25 Mar 2010

Efficiency vs. Creativity

Let's start with the big picture here.

Ask the head of any business, what he or she thinks is the single most critical factor for success. And you'll likely get "innovation", "motivation", "teamwork", etc. If we sift through all of it, you will probably (nay, certainly) arrive at that ONE key factor...


There is no escaping the fact that virtually all businesses (except SMEs) today are shareholder-focused. And if there is one thing a shareholder values, it is the return on investment.

When you consider that an investor (or a holding company) really does not differentiate between a shoe factory and an advertising agency when it comes to ROI, you can already see the incongruity.

But what we're seeing is just the tip of a proverbial iceberg... You see, to stay competitive in comparision with other investment opportunities out there, a business also need to show an year-on-year or quarter-on-quarter increase in RIO - or, efficiency.

In Advertising industry parlance, it means 'new account wins' and 'big-billing campaigns'. But we all know there are only so many of either. Now factor in, intense competition, and resulting drop in margins, and you know something's gotta 'give'.

To see what that something is, let's look at what is the least 'efficient' part of the Advertising business... It is without a doubt, the part that comes up with ideas. It is the Creative Department.

But creativity being creativity, it is not predictable or efficient. And it is also at the core of the Advertising business.

Or is it?

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