Recently, I had several animated discussions with some of my colleagues regarding the ethical standards that govern collaborations between agencies (or consulting firms for this matter) and their clients. And, in those conversations, it came to my attention that there is a critical issue that, for the most part, is not being addressed as firmly as I believe it should be. 

The dialogues I had with fellow professionals led me to conduct my own research, in which I spoke with founders of design studios and leaders of advertising, marketing, and PR agencies, as well as with professionals who work for Big Four firms, providing consulting services to established corporations. 

Those of us who have been in this world for long enough know that there is an unspoken rule, an unofficial principle in which the practice of poaching specialists is frowned upon. This is followed not only by advertising and marketing agencies, but also by some venture capital funds and other organizations. However, unfortunately, it is something that still happens, and that has several negative repercussions. For example, a client’s attempts to steal someone from an agency slow down the industry’s development, in addition to hindering their own reputation as well as that of the employee who receives the offer, especially if they fail to report it. 

What is talent poaching? 

In case you are not familiar with what the term “poaching” means, it was used, in principle, to define a practice implemented by certain businesses to hire talent who worked for competitors. In sectors that place a high value on technological deployments and intellectual property, this caused major scandals, like a long-lasting legal conflict between Google and Uber, with the former claiming that the latter had poached employees who took their trade secrets with them. 

However, in this case, I am referring to poaching in the context not of hiring a star engineer from a competitor, but in the situation in which clients try to steal agencies’ talent and get them to work directly for them as in-house service providers. It is important to make this clarification, in addition to stating that poaching is when the client explicitly and actively attempts to recruit the agency’s employee. This is different from normal employee mobility. “If a manager decides to switch to another company on their own, I’m okay with it,” says one of my peers, who is the founder of a PR agency. “But if they are actively poached, that is unacceptable.” 

How big of a problem is poaching, in terms of client-agency collaborations? 

Unfortunately, it is a very pressing issue. Here are some examples that my acquaintances shared with me while I was investigating the topic: 

  • A colleague who works for a Big Four firm was offered a C-level executive position at a corporation which would have tripled his salary. He complied with his obligation to inform HR about it, but as he said to me, “Dina, you understand that almost everyone here receives similar offers a couple of times a year, and not everyone reports them to HR.” 
  • The founder of a web design studio told me that one of his clients sent a job offer to his designer, which was rebuffed. Then, the same client scheduled a call with my acquaintance, and directly mentioned that she would like to hire that specific designer for her team. Her request was refused, again, after which she terminated the contract with the studio. 
  • The founder of a large advertising agency shared that her media buyer received an offer to be the head of the advertising department at a client’s company. “I was lucky that she is not interested in the real estate market, so she refused and told me,” she said. 
  • A senior executive at an ad agency went public about his frustration with losing some of his top talent to their clients. “When you hear about poaching happening, you immediately get on the phone and say, ‘Hey, please don’t steal our people! We’re trying to deliver the best work for you that we can’,” he said to Digiday. 
  • At Mindset, we are no exception. Our employees have been offered side jobs by our clients at least twice. Managers were asked to keep the conversation confidential. 

Three reasons why clients attempt to poach talent from agencies

As I listened to all these stories, in addition to witnessing those that happened at our firm, I continued my conversations with various acquaintances on the topic, and went deeper into my own research. My intention was to understand: Why is this happening? 

After speaking with many people who have experienced this issue first-hand, here are the conclusions that we came to. 

Lack of familiarity with how the industry works: Often, first-time entrepreneurs will poach managers. This can particularly happen when the manager has a corporate background, and the founder is aiming to recruit someone who can help them institutionalize the occasionally muddled territory that a startup can be. Likely, the incipient venture lacks business processes and an organizational structure, which means that they do not realize, yet, that one of the most challenging parts of building a successful company is finding, hiring, and building a team. 

Some clients love shortcuts: There are people who consciously betray the principles of fair cooperation because the idea of hiring a specialist and getting them to work for them directly is very tempting, and they succumb to it. However, something that those who opt to do this fail to take into account is that it comes with many risks, including potentially permanent damage to their reputation. All of the examples that I chronicled above happened in environments in which there are few players and everyone knows each other. Therefore, by violating trust, they quickly placed themselves in a quandary. 

Clients, often, can underestimate the agency’s work: Those of us who have started an agency know that there is a lot of time, money, and energy involved in building a world-class team that can deliver a top-notch, tailored service to our clients. For example, we at Mindset conduct training seminars on an ongoing basis, hire consultants, and invite journalists to deliver masterclasses, all with the purpose of helping our managers grow and develop themselves personally and professionally. We invest in our team because we know that they are key to being a viable business in the long term. It can be easy, occasionally, for clients to overlook this. 

Final Thoughts

In this regard, I cannot emphasize enough how important it is to build a strong corporate culture that has as a fundamental principle open, transparent, and honest communication. This will foster an environment in which ethical behavior is encouraged, and in which employees will feel safe to report any poaching attempt from a client. Also, ideally, this will lead to the development of a completely trustworthy relationship with customers, who will respect the agency’s work and refrain from engaging in unethical and dishonest tactics. At the end of the day, we are all looking to accomplish the same thing, which is to grow our business, support entrepreneurs, and move our society forward, so why get in each other’s way?