The ad agency leadership crisis isn't at the top, it's in the middle ranks

After spending more than four years at an agency, Deborah Hanamura had enough. Without a clear path for advancement, she bolted, going to work as director of marketing for management consultant Paladino and Company. The challenges at her new job were similar, but with a crucial difference. At both places, Hanamura has been responsible for increasing brand awareness and use marketing strategies to drive sales. But working on the client side, Hanamura feels much more empowered.

“I’m able to exert significantly more influence in-house and, therefore, enjoy greater momentum and personal satisfaction,” she said. And now, instead of having a shallow relationship with multiple clients, Hanamura can focus on just one brand, her employer.

Hanamura is not alone. Agency middle managers — staffers with three to five years of experience — want more challenges and real leadership experience. Many report being stuck, with only two real paths for growth going forward — neither of which necessarily entails staying with their agency. The best options for them entail either going to the client side or starting their own business.

Agencies are short of middle managers …
In many agencies, middle managers are the firefighters — problem solvers and productivity drivers, skills that come in handy in their lives after agencies. When Laura Noll, owner of MARKETMOX, served as a manager at agency AdStation, she made media-buying decisions, hired contractors and generally “owned” the direction of her agency among other responsibilities. Tyger Danger, public relations manager for Bleacher Report, held management positions at two PR agencies before where she handled five to nine clients every day, hired contractors and trained juniors in addition to other administrative responsibilities.

As effective as they are, both women fit the profile of people most likely to leave — and are paradoxically the hardest to find, according to Kristen Metzger, managing partner and head of people and culture at MEC. In order to retain mid-level talent, MEC has developed a few projects including management training, career path experience mapping, one-on-one learning as well as health programs. But it hasn’t been enough – the turnover rate at the middle-management level is still high.

“Forty to 50 percent of people who leave don’t stay in the agency world. If they do, it usually means they need a promotion and a better salary,” said Metzger. “So when we hire a senior associate from another agency, we need to have the confidence that he or she is truly qualified to get the promotion.”

Metzger added that when businesses like Procter & Gamble and Coca-Cola change agency assignments, it also drives recruitment. When an agency loses a big client, it cuts off employees; and when an agency wins an account, it staffs up.

… But long on layers, vanity job titles and siloed departments
Part of the problem lies in the fact that agencies, especially big ones, don’t give middle managers authority to match their job titles. They get pressure from both C-suite executives and junior professionals: The former have the real decision power while the latter expect mentorship.

“There are lots of layers in middle management at some big agencies,” said Stephanie Redlener, managing director of talent strategy at DDG. “People have vanity titles like vp or svp. But when people work on the client side, they feel more invested.”

Indeed, conversations with a few middle managers have revealed that when they move to the client side or establish their own business, they feel more appreciated and influential in the decision-making process.

Paladino and Company’s Hanamura loved the energy of agency life, she said, but she found marketing within an agency to be like wading through quicksand. Running an in-house marketing department, meanwhile, is like gliding on skates. In general, agency marketers are swamped with client work while in-house marketers can take a back seat.

“At agencies, every decision has to run through a gauntlet of internal reviewers, peanut galleries and competing viewpoints,” said Hanamura. “When I [worked at agencies], everyone wanted to put their signature on every initiative, and there were times where something that should rationally take weeks would literally take years to get done.”

Karan Pandya moved from Razorfish to marketing consultant Kepler Group where he also feels more empowered. At Kepler, Pandya serves as associate director of client solutions, spearheading the direction of three cross-functional teams, each of which is on a separate line of business. “When you work for an agency, you are only supposed to do X, Y, Z. But I want new challenges and work with the best and brightest in the industry,” he said. “Money is a motivating factor, but at my level, I’m looking for daily challenges more than just making a certain number.”

Pandya added that agencies have siloed departments and thus lack the ability to drive impact for their clients.

MARKETMOX’s Noll took a different route. She moved from manager to business owner simply because she has a longtime goal of owning a data-minded marketing and creative agency. “There’s a bit of pride and a huge sense of adventure that comes with taking on that challenge – both of which are exactly what I needed in this next step of my career,” she said.

Mo’ money, mo’ authority
Many mid-level professionals are in a bind: On the one hand, they do like the lifestyle, energy and community-rich environment at agencies. On the other hand, they find it hard to lead a rewarding life at agencies: long work hours, low margins, complicated client relationships and the constant balancing act that comes with selling services.

DDG’s Redlener thinks that agencies should solve the jigsaw puzzle by empowering middle managers. When people are more involved in real business decisions and are informed of what’s going on, they will feel more invested, she added.

And empowerment often means more pay. Dale Ferreira, who used to work as social media community manager for Base2 Digital and is now a marketing consultant, thinks that one simple solution is remuneration. “Agencies can no longer rely on the good life to train employees. The world is under pressure economically, and loyalty is green,” said Ferreira. “If you want to keep brilliant talent, then pay them.”

Paladino and Company’s Hanamura agreed that cash flow is a constant challenge for many agencies. And as people start to have families, they often look for the stability offered by bigger firms. But on top of that, middle managers tend to leave not because how hard the work is – it’s about finding a place where they are able to have greater influence.

“People thrive professionally when they are connected to the company mission, understand their career path, experience success and the joy of winning as well as feel empowered,” she said.