LONDON: Agencies which invest in the development of their people through external courses and qualifications are being rewarded with more business, generating greater levels of income growth, a new analysis claims.
The IPA plotted the gross income growth of 155 agencies against the number of Continuous Professional Development (CPD) hours completed by their staff, and found a positive correlation between training and business success.
Furthermore, this correlation held regardless of the agencies' income group. And the IPA suggested this pattern was also likely to be cyclical – with income growth enabling greater levels of investment in staff development.
The effect was most pronounced among the biggest agencies – namely, those with incomes above £15m. According to the IPA, the 87.5% of operators in this group boasting more than 3,000 hours of CPD learning had logged income growth of 15% or more.
A similar picture was evident with the middle range of agencies where incomes sat in the £5m to £15m range. Here, the 80% of agencies with more than 500 hours of Continuous Professional Development saw growth in income of 15% of more.
Smaller agencies, too, were able to generate up to £16 for every £1 spent on CPD, as some 62.5% of shops with income below £5m and more than 500 hours of Continuous Professional Development posted income growth of 10% or more.
"Training within the agency community has for too long been seen as nice to have window-dressing, rather than a business fundamental," said Andrew Pinkess, director of innovation at AMV BDDO and co-chair of the IPA Continuous Development Group.
"This analysis suggests for the first time that agencies that invest in CPD grow faster than their peers. So, it should be commercial teams pushing HR and management to invest more money in training, rather than the other way round".
Attracting and retaining talent in an increasingly fragmented media landscape is a challenge for agencies. The IAB, for example, has argued that as advertising sales, operations and content creation become knowledge-based capabilities, so workforces must continuously learn new skills.
Patrick Mills, director of professional development at the IPA, welcomed the "tangible proof … that upskilling staff is good for the bottom line".
Data sourced from IPA; additional content by Warc staff