CLOSE-UP: LIVE ISSUE/INTERNATIONAL ACCOUNT DIRECTORS - Account chiefs’ power grows at expense of local agencies in power struggle. Are local directors taking the rap for lost accounts? Francesa Newland reports
By FRANCESA NEWLAND, campaignlive.co.uk, Friday, 29 January 1999 12:00AM
Nobody doubts that 1998 was a bad year for Ogilvy & Mather, so the departure of its London chief, Tom Bury, surprised few when it was announced last week.
Nobody doubts that 1998 was a bad year for Ogilvy & Mather, so the
departure of its London chief, Tom Bury, surprised few when it was
announced last week.
One question raised by his departure is whether or not he is taking the
rap for other people’s mistakes.
And in the context of O&M’s loss of lead status on Ford of Europe, it
highlights a current agency issue: are international account directors
getting so powerful that they are wrenching authority away from national
O&M insiders say that if Bury had realised there was trouble afoot on
the Ford account, his hands were tied. The worldwide client services
director, Kelly O’Dea, was the man at the helm of the account and he
reported back to O&M’s head office in the US - to Bury’s bosses.
One former O&M employee says: ’O’Dea had strong relations with O&M’s US
bigwigs.’ Another comments: ’He (Bury) can’t be blamed for Ford. It was
nothing to do with him. The Ford agency structure was led by Kelly
O’Dea.’ A third says: ’Tom thought they were doing all right because
these guys told him they were doing all right. What Tom could have done,
I haven’t a clue.’
The rise of the international account director mirrors a shift by
clients towards globalisation. The managing director of DDB
International, Michael Bray, says: ’You must have them. If you don’t you
can’t run these businesses.’
William Eccleshare, the Ammirati Puris Lintas chairman and regional
director, northern Europe, agrees: ’International account directors have
to be very powerful. It’s very important that agencies deliver a unified
service globally, and to do it they have had to put real professionals
into very senior advertising roles.
’There are now two clear ways to senior positions within agencies:
running multinational clients, or running regional units,’ he adds.
In a recent CampaignLive poll, 89 per cent of respondents felt that
international account directors have more power than local agency
management. To clarify the roles, Young & Rubicam calls its top account
people ’account managing directors’, according them the same status as a
regional managing director.
Kevin King, who led Y&R’s successful assault on O&M’s Ford business, is
a prime example.
It is, of course, cash which makes the international account directors
so valued. John Banks, chairman of Banks Hoggins O’Shea/FCB, says:
’There are some international clients that are much bigger than any
single local office.’ His view is shared by Bray, who says: ’A worldwide
account director can be generating between dollars 50 million and
dollars 75 million in revenue. That’s hard to replace.
It’s simple mathematics.’
And the result: they are extremely powerful. As one client services
director says: ’They have a significant slice of income in their
pockets. When they sneeze, chief executives jump.’
It seems the two posts rarely work together in harmony. One key area of
tension is finance. The account director can demand extra people and
extra money to support a particular client, but it’s the regional
manager who picks up the tab. Eccleshare agrees: ’Sometimes there can be
frustration where the account director needs resources which the office
manager feels are unnecessary.’
There can also be creative tension when local agencies and clients
disagree with the global strategy and campaign.
Not surprisingly, no agency will admit to such tensions. Instead they
claim a free-flowing interdependence between global account management
and local agency management. Richard Hytner, Publicis’s managing
director, says: ’They are both very important and mutually dependent.
You may lead a global piece of business but your only way of delighting
a client is through the people running the domestic agencies.
’Equally, if you are running a UK agency and want to be on the map, you
need the guidance of the global players.’ Eccleshare agrees: ’In the
best-run multinational agencies there will be a partnership. The two
jobs are mutually dependent.’
However, another agency head admits: ’There is a structural flaw that
makes the running of a global account and the running of a local agency
mutually exclusive. At best there is an uneasy sort of balance.’ Another
international agency head says: ’The guy who runs a big piece of
business around the world doesn’t give a toss about the regional manger.
There’s a hell of a lot of steam-rollering.’
But there are means of limiting any damage from the rivalry. Saatchi &
Saatchi’s chairman, Europe, Middle East and Africa, Derek Bowden, says:
’If you keep talking to each other every day you will avoid the
Banks believes making the international account directors accountable is
a must: ’They should be on the worldwide executive board and get paid a
lot. But if they lose the account they should lose their job.’
Which brings the story back to O&M and Ford. O’Dea was not sacked, but a
month after the Ford loss he was moved to New York, where he reports
directly to O&M Worldwide’s chairman and chief executive, Shelly
One friend of Bury and former O&M employee says: ’It’s the classic
search for the scapegoat and punishment of the innocent.’ This is a bit
of an extreme analysis - the agency also lost Guinness and Bupa in 1998
- but there’s an element of truth in it. By letting Bury go, O&M enters
1999 with a clean slate.
This article was first published on campaignlive.co.uk
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