Blue-eyed boy of the Young & Rubicam empire

By by John Tylee, campaignlive.co.uk, Friday, 16 June 2006 12:00AM

Hamish McLennan will bring a change of accent to the New York office as Y&R Advertising's chief executive.

It is a measure of the trauma and turmoil that has bedevilled Young & Rubicam's Madison Avenue headquarters in recent years that Hamish McLennan should find himself as the network's chief executive-in-waiting.

Next month, he will leave his native Sydney to become the first non-American to lead Y&R Advertising in its 83-year history. And everybody expects there to be a change of accent in both senses of the term.

"He will go in there and make changes," a former associate says. "His lack of sentimentality borders on the ruthless. He won't be fazed by anybody who tries telling him what he can't do."

Mercurial, bullshit-free and possessed of a relentless ambition, McLennan has emerged as the blue-eyed boy of the Y&R empire. The one-time agency intern who opted for on-the-job training rather than university is capable of springing surprises. As, for instance, he did when he quit the national managing directorship of Australia's iconic George Patterson Bates to run the ailing local Y&R operation.

McLennan's decision proved astute. Under his leadership, Y&R Brands' Australian and New Zealand operations have quadrupled their revenue over the past four years. What's more, McLennan's gamble paid off when, three years after quitting Patterson (where he began as a mailroom boy), he was named boss of that agency and of Y&R, when the two merged under the WPP umbrella.

Even more important for the go-getting McLennan, his success drew him into the inner circle of the WPP boss, Sir Martin Sorrell. Whether or not this was all part of the Australian's advancement plan is open to question. "Martin has never let me down and always delivers on every promise," he says.

"McLennan is a very political animal who has been very assiduous about getting close to Sorrell," a former Y&R senior manager says. "Sorrell likes entrepreneurs who will get things done and McLennan is certainly capable of doing that."

Nevertheless, McLennan faces some credibility hurdles. One is the perception that he is a second-best option, an internal solution picked only because a suitable external candidate failed to materialise. It is, after all, more than a year since Ann Fudge, the chairman of Y&R Brands, announced she would give up her leadership of Y&R Advertising and appoint a new network leader. Industry sources claim that Sorrell suggested McLennan to Fudge, but that Fudge was reluctant to appoint him until other options had been fully explored.

"I certainly don't feel like second choice," McLennan insists. "My going to New York has been talked about for some time and I believe Martin and Ann agree that I'm the right choice. It was always made clear to me that things would happen for me if I delivered locally."

At the same time, he will have to demonstrate that his management skills are exportable into the US market. Apart from two years running the pan-Asian business of the food manufacturer Goodman Fielder from Hong Kong, McLennan has worked only in Australia. One ex-Y&R executive suggests he should at least have served a stint running the network's North American operations before being given the top job.

"The size of the US market obviously presents a big challenge," McLennan acknowledges. "But I sit on Y&R's global management board and have been exposed to a lot of its vision. Get your talent right and things happen. We see that everywhere we operate."

A decade ago, McLennan's chances of running a US-based agency powerhouse such as Y&R would have been somewhere between slim and none.

In the early 90s, Y&R was at the top of its game. However, two seismic events knocked it off course.

One was the group's 1998 initial public offer, which valued the company at close to $2 billion. The other was WPP's $4.7 billion acquisition of it two years later.

This made a number of key managers millions of dollars richer, but also left a lot of senior staffers disenfranchised and disenchanted. It created a "them and us" culture and the US agency failed to become the network's global "lighthouse". "The place was in the crapper," one senior executive admits.

Sorrell's choice of Fudge, a former senior marketer at General Mills and Kraft Foods, to run Y&R Brands three years ago was a controversial one. Not least because of her lack of advertising experience. Since then, she has presided over a series of defections by both senior executives and clients, including Burger King, Sony and Jaguar.

Now McLennan has plugged the gap, those who know him predict he will act firmly and decisively to improve fortunes. Jim Kelly is a former chief executive of Rainey Kelly Campbell Roalfe/Y&R and now the managing partner of United London. He says: "I expect him to move quite quickly once he has made up his mind what to do."

With Massimo Costa considered a competent head of Y&R's Europe, the Middle East and Africa region, McLennan is expected to focus heavily on New York.

There, new business has been hard to win; morale is low; creativity has been less than exciting and leadership has been lacking. Onlookers predict an early break-up of the old guard and the installation of a replacement for Mary Maroun, the boss of the New York office, who moved to Arnold last month.

"Losing Jaguar and Sony were serious setbacks, but we have been picking up business there," McLennan says. "We're having some success but we could do better. Nor have we shown enough enthusiasm for what's been going on in digital and interactive."

Some believe his most pressing concern must be to ensure all runs smoothly on Colgate-Palmolive, one of the network's largest pieces of business, in the wake of some recent client-side changes. "Colgate-Palmolive has become a law unto itself within Y&R," a former Y&R chief comments. "McLennan has to identify who runs the business."

The big question, though, is how much freedom Fudge will allow McLennan to do what he thinks necessary. Other operations under her charge, including the Wunderman direct marketing specialist, and the public relations agency Burson-Marsteller, are allowed a high degree of autonomy. They do not take kindly to having their corns trodden on. "If McLennan starts making decisions about shared clients, there could be trouble ahead," a former Y&R executive warns.

Perhaps. But if confrontation comes, nobody expects McLennan to be the one to blink first.

THE LOWDOWN
Age: 40
Lives: Sydney
Family: Wife Lucinda, children Olivia, eight, and Ted, seven
Most treasured possession: My family
Describe yourself in three words: Creative, pragmatic, direct
Hobbies: Fishing, art, skiing
Favourite ads: George Patterson 1976 "memories" commercials for OTC
Most admired agency: Bartle Bogle Hegarty
Personal mantra: Do the right thing

This article was first published on campaignlive.co.uk

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