The Pentagram Model
I'm continually interested in having a discussion that begins with ...
"What if we started our own version of Pentagram....?"
The Pentagram Model
Pentagram. If you say this word to a group of Designers you may seem them turn into a group of seriously proud parents, or in some cases a group of screaming fan girls and boys. They'll start talking to you about the achievements of this almost 40-year old US design firm and glow with pride.
They'll highlight the logos this famous firm has designed and speak with a parental-type love for Michael, Paula, Marina and the other partners. Rightly so. Pentagram has established itself as one of the worlds largest design practices since its inception 40 years ago.Not many of its ilk can claim to be “the largest independent design agency".
160+ employees, $25M in annual revenues and a global footprint — this is a design business to be taken seriously.
I’m not sure if a model such as this exists outside of the Pentagram business or if anyone has attempted it and failed. If you know of one, please do let me know.
I do know though, that the model has been of interest to me for quite some time. I speak openly of my interest to explore a venture like Pentagram's and have also, through the years, researched the ins and outs of what it might look like.
The idea has been floated around many a discussion between industry-folk here in Australia as I'm sure it has all around the world. It's a novel, if not idealistic idea of a group of leaders in their fields, coming together to build on their already-powerful personal brands and contribute equally to a partnership that surrounds the Pentagram brand.
It has seen industry leaders choose to move away from their independence and opt into a partnership arrangement under the Pentagram banner. It has also seen this business grow from a single office in New York to offices in London, Austin and Berlin.
Much of it has to do with perception-building, a lot of personal brand building and much of creating a shared eco-system of revenue and profit that leverages both of the above. Doing good (better) work is symbiotic and also a by-product of this system.
Over the years I've been approached by many agency owners seeking to build on this idea but no one has ever really mirrored the Pentagram model. All approaches have taken the ideal aspects of the model and left out the aspects that are a little too difficult to digest.
The Pentagram model isn't a supergroup of people within a single discipline, it is a collective partnership of discipline leaders working together for a common good. That common good is the growth of the Pentagram brand and business.
The model isn't a panel of suppliers that cherry-pick ideal business opportunities and fight out which panellist is going to go for them — it's a collective of partners working together to benefit their own profit centres and eventually share their profits equally with all other partners.
What makes the Pentagram model unique is that these leaders have absolved their own businesses and have diverted their energies to making this new business work. They're all in.
This model has intrigued me for years because of it's disruptive approach to our industry norms but also because some its aspects actually force us to take a long, hard look at ourselves as an industry and as professionals.
And they don't have Executive Creative Directors which is an idea I love.
"At a big company you find the higher you go, the more managing and the less design you do. You end up doing the design when everyone’s gone home."
— Luke Hayman - Pentagram partner.
There has been a lot written about this business and I don't to regurgitate it all here, but what I do want to do is to capture the few key ingredients that I believe make it unique.
1. Partnerships are equal
All partners are equal partners and share profits equally. If the total combined profit for this financial year is $1M profit, this profit will be share amongst all partners. Even with partners who's profit centres made a loss.
Some partners make less as a Pentagram partner than they did before they joined. Some make more. Albeit the profits are distributed equally. The benefit being that in bad years partners exist to help one another even though it has been stated that 'a consistently unprofitable partner wouldn't last forever'.
2. No hierarchy amongst partners
There is a simple hierarchy in this organisation. An employee, an associate and a partner. That's it. Every partner has equal voting rights on decisions and equal profit share.
3. Learning organisation
All offices openly share intellectual property and knowledge knowing that the shared success of offices benefits the whole rather than the individual.
4. Performance, performance, performance
Partners come together twice a year from all global offices to dissect and measure the performance of each office. Graphs are compared and dollars are discussed openly as is the quality of a partner's work. The good, bad and ugly. Open and honest critiques of design work and financial performance is a critical aspect of partner meetings so leave your ego at home.
5. The search for new partners
The search for a new partner is one of the driving business goals. This search seems to be organic as much as it is strategic. The question of 'who will be the next partner?' is often asked.
6. Synergy not duplication
New partners compliment each others skills instead of duplicating. This is a key aspect of the system. This is not a team of super-Graphic Designers. This is a team of creative leaders with a mix of skills and strengths that are complementary and not in competition with one another.
Issues are dealt with democratically with a simple partnership voting system. Enough said.
8. Share brand equity
In a global industry that sees most businesses operate as small businesses, the notion of a larger partnership collective in itself is something worth considering. Working together with like-minded experts you're working together to build a brand, a business and a model — something you're already doing but now with more behind you to propel you.
“Maybe we don’t have to take over the world, maybe it’s ok if we lose some projects to Wolff Olins, maybe it’s good that we don’t make as much money because we’ll end up having more people with suits anyway.”
— Luke Hayman
It's not for everyone, but the intrigue is still there for me.
What do you think?