It’s always interesting when you hear heads of leading creative firms talk about their business purely in the terms of it being, well, a business. Once you step away from discussing what an agency creates, its approach to that creative process and how you develop that further, creative firms are much like any other: they need to innovate, plan for the future but be flexible in face of change and – most of all – turn a profit.

Last week, Sir William Sargent (above) spoke to an audience of MBA students at Cass Business School in those terms. William is CEO of the prestigious Soho-based visual effects house Framestore, whose Oscar-winning VFX work on Gravity follows on a legacy that stretches back beyond even the major VFX work that made its name in the late 90s, the BBC’s Walking With Dinosaurs.

He acknowledged that like all sectors, the creative industry has its idiosyncrasies – he notes that its “an industry where motivation is not a problem. You have to send people home, not stop them going home” – but it’s a lot more like other business sectors than it might appear from the outside.

William detailed the challenges of running a business like Framestore, which he describes as "like trying change the wheels of a car as it’s running along the ground”. The company needs to do what it’s been doing before – feature film visual effects work – as efficiently as possible, while also trying to adapt itself to what clients will expect from the firm now and in the future: from live interactive installations to game engine-based realtime projects for very fast turnarounds to 3D virtual reality using hardware such as the Oculus Rift.

Change isn’t new to Framestore, says William. "We are different from what we were 28 years ago. We’re different to what we were five years ago. And what we will be in five years time.”

In 1986, Framestore was founded by five people (including William) as a post-production company and, he says, was conceived as growing into a 20 person company. It’s grown many more times than that, with offices in New York, Montreal and Los Angeles as well as London and over 400 people working on Gravity alone (though many of those were freelancers).

As companies grown, it can be easy to assume that the new people are vessels to be filled with the knowledge already in the firm – but Williams says its essential to see those people as be as important as long term staff members, especially as those newer members can bring skills and understanding that can help a company transform itself to adapt to market changes.

How clients have changed Framestore

William says that another of the biggest drivers for change has come from their clients. Used to working with the film industry and its notoriously tolerant culture to everything from clothing to language, Framestore had to appear more businesslike when they wanted to work with Nokia directly in 2010. More recently, working directly with Beats meant they had to learn to be able to respond to a client’s requests very quickly.

For Beats, Framestore created a series of traditional ads featuring two CG characters based on the company’s Pill speaker, but then were asked to create a real-time 3D engine so that they could respond to what was happening at the 2013 MTV Video Music Awards as it ran, based on live commentary by a group of comedians.

That responsiveness was what Beats came to expect from Framestore. William received a call from Beats at 3am one night, along with an emailed copy of Pharrell Williams’ then not-yet-out music video for Happy. Beats wanted a similar riff on the video to what they’d done at the VMAs. By 9am, a Framestore crew was boarding a plane to New York to create that.

However, William was quite open about that he didn’t work through the night on it, he phoned people and delegated (and went back to sleep). While creatives at Framestore, like all VFX firms, work extremely long hours on projects, William thinks it’s fine for those on the business side not to exhaust themselves so that they can function properly at all times.

“I don’t feel the need to be there at 10pm at night if I wasn’t contributing,” he says. "You need to be well rested, to be a leader who can think when everyone has their head down after doing a 72-hour week.”

How to be a leader in a creative business

Another time when leaders need to step back, says William, is when trusted staff are going to fail (as long as they don’t do it too much or too often).

“[Staff members] need permission to fail, permission to try new ideas,” he says. "As a leader, even if you know someone’s going to fail, you got to let them so they learn something.”

Both of those approaches only work if you trust your staff, and William says that this is a key skill a leader needs to have so they can focus on the most important decisions.

“There’s always a crisis on a major movie,” he says, “but I have talented colleagues who have already tried to fix the problem before it gets to my desk.”

If a project really is in trouble because it needs more resources or time (or budget from the client), William has to be the one to make the difficult decision about what

"I have to be the one to ask the client, ‘Can we get more money, or time?’,” he says. And if the answer’s no, “I have to phone the client and say ‘We can’t hit that deadline’.”

Heads of creative businesses are often under pressure to make decisions quickly, but William says its better to wait and consider problems if its at all possible.

“There’s a balance between being decisive and waiting three months for more information."

"Live a decision for a while,” he says, by which he means that you should behave and think as if you’d made the decision in one direction for a few days, then repeat the experiment as if you’d made the opposite choice. The right decision should emerge.

Asking himself about his success rate on decision making, William is blunt about how well he’s done.

"I’ve survived", he says. "Many of my peers haven’t. And it’s because [Framestore has] evolved. We’ve lost money on co-producing films, but overall we’ve stayed profitable."

To achieve this evolution, a creative leader has to engender a sense of entrepreneurship in many of its staff.

"Even when you’re six to eight people, you can’t be the only person who is entrepreneurial,” says William, "You need to be surrounded by people who are entrepreneurial. If you don’t have them, find them. If you do, encourage them.”

William notes that many creatives don’t believe they have the skills or drive to push the business forward, but given the right incentives, push and framing – for example seeing development as a creative challenge rather than a business one – they can make a real difference.  

It’s important to treat staff with respect, says William, as it creates a culture that gets the best from everyone: "Integrity is important to us. If you bully someone, you get fired. I’ve done it two or three times."

“I’ve also fired clients for bullying staff,” he says, noting that you have to learn to live with the short term financial hit for the longer term success of a holistically satisfied team.

Growing Britain’s businesses

As a ‘red tape tsar’ under the previous government, William also talked about the place of government in driving and developing the businesses in the UK. He doesn’t think the government should invest in businesses, but instead just play a regulatory role.

"Governments can enable and facilitate but can’t create wealth,” he says.

William’s notes that creative companies generally grow in areas that haven’t seen a lot of regeneration, but by being there and being successful, they engender redevelopment.

“You have to have to awfully long term view of making things happen,” he says. “We’re in Soho, [which has creative roots" going back to the 60s when Soho was a deeply seedy place. This attracted filmmakers, which then attracted ad agencies – one type of creative industry following another.

“A lot has to do with creative culture that’s there already – with people willing to take risks – [but it’s also because] rents were cheap. No one put a billion dollars into [Soho], it grew organically.”

The future of Framestore

William is candid in admitting that there’s a question he’s “struggled to get a grip on the last few years, what’s the long-term vision [of Framestore]?”

As a businessman he’s cautious about allocating resources to projects that aren’t funded by clients, but might lead to cutting-edge work in the future – but he know’s there essential to driving the business forward. For him, the decision is who give scope to work on such projects and who to restrict to those that derive direct revenue.

“I give the software guys more latitude as they are developing in areas that are new to us,” he says. "We understand filmmaking, We don’t understand things like Oculus."