Ultimate Guide to Agency Culture

I've always found it particularly difficult to write about culture.

When we first started, culture seemed to come naturally to our agency.

Internally, we recognised culture as a major USP for our business. This was validated externally when we began winning awards. Our proudest achievement was ranking 5th best company to work for in the UK overall, and 4th in the tech category— this award was for all UK companies, not just agencies.

Culture came naturally to us; it was easy.

Then, the world changed.

Covid hit.

Chemistry, laughing, and connection were replaced with muted video calls over robotic internet connections.

Body language was replaced by slack status'.

For our business, this period brought incredible growth. We doubled in size, then doubled again, and doubled again, reaching a peak of hiring two people a month for 14 consecutive months.

But today, as the pandemic feels a distant memory and growth has naturally eased. We find ourselves in a generational paradox where managers and seniors are longing for the olden days of culture (but not too much, not to be full time in the office) but the newer generation not knowing what the olden days were like.

As a result, over the last few months, we've been making a much more conscious approach to culture and, to an extent, it feels like we're forcing it too. The natural approach we used to take doesn't translate to the transactional virtual world; how do you get to know your work colleagues when every interaction has a fixed timeframe (usually 30 minutes) and an agenda point/outcome of the meeting?

Why is culture important for agencies?

For me, culture is everything for agencies. I've worked for agencies, I've worked in-house, and I've owned an agency. Culture is what sets apart an agency from an in-house role. So, if an agency is trying to acquire the highest talent on the market, culture is going to be the big draw for an individual if they are weighing up an in-house role vs an agency role.

In terms of the direct benefits to a business, a better culture means a higher level of engagement from staff. This can lead to a boost across all important business metrics; see the below summary from Gallup (more on this later)

The above stats apply to businesses in general. However, for agencies, I'd argue culture plays an even more crucial role. Agencies are people businesses. We sell to people; people buy people, and those we've sold to are then directly serviced by people we hire. If our hires are unmotivated and disengaged, our clients will notice and be unhappy, regardless of the results they get. This contrasts sharply with, say, a sofa company. In that case, the entire purchasing journey might occur without the business knowing who the customer is, and the customer may never interact with a single staff member. Therefore, if the sofa company's staff are unmotivated and disengaged, the customer remains oblivious and unconcerned—as long as they get what they paid for.

So here's my approach and general thoughts on culture in a new hybrid agency world.

The Fundamental: Give a shit.

In the opening page of Daniel Coyle's "The Culture Playbook," he highlights that "culture" comes from the Latin word "cultus," which means "care." This is the recurring theme you'll find throughout this post, as it's crucial.

The first step is to genuinely care about your staff. If this doesn't come naturally to you, try harder. If it still doesn't, then don't force it.

I'd recommend hiring a leader to take over and own culture at the agency. This can be either a fellow director or you can create a "culture club," with its leader serving as your point of contact and internal culture champion. Generally, it works best coming from a senior figure, as they understand how decisions are made and can influence culture more effectively. Often, this falls under an Operations or HR-type role.

Don't force it. I want to emphasise this point again. When I was in-house, we had a CMO who didn't understand culture, didn't care about the team, and focused solely on performance. This was fine; she wasn't a bully or anything—just intense with little time for us. However, I'll never forget when she clearly read an article or book over the weekend about the importance of engaging with your team to boost productivity.

Her response? We were all seated around an I-shaped desk (about 20 of us), and she started approaching each person, asking how we were and about our weekend. No matter the response, she'd nod, acknowledge, and move on to the next person with the same questions. One by one, it became the most forced, painful experience I've had at work. It obviously didn't come naturally to her; she forced it and, if anything, made the situation worse. I think many of us lost respect for her that day.

People, perks and ping-pong

I'm sure you've seen those LinkedIn posts or tweets that usually go something like a ping pong table isn't culture, eg.

reference: https://medium.com/pushtostart/culture-is-not-a-ping-pong-table-3d3f481cc299

And while I definitely do agree with this point, ping pong tables etc are not culture. They are very much an output of trust which is a huge part of culture, i'd argue one of the biggest parts.

In my in-house role, we had a ping-pong table that revealed which teams had cultures built on trust. Typically, the same groups—often the developers—used it most. Other teams would grumble, questioning their productivity. This provided insight into different department cultures. The developers were output-, deadline-, and communication-driven. They knew their tasks and deadlines, planned effectively, and maintained a positive atmosphere. As long as work was completed, there were no issues. Other teams, however, lacked structure and clear direction, operating too reactively to plan well. Eventually, ping-pong was restricted to lunch hours, defeating its purpose and exposing the company's lack of overall trust-based culture. What management thought would boost morale actually created divisions between teams and negatively impacted the culture, as it was introduced without proper consideration.

Culture means to care.

So i mentioned earlier about the 'caring about staff' point, I also mentioned don't force it. There is a middle ground between this which around getting some of the basics in place. Below are a few examples of what I mean and what we do as an agency, they are broadly grouped into recognition and feedback.

Recognition

Recognition and shoutouts are so valuable in boosting morale. Who doesn't like being told they are doing a good job? What if that was coming from their other peers and not just from their manager?

We use Assembly, which I highly recommend exploring; here's the link: https://www.joinassembly.com/ - in a nutshell, each member of staff gets an allowance of points (you can call them what you want), and they can give these points out to different members of staff when they do something great like adding value, excelling in a client meeting, completing a challenging project. Once you accumulate points, you can use them for rewards like food deliveries, massages and other great perks. In short, this creates a peer-to-peer reward and recognition system that the staff love and boosts culture, sharing and relationships across the business. Even more essential in a remote working world. (Note: The rewards are taxable, so staff won't notice it as the overall amount would be small, but you should let them know).

Remember employee of the month? This is another form of recognition. Yes, it feels a bit old school, but the basic concept is easy to adopt, and staff value it - it's a tried and tested method. Every month, the staff can nominate team members to be 'Novae of the Month' as we call it. If there are multiple candidates, we'd then have a final decision vote between the management team. We announce the winner in our monthly company updates, and they get a £100 bonus as well as company-wide recognition/acknowledgement of how well they've performed this month.

Remember, you don't need fancy tools and apps like the above if you can't afford them. A simple Slack message saying 'great job' is so valuable for the team, especially if it's from the founder or director.

Feedback

1:1 check-ins are great for feedback. You should have 1:1s with all your direct line reports, and they should have 1:1s with their reports. Every now and again, I'd recommend getting in 1:1s with team members who don't report to you. This varies based on the size of your agency, so we don't want this becoming a full-time job where you have 1:1s with everyone. The aim of these should be to get feedback on the business, areas you can improve, and lines of communication to improve.

You'll find not everyone is forthcoming with honesty and giving you what you want, but the ones that do are invaluable, and you should tap into that source of information at least quarterly to ensure that how they view the business from their position is aligned with how you view your business from the top. Remember to remove your founder's hat here; don't take it personally. You won't make everyone happy, but you're doing the right thing by asking; most businesses don't give a shit what their staff think and therefore have a poor culture.

If done right you'll get a picture of your agency from a completely different lens, instead of yours and your leadership teams top down view you'll be getting more of a bottom up lens which is invaluable.

As part of everyone's quarterly reviews they receive anonymous 360 feedback from their peers which has mixed insights and most people are overly positive but every now and again they offer invaluable insights, More often than not we find that feedback we have for the team is then supported by the 360 feedback, therefore it's harder to argue with the feedback if its coming from multiple sources.

Think tank

When we were in our fast scaling stage, we created a concept we called a think tank, which can be summarised as follows:

• Each member of staff was able to get a bonus allowance of 5% per year for contributing towards business initiatives. These bonus' would be paid out quarterly based on hitting agreed KPIs/Rocks.

• The SLT would outline broad themes of areas to improve as a business, e.g. culture, processes, marketing ideas, etc.

• Every month, we would break the company up into groups of 2-3 people, and they would each brainstorm ideas around the theme we decided that month, let's say marketing for now.

• The teams would brainstorm and give feedback on their ideas and thoughts to the SLT.

• The SLT would then approve any ideas we thought fit the business and would drive us forward.

• The team would then allocate these ideas or projects back to them as part of their quarterly KPIs

This is a unique system that give the staff a platform to have a voice, share ideas and contribute to the business which then comes back as a full cycle to them getting rewarded once the idea or project was completed.

My initial concept behind the bonus' was around 'people power' so if we as an SLT knew we had 30 SOPs we needed to be documented, that could take a 4 person SLT team all year to complete on top of day to day work. However if you allocated 1-2 of these SOPs to individual staff we'd be getting these SOPs done within a quarter and allowing the business to scale 4x faster.

This was an incredibly successful model when we were scaling aggressively and hiring two people a month for 14 months in a row. I've written about it in more detail on the NOVOS website here.

However, when we got to the 40-people mark, the model itself didn't scale as well as we wanted. We found the SLT couldn't allocate the KPIs across the entire business, so naturally, we had to delegate this responsibility to managers. However, we found we were paying bonuses for essential non-business tasks. Eventually, we phased it out and replaced it with a marketing menu where staff could still get bonuses, but it was only for marketing initiatives that we knew drove value to the business vs them doing a non-business critical SOP process.

NPS surveys

Every quarter, we do an NPS survey. This is an anonymous survey aimed at gathering scores across a range of different criteria across all different departments. These scores are then communicated to the SLT team and put into their workflow if anything needs fixing. The operations team then stores these scores in Notion so we can benchmark improvements and declines each quarter. Once the SLT has compiled an action list to improve the scores, we then share these scores company-wide so we are holding ourselves accountable for fixing the issues the staff have raised (if there are any, it's not a survey to identify issues, but naturally you can always improve as a business).

Lines of communication

We have three forms of company updates:

• Weekly virtual all-hands on a Friday

• Monthly in the office (remote staff dial-in)

• Quarterly written update via Notion

The weekly and monthly updates can vary, and sometimes, we'll do some deep dives into finances/sales or a specific client account. Weekly, we share the wins of the week across the different departments. Monthly, we share both the wins and areas we didn't do well or areas to improve; this gives department leads the chance to be vulnerable and honest about where they know they can improve. We also give full transparency into finances; we always have and always will. The team can see how successful we are off the back of their hard work, or they can see why we're making certain decisions if we aren't performing well.

Anonymous surveys / Q&As

It's highly unlikely all members of staff will ask questions, particularly junior members. Therefore, with big company updates, we often leverage anonymous surveys to gather feedback from the team. Examples of big company updates include removing a member of staff, updating our new strategy, or making changes to pay brackets and progression. If there are a lot of questions, we will answer them on our weekly all hands; if there are less than a handful, we will just write the answers on a notion page and share them with the whole company.

The key to all of this feedback is to actually action it. It's a waste of everyone's time if you do all of this and do nothing. Action it and tell the staff you've actioned it and it was because of their feedback.

People committee

Once the agency had around ten people, we set up a culture club, which evolved into the people committee, and we became employee-owned. The People committee can be a representative from each department or team, and its aim is to provide ideas for the business to improve; it gives these individuals a voice on behalf of their team, with ideas directly feeding into the board/directors to action. These meetings are chaired by the people committee lead, and as part of being an employee-owned business, they also sit on the trust with one of the selling founders. Every year, we then ask for new people to come forward to join the committee, with previous members stepping back. Our model will be slightly different from most due to our employee ownership setup, but hopefully, this will give some inspiration.

Bigger voice and rep for their team if they have that desire and motivation

The role of managers

If you haven't already done so, I highly recommend subscribing to Bruce Daisley's Make Work Better newsletter.

He recently highlighted the statistics and data from the new Gallup report on the State of the Global Workplace (including data for 100 different countries). He highlights how prominent management is across the stats and key takeaways from the report. His conclusion is, "If you want a better culture, then build better managers". Here are stats directly from the Gallup report above related to management:

• Managers account for 70% of the variance in team employee engagement.

• When firms deal with this and increase engagement, this cascades into profit, customer service and retention (some of this is in the image below)

• Twenty per cent of the world's employees experience daily loneliness - it is higher for young employees.

• Work itself normally decreases loneliness. In general, working adults are less lonely (20%) than those who are unemployed (32%)

• Being a manager is a force multiplier - the highs of work are higher for managers, the lows lower.

• Managers are more likely to be engaged and thrive in life. They are also more likely to feel their opinions count, to feel connected to their organisation and to have peers they can rely on for support.

• On the flip side, managers are more likely to be stressed, angry, sad and lonely than non-managers. Managers are also more likely to be looking to leave their jobs.

• When managers are engaged at work, their team members are also more likely to be engaged (and as mentioned above, 70% of the variance in team engagement can be attributed to the manager)

So, based on this, your priority as a founder should be to support and level up your managers if you want to improve culture. You can invest in your managers either with time or with money. So start with either yourself or your leadership team running 1:1 or mini-group sessions to support them and train them based on your experience. Once this is done, the next step would be to invest in external management courses as part of a regular training budget.

I'd also recommend getting your managers to sign up for Paddy's newsletter here > https://thenewleader.digital/about/ < he's run a digital agency in the UK for over 20 years and now runs this newsletter to help level up managers. Our team highly rates it and often shares it among themselves.

Connection is another big part of culture which can be achieved through various different types of team culture activities. I won’t go into detail on these but I would recommend reading Daniel Coyle's 2 culture books. The Culture code and the culture playbook. Both are excellent reads for all things company culture.

In conclusion, fostering a strong and positive culture within an agency requires genuine care, effective communication, and a commitment to continuous improvement via feedback. Culture is not about superficial perks but about creating an environment where employees feel valued, heard, and inspired. It's essential to have leaders who exemplify the values of the company and who are willing to invest in the development of their teams. By prioritising culture, agencies can enhance employee engagement, boost morale, and ultimately achieve greater success.