The Bees Group, a local agency co-founded by owning three subsidiary agencies including The Bread Digital, Secret Tour Hong Kong and The Right Side, says it is the first agency in Hong Kong to offer employees a share of the company’s profits to highlight its core value of valuing human capital.
Entitled 3-3-3, the profit-sharing system equally dissects the company’s profits into three shares in which one-third go to the employees, one-third for the shareholders and the other one-third for the company’s operation needs.
This unique system was initiated by Shih Wing-Ching (pictured), a shareholder of The Bees, who first trailed the scheme on his own companies including Centaline Real Estate Agency and free newspaper am730 – one story has it that the newspaper once handed out seven additional months worth of salary as a bonus to staff.
Stephen Chung, founder of Secret Tour Hong Kong, told Marketing the idea was born to make a change on the unhealthy ecosystem in international agencies.
“Many agencies under the 4As umbrella have not employed a profit-sharing system, employees at the grassroots level are usually getting low salary, “said Chung.
“The profit-sharing system equalise the shares each staff rewards from the company’s profits and from that to motivate staff, to foster employee loyalty and to boost productivity.”
The internal revenue programme is packaged with an external financial scheme, charging clients a nominal fee for every pitch with no higher then HK$50,000 each.
“The whole point here is to shift the balance of power in the client side,” he stressed and added clients tend to take advantage from free pitches where they may steal the best idea and pick the agency with lowest charge.
“We aim to do something to reverse this vicious circle.”
Holding the same belief, Eddie Ngan, co-founder and director of The Bread Digital, said the whole system is applicable especially on this “people-oriented industry”.
“The only asset we have really, not tools, not software, not anything, is people,” said Ngan, who added it may help explain why many traditional 4As agencies are letting clients to slip through the cracks.
Indeed, after M&C Saatchi withdrawal from Hong Kong back in May, the senior shuffles from Bates Chi and Partners to JWT in the following month, plus the most recent closure of DraftFCB Hong Kong, traditional global 4As brands seems to be losing their grips.
Maybe this is partly why Ngan, the 4As veteran who spent over 18 years serving the WPP Group, started the local agency The Bread Digital two years ago when he left GroupM Hong Kong as general manager.
He said the talent landscape in the industry, whether it’s in advertising or media, is changing. The industry is now suffering a brain drain as more young talents leave the field.
“Five to six years ago people (who work under 4As agencies) shuffles within the 4As family and tend to stay for a long period. But the industry today is no longer able to retain young talent mainly due to low salary, long-hours culture and limitations brought from strategic policies and structural systems from headquarters.”
“They can’t see a future for staying in the industry anymore.”
He went on to say that global clients are losing trust in global agencies in Hong Kong in favor of local ones as local insight is becoming increasingly valuable to them.
“Global clients started to realise the importance of local solution in this very localised communications industry, and they turn to local firms to that end. In all the clients local agencies are serving, around 60% of which are global ones,” he added.