Lead
March 31, 2025
The Agency Operations Model Reboot: Key Takeaways from NYC
Jani Folland
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Agencies today face a unique convergence of challenges that demand adaptability like never before. The "perfect storm," as Mikko Virtanen described it, consists of economic uncertainties, fluctuating client demands, and the disruptive influence of AI on traditional roles. Agencies no longer have the luxury of slow pivots. The market rewards speed, adaptability, and the courage to redefine business models.
Stephen Beck (Engine Digital) emphasized the importance of balancing core expertise with adaptability, recognizing that while agencies must remain flexible, their foundational strengths cannot be overlooked.
"I think right now you just have to be open to change. You have to, and you have to be adaptable. But I think at the same time, (there’s) this idea of remembering your expertise and balancing those two things.” … “But also, you’ve got to rely on what you've built over the period of time you've been doing what you've been doing. That's what our clients come to us for. They want not only the expertise of the day, but the history.” – Stephen Beck
Takeaway: Agencies need to consider transitioning from rigid hierarchies to adaptable, composable organizations - teams with clear missions, high autonomy, and the agility to evolve based on real-time business needs.
Many agencies have excelled by creating "great places to work", but Virtanen highlighted that this is no longer sufficient. The formula for success now extends beyond engagement; it requires embedding business thinking into every layer of the organization. Teams need to understand not just their creative objectives, but how their work impacts profitability.
Virtanen pointed out that democratizing data and increasing transparency are critical to this shift. When team members understand how they contribute to business outcomes, they make better decisions that drive long-term success.
"You are not a leader anymore with your position power and being a vice president, you are a leader because you can bring value to the people and clients when the data is democratised." – Mikko Virtanen.
How to get there?
Takeaway: Embedding business acumen across all levels, while maintaining a culture of engagement and creativity, is key to sustainable success. Transparency and autonomy empower teams to make business-driven decisions, fostering an entrepreneurial mindset within the organization.
AI is already transforming how agencies operate, but Virtanen emphasized that its true potential lies in enhancing decision-making and providing insights, rather than simply being an efficiency tool. By making data accessible and transparent, AI can eliminate organizational silos and reduce friction. This isn't just about faster workflows; it's about enabling better, smarter decisions.
David Schwarz (Hush) reflected on the role of AI in broadening perspective and empowering better choices:
"I really like when I learn something from a tool like that and it kind of changes my perspective, or the data was beyond my grasp of understanding, but then it showed me something that I didn't know and I can make decisions based on that." – David Schwarz
Stephen Beck (Engine Digital) added that AI's value isn't just about automation—it's about enabling creativity to reach new heights, making the impossible possible:
"This needs to find its way into our projects, not just from a doing things faster perspective, but creating magic inside a product that we couldn't do before, and doing it at lightning speed." – Stephen Beck
Takeaway: Agencies that embrace AI as an enabler can streamline operations, foster creative freedom, and stay competitive. It’s about seeing AI not as a threat but as a team member that adds value at every level, helping unlock new creative possibilities and better data-driven decisions.
Profitability is a non-negotiable for agencies, but it shouldn’t come at the expense of creative excellence. The panelists discussed the need for agencies to create space for experimentation and innovation while maintaining sustainable business models. Striking this balance means acknowledging that while efficiency is important, protecting creative time and space is equally critical.
Teams benefit from environments that encourage trying new approaches and exploring ideas without the immediate pressure of output. Hiring individuals who are innately curious and committed to continuous personal growth also fosters innovation. These are the people who will naturally seek out new challenges and experiment with emerging technologies, helping agencies stay ahead of the curve.
Takeaway: Agencies that balance profitability with creative freedom will be better equipped to innovate. This requires protecting space for experimentation, even if it means operating with slightly lower utilization rates at times.
The traditional agency model is under pressure. Virtanen introduced the idea of "composable organizations" as the future. These are flexible, autonomous teams that form and reform based on shifting priorities and market demands.
This approach allows for rapid scaling, faster innovation, and higher team engagement. Composable organizations can also benefit from flatter structures, where senior specialists thrive without traditional management hierarchies. These flat models encourage more autonomy and expertise-led decision-making, reducing friction and empowering teams to focus on delivering value.
Chris Mele (Siberia) described their approach:
"We kind of transitioned from pyramid shaped to top down to now just top only. We design strategies and scopes with clients, putting together the dream team for each project. It's about having the right people at the right time to realize a vision." – Chris Mele
Takeaway: Composable organizations provide the flexibility to meet changing client needs and market dynamics without losing speed or creativity.
The NYC SoDA Session panel made one thing clear: the future belongs to agencies that embrace change, prioritize clarity, and empower their people with the right data and tools. It's about finding the balance between creativity and efficiency, the flow between people and profit, and the right tension between delivering impact today and shaping possibilities for tomorrow.
