One of the main points of the world-renown book, Good To Great, by Jim Collins is the hedgehog principle:
‘What can you be the best in the world at (and what you cannot be the best in the world at). You may have a core competence in something, but you may not be the best in the world at it. Do only what you can be the best in the world at.’
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Ad agencies get the big bucks for the big idea. At the most basal level, this is their hedgehog, to create and deliver! They are think tanks. Nonetheless and all too often lately, we see ad agencies veering far away from their hedgehog.
HEY, COME USE OUR STUDIO!
A primary example of this is the production studio. Retouching and prepress services require certain skill-sets that are be both valuable and profitable to the agency- and in many cases they are a necessity to deliver the end product of what the agency has created. So employing a studio for the internal agency fits nicely into their hedgehog. However, we’re seeing agencies try to sell their studio services to other competing agencies with the ultimate goal of turning a larger profit. The downside to this is the studio is a major ingredient in the agency’s proprietary brand essence, their thumbprint. -And isn’t this also taxing to the valued internal resources of the agency?
Collins explains that the hedgehog survives because it innately does one thing, and sticks to that one thing exceptionally well. IT IS CONSISTENT, that’s why it succeeds.
Agencies veering from their hedgehog seem to be an unfortunate trend. There may be seemingly sound reasons detracting them from their core initiatives, but the proof is in the pudding. An economy of scale is one thing, but this has time and time again proven to be a futile and costly exercise.