H&V, harkonsalo&vesa, AI, viestintä, markkinointi
Mikko Sillanpää

Newest new: Photoshop has layers now!

I don’t often write about development and internal stuff of our branch. This is mainly due the fact that it’s mostly quite uninteresting technical details for my primary audience – clients and prospects. It’s also because I’ve always felt that these topics are much better suited for dialogue than monologue. Now I’m breaking my own rules in this, as I think that this topic has some relevance for my primary audience and also because this topic does actually suit for blog-monolugue -format quite well.

I came into this branch while there was a major change happening. The big thing was DTP (for youngsters: desktop publishing, i.e. using computers for design and production of marketing materials). With risk of sounding what I actually am, a dinosaur, I can tell, that when I started my career, the Photoshop didn’t have layers. Yes, it’s a bit hard to imagine a design or image software without layers, isn’t it? Still, one could do with it just about everything one can do with Photoshop with layers.

Why this is relevant, you might ask? It is relevant because of the agency business model. What designers can do, what clients want, and what is hot contemporary design changes, but human mind is very capable of finding ways to fulfil those demands. If your Photoshop doesn’t have layers, you make do and be damn clever with the work processes. You had to know what you were about to do and which was the precise order of steps that you needed to go through to get there. What is very interesting in this, was that I as a very young person had many talks with the old beards of the day about this. Quite many were of an opinion that layers are a bad thing. Not because it was a new feature, but because they made designers lazy: you didn’t need to know anymore what you are doing, you could just fool around and end up with something. This might sound a bit funny way to look at it, but it is true. I think many designers deep in their heart know that layers and automatic background removals etc. tools make one lazy and while speeding up the work, they also take away the precious design element: time to think. And this affects everything to the agency business level.

DTP, Internet, AI

I’ve been in the advertising, design, marketing and PR business now over 25 years. My roles have mainly been of team leader and agency owner, so I’ve spent quite a lot of time thinking about teams, talent management, work processes, efficiency, budgeting etc. aspects of our business. DTP, Internet and now AI are those big changes that have happened over the years. I’ve sometimes said that layers in Photoshop actually has been the most important change in our business and that we as a branch have not gone through a real digital revolution or paradigm change. Feel free to disagree with this, it’s meant to be provocative statement.

Internal teams and agency teams are from organization perspective quite the same, so what I write here about agencies mostly concerns also internal teams of design, marketing and PR. Still we also have to make amends here: not all agencies are the same. Staff size, client profiles, company structures are very varied, so each agency will go through these changes we are talking about here in different way. I’ve tried to find some broad views here, not to tell you in detailed manner how your agency should go through things.

People and profitability

With these points in mind, I’d like to say few words about efficiency in the agencies. Ours is people business very much. It’s not uncommon that 70% of the costs are personnel costs, in fact, it would be in most cases quite unhealthy if they would be less than that. This means that agency business is profitable or not profitable by the people costs. We can measure efficiency in different ways, by invoicable workload per person, by used hours per project, annual client profit… but one way or another we are counting hours and euros in the end. The trick to make an agency profitable is to find a way to make most euros by least amount of hours. This can of course take many guises, and it’s far from being non-creative task, and there are also scale factors involved.

The makers of the tools for professionals have very limited approach to this. They aim to make tools that are more automated and which save time in particular task. In itself this is a logical choice. If one can do a needed image in Photoshop with layers in quarter of a time than with Photoshop without layers, it is quite evident which version will be adopted into agency use. This is very much the hours side of our business efficiency. The euros side is different. How much the client is willing to pay depends on many factors. Even while many clients talk dismissively about too artistic agencies, or too high-flying designers, it is actually this creative side they still are ready to pay more euros for.

There are different people profiles in the agencies. In order to keep this writing at least somehow concise I’ll present here a two-tier view: junior and senior. These are not necessarily referring to number of years in work, nor individual talents or potential, but rather a role in the production team. Senior designer, consultant, analyst, or whatever, is usually a position where decisions are made on broad lines. Junior persons usually turn these visions into actual production material pieces, individual ads, flyers, websites, press-releases… you name it. Even a very experienced and talented person can sometimes work in a junior position (and this is something that very few outside our branch understand, team role is not connected to individual person worth as human being or professional).

Regardless if one is senior or junior there is one thing that one wants from the tools one is using: that they would enable creativity. Especially in senior role hours are not important, if the tool allows to do higher quality. This is the euro side of things, the quality of creative work. DTP revolution did this. More complex designs, and things that were impossible to do before were now possible. Junior side also appreciates ease of work, and this usually coincides with less working hours spent on particular task. Agency business planning needs to understand these both views: hours and euros, and find some kind of sweet spot in them (usually a compromise).

Hours and euros and tool providers

Understanding this is important, because otherwise we are stuck with one-sided perspective of tool providers. “But you can create it with just one press of a button” You can give this same argument to any professional of any field, but there is quite a bit more than just one press of a button involved. All the productivity revolutions in our business have meant changes in the roles of juniors and seniors. Usually it is juniors who find that their work is automated – this is the ultimate step of saving hours. Senior roles are not immune to these changes, but overall they are less affected. This is because part of the senior role is to determine where junior roles are needed.

In my opinion, however, these are not disruptions or paradigm changes, what we have seen this far. I know I say something utterly unpopular, but what we have seen this far from AI side is actually quite similar to DTP change or Photoshop having layers. Surely, a profound change in daily work and tools we use, but we will see the same: juniors being kicked out from the teams and seniors learning new tools and being resentful over losing once again time resource from their work. And also we will see some new design that was not possible before. Some agencies struggling financially, some prospering.

This is because the developers of the AI tools are not professionals in the agency business. They are seeking for the easiest product-market -fit for their core technology and produce easiest implementation of it for the creative professionals to use. This may sound harsh or dismissive to the client understanding and development efforts for the software companies, but in the end of the day that is the efficiency in their business. For a creative business the question of originality, for example, is a crucial competitive edge. If the agency can design eye-catching original designs for its clients, the produced materials drive more sales in to their clients because they appeal to the target audience, and this kind of agency can sell one work hour for several times higher price than non-original mediocre agency. Website templates, for example, are essentially unusable for this kind of highly profitable business, because they lead websites produced to look the same, no matter what variation they allow. I’m not saying there is not a business opportunity here, but I underline that this hour-saving production choice is just one way to look at the profitability of an agency. For popular imagination, however, it seems just pressing the one button kind of thing, just take a ready template and put our company name there – and it is usually the clients that most need to stand out from their competition that choose this approach to look exactly like their competitors, btw.

Generative AI and template business

The developers of the AI tools have this far essentially done this. They have developed technologies that ape things that have been done before. For example, if one uses AI services to generate a website layout, one gets very stereotypical choices. Again, this is not bad thing in itself, but it is a one-sided approach to agency business development. Cut down work hours. With these kind of tools we will see some changes in the business: less juniors needed, senior workload change a bit, profitability raise somewhat, even considerably – until competition starts to corrupt the prices. For a momentary profitability boost these tools provide a good basis, just like using templates does. For example in PR business AI can be used to write bulk material or to make variations of core piece into different format, usually what you’d use juniors for, and then senior just checks the texts of the AI just he would check the texts of the juniors.

For short term agency competition this means that those agencies that find the best ways to implement generative AI tools deep into their production process will save in personnel costs as long as the all branch covering AI change is going on, but lose that edge when everyone is capable of the same, and price competition begins again.

AI is nothing without software robotics

In order to achieve fullmost productivity boost AI is not the only needed element. Let me use a yesteryear term and call in here software robotics. AI and software robotics as buzzwords are of course very unconcise, and can mean pretty much everything. As this is not an academic paper, I will not go very deep into definition of these terms, but want just to point out some things. By software robotics I mean in this context the parts of the work process done between software. Task automation is another term you could use for it.

For example, a production process of a website could go like this: the designer uses AI service to generate website for the client. Then tech guy opens up a server space, sets up domain and copies the AI built / designer improved website into the website space. Social media guy then uses AI to write a post that says “hey come and see our new site” and publishes it into different social media channels, or uses a social media tool to publish it.

AI here, even while generative, is akin to the layers of the Photoshop. It just speeds up the process, saves hours. However, it also very likely lowers the originality of the produced content, unless the senior is very skillful. The temptation to cut corners also in design work is very real there – just like with the layers of Photoshop.

With software robotics, the process could be like this: the designer gives design parametres into the production system of the agency with deadlines for proofs to be delivered to the client and with tool selection that the client budget allows. Then the production system uses one of the agency licensed AI platforms for the design, submits it for the approval for the designer, who makes some changes, the production system them implements those changes and delivers the design to the client for approval. The client interacts with the production system interface and gives consent for the design. The production system then opens a server space and books domain for it automatically from agency linked service providers and sets up the website there. After the designer has given approval, the production system makes the site live and connects to AI service to write “we have new site” post, to generate an image for it, and submits them to the designer for approval. Designer gives approval, and the production system connects with social media services or publishing tools, and publishes the post. The production system here is actually just a simple piece of software robotics, that connects into different online services automatically.

AI makes sense only with software robotics, if we are seeking the full productivity boost, to go beyond layers of Photoshop. In fact, I make a claim, that one of the largest productivity gaps there are in the current agency work, comes from the (unnecessary) manual work of moving data between the systems and working with different kinds of interfaces. While there has been a wave of new tools and online services, they all consume a lot of time in the form of non-standard user interfaces, learning curves, and finding ways to make the data to go from one system to another. Tool makers have not anything beyond their task. From productivity point of view, it might even be more efficient to use two work hours more with Photoshop without layers, than use those saved two hours into meaningless secretary work of moving files from one place to another. The time used in design would create more value, euros, than work of moving files. Yes, this is a bold claim, but I challenge everyone in our branch to analyse where the actual work hours are going, and are those tasks really the most optimal ones from creativity (invoicing) point of view. If a new service or software is using the time it saves in less productive work, we still are on the losing side because of the implementation costs, for example.

True business disruption comes when buying changes

Then, lastly, I want to say a few words about buying of the services of our branch. For a branch to see true disruption, true paradigm change, also the client buying process needs to change. Take for example the production system I envisioned there above. Now, if the client would enter the prompt into the system, the process of buying would be very different. It would not be an agency internal production system, but a client-based service system, a platform. The role of designers and other professionals would still be there in the process, but agency business model itself would be kind of reverse image of what we have currently. The client would give the prompt, and choose team of professionals (probably by the production system giving preferred choices depending on the details of the task), and the production process would run inside the platform, not inside one agency. Virtual agencies could live in this production platform based on team member competencies rather than agency built teams. This would disrupt the agency business model. For me it seems inevitable that we will move into this kind of business model in our branch in the future. The current online services with hire a freelancer -approach will also see transition into this model, as there is no real future in freelancing business in our branch. Ever more growing needs of expertise outside narrow specialisation is obvious in our branch, and this does not favour freelancer business models.

To conclude, I’d say the Photoshop has the layers now, with AI, but we are still quite far away from true digital disruption of our branch.

Mikko Sillanpää

CEO - markkinointiviestinnän asiantuntija

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