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CIAO: The Four-Letter Framework Behind Every Bad Outcome · GOOD CEOs

• Ollie: Welcome back to Good CEOs. Today, if you have been paying attention, I'm on my own. And as an avid listener of Good CEOs, you will know that every other episode I spend some time on my own reflecting on... how I'm doing, what I'm seeing in the world of the creative economy, what we've learned from various conversations, podcasts, the meetups. We have one meetup every six weeks with good CEOs. Sometimes there's 10 of us, sometimes there's 30 of us. And also the thousand conversations that Unknown is having every single month. We have 20 consultants every month having five or six conversations a day. So... understanding what is happening, where is the growth going, what are the trends that we're seeing. today I'm going to reflect on a quote that I heard actually about three or four years ago. And it came from a man called Rob Pierre, who is the founder of Jellyfish, which I believe at its height got to 200 million pounds in revenue. And he said this brilliant quote, which has always stuck with me and I'm going to relate it to Unknown 1.0. And hopefully, if you're listening to this as a scaling founder, thinking about growing your company, it might be helpful. So the quote was, are you growing your company in JPEG or in Vector? nerdy, but bear with me. I'm obviously not a creative or a designer, but it made sense, right? So we have JPEG for those that aren't designers. If you pixelate and grow out a JPEG image, it gets uglier and jagged and not very nice to look at. A vector is infinitely pure. you scale it and you grow it out, gets clearer. It's as clear as it originally was. And it reminded me of growing a company and this idea that if we If we're panicked and we grow a business out of fear and we assert a false timeline on ourselves, we build something that we probably recognize and have already seen before. And it reminded me of when I first kind of built Unknown, we had to build quickly. We had to find the right consultants. And I had this vision in my head as to what I wanted Unknown to become. But money and time didn't allow for me to fully see that vision through. So when we first launched Unknown, was, everybody in, we have these new models, here's how we're to do recruitment differently. my God, okay, that's quite a huge project. Let's just say yes to that thing. And when Unknown 2.0 was designed, we spent a year and a half really thinking about what the business would look like in five, 10, 15 years time, i.e. thinking in Vector, not in JPEG. I saw this really interesting concept that came from I think it was Alex Hormozzi again. I to stop referencing this guy, but it was super clever. He gets a timer and he said, right, okay, if you give me 10 seconds and I've got these Lego pieces and you tell me, you know, build the quickest, tallest structure you possibly can, I'm going to build it really quickly, but I'm going to stack them on top of each other. And it's going to reach this height, but the height of that Lego stack could easily fall over because I was given such a short amount of time to build this stack of Lego pieces. But if you gave me a minute, I'm not going to brick by brick vertically straight up like that. I'm going to probably put maybe three or four different pieces down. So when we scale and grow this tower of Lego pieces, there's more of a solid foundation. And I like that as a visual. I like that as a concept because once we had, you know, got warm water through the pipes, had three years of learning and mistakes and saying yes to the wrong clients and no to the right ones. When we had enough time and revenue and cash, we could fully figure out, take our time and say, okay, what would the foundations of this business look like if we were to build it for 10 years down the line? And I think that is the difference between looking at building a one million pound business or a $10 million business or a $50 million business. The more time you spend in building the foundations and really figuring out how can this thing be solid in what it... is today and what it's gonna become tomorrow. There's this quote that my non-exec always said to me, which is, if I have six hours to chop down a tree, I'd spend five and a half of them sharpening the axe. i.e. spend more time really thinking about the foundations of a business. I guess I say that because if you're right there, you know, sitting thinking, okay, what do we need to do right now to launch this business? Where do we need to be in five years time? Whichever part of that journey you're on, I would just encourage as much time that you can afford to spend in really thinking, what does the model look like? Where is our recurring income gonna come from? What is a hero client that will help us attract more work? And what is a client that's gonna help us consistently not worry about income? because there are so many different businesses, I think, that begin and they take on the founding client or they say yes to a piece of work that perhaps wasn't the kind of work that they wanted. And if we go back to, or we go forward to a few episodes, there was a CEO that came on here that spoke about how saying yes to the right client early on could have broken their agency. And thankfully they didn't because they were building foundations that would last 10 years. yeah, I wanted to start with my, that was my first kind of entry story. And I really hope that that kind of resonates with the people out there that are thinking of building their own thing and needing an excuse to take their time in thinking about what the model will look like. My second thing is actually more about culture. that was about, I guess that's about culture, but it's also about business models and growth and things like that. The second thing is about culture. this is, I think this is important for any business at any size. We speak about values and principles a lot. And in a few episodes back, I spoke about North Stars. And I think it's one of the hardest things to do is to figure out what your North Star is to make sure that it sounds compelling enough to your clients and compelling enough to your culture and your talent. But when all of that's gone and you kind of stood up and said the North Star, really what we boil down to isn't our words, it's boiled down to our behaviors. And those behaviors are things that happen. over and over and over again in micro moments. It could be in an email that you sent. It could be in a proposal that you stood up, a pitch that you presented, a piece of work that you're really proud of putting out into the world. Everything that you do is based on your behaviors. And I was thinking about our culture and I was thinking about how I really want to make sure that Unknown is a place that has 360 feedback, as painful as it is to give and receive. So I spoke to my long standing coach, Hass, if you're listening to this, hello. And I said, wanna, I've written our values, I've written our principles so many times. And I feel like if I go out again, I watched that film air with Nike and they've got those incredible 10 principles. Why can't I just have those in the blood and in the veins of every single person that works at Unknown? And how can I make sure that everybody in this business is thinking and acting and speaking in the right way? And he came back in classic fashion and he said, there are no better principles than the four agreements. And I was like, what are the four agreements? Have you told me this one before? And he said, yes, I've told you this plenty of time, but maybe you've forgotten. So he reminded me and he said, these are the four agreements that most of the successful agencies and brands that I've worked with have agreed to. Here I go. Number one, be impeccable with your word. I do what you say you're going to do. Number two, don't make assumptions. Ask the awkward question, basically. Number three is always do your best. Sounds flimsy, but if you can say to someone, did you really apply yourself fully? Did you really try your best? And the answer is yes. You can go, cool, I trust that you're telling the truth. And then the fourth is don't take it personally. Feedback on the work isn't a verdict on you. It's the feedback on the work. And I think a lot of the time, this is probably the biggest thing that goes wrong in culture. We fix on someone's words and we say, you know, rather than I've done a bad thing, it's I'm a bad person. And in business, particularly, we can try and show up and be our full selves, but the reality is this is the work version of you. This isn't your entire personality. There are millions of different versions of you that exist. are happy... Olly sad, Olly angry, Olly energetic, you lazy, work, home, when I'm with my cats, when I'm in meetings. So if someone's criticizing the work that you've produced, it isn't necessarily a criticism of you, it's a criticism of the way that you've approached that work and therefore don't take it personally. So I love that one. I think that's a muscle that we should all work on. when someone says something that hurts, asking yourself, which part of me is that hurt? If someone says like, you're so disorganized or, you know, every time you do this thing, it's not a nice way to hear information, but there'll be a kernel of truth in that thing that they're saying to you. And I think the better we can be at looking at that information as it's coming in and hitting us in the emotions, how easy does it come to you to disassociate you from the piece of feedback that's been given to you. And I think that is a superpower. If someone can hear something that's relatively negative about them and go, OK, they're speaking about this thing that I did, and they're speaking about some of my actions and behaviors, I either agree or disagree with them. But either way, I'm going to look at that subjectively or objectively versus taking it personally. So I thought I'd just talk about that one because I feel like culture becomes easier. to understand when everybody understands the agreements. And I speak a lot about clarity and sometimes I don't live up to my own obsession with clarity and I'll choose politeness and I'll choose avoidance instead of being super clear because maybe the way that I was going to communicate that clarity felt emotional or quite sharp or quite offensive. And yet if you had a culture that understands the direction you're heading in and the four agreements, it would be whatever you're saying, the first group being impeccable with your word. If you don't have the time or you're rushed in your words and you've said this thing very quickly, the culture works well if the expectation is, well, I won't take that personally because I know that they're in a rush or whatever. So yeah, I thought I'd just mention that. The four agreements. Be impeccable with your word, don't make assumptions, always do your best and don't take it personally. Okay, the next one. This is a belter. really, this one means a lot to us because right now at Unknown, we've had over 500 clients ranging from agencies to brands around the world from New York to Nairobi to Sydney to LA, everywhere. And it's been brilliant working with loads of clients. The challenge is what kind of clients are they and what kind of relationship do you have with them? are we able to be our best version of ourselves with those clients? Or are we in more of a supplier relationship? So a year and a half ago, we committed to moving of those 500 clients into becoming partners of Unknown. And I was speaking to a man called Mark Knorr who I think one day I'll get on this podcast. is like the, he has a very lovely radio DJ voice and he's like the, I think he's a black belt in karate and all this different stuff, but equally. very successful founder and CEO. sold his own agency, KitKat and Ordigitas, the publicist, and then I think did the same thing with Fold7 in the Miramar Group. And I was having a conversation with him and he said this brilliant quote to me which was, Ollie, you should always treat your clients like prospects and your prospects like clients. Isn't that a nice concept? Because I think most people can be caught in love bombing their clients and being, ooh, woo, know, we're gonna be the most, and then, you know, they're over the line and then suddenly they're sort of put to the back of the pile. Bad, bad process. Why should that relationship ever change, particularly in this world where retainers and AOR and things like that are harder to come by and harder to keep? So I quite like the idea of treating your clients like prospects and treating your prospects like clients. On the other side, how does one treat their prospect like a client, in a similar way, rather than putting this person on a pedestal because they have a thing that you want and you want to win their business, what if you spoke to them as if you've been in business for a year and a half or two years together? Suddenly the relationship is more peer to peer. Suddenly you're working on a park bench together versus selling to each other across the table. We speak about that a lot at Unknown, is how do you unlock a park bench relationship with your clients where it's never me versus you. It's not, I'm going to try and get this thing from you and you're not going to get that from me. We're looking out into the horizon and we're going, where is there mutual growth for both of us? And how can we help you see around the corners to help you get there? So for me, treating a client like a prospect rather, you know, rather than being all jazz hands in the pitch and promising the world is more wherever you are in the journey of being in a partnership with us, whether you're just about to walk through the door for the first time or we've been working together for three years, we should be able to have this relationship where we can be honest with each other and no one's selling to either person. We're just looking out into the horizon together. So I love that. I think we should embody that more. The more I work with CEOs that have come from being in client services positions, the more I get this calm sense from them and they're never selling. They're always asking questions with curiosity. They're always, you know, leaning into the hard parts of the conversation as if they were a friend. And I think that's where most of the best client relationships are born, where there's mutual trust and there's no one selling to anyone. No one's trying to get a fast one over on the other one. And they're being treated like they've known them forever. So I like that. Okay, this one's kind of deep shock. But I heard this and I thought it was, it was lovely. I've got no idea where it came from. But the words were bad outcomes often have innocent origins. Nearly in every situation, a bad outcome was never the intention behind whoever it was that achieved the bad outcome. And I think that happens a lot in businesses where Nobody planned for this really bad thing to have happened. We all planned for it to go really, really well, but somewhere along the line, things started to turn. And I normally put that down to a series of things. I call it ciao, an Italian word for saying hello or goodbye. I think that's mainly what ciao means. There might be a third meaning to ciao, but that's why I have ciao. It's actually irrelevant in this instance. Ciao, in my words, stands for clarity. incentive, autonomy and objectives. This is where I think things go really wrong when there is alignment in all of those things. Clarity. If we think about the origins of a good idea, which is where they all start, are we clear on what it is, who is owning it, over which timeline and all of those things that come into the world of clarity? Are we bulletproof and aligned in all of those things? I always, when you go down the line and you go, wait, how does that happen? was that my job? You know, bad outcome, innocent origin. Incentivization, I think it was Charlie Munger or Warren Buffett that said, show me an incentive and I'll show you an outcome. I think we underestimate, particularly now, there's a lot of talk around salary surveys and people trying to figure out, I well paid? Am I well valued by my company? Incentives are important. They're also not only ever financial. You have status, you have autonomy, you have loads of different things in your artillery. You have long term incentives that aren't just based around salary, but they're based around LTIPS and potential shares and equity and events. There are loads of things that fit under the the roof of incentivisation. And I think the better you get at figuring out if the incentive is the incentive, the better the thing will become because a lot of people, I think a lot of people assume that everyone's on board with this incentive and it means the world to you. Let's say like an agency are pushing for an exit and the only thing they keep on reporting on is EBITDA and how that's going to make the Topco, X amount of money when they exit. They kind of forget that some of that Topco maybe might not be there, maybe aren't actually incentivized by that thing, and maybe they're doing it for making the best work in the world. I think everyone is very different and lots of things drive different people. And I think we try and sort of apply a kind of blanket incentive and assume that everybody is aligned on the same thing. It's not to say that... everyone in that team aren't going to pull towards the major incentive, which in a lot of cases is the financial outcome. But figuring out what is actually incentivising people, I think is a really important thing. I've had it before where we've hired a senior person within the business and actually, you know, having the autonomy to work from where they want, working with a specific kind of client, knowing that they're moving up in their career is the incentive. And yet I'll be banging the EBIT, EMI thing. loudly and they'll go, yeah, yeah, that's really cool. That'll be a lovely bow at the end of this kind of present. But the main thing for me is X, Y and Z. So really getting aligned on what the incentive is and if it is actually doing the job of incentivization, I think is key. So C, I, clarity, incentivization, autonomy. I wang on about this and I'm sorry if you're an avid listener to this podcast. Of course you are, you're a human being with a pulse. Autonomy is like... I think it is the love language for most people that are good at their job. The more senior you become, the more autonomy you should have. I speak to so many CEOs that leave their role because they were given fake autonomy. They were given the idea or the allure that they were in a CEO position. They could make hires, they could make fires, they could make investments, they could make mistakes, they could learn trial and error, only to find out that no, if you miss a quarter, you lose your autonomy. That's fine if the person is clear that that is the case. It's not fine. when you're told you're given a level of autonomy and faith and belief and it is rug pulled away from you. So I want to bang that drum loudly. Autonomy is the love language of every senior leader being clear, back to my C in ciao being clear on where that autonomy starts and stops. that parameter, you can be so binary with this. You can say, look, The rule here we have is if you are not hitting your quarterly targets, two quarters in a row, the autonomy will begin to disappear. In a similar way, it's a bit like a football manager when I'm really bad at football, but I watched the Mourinho documentary and you get Jose Mourinho is doing really well. And as soon as the game starts to not become wins, become losses, Roman Abramovich is there on the training ground getting involved because lo and behold, that coach or that manager has started to lose games. I think the same thing should be true with any business. Where is the rain? Could be of infinite autonomy, which is great, but tell me if that is the case and don't tell me that's the case if it's not. The last thing, the O in ciao is objectives. What are we trying to achieve? I am really guilty of this. I want to achieve loads of things and it took me a while to learn from our chair that you can't have 10 objectives. you can't have 10 strategic bets of a business. And when we meet companies now and we ask about their growth goals and we'll say to the agency, founder or CEO, what are your growth levers and what are the strategic bets that you're making? If we hear more than five, you start to go, yeah, okay, great, but which one's like, me three. I think we can say that three is the maximum because it's not possible to remodel the company as one of the bets. internationalize as one of the bets, build a tech function as one of the bets, go out for investment to grow the business as one of the bets, move the model of resourcing to more of a freelance-based model. All of this stuff is a lot of stuff and I imagine they're all very important to your business, but you have to figure out which order those things need to go in. And I'm massively guilty of that. Three years ago, we decided that the US was one of our massive bets. But in order to afford it and in order to make the money make sense, we had to figure out our recurring revenue model. Otherwise, we're having this firework income thing with M&A deals and exec searches happening. You can't build a business with revenue that isn't predictable. It's hard. And so therefore, you can't take the big strategic bets that you want to take without that predictability. Big one is objectives, getting really clear on what they are and most importantly, getting clear on the order that they need to go in. And I'm saying this to myself. This is really weird. This podcast is like almost like therapy. all of this stuff is just in the back of my mind. you know, I'm saying this stuff to me. I'm saying it to you. Hopefully it's going there somewhere. I'm not preaching, although I kind of feel like I am preaching a little bit in this. I'm preaching to myself. Really? OK, this is more of an industry, industrial thing that we're seeing. Okay, this is really interesting. Small story time for this one because I think there has been a big change in agency structures and I don't think many people are talking about it. And I want to tell you a story that will compare 2015 or 16 to now. Okay, it was 2015. Carly Rae Jepsen was on the radio probably, I imagine. it was 2015 or 16 and things were going very well. In Agencyland, we were still relatively in frothy retained account territory. briefs used to come to us they would say right you know we are Schmeiden and Fennedy and we've just won a giant account and we need to basically staff up we need to hire an easy well normally it would be a CCO and ECD two CD teams for ACD teams for senior creative and then everything else in between a junior creative team and and and there there was even and this is where I think it's interesting we once had a CCO came to me and said This just shows you how much money there was at that time. We have all the creative talent that we need, but the work is kind of like, okay, you we're not winning any awards. We need to do something about diversifying the talent that we have in this business. So I want to build this weird team of misfits where we have like graffiti artists, sneaker designers. He was, even want like a tapestry designer. And I was like, I was sitting there going, fucking hell, okay, yeah, yeah, okay. Obviously that's not great to hear. for someone that specialized at that time in quite a niche, commercial, senior creative talent. And so I'm going, yeah, yeah, yeah, wicked. I can find them. I can figure out where to find a tapestry designer and a sneaker designer. For the record, we did, by the way. And this is why, again, when I built Unknown, the first thing we would say is we need a commercial objective behind every single hire that you're making. Nice hires don't work out. Nice hires haven't got revenue streams attached to them. Nice hires are really easy to go. Yeah, that was a of an idea, didn't work out. Anyway, and behold, we built this department and lo and behold, it didn't work out. I don't think the graffiti artist ever made any work. I remember them calling me up and being like, they've got me making a deck? Like, what the fuck is a deck? I literally spray walls. Why am I making a deck? I thought I was coming here to make all this work. Anyway. I think it's fair to say that those worlds or that world, we're not in that world anymore where you can afford to pay, I don't know, six figures to people that may or may not get the call up or could like add some value to a deck. Where we are though, has changed. Where we are is what I'm going to be calling the very catchy title, Navy Seals and their beautiful brass band. So we had a really similar budget brief that came in to Unknown. And the brief was again, similar budget, let's say between two and a half and five million of salaries or, you know, operational costs. And the idea was rather than building out this hierarchical department, we want to spend that money on five practitioners. So we want the best CCO in campaign world. We want the best CDO in design world. And we're not just talking. branding design, we're talking someone that's done brand experience, we someone that can maybe even design like furniture, da da da da da, someone that is a holistic design person. You know, goes on CSO, we're not just talking CSO, we're talking commercially minded, someone that might have worked at an IDEO, but also been at Widener Kennedy, and then they've been at, you know, Wolf Olin's. We want someone that is, again, holistically a design practitioner. So, we're calling that the Navy SEALs team build, because it's happening more and more. You want these people to be able to go onto a client conversation. and have no fixed solution to the problem. They are agnostic, basically, about wherever the solution may end up. It could be that we're designing a first-class cabin for your airline. It could be that doing a brand-experiential event for your cabin, for your new airline thing that you're launching. It could be anything. This person thinks in a way where they are completely agnostic to the medium, but they have a specialism and a superpower that... you know, the clients find valuable. So you build this Navy SEALs team and they are brutally fantastic at practicioning and client conversations. They're commercially minded too. These are the kind of people that will command anywhere between a, you know, 500 to over seven figure salary. They are either normally based in New York, London, or one of the key creative capitals. And you can do a lot with that team. The brass bands where I think it's really interesting because A lot of agencies have tried to do this. you think about RGA, they tried to do this with the RGA associates. The challenge with this is, if the question is, can we build a brass band of specialists around our Navy SEAL team of practitioners, will they hang around waiting for us to call them? The answer, by the way, is no. And fair enough. You can't just have a guy with a trombone being like, they'll call one day. They will call. Just saying this sorry that is a nerdy joke, but I'm doing it That doesn't work obviously because that person has has you know a wife husband family, you know mortgage to pay or whatever So that doesn't work. You can't just be like we'll give you a shout whenever we get the perfect opportunity mister or mrs. Graffiti artist However, you can build a system a bench around that Navy SEALs team. You can build loyalty with with the graffiti artist the sneaker designer the strategist that thinks in in commerciality and is almost kind PWC, but they can also talk in design. You can build that bench of people so long as you are clear. Again, we're going back to ciao clear on the incentive, the autonomy, the work, everything that they're gonna be making is part of that brass band. And so this is the thing that we're starting to see. We're seeing the dissembling of heavy, expensive, underutilized... creative departments, strategy departments, design departments, and the practitioner at the top saying, I don't want to manage people anymore. I don't want to be doing reviews and not really being anywhere near to the work. I saw that there was a thing that the ex-Wyden CCO said where he said, being an ECD in a department is like someone driving a car along a cliff and you as the ECD being in the back of the boot texting. I thought that was really clever. And it's true. Those days, I think, are beginning to become yesteryear days because the CCO and the ECD want to be involved in the work. They should be. They're brilliant. They're practitioners. And the client wants them there. And now with AI, there's a lot more stuff they can do. They can be in lots of conversations at once and they can reply to clients. So I think this is the thing that we're going to see. What does that mean for you? What does that mean if you're a CEO listening to this or a CCO or someone that's perhaps wanting to progress their career? I think it's really, it's the golden, I don't want call it a decade because nothing lasts 10 years these days, but this is a golden time if you have got five to 15 onwards years experience in this industry because you have the work and the reputation and the receipts to be trusted in doing what you're doing. I think you're going to have a brilliant time making incredible work that's entertaining and you'll be surrounded by the creme de la creme of the practitioner that you have worked so hard at becoming a specialist in. Who it isn't exciting for is the junior talent. you know, I haven't got the solution for this. I've mentioned this a couple of times on the podcast, but there is value. We need to attribute value to bringing junior people along on this journey. Yes, we're not going to have the days of, you know, tons of apprentices, running around, learning from everyone, fetching tea, scribing notes. But there is huge value in bringing those people along on this journey because they'll see an idea somewhere, they'll know something, they'll know a trend, they'll have a different perspective of what the idea could be. So I just say this because I think this is where we're going to get to. think the good news is that it will be an increase in fractional employment. It means that you can leave that job where you're not working on the brands that you want to work on and you want to work with an array of different agencies and brands. I think there'll be a lot more direct to brand situations happening here. I think we're to start to see, we're already seeing it with Netflix, Google Labs and OpenAI. Loads of these companies are jumping straight to these practitioners. Look at the intangibles, look at Fundamental Co, look at Sharp End, which is a new thing by Nick Rupp and George Prest. there's loads of these things sort of bubbling up. There are loads of frustrated CCOs and CSOs that are like, we have all the contacts, we just need to build a brass band around us to, you know, go up and go down as we win and create projects for our clients. So I just, I think this is an interesting thing to be aware of. I think the reason it works is because the model that you charge your client with can change, I think we're killing time and materials. I think because of that, it's gonna open up an opportunity for seasoned practitioners to agree productized offerings where the client can go, yeah, I'll buy one of those things from your shop, here's how much budget we have. The practitioners can go, yeah, cool, this is the margin that we wanna make, these are the people that we wanna do it with, we have a bit more time autonomy to do this, let's go make great work. So yeah, I can see that being the case. And I think that's where I want to end this. think there's a lot in there. I hope that was helpful. I hope there was something in there that made you go, yeah, interesting. But the TLDR, if you are not going to to this podcast, here's what we said. Build the business like a vector, not a JPEG. Create clear agreements. Design roles through ciao. Turn projects into partnerships. Keep the permanent core small and brilliant and assemble excellent specialists around you and build a beautiful brass band around you. All we need is brass. Thank you so much for listening. This has been Good CEO's episode God knows what. I hope you enjoyed this and I will see you very soon.