Hanson Search talks to Paul Davies, Managing Director at firstlight group on the impact of Covid-19

Welcome to our ‘Getting Business Back’ series where we are talking to industry leaders from agency and inhouse backgrounds about the impact of COVID-19 on their businesses and the steps they are taking as we move out of the crisis.

Here, we sat down (virtually) with Paul Davies, MD at firstlight group. Read on for his thoughts about the impact of COVID-19 and the transformations that he’s seen take place as a result of the pandemic.

What impact has COVID-19 had on your business and on your sector as a whole? 

We had our annual kickoff meeting in the middle of March and set a modest +25% growth budget, which I suppose isn't that modest for a smaller business. Then, in the space of two weeks, we went from that projected growth to anticipating a -25% fee decline. That's quite a swing.

So, it had a big impact; we had to be very cautious. It had a chilling effect on our business and the industry. We had to put hiring plans on hold and make sure that our cost base was appropriate. Everyone in the business played a role and whilst we’re not out of the woods yet, we can see light as the trees thin out. And now I’m pleased to say that we expect to close that gap.

COVID-19 has understandably impacted some clients directly – either operationally or it has hit their ability to predict their future needs. We’re seeing some clients take longer to make decisions and quite frankly I am not surprised. They need to be sure that they’re investing their money wisely and we’re respectful of this need for greater scrutiny.

From a comms perspective, a lot of agencies are pretty average if I'm honest. Many of them sell, they don't solve problems, and if you're in that selling space then your spend is discretionary and you should be looking over your shoulder. Our motto, which is in our bones, is business development through communications. How can we help our clients achieve their growth ambitions - whatever growth means. We are more embedded in the client business performance than in generating noise or coverage.

It doesn't wholly insulate us but it protects us more than other agencies. Comms can be really powerful but it has to be applied in the right way otherwise it is just noise. I think this will be a bit of a wake up call to many in the industry.

As a result of COVID-19, organisations have had to move faster than ever before to problem solve and navigate the crisis. How has this pushed your organisation and industry forward positively and which of those measures taken would you like to remain in place post pandemic?

I think it’s helped remind us of what is important to our clients and to ensure that we start there and work back. It’s easy to get caught up in the momentum of a rising market and that’s where complacency - and greed - can creep in.

We’re now seeing clients adopt a business critical stance. They are asking, 'will this help our business or is it noise?'. If we're doing something that won't help the business, then we drop it. We're not worried about the 'nice to-dos' or the 'could-dos', it's all about the 'must-dos' right now. And I think that's really good discipline.

There's been mission-creep - not necessarily for our clients but in the industry. You start out with your pitch, you do all your analysis, you go in with a really well-informed response and then you throw in the nice shiny ideas. Then 3, 4, 5 years later if you're still working with that client, you've drifted miles away from where you started. COVID has bungee-corded us back into the original mission and that's a good thing. It has put into sharp focus the need to look at all activities and ask if they will help the business. It reminds us that some things are luxuries that we can't afford.

Which of your values/your company’s values have  truly come to life since the beginning of this crisis?

We've always tried to be transparent. Anyone who says, 'Oh, things are fine', are either in a very rare niche or they're lying. We've always tried to do right by our people and be honest with them.

When I set this business up, I took the decision to share as much information with people as I could. That wasn't always the case in previous agencies where I worked. But I thought actually everybody needs to know how we're running the business and what we're doing.  So, from day one, every quarter we share the performance of the business, we talk about margins and challenges and how we're changing our strategy.

We took the same approach in this situation. We wanted people to understand why we took certain decisions. We shared a lot of information. This could be seen as unsettling by some, but I have always believed that it’s important that everyone is aware of how we’re performing. I think it really helped everybody to feel part of the journey.

Internal  communications  has never been more business critical, how has your business engaged with its employees and what changes in culture has it resulted in?

Like I said earlier, we're all in it together. We’ve always done our best to be open and despite being a smaller agency, we’ve made elements of this more structured, so quarterly company meetings to share financial information and update on our progress to plan. A lot of this has now been compressed and we share information more frequently and we have to be more direct.

And of course, we have our PDQs (Paul Davies Questions) – these are breakfasts with less senior team members the morning after our monthly exec team meetings. This is where I get some of the smartest and toughest questions and it’s a great way to check in to see how everyone is getting on. They also check in on me which is really lovely - they're a great bunch of people.

What  challenges  have you faced leading people remotely and how have you had to adapt your style?

The main challenge is that you can’t tell how someone is managing without asking them. It’s probably meant that we’ve all upped the check-in frequency and perhaps been a little more open about stuff because we’ve had to. I like the way that has evolved how we work.

Are there any businesses you feel have communicated particularly well (or not) well during the crisis?

I think most organisations have done a decent job at trying to convey a series of often complex messages in a compressed time frame. Hats off to the supermarkets which had to say no to some customers and massively erode good will whilst at the same time doing the right thing by vulnerable people – and explaining it. I’ve seen this first hand and it was good work.

I really feel for some sectors, like airlines. I think if they had said, 'Look there are going to be quarantines and for this length of time', then people would have accepted it, but it's been fits and starts. Some industries that people say haven't done a great job - well, it's because they haven't had a choice. They're trying to survive and the government gives them the green light and then they say, 'No, red light'. It's really hard for them.

Hospitals have done a great job. The precision and volume and content that they've had to share in a compressed way to multiple stakeholders has been really impressive. It's been like a military operation and I think they've done really well.

As companies move from reacting to mitigating the impact of the outbreak, what is your strategy to move forward over the coming months?

There were things we wanted to do this year that we've had to put on the back-burner. We wanted to invest in extending our offer further into digital and social.  And we wanted to continue our internship programme. We can't do that just yet because it requires resources and support.  And of course it's really hard to do a virtual internship. But I know what it's like to graduate in a recession and if we can help people, increasingly drawn from more diverse backgrounds, feel that comms is an industry that could be right for them, that's a good thing to do. We want to carry on doing what we are doing, but work out how we can diversify our offer.

We went from saying, ‘Whoah, what's going on?' to then, 'OK how do we get our cost base in the right place?'. You can't have a great 2021 if you don't make it over the line. We have good provision as we've always been cautious – I’m Northern, you might say. Not showy. And that gives you a lot of latitude in how we plan. We are already seeing a number of prospective clients pick up the phone which is encouraging but clearly things take time to convert.

Our plan in simple terms is to show up in great shape for when the recovery starts. And to make sure we’ve got the right people in the right roles ready to support clients who – I’m sure – will want to come out of the blocks quickly. We’re looking at how we plan investment and resourcing to deliver this.

What do you feel are the major communications challenges once the recovery begins?

How long have you got?

You can’t CRTL-Z things. We won’t be going back to where we were. Organisations need to think about where they want to land and start to prepare to articulate this.

Authenticity is important. Can we really expect people who went from queuing for food to want to buy a £1,000 phone? Some will of course, but maybe we’ve reached an inflection point where other motivations will shape demand.

As someone born in a recession (don’t ask), graduated in one, was on the board of an agency during 9/11 and who set up firstlight during the financial crisis of 2009 -- things will pass, the economy will recover. It’s just that this time it will regenerate and look slightly different. And we need to be agile if we’re going to help our clients make sense of it.


Posted on 25.08.2020

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