The Christmas Tree Effect
David Epstein is one of my favorite writers. His book Range is a must-read for people who consider themselves “generalists” (also great for managers, parents, and anyone seemingly responsible for somebody else’s development).
One of Epstein’s recent articles introduced me to “The Christmas Tree Effect” - a concept that immediately struck me as highly relevant to the agency world. The core idea is that we often address issues by piling on more - like adding ornaments to a christmas tree - when in reality, our problem is often best resolved by removing unnecessary elements.
Most small and medium size agencies are very well-lit christmas trees.
“Profitability isn’t where it needs to be! We need a weekly meeting to review.”
“Revenue is off this quarter! Let’s expand into a new vertical.”
“The client doesn’t see us as innovative! We should add a new capability.”
You can see how the boughs of agency trees get weighed down very quickly with meetings, capabilities, and target audiences.
What if we had the inverse reaction and problems led to increased focus?
“Profitability isn’t where it needs to be! Let’s cut down on meetings so our team can get through client work.”
“Revenue is off this quarter! We should double-down on our core vertical where we have a great story to tell.”
“The client doesn’t see us as innovative! Let’s find a way to evolve the capabilities we’re great at and do them better.”
I’ve always thought you could learn a lot about families and people based on the color of lights on their christmas tree (white or colorful) and the ornaments they hang (hot glue creations or procured pieces). It’s the same with agencies - everything you do or ask your team to do is sending a message about what’s important and what should be prioritized.
The more you add, the more confusing things become - and the more diluted focus and attention gets.
The external perception isn’t really all that different. As you add new services to your website and publish thought leadership about different verticals the further you move from strategic partner and closer you get to jack of all trades, master of none.
I’m not suggesting that addition isn’t sometimes the best option. But encouraging firms to weigh subtraction and status quo equally in the decision-making process. Continuing to add pieces is great, until it isn’t.
At the very least, when you contemplate adding something (a meeting, a new capability, or a new vertical focus) consider subtracting something of similar weight. Your agency isn’t going to magically grow because you add more to it, it’s going to grow because you focus on the right things.
One question I always try to ask new clients during the early stages of our partnership is “What can Logline take off your plate?”. It’s an acknowledgement that hiring outside help can be an addition, and it needs to pay off with results that simplify (not further complicate) our clients' lives.
Being a generalist (person) with diverse experiences and translatable skills can be interesting and impactful. Being a generalist (agency) with a long list of focus industries and capabilities can be confusing and distracting.
