Pretend That You're An Advisor to In-House Departments

I’ve been looking forward to penning this article for a long time because it unearths some valuable insight that used to be a part of my consulting practice before I gave up working for in-house (or client-side) departments. I’ve followed the space closely, though, mainly because it’s a big part of your world and I need to understand what’s going on in order to advise you effectively.

I had immersive consulting engagements with the marketing departments of 40+ F1000 firms, and I learned a lot. They are unique beasts with solvable problems. Today, though, we just want to understand their struggles without necessarily solving them. I think this will help in your work with them.

By the way, this is the second part of a three-part series. Last week we looked at how these departments are changing and what that means for you; this week we’re looking at how to understand them; and next week we’ll dive into staff augmentation, which is essentially you staffing an in-house department on their behalf.

Here’s what you would discover if you were a consultant to these folks. Here’s what you’d write in your summary report to help them understand what their world looks like:

1. You have a client concentration problem. That’s a big duh: everyone knows it, but few people understand the implications. So let’s pretend that you had a client concentration issue. If you did, you’d migrate from expert to order-taker because they owned you. You wouldn’t push back where you otherwise would because you’d be afraid of losing the client. The client would take you for granted and not be as amazed at your work—they’d be grateful that you jumped through hoops but your work wouldn’t necessarily blow them away. See the overlap? Read this article through the eyes of a department manager with one client (the mothership).
2. There’s no measurable value proposition (currency of respect). It’s true that more of them have chargeback systems than before, but even then the chargeback system isn’t at market rate. In most firms, the marketing department is a cost center, budgeted from on-high and used at will by the various internal clients. Since money doesn’t change hands, there’s no filter for stupid requests. Their “clients” don’t need to prioritize what they need, plan far enough in advance, and spend their chits wisely. The more enlightened entities have moved beyond the cost center model to a hybrid revenue center, but the work that gets commissioned is charged back at a much lower rate ($50–90/hr) and so it’s not a fair fight—you’re always more expensive. On the other hand, let’s be careful what we wish for, because cost equals value in this case and they use you knowing it’ll be more expensive, which they consider a valuable exchange because of the quality of what you bring to the table.
3. You have too many clients, and many of them aren’t qualified. Not only is this true, but it’s exacerbated by the fact that in-house departments do not take account service seriously. They don’t treat it as the professional, expert position that it is. A recent report I saw showed that nearly one-third of departments with chargeback systems don’t “charge” for account service, even. So you have a combination of “account executive” and “project manager” in the same person (always a disastrous mistake), and they are forced to work with whoever needs their help. These are frequently not the decision makers, either, but assistants to the decision makers. It’s a sh1t show, folks, and it comes with unreasonable expectations and snickering from both sides. The unqualified “clients” wonder why things are so complicated, and the in-house liaisons roll their eyes at how much they have to explain.
4. You’re too available to be respected as an expert. That’s because the department is in the building, you eat lunch together, and you can’t hide from someone. You’re right down the hall. Egads: often you can actually book a meeting on someone’s calendar without their consent! Don’t laugh, either, because this is what’ll happen to anyone you embed with the troops.
5. It’s hard to push back and still wear the “Team Player” badge. Unless your career plan is to “quit & stay” (coined by the BLessing & White people in the UK), you’ll need to be a team player. So try to push back on someone’s pet project and still get promoted up through the ranks. The occasional maverick can get away with contrary behavior if the results speak for themselves, but it’s rare and it’s tantamount to putting your head in an alligator’s mouth to see if it’s alive.
6. You don’t do any new business because you have all the clients you need. So it’s true: in-house departments don’t need to “sell” their services or make a case for their existence. If anything, they want less work from internal peers. But what escapes them is that they are not controlling their own narrative about the value they bring. If nothing else, they should set some time aside to educate the larger company on the principles of positioning, marketing, and sales. They need to shape the narrative about how their work contributes to the success of the larger company, and that will not happen automatically. They’ll be vendors instead of partners. They’ll be doers instead of thinkers.
7. Your CEO believes that your primary advantage to the company is cost savings. That is a widely held belief. But I’ve measured it across 19 F1000 firms, and in no single case was that true. It was more expensive to have an in-house firm. But the problem with that perception is that it glosses over the real reason they should have an in-house firm: specialization. That is, a team of people who know so much about their “client” that they can’t easily be replaced. So here you are working with a department that’s not appreciated for their innate value and you can see why they resent you, the outsider, getting listened to more frequently than they are.

There are inherent advantages to in-house agencies, but there are drawbacks, too, and it’ll help if you understand their world a little bit better. There’s no big payoff or call to action here—just passing along some things I’ve learned about them.