“There is nothing so useless as doing efficiently that which should not be done at all.” Peter Drucker
I am writing this from a gate at LaGuardia. My flight home from Affiliate Summit East was supposed to leave twenty-four hours ago. Storms rolled through, the board went red, texts went out, everyone jacked up the prices of hotels in Manhattan, and a whole terminal of us got the same cancellation text at the same second.
So I have had a full day to sit here and think, which is dangerous.
And I keep coming back to one conversation from the floor. An agency owner told me, half proud and half exhausted, that he had just hired his fifth account manager this year to keep up with client load. Fifth hire. Another agency told me they have dozens and dozens of affiliate managers. Some have hundreds! Same margin. More chaos.
I did not have the heart to tell him what I was actually thinking. The model he is scaling so hard is the one that is about to break.
Here is the part nobody at the conference wanted to say out loud. For twenty years the agency playbook has been the same, and it worked, right up until the moment it stopped. So this week is about the flip that separates the agencies that make it through the next two years from the ones still selling hours to clients who finally did the math.
What You’ll Get in This Issue
Why the agency model was quietly built on bodies instead of strategy, and why that math is breaking right now while everyone is still hiring their way out of it. The hidden incentive that pays you to keep the work slow, and why your clients are starting to feel the difference between expertise and activity. The three moves that turn a headcount agency into a leverage agency: split the work into the pile a machine should own and the pile only a human can, put the first pile on agents that run it continuously, and redeploy your best people onto the judgment that actually compounds. And why this is good news, not a threat, if you are the one running the agency.
Part One: The Agency Was Built on Bodies
For twenty years the playbook has been dead simple. Win a client. Assign a manager. Win another. Hire another. More logos meant more headcount, and more headcount meant more junior people learning on your dime, tagging partners in a spreadsheet, sending the same recruitment email for the hundredth time, and pulling the same report every Friday afternoon.
That is not a strategy. That is staffing. And it worked, honestly, because the work was manual and there was no better way to do the volume. So you threw people at it, because a person and a spreadsheet was the best tool anyone had. I ran teams exactly like this for years and called it scaling. It was staffing with a nicer word on it.
Here is the trap underneath it, and it is one almost every agency owner walks into whistling. When you bill by the hour and staff by the client, your incentive quietly runs backwards. You do not get paid to make the work faster. You get paid to keep it slow enough to justify the team. Every hour a junior manager spends scrolling a dashboard, building a list from scratch, or reformatting a report is an hour you get to invoice. The client thinks they are buying expertise. Half the time they are buying activity. And the people paying the bill are finally starting to notice the difference.
That is the whole problem in one sentence. The agency model rewards motion, and clients are done paying for motion. Which means the work itself has to change, and the good news is it splits along a line you can actually see.
Part Two: The Playbook
Three moves that turn a headcount shop into a leverage shop. None of them require firing your team or betting the company on a robot. All of them start with looking honestly at what your people actually do all day, which is exactly why most agencies skip them and hire a sixth manager instead.
Move 1: Split the Work Into Two Piles.
Before you automate anything or hire anyone, sort the work. Everything that fills your team’s day splits cleanly into two piles, and once you see the line you cannot unsee it.
The first pile is pattern work. Scanning publisher data. Surfacing which partners are growing right now. Flagging category overlap. Building the recruitment list. Pulling the numbers every Friday. That pile is real work and it has to get done, but it never actually needed a human. We just never had anything better than a person and a spreadsheet, so we hired the person and called the spreadsheet a system.
The second pile is judgment work. The phone call. The negotiation. The read on whether a partner is worth the relationship or a slow leak. The strategy that turns a flat program into a compounding one. That pile is all human, and it always will be, because it runs on taste and trust and thirty years of having seen this movie before. No machine reads a room.
Most agencies never draw this line, so they pay senior rates for pattern work and bury their best judgment under busywork. Draw it first. You cannot fix a number you have never separated.
→ The work that fills your team’s day splits into pattern work a machine should own and judgment work only a person can do. Draw that line before you spend another dollar, because you cannot move work you have never named.
Move 2: Put the Pattern Pile on Agents.
Once the first pile is named, get it off your people. Not someday. This quarter. Every hour a strategist spends doing work an agent could do continuously is an hour you are paying senior wages for junior motion.
The shift is not “buy software and hope.” It is handing the repeatable, pattern heavy work to something that runs it around the clock and never gets bored, never forgets to check on Friday, and never sends the list a day late because it was slammed. The recruitment list builds itself. The publisher data gets scanned overnight. The report is waiting before anyone asks for it. Your people stop starting every Monday from a blank page and start it from a finished one.
This is exactly what we built Alfie.io to do. It is the affiliate intelligence layer that runs the pattern work continuously, so the human on your account walks into every call with information instead of a hunch. Alfie automates the work. The strategist elevates it. The point was never to replace the person. It was to stop wasting the person on the pile a machine should have owned all along.
→ Move the entire pattern pile onto agents that run it continuously, so your team starts every account from a finished page instead of a blank one. You are not cutting people. You are done renting them out to do a machine’s job.
Move 3: Promote Your People to the Judgment Pile.
Here is where most owners get scared, and where the whole flip actually pays off. When the pattern work leaves, your people do not have less to do. They have room to finally do the thing you hired them for.
The junior manager who spent all week formatting reports now sits on the call and learns to read the deal. The senior strategist who was babysitting two accounts because each one ate so many hours now runs strategy across ten, because the busywork that capped them is gone. This is the part that fires me up, because it is the opposite of what everyone fears about automation. The machine does not take the interesting work. It takes the boring work that was quietly burying the interesting work, and it hands your people back the reps that actually grow them.
That is the difference between an agency that shrinks and one that stops drowning. The gray hairs on your team, and gray hairs are experienced people, become force multipliers instead of expensive spreadsheet operators. You take on more clients without a warm body for every one. And your margin stops leaking into onboarding and turnover, because you are no longer hiring bodies just to keep the lights blinking.
→ When the pattern work leaves, redeploy your people onto judgment, negotiation, and strategy, the work that compounds. One strategist covering ten accounts on judgment beats five covering two on busywork, every time.
Part Three: What the Flip Actually Buys You
If this still sounds like a cost cutting play, like a fancy way to run leaner, you are reading it backwards. Cutting is not the point. Leverage is.
The agency that turns its playbook into agents does not shrink. It stops drowning. You take on more clients without hiring a warm body for every logo. Your senior people stop babysitting spreadsheets and start running real strategy across ten accounts instead of two. Your margin stops leaking into onboarding and turnover, the two costs that quietly eat a headcount shop alive. And the clients feel every bit of it, because they stop paying for activity and start paying for outcomes, which is the only thing they ever actually wanted to buy.
And it compounds, which is the part that matters most. Every account you run on leverage instead of bodies frees up the judgment to win the next one. Every strategist you free from busywork gets sharper on the work that actually moves revenue. The headcount agency adds a client and adds a cost. The leverage agency adds a client and barely feels it. Same market, same tools available to everyone, opposite economics. One of you is scaling chaos. The other is scaling clarity.
The agencies that refuse the flip are not going to disappear tomorrow. They are going to keep selling hours, keep hiring their fifth and sixth and seventh manager, and keep losing the clients who finally sat down and did the math. Slow at first. Then all at once, the way these things always go.
→ The flip is not about doing the same work with fewer people. It is about taking on more clients without more bodies, freeing your best people for the work that compounds, and finally getting paid for outcomes instead of hours.
Your Weekly Chaos Challenge
Whether you run an agency or hire one, do this. Take one account, or your own program if you run it in house, and track where the hours actually go for one week. Not where you think they go. Where they actually land.
Then sort every hour into the two piles. How many went to pattern work a machine could do continuously? How many went to judgment work only a person could do? If more than half landed in the first pile, you just found the exact thing capping your margin, or the exact thing you are overpaying an agency to do. Fix that one number and everything downstream moves. Then hit reply and tell me what changed. I will be at LaGuardia a while longer. I have got time to read them.
→ Track where one account’s hours actually go for a week, sort them into pattern work and judgment work, and go fix whichever pile is eating your margin.
Final Thought
For twenty years, the agency answer to growth was a person. More clients, more people. It was not lazy and it was not wrong. It was the only tool we had, so we got very good at throwing bodies at volume and calling the pile of them a strategy. I built teams that way, ran them that way, and was proud of the headcount for longer than I should have been.
The flip is not that people stopped mattering. It is the opposite. When a machine can finally run the pattern work, people stop being the way you do volume and start being the only reason the work is worth buying. The pile a spreadsheet should have owned goes to the agent. The pile that runs on judgment and relationships and having been through a few cycles goes to the human, where it always belonged and where it now has room to breathe. Fewer people doing more of what only people can do. That is not a smaller agency. That is a sharper one.
That is also the whole reason we built Alfie.io the way we did. A tool should carry the pattern work so your people never have to, which is why we baked a hundred years of affiliate judgment into it, so the strategist starts every call already ahead and spends their day on the part no software will ever touch. Alfie automates the work. Your people elevate it. That is not a threat to anyone good at this job. It is the biggest raise their judgment will ever get.
So if you are staring at your team wondering whether to make that fifth hire, do the one week count first. You might not need another body. You might just need to stop spending the good ones on a machine’s job.
The agency model built on bodies is on the clock. The one built on judgment is just getting started.
Until next week.
Run toward the chaos.
Matt Frary Chief of Chaos
President & COO, XPFlow
#Agencies #AffiliateMarketing #Leadership #FoundersJourney #ChaosToGrow
