The Business of Creativity is a series from Emily Cohen and Hunter Vargas of Casa Davka, a consultancy that helps creative firms evolve their business strategies and practices.
Learn from yesterday, live for today, hope for tomorrow. The important thing is not to stop questioning.
Albert Einstein
To move our creative practices forward, we must first look to the past, and to do this, we should wrap up the end of the year by analyzing our business holistically. This critical yet often overlooked end-of-year milestone is necessary to develop achievable yet aspirational plans and goals for the new year. It’s an opportunity to review and celebrate your team’s accomplishments as well as discuss, address, and learn from challenges endured and opportunities left untapped. Let’s dive into these!
Organizational Opportunities
State of the Company
Delivering a year-end “state of the company” presentation to your entire team (or, if you’re a solopreneur, to an accountability partner) is one of the best ways to celebrate your successes and analyze the challenges and opportunities going into the new year. In this presentation, you’ll evaluate and highlight key milestones, metrics, actions, and strategies related to all areas of your business, from new business and marketing to financial to organizational and operational areas such as:
Evaluation of key financial metrics (e.g., gross revenue, company profit, and average project-level profit)
Depending on your comfort level regarding transparency (more on this below), you can showcase this through actual dollar amounts or as a percentage change
Percentage of prospective projects/clients won and lost and what you plan to stop, start, and continue to improve your win/loss rate (e.g., changes and improvements to your business development process, capability deck, proposals)
New business goals and/or key performance indicators (KPIs) that you measure and track throughout the year (e.g., number of projects completed, outbound business development, client outreach, income earned, and profitability by industry and service)
Effectiveness of your marketing initiatives (e.g., social media campaigns/posts, email blasts, website metrics, speaking opportunities, thought leadership)
Recognizing your team’s accomplishments, growth, and any changes, e.g.,
Welcoming new hires
As applicable, addressing any critical organizational structure changes that occurred during the year (e.g., new roles/positions created, key team member leaving, layoffs)
Recognizing big achievements—personal and professional (e.g., how/what each team member contributed to the company)
If you have “values,” how did your team (or each person) contribute to these, and/or how did the company do overall against these values
Fun facts and tidbits (e.g., number of hours worked, number of Slack messages sent, positive feedback/emails from clients, etc.)
Introduction to new changes, strategies, and goals for the new year related to all areas of your business (e.g., revenue, new business, organizational structure, etc.)
How much information is too much information?
We at Casa Davka believe in strategic transparency in which you share just the right amount of critical data and information with your team. The more informed your team is, the more they understand your firm’s vision and the context from which business decisions are made. Your employees don’t want to feel the pressures of running a business (e.g., financial worries), but they do want insight and open communications into the reasoning behind certain critical decisions (e.g., new business choices, organizational changes, hiring needs, salary bands). More on this in our previous article, “The New Creative Team”! We also believe we have a duty to our industry to educate the next generation of creatives about the behind-the-scenes of running a creative firm, the highs, the lows, and everything in between.
Here’s what your peers are doing during these presentations:
“We set a goal years ago to move towards more robust projects that fit best with our process while simultaneously scaling down the sheer number of clients we could take on at any given time. Sharing how we made good on that goal, depicted in infographics that compared workloads across several years while still meeting revenue goals, really impressed upon the team that we were actually walking the talk.
These team get-togethers are always combined with great meals, often a service project for the team, and some downtime for everyone to simply enjoy each other’s company. Candle-making, pottery & cooking classes, museum tours — things that are creative-leaning (and having nothing to do with our work product) have been big hits.” – Allyson Lack, founder & creative director at Principle
“We focus on all of the great work that we accomplished — including data and stats reflecting the monumental effort of everyone’s contributions and project highlights showcasing the impact of everyone’s work.” – Zeke Shore, founding partner & head of product at Type/Code
“We showcase team milestones and achievements, along with firm achievements of the previous year. We also discuss what went well and perhaps what didn’t and why. We also review how the firm did financially compared to previous years (percentages, not actual numbers). During this meeting, we look at our Vision for the year and discuss where we are headed and what small quarterly steps we need to take to get there.” – Brandie Knox, principal & creative director at Knox Design Strategy
Employee Check-ins
Year-end check-ins with employees are a great way to reflect on the past year, plan for the next, and strengthen trust while staying in touch with your team’s overall morale and culture. That said, in lieu of the standard end-of-the-year performance reviews, we recommend conducting shorter 1:1 check-ins with each team member to discuss and explore:
Their thoughts and questions on your State of Company presentation
What and/or how they would like to contribute to your firm’s growth plans and changes in the year ahead
How they see the year ahead regarding their growth/status within the firm, any applicable personal updates, etc.
We recommend doing these end-of-year 1:1 check-ins instead of end-of-year performance reviews (which we recommend should be done on the anniversary of each person’s hire date, ideally staggered throughout the year) as it:
Is less draining on you as the firm principal not to have to do all performance reviews at the same time
Allows for the cost of salary increases to be amortized across the year
Provides the freedom for organizational changes (i.e., promotions) to happen more organically throughout the year.
Alternatively, you can still conduct end-of-year performance reviews but without salary raises. By doing it this way, you can review and establish performance improvement goals for the upcoming year so that by the anniversary of their hire date, you can make more informed decisions about salary increases or promotions based on how they performed against these goals.
Relatedly, we don’t recommend end-of-year bonuses because they create a sense of entitlement among employees, making them feel expected rather than incentivized. Instead, you should have a budget for spot mini-bonuses, which you can distribute to each employee sporadically throughout the year as a surprise to unexpectedly reward those who did something special or who went above and beyond the call of duty.
We moved from a traditional annual review to a Feedback and Coaching model this year, which means each team member has been meeting with their coach every 6 weeks to address immediate challenges, provide meaningful feedback on performance, share insight on growth paths, and advance individual and organizational goals. So, we do not have one formal conversation at the end of the year since we’ve been working consistently on growth all year long.” – Kelly Jennings, Kelly Jennings & Partner / director of client engagement, J2 and Exit Design
Client Relationship Opportunities
Conduct Post-mortems: For important strategic and/or bigger relationships that closed out this year, you should meet with your clients to evaluate what went well in your relationship and with the project and discuss and identify areas for improvement, lessons learned, and potential next steps.
Post-mortems are also an opportunity to collect any success metrics (quantifiable data) that demonstrate if/how the project aligned with and met the client’s business goals. Testimonials are meaningless; the data and results matter when demonstrating your value to prospects and current clients. How do you help your clients “move the needle”? Any metrics gathered should be showcased prominently in case studies, capability decks, etc.
Send Client Feedback/Satisfaction Surveys: For the smaller, less strategic relationships, you can ask for their feedback on services provided and projects completed during the year through a simple, short survey. You can then use the data and learnings from the post-mortems and surveys to improve process and service offerings.
Advise on Marketing Plans: During the fourth quarter, clients often evaluate their marketing spend from the last year and develop budgets for the upcoming year. This is, therefore, an ideal time to reconnect and schedule meetings with select clients or even conduct an end-of-year “strategy summit” where you can explore what’s next for them and how they can best move forward in leveraging their end-of-year unspent marketing dollars and/or how best to allocate their marketing budget in the new year. Use these moments to be advisory and build trust with your client, not to “upsell” them or “win” business. These discussions are not “business development” or “selling” but relationship building. You should authentically show that you care about their success and future growth.
Review Contracts and Renewals: Assess which client contracts/retainers are up for renewal and begin discussions for the next year. Offer discounts for early renewals, as appropriate.
“We have a long-time client we’ve partnered with for over a decade, and a key aspect of staying in sync with their future growth and overall goals is ensuring our team can meet those creative pursuits and needs well ahead of the project being anywhere close to beginning or receiving a brief. Our tradition is to meet over a meal in Q4 every year to understand what will happen in the following year and 2+ years out, ensuring we’re prepared to hold bandwidth and have the right talent in place. It helps us be less reactive to their larger-scale projects that require a dedicated team on our end.” – Allyson Lack, founder & creative director at Principle
Promote Retainer Offering: Review ongoing client relationships that provided you with consistent work throughout the year and consider “upselling” a retainer for the next year.
Financial and Operational Opportunities
The year-end is also the ideal time to close out, clean up, and evaluate your financials and assess key operational areas:
Analyze Financial Performance: Do a deep dive review of revenue, profits, expenses, and cash flow with your bookkeeper (some of this information will have gone into your State of the Company presentation), and compare these numbers with forecasts set the year prior, and set new financial targets for the next year.
“We do a company performance evaluation with leadership, digging into financial performance relative to projections, project-level P&L, team-member utilization, and setting performance goals for the next year.” – Zeke Shore, founding partner & head of product at Type/Code
Close Outstanding Invoices: Ensure all outstanding client payments are received and clear pending bills.
Prepare Taxes: Start to prepare and gather all necessary tax documentation. Work with your bookkeeper and accountant to clean up any outstanding issues and begin the tax preparation process so that, in the new year, you have all your ducks in a row and can file taxes accurately and on time.
Review Your Processes & Tools: Evaluate your firm’s workflow strategies and systems from the tools you use for task management, time tracking, schedule, and budget development/tracking, etc., to meeting strategies (looking at quantity, efficiency, etc.) to project/client management processes, identifying inefficiencies, bottlenecks, etc. so you can make improvements going into the new year.
Marketing and New Business Opportunities
While you should be doing business development and marketing throughout the year, the end of the year is an ideal time to tie up some loose ends and help prepare you for the year ahead:
Develop Case Studies: Based on the post-mortems with your clients, you can develop new case studies and update existing ones with new success metrics.
Send Holiday Gifts… Not: This is one thing we know creatives love to do: develop or buy some sort of swag or gift to send to clients, but our POV on holiday gifts/campaigns is don’t do them! Often, these gifts get lost in the rush of the holidays, have little impact on nurturing a client relationship, and are more than likely time-consuming and expensive to produce or purchase. Building and maintaining one-to-one relationships with clients is a far better use of your time (and far less expensive).
Alternatively, you can send clients a handwritten thank you note or personal email to express appreciation. You can even send a small, inexpensive gift to select clients, but make sure these gifts are unique for each client to show that you are thoughtful and know something about them that personally or professionally resonates with them (e.g., a spa gift card for a new parent, a fancy dinner for a foodie, a new set of pickleballs for the pickleball obsessed).
“I sent an end-of-year letter to past clients, former colleagues, friends, and family—people who already knew me pretty well—and called it a Year In Reflection and shared an honest look-back on wins and work. It took me an entire month to send my letters as I added personalized touches to many of them, but wow, what a touching response. I think these letters—which didn’t cost anything—were more successful than gifts or holiday cards because it felt personal and from the heart.” – Saundra Marcel, designer & brand author at Design Minded
“We’ve moved away from traditional “client gifts,” but recognize select clients with a donation to a charity or a themed treat. We focus on celebrating client or project milestones as they happen with shared meals throughout the year.” – Kelly Jennings, Kelly Jennings & Partner / director of client engagement, J2 and Exit Design
Plan Your Marketing Campaigns for Next Year: Evaluate how marketing efforts (e.g., social media campaigns/posts, email blasts, client outreach, speaking opportunities, thought leadership) from this past year performed and start building a content calendar for the coming year based on these learnings.
Develop Business Development Goals and Strategies: Based on historical data and market conditions, forecast next year’s new business/sales (ideally by industry and project type) and develop and plan relationship-building/ and business development strategies and goals to meet or exceed those targets.
And that’s a Wrap!
We know this is a lot of work and takes time, but these actions are all incredibly valuable and critical to helping you holistically evaluate and strategically evolve your business year after year.
These end-of-year wrap-up actions also provide the necessary context to begin envisioning, planning, and executing against your goals for the new year (keep an eye out for our next article on New Year’s resolutions in January!).
This process is also a very rewarding experience as you can look deeply and holistically at your business from all angles, identify and celebrate your successes, big and small, and learn from your challenges.
Emily Cohen and Hunter Vargas are business partners and consultants at Casa Davka who offer customized business solutions to creative firms so they are able to refine, evolve, and elevate their strategies and practices. Emily has been in the business for over 30+ years, partnered with 500+ leading creative firms, and is a frequently requested main-stage speaker. Hunter is an experienced marketer, project manager, client partner, and business development manager. They also happen to be a mother/daughter pair, so they work together seamlessly, complementing (and challenging) each other in many ways.
The post The Business of Creativity: End-of-Year Wrap-Up appeared first on PRINT Magazine.