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What obligation do creative agency founders and owners owe to their employees? Gini Dietrich, Martin Waxman and I, all current or past agency owners, discuss this in the wake of a recent high profile creative company closing.

Teehan+Lax recently announced that the partners had accepted jobs at Facebook – and that Teehan would therefore be shutting its doors. Good for them. But what about the employees? Did the fact that dozens of creative people – the people who helped the partners realize their dream – were being left behind detract from the positives of this story? Are creative agencies simply the expressions of their principals? Or are they in fact the product of the entire team? And what does the move of agency principals inside a previously-client company mean about the viability of agencies in the era in which nimbleness must be married to creativity?

Gini, Martin and I kick around our views about the arc of agency life and the types of things that we and agency principals and agency owners should or may not consider when making the next move.

Martin points out that we have become used to employees moving frequently from job to job. Many creative people today base their happiness on the challenge of the projects they are working on today. What they did last week mattered last week, not this week. What their title is isn’t so important. Where they stand in the hierarchy isn’t their motivator. Challenging creative work drives them. And if they can’t get it where they are, they will quickly and without hesitation hop over to another company that offers that to them. And then they will move again after that.

So, should we be surprised if people who are founding and running creative agencies have the same approach to the world? Probably not. So, we shouldn’t be surprised if this isn’t the last time that agency principals proclaim, “We didn’t get into this to build a company to last. We got into it to be challenged. And the challenges are elsewhere. So, we’re shutting down our company to go and do something else.”

And good for them. But that still leaves the first question. What obligation do they have to the employees who believed in them and invested part of their own careers in the success of the founders’ dream?

Gini suggests that an employer’s obligation to the employees is real, but limited. “But you have to make decisions that are good for the business first, and for the founders second. Without the founders, there is no business. So, the founders have to take care of themselves. This is a difficult thing to do, particularly when you want to do what is best for employees.”

This leads to situations in which it is difficult to untangle what really happened in order to discern how an employer has treated employees. We may see the end result – people looking for jobs. But we cannot get the complete picture of the relationships between employer and employee. “There’s always three sides to the story,” says Gini. “Their side. Our side. And the truth somewhere in the middle.”

But at the end of the day, Gini believes, owners are entitled to put their interests ahead of their employees. “Sometimes you have to make a decision that’s not best for the employees. Sometimes you have to make a decision that’s best for you and your family.”

And that’s only half of today’s episode. In the back half, we move on to discuss the importance of communicating these changes clearly, honestly and transparently. We hope that you’ll listen to the episode and find something to think about here.

Context

If you want to get a fuller sense of the Teehan+Lax announcement and the conversation it occasioned, here’s a set of articles that provide an excellent jumping off point.

And Now, For Our Next Act, the Teehan+Lax partners announce that they are joining Facebook and shutting down their agency

David Crow reflects on the announcement and what it means for the partners, the local creative scene and the employees. Read the comments as well as the post to get a sense of the debates that followed in the wake of the announcement.

Brian Krogsgard throws attention on the fact that this isn’t good for everyone. What about the employees?

Jon Lay argues that that innovative design firms can still thrive.

Ev Williams reflects on when and why to sell your company.