes in. And probably, as silly as this might sound is, go to the pub or whatever with the business development team and have this conversation. I’d like to think, and this is how it should work, that senior management at the agency … if it’s a small agency, the owner; If it’s a larger agency, the management team … has to be involved in this.

I mean, at the end of the day, they’re looking at the profitability of the agency and running too many pitches for the wrong clients and not running them efficiently is an incredibly high cost to an agency. I think product management has to play a role in that. I refuse to believe that an agency management or the business development team cannot understand the importance of managing the entire process correctly and having a process set before you ever get the incoming. They won’t win pitches if it’s run in a zoo-like atmosphere. And frankly, most agencies run. It’s like wild animals when it’s a pitch.

Ben Aston: Yeah, well, it’s because we all get excited, right?

Peter Levitan: Well, I use dating. One of my major metaphors, if not my best metaphor for a business development, is dating. We all get excited. You meet somebody and you go, “Wow. This is it.” If it’s somebody that you’re actually interested in, you have to have a little bit of a system to woo them, and this is all about wooing, right?

Ben Aston: Yeah.

Peter Levitan: So you don’t go on your first date to the most expensive restaurant. You got to figure this stuff out.

Ben Aston: The woo system. I like it. So, we’ve talked about one challenge is that the pitch process itself having a process and system around so that you don’t have too many … You’re not trying to pitch for too many things. You’re not investing all the agency’s resources in pitching and going after everything. But there’s this other challenge which is when a new business does win the … You win the brands. You win the clients, and everyone is excited about it. But then it gets passed onto the project management team who are responsible for actually delivering it.

And at that point, new businesses have made these bold and wild claims about what they can deliver and how much it will cost, and then the reality sets in for the project manager who has to deliver. They’re like, “Well, why was this ever agreed? There’s no way we can do this for 100K. This is a 500K project or engagement. How did we get to this place? Have you got any advice for a project manager in that situation?” They’ve just received the scope of a project and a budget that nowhere near meets the scope that it’s being sold in. From a project manager’s perspective, what should they be doing?

Peter Levitan: Well, let me turn it around for just a quick second. Is this a fairly standard issue in project management? Is this what you hear from your world?

Ben Aston: Yeah, I would say this happens all the time that the new business team oversells because they want to win the work. So they’ll say, “Hey, of course, we can do that, and we’re going to sell it at this special price, discounted price,” because they want to win the work, so yeah. Cost or the amount that client is charging, it’s being pushed down, and clients are expecting more. It aligns with that trend that you were talking about. Clients are expecting more for less, but what I find now is that clients are … They’re shopping around as well.

They’re putting out the same brief, and they’re saying, “Best and final offer. How cheap will you do this for me?” So new business teams are often just undercutting just to win the work.

Peter Levitan: Okay. Well, let me go sort of Gary Vaynerchuk here for a second. I’m going to assume a lot of your listeners know who Gary is. I’ll use his words. It’s absolutely bullshit that this should happen, so I’m just going to … I’m going to say it happens. It shouldn’t. It’s absurd. It’s why agencies make less money than they should. Okay, I can’t. I’m not going to address that. So the reality is they get a new client. Everybody’s excited. Isn’t this great?

I just want to divert for a second and just say that there were just a couple of things I wanted from clients. One that they paid a lot of money in that case that this wouldn’t be an issue, or two, they’re famous, or three, they love marketing and love what the agency is going to do for them. And finally, that they’re nice people. I had very few clients that had all four. If I got two, I was lucky. Fame and nice was okay if it was Adidas, right? Okay, we’re working on Adidas. Everybody’s happy.

So hopefully, at least at the beginning, everybody agrees. That’s why this is an account we want to work on, all right?

Ben Aston: Yeah.

Peter Levitan: There’s no secret formula here. I think it’s interpersonal relationships in the agency. When you have a creative director overdelivering, overworking the job, coming up with too many ideas, saying, “No, we’re not ready. We need another week. We need another two weeks. We have to put another 100 hours into this.” That’s a failure at the top of the agency. What can a product manager do? I’m going to be frank here. I don’t know. They could go on strike and say, “Sorry. We can’t do this.” They can write some memos. They can send emails. They can use Slack or whatever the agency uses to communicate.

But the bottom line is I think they have to demonstrate to somebody that cares, and I’m assuming on every account there is a leader, including new accounts, and say, “Look, you tell me, because it’s not my … ” Now, I’m talking from the PM perspective. “It’s not my job to make sure that this is a profitable piece of business. I’m assuming that you guys have figured out why we’re doing this.” Okay, so, “It’s not my job to be responsible for being profitable because you oversold it, but it’s my job to bring it in at the lowest cost and as efficiently as possible. I’m just not sure that this is a solution solved by PMs. On the other hand, I know that there’s the anxiety and the issues and so forth.”

Let me, again, I’ll turn this around. What are you hearing in the marketplace that … How do people solve this?

Ben Aston: Well, yeah, I think it comes to where we started the discussion, and that is I think it is important that PMs do have a seat at the table with business development right from the start. So then we’re evaluating the opportunities together that no project or no budget ever gets sent to a client without some kind of project management approval and review of the scope that’s attached to that estimate. I think if we can get a seat at that table and we … For me, it comes down to this alignment with business development.

We don’t just want to be winning clients like you talked about that and not going to deliver us a return on that investment that we’re making. So, that return on the investment might be a sexy client. It might be that they’re really nice people to work with or that we’re kind of aligned with what they do. But really, it does have to be … It has to be generating some money, or there needs to be enough clients that are generating lots of money in order for the whole thing to be sustainable.

And I think the temptation can be for new business just to go for the quick win and think, “Hey, well, I’ll be out of here in six months anyway when this project goes over budget.” So, they sell the team shorts. I think if the PMS can be at that table and involved in business development right from the start that I think it’s a lot less likely to hit the project management team with this budget that’s too small and a scope that’s too large to be delivered, because then it becomes the project manager’s problem.

Management will say, “Well, just find a way.” We’re like, “We’ve only got 100K to just find a way to deliver it for 100K.” The reality is it’s a half a million dollar project, so how are you … No one’s ever going to win with that.

Peter Levitan: Well, I think, here’s a potential solution. Just one. You’ve got to get ahead of these problems. The day when you get the $500,000 account and they’re only going to spend 100,000 is probably a bit late in the calendar. I realize that a lot of the folks that you’re working with, the product management people, some are full-time at the agency, but they’re stretched in many ways. Some are also freelance brought in at the last minute to work on the project.

Here’s a suggestion. When I had my agency, I was dumbfounded by … I used to work very closely with our CFO. We talk about profitability, and I was having a problem. Even though I own the agency, I was having a problem with my creative team about them doing too much work. So, I hired an outside consultant because their voice was listened to. Even though as the boss, their voice was listened to. I wrote this up on my blog. If you just search on the word process, you’ll come across it. It’s quite lengthy. What I did was I simply changed a few words. I took what the consultant sent me and I put it up on my blog.

My suggestion is that a project manager, take what I wrote, rewrite it, and then hand it around a little bit and say, “Okay, this is something I’d like to talk about for the future. I don’t know how you solve today’s problem because it’s already been sold, but you can certainly work on the future, and I think that’s imperative.”

Ben Aston: Yeah, love It. We’ll have a look for that and make sure that we link to it in the podcast as well.

Peter Levitan: Yep. On page four, so you get it for free.

Ben Aston: Perfect. I’m trying to understand a bit more about your advertising agency business development system, and you talked a lot at the beginning about it’s about creating a system that’s sustainable. So, can you tell us a bit about how the system works or is it bespoke for the agency?

Peter Levitan: Well, what I have … I mean, I certainly have a system that is somewhat templated. On the other hand, every agency I work with is completely different. Whether they’re small or large or medium, a PR agency is different from a digital agency, which is different from a full-service advertising agency. So, I apply certain things that are, I think, universal. And again, many agencies don’t have this. What are Your business development objectives? What kinds of clients do you want? How much money should they spend?

Then how are you going to attract them? What are the strategies? What are the inbound and outbound strategies? Account-based marketing being outbound is … That’s how I lead people. Know who you want and figure out how you’re going to talk to them. Have very clear timetables for how all this works. Very clear roles within the agency. Who is going to do what, when is it due? Right? This is project management 101. Have very clear communications. Have that be part of if you have a weekly meeting, whenever the agency gets together or the core team gets together, who’s doing what, it’s due.

I remember that my creative director partner, eventually, not that long into when we had a very clear process, would come into my office and he’d say, “You said you were going to write a white paper about something. You’re a week late.” This is the creative director. So we got it into our culture, and it has to be part of culture, but it also has to be run exactly … This is really an important point. You have to run business development in the same way that you run a client’s job or the relationship with the client — objectives, strategies, timetables, deliverables, who’s in charge.

Ben Aston: Yeah, so, in terms of codifying that system because there’s a lot … I think from a project management perspective, it’s often hard to get people on the same page. Gantt charts might work for one person or a big document might work for another person, but that kind of change management partner … It’s one thing to create a process and a system. It’s another thing entirely for people to follow it, including yourself, as you gave the example. So, how do you codify it and then that kind of change management of introducing a process for new business? What are the things that you find useful in rolling that system out?

Peter Levitan: Well, I’ll start with, “Keep it simple, stupid.” It’s not like you have to deal with the lowest common denominator in your organization. But if it’s too complex and they won’t read it or work through it, then it’s a waste of time. You have to have a system. And really, this is the bottom line. You have to have a business development plan. It’s called a sales plan. Every smart organization has this. I mean, let’s just look at a client. Adobe, which everybody in the agency deals with, has a business development program to grow Adobe.

It’s not just waking up in the morning to going, “Gee, we need some new business. How are we going to go get it?” If the agency doesn’t have it, it needs to figure out a way to do it. many of my clients come to me from junior levels first because they say, “I’m losing my mind here. Can you help us?” Right?

Ben Aston: Mm-hmm (affirmative).

Peter Levitan: And quite often when that happens, when it’s a more junior person, I help them a bit. I send them to look at things that I’ve written. I have 600 blog posts. Read some of these. It’s free information. So when it’s a junior, they have a tough time selling it. By the time it gets to the owner of the agency, they know they got to do something. So, is there a secret here? The secret is you need a plan. If you need a plan to get your agency to develop a plan, then you’ve got to start with the plan to get people to do something they should be doing otherwise.

Ben Aston: Yeah, I think this comes back to one thing that you mentioned earlier as well though, which is I think often the true cost of business development isn’t something that’s actually calculated often. So people can be … People know that new business is really important. So, it often trumps all else. No one actually ever does that due diligence and say, “Okay, well, let’s work out how much money we spent on that last pitch. How much resource did we actually invest in trying to win that? Hey, we work out and we spent $40,000 on a pitch for a project that was only worth $100.” That kind of thing.

So I think often trying to find the data points and also it might be that we spent 40K and then we delayed two other projects, which meant we lost one of the clients, and there’s a whole knock-on effect, right? So beginning, to put some … If you’re trying to make a case for introducing more process into business development, trying to find some data points to work with to illustrate why it’s important to create more of a system I think can be really valuable.

Peter Levitan: Well, I’m going to say right on you have to do the math. In my book that I wrote on pitching, there is a section called The More Painful Math. It really looks at, and I’ve estimated this based on talking to many agencies of … Just to give you an example, an average RFP could cost $15,000 just to process it. Just the RFP. So at the beginning, you have to say, “Is all of this worth it?” I think a postmortem is absolutely critical.

And maybe going back to your question a few minutes ago, product management, if they can find the time, and I know this is hard. I’m working with the financial person at the agency. What did that last pitch actually cost in both hard costs and in staff costs? And of course, as you said, there’s the follow-on cost of, well, we’re not paying attention to the clients that we already have. So, the best way to get the agency’s attention is to say, “We’re losing money on pitching.”

Ben Aston: So you’ve also written a book, and it’s called The Levitan Pitch, and it has a wonderful claim, a bold claim. Buy this book, Win More Pitches. You don’t even need to read the book. You just need to buy it.

Peter Levitan: Just put it under your pillow.

Ben Aston: Can you give us a sneak peek into what The Levitan Pitch looks like?

Peter Levitan: Well, it’s 250 pages. So there’s a lot here. It’s, again, I discuss at the beginning of the book how ugly the whole pitch process can be if you don’t manage it correctly. I talk about really having a way to determine, “Should I bother pitching this business?” And then understanding really what is it that motivates a potential client. You really have to put yourself in their shoes and you’ve got … I’m going to keep it simple … two types of clients, really smart ones and ones that … I’m not sure the best word. Let’s just say dumb or inexperienced.

They’re just throwing a count out into the world, and they don’t even know what their objectives are. I hear that from pitch consultants, so I know it’s the reality. Then there’s a system, I mean, you have to understand how the agency is going to do this, and it has to be a repeatable way to approach. Then really the last … almost the most valuable section in the book are a bunch of interviews I did with experts and bunch of different kinds of experts because you can take my word for it, and I’ve been in the agency business.

But I realize that it’s very important to go talk to the people who are really on the front lines, and that means the consultant, the pitch consultant who has now met with six agencies, and they see the spectrum from brilliance to idiocy. So, these are just great interviews and it’s ultimately … Don’t take my word for it. “Let’s listen to some experts.” That’s a two-minute perspective on a 250-page book.

Ben Aston: Yeah, and to finish, I want to round out with just talking about failure. I mean, we’ve touched on this, but I mean, you’ve talked about creating this business development system. Obviously, you’ve created a bit of a formula for pitching as well. But I’m sure you’ve worked with some clients who’ve listened to what you said and who’ve been able to turn things around and change that process. But what are the things to watch out for where this has failed where you’ve dispensed some advice? Where have people misheard you and got it wrong and then continued to flounder? What are the watch-outs or the roadblocks that people can look out for?

Peter Levitan: Well, the number one issue for most advertising agencies, PR agencies, et cetera, is that they try to be everything to everybody. This is well documented. I’m not the only person that says this. They don’t have a clear positioning. They don’t say, “For example, I’m an agency targeting a specific demographic,” or, “I’m an agency that’s the leading expert in mobile advertising.” So, I’ll work with clients and they say, “Yes, we’re going to be the number one pet products company in the world.” And six months later I talk to them, and they go, “Well, we won Banjo accounts.” It’s like a shiny penny bullshit machine.

So I would say that’s the biggest issue. The second one is that they just don’t follow their calendar. As I said, I trained as … I really didn’t do this. But I trained my creative director into coming into my office and saying, “We didn’t send out the blog post.”

Ben Aston: Yeah, so, it’s important to stay focused, and if you have a process, commit to that process, or the whole thing is going to fall apart. So that accountability thing and staying accountable to one another I think is really valuable.

Peter Levitan: Yes, and in the big meeting, whenever the product manager runs a meeting and points to people and say, “Did you do this?” One of the things I have to say is, “Did you do the jobs in business development you said you were going to do?”

Ben Aston: Yeah, and we’ve got to make the time for people to be able to do this because it’s … I mean, it’s one thing to create a process and assign people all these responsibilities, but they need to be realistic as well. I think one of the things that can happen is when we create a new process or a new system we’re like, “Okay, well, this should work.” And Yeah, logically, it does work, but often it might be the case that there just aren’t enough people to do all those things. There aren’t enough hours in the day.

So being able to … the processes. There’s got to be some agility to it as well, and it’s saying, “Okay, well, let’s review the process. Is this working or is it not? If it’s not working, why is it not working?” Then iterate on it until you get to a point where you’re winning clients, and you’ve got the right Resources to be able to deliver on that process that you’ve created.

Peter Levitan: Absolutely. I think you have to understand the internal workings of the agency and only doing what you will do or only saying that you will do what you will do, I think, and that’s a major failure point is not being efficient and not being smart enough to … So, try to do less. As I said earlier, “Keep it simple, stupid.”

Ben Aston: Good stuff. Cool. Peter, thank you so much for joining us. It’s been great having you with us.

Peter Levitan: My pleasure.

Ben Aston: If you want to check out more on Peter, and if you know that you need some help with your agency growth, go to peterlevitan.com, and you can read a whole slew of Peter Levitan’s posts. He’s got stacks and stacks of really interesting posts that you can check out there that you’ll find helpful. Or if you’re looking for a consultant, check out peterlevitan.com, and Peter, I’m sure, will be delighted to help you. But I’m curious as to know what everyone else thinks about this challenge between managing the new business process and the role that project management plays within that.

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