Why The Agency Model is Broken A better way to partner in the digital age

In theory, business plus agency should be a match made in heaven. Companies can outsource their creative, strategic and technical work to expert teams, while they focus on their own area of specialist knowledge. A win-win, right?

Not quite. Despite the many wonderful, high-quality products agencies have given us, the traditional outsourcing model is beginning to crack. We live in a world where digital products and services are outperforming physical goods on a consistent basis – which means design and execution need to move much faster if business is to survive. In order to achieve such speed, however, firms must partner with people who – not only return with a solution on brief – but also understand increasingly complex long-term visions and goals. This is something that's often beyond the capabilities of a traditional agency, particularly as they juggle a barrage of deadlines and continue to deliver for multiple organisations using limited resources.

It's more than just transaction
Most agencies treat client relationships as a basic transaction. The client asks for a product or service, the agency delivers – and everyone moves on. But digital products aren't static creations, so the digital creation cycle cannot be so simple. As evolving ecosystems in their own right, apps, platforms and digital services alike must remain agile and responsive to changing user needs and demands – and this requires continual optimisation – not just on an agreed-upon contractual basis but as a daily priority. Agencies that rely on fixed-scope or one-off delivery models thus end up letting companies down, struggling to keep pace and leaving clients frustrated with products that fail to meet future demands. Short-term, time-limited partnerships are rarely equipped to deliver success in the long term.

Becoming an extension
In order for collaborations with digital product agencies to truly thrive, then, agencies must become part of their clients' operations, moving beyond brief to integrate themselves into the overall creative and strategic process. In-house teams have intimate knowledge of their company's history, products, values and goals and, if they are to truly deliver, agencies must develop the same. In other words, they must replicate this deep connection, aligning their own businesses with their clients' for fruitful partnership.

A more integrated model, where agencies work with clients on an ongoing, regular basis, much like an in-house team, will always deliver far more value than traditional outsourcing – particularly when this integration is paired with the ability to tap into a global talent network. Indeed, whist most traditional agencies are fixed to one particular location, more modern teams extend across the globe, allowing these service providers to offer the world's best in expertise, experience and talent. It all makes for a richness and depth of experience that most agency companies simply can't offer.

One step ahead
Another limitation of the traditional agency model is its failure to anticipate future trends. Most agencies are reactive, providing solutions to current problems without looking ahead to the challenges of tomorrow. This can be detrimental in the digital product world, where companies that win are those that not only respond to but also anticipate and shape the future.

This is where progressive agencies are beginning to set themselves apart. By providing proactive, forward-thinking insights and solutions that empower leaders to remain one step ahead, these companies protect themselves from the agency fallacy. They invest heavily in research and innovation as well as design, always keeping one eye on the market to make their clients leaders in their respective industries.

Why the agency model needs to evolve
Ultimately, the old ways of working no longer cut it, especially in digital product design and creation. The traditional agency model, with its transactional nature and lack of long-term vision, is broken. And it's up to businesses that work as partners to understand their clients on a deeper level to fix it.

Agencies that succeed in the future will be those that not only deliver on the brief but also act like an in-house team – with the added benefit of global expertise. Ultimately, being proactive, not reactive; agile, not fixed; and collaborative, rather than transactional creates clear mutual benefits: clients are rewarded with future-ready products that grow and evolve with their user base, as agencies – like Format-3 – work hard to lead change in our digital world.