LESSONS LEARNED PAUL KNAPP CEO, Young & Laramore 'Shoot for the Stars '
Paul Knapp isn't one to declare victory. Nor is he eager to toot his own horn.
But even he has to admit that something's working at Young & Laramore.
The Indianapolis advertising agency Knapp leads has a stable of national accounts, is opening a satellite office in Canada, and has projected capitalized billings in 2007 will hit $80 million.
So what's the secret of its success?
Y&L's leaders have embraced a shared philosophy-turned-business strategy: In order to excel, a company must take large, calculated chances. Shoot for the stars, if you will-but prepare to handle the repercussions if you fall short.
"Make no mistake, the path we've chosen is not for the faint of heart. It is difficult. It requires discipline," said Knapp, the agency's CEO. "I often tell new recruits that 'You have to love the battle because the successes are few and far between.' But the successes are really sweet."
Indeed, the agency has sampled success, gaining national attention to go along with national clients such as Delta Faucet, Steak n Shake and Red Gold. But getting there has been more of a roller coaster ride than a rocket trip.
Knapp developed the philosophy over time-from observing successful individuals, companies and brands-and happily discovered like-minded colleagues when he joined Y&L 11 years ago.
Before long, Y&L leaders had identified their stretch of sky: They wanted to work almost exclusively on national consumer brands-no small feat for an advertising agency in the Midwest.
Still, that has been Y&L's raison d'etre ever since.
The agency pulled out of local awards competitions to focus on higher-profile ones. It made a commitment to attracting national-caliber talent. It hired a New York PR firm to help build media awareness. Y&L even turned down jobs that didn't fit into the grand plan.
"It is critically important to align all of your business efforts in the same direction as your main business goal, especially if your goal is a big, calculated risk," Knapp said. "Every business effort or initiative you undertake needs to be done by looking through the lenses of your primary business goal."
Y&L leaders also kept the strategy top of mind when looking for new offices last year. No. 1 on their wish list: a building that would appeal to talented advertising professionals and national clients alike. They found it in a 100-year-old school building that was artfully transformed into creative space.
"All of these steps are big, calculated risks," he said. "Some have already borne fruit and others ... time will tell."
Y&L doesn't always hit home runs, to be sure. Take 2nd Globe Pictures, its film production company launched in 2001. Although its initial project- award-winning short film "Belzer's Science"-was successful, efforts to develop a full-length feature fell apart because of problems working with the actors' union. With costs escalating, Y&L determined the risk was too high.
That's where the "calculated" part of its strategy comes in. Y&L leaders do their best to estimate the cost of taking the risk, from actual out-of-pocket expenses to the cost of lost momentum.
"Only after envisioning the worse-case scenario and feeling that you can live through it should you proceed with taking on the big risk," Knapp advised.
In the 10 years since Y&L staked out its strategy, the agency has grown from 27 to 82 employees, and quadrupled capitalized billings.
Knapp is quick to point out other accomplishments, too, including the creation of Y&L offshoots 2nd Globe Studios, EchoPoint Media and TheCurious-City.com, a Web site aimed at introducing out-of-town recruits to Indianapolis.
Even so, Knapp won't declare victory. Y&L's mission is still a work in progress, he said. There are plenty of ways to improve. And nothing lasts forever.
"We realize we're in a very volatile industry. In 15 minutes, it could all go away," Knapp said. "We can grow, and get big clients, but that does not translate into being more secure. If anything, we're probably more vulnerable."
So does he ever question the aim-high approach? Sure. But such doubts are fleeting.
"After losing a new-business pitch or after a big downturn in the economy when clients are tightening their belts ... it can cause you to question the wisdom of our course," Knapp said. "After all, most agencies will take on just about any work if it will bring in revenue. But that is inconsistent with our fundamental goals and, I might say, our collective DNA. So, time after time, I shake off the doubts and stay the course."