“We tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run.” – Roy Amara
At Fraction we are on a mission to find the future of business by exploring what we know and what we think we know right now. While client-facing AI applications grab the headlines, the real revolution might be happening behind the scenes, fundamentally changing how companies function day-to-day.
The operational reality we all recognise
Operations in agencies have traditionally been inefficient by design. Resource management systems that never quite reflect reality. Forecasting that feels more like guesswork. Admin tasks that consume hours of potentially billable time. And perhaps most painfully, the constant struggle to extract clear briefs from clients.
These operational challenges aren’t just annoying – they’re expensive. They reduce margins, create stress, and take focus away from the work that actually matters.
How AI is transforming the operational landscape
The agencies embracing operational AI are seeing remarkable shifts across several key areas:
Enhanced brief development Let’s start with something we’ve all struggled with – getting good briefs. AI tools are now helping agencies create more structured, comprehensive briefs by:
- Analysing past successful projects to identify critical information
- Suggesting questions based on the specific deliverable
- Flagging potential issues or missing information early
- Creating brief templates that adapt based on client and project type
The result? Better briefs, clearer expectations, and significantly reduced scope creep.
Project scoping and estimation AI systems are analysing historical project data to provide far more accurate estimates than the traditional “educated guess” approach. These tools consider:
- Historical time spent on similar deliverables
- Client-specific variables and complexity factors
- Team experience levels and efficiency
- Seasonal fluctuations and other contextual factors
This leads to more realistic timelines, better resource planning, and healthier margins.
Resource allocation and management AI scheduling systems are transforming resource management from an art to a science by:
- Optimising team composition based on skills, availability, and project requirements
- Predicting potential bottlenecks before they occur
- Suggesting resource shifts based on changing priorities
- Identifying capacity gaps with enough notice to address them
The days of the Monday morning resource scramble are becoming a thing of the past.
Financial forecasting and cash flow AI forecasting tools are providing much clearer pictures of future finances by:
- Analysing payment patterns and predicting client payment timing
- Correlating project progress with revenue recognition
- Assessing pipeline opportunities based on historical conversion rates
- Identifying potential cash flow issues weeks or months in advance
For agency owners, this means fewer financial surprises and more strategic decision-making.
Knowledge management and institutional memory Perhaps most valuably, AI is transforming how agencies capture and utilise their collective knowledge:
- Creating searchable archives of past work, approaches, and solutions
- Generating insights from successful (and unsuccessful) projects
- Preserving institutional knowledge even as team members come and go
- Making expertise accessible across the entire organization
This democratisation of knowledge reduces dependency on specific individuals and elevates everyone’s work.
Getting from zero to one: Practical first steps
For agencies looking to begin this transformation, here’s a pragmatic roadmap:
1. Audit your current operational pain points Before implementing any AI solutions, identify where you’re spending disproportionate time on low-value activities. Look for repetitive tasks, information bottlenecks, and processes that consistently cause problems.
2. Start with a single high-friction process Don’t try to transform everything at once. Pick one operational area with clear ROI potential – brief development, resource management, or reporting are good starting points.
3. Explore purpose-built AI tools rather than building custom solutions Unless you have significant technical resources, utilise existing AI platforms designed for agencies. The market is rapidly expanding with specialist tools for everything from timesheets to resource management.
4. Implement with intention and training Any operational change requires buy-in. Invest time in proper implementation and training, focusing on how the technology helps people rather than replaces them.
5. Measure impact rigorously Set clear metrics for what success looks like – time saved, improved accuracy, better margins – and track them consistently.
6. Expand methodically based on results Once you’ve demonstrated success in one area, use that momentum (and hopefully, freed-up resources) to tackle the next operational challenge.
The emerging shape of the AI-powered agency
The agencies embracing operational AI are evolving toward a distinctive new structure:
- Flatter hierarchies with fewer middle-management roles
- Smaller, more specialist teams focusing on high-value work
- New operational roles centred on systems design and optimisation
- More flexibility in working models (remote, hybrid, flexible hours)
- Greater emphasis on strategic and creative thinking over production
Most importantly, these agencies are shifting operational focus from administration to innovation – using AI to handle the routine so humans can focus on the exceptional.
Is this the future?
The evidence suggests that AI-powered operations aren’t just a possibility for agencies – they’re rapidly becoming a competitive necessity. In an industry where margins are perpetually under pressure, the efficiency gains alone make a compelling case.
But perhaps the most powerful argument is what these operational shifts enable. Agencies that automate their operations effectively free up significant human capacity for the work clients actually value most: strategic thinking, creative innovation, and relationship building.
The question isn’t whether your agency will transform its operations with AI, but when and how intentionally you’ll approach that transformation.
What’s your next step toward operational intelligence? We’d love to hear how you’re approaching this shift – because while the destination may be similar for many agencies, the journey will be uniquely your own.