Opinion: Perspective - Agencies need to grasp the nettle on redundancy
By Larissa Vince, email@example.com, campaignlive.co.uk, Friday, 28 August 2009 12:00AM
It might have started to feel like autumn, but the dog days of summer are still upon us, and what news there has been of late (England's victory in the Ashes aside) has been of an enervating sort.
Bartle Bogle Hegarty, famously one of the best-run businesses in adland, picked this week to announce a programme of redundancies that will see it reduce its staff numbers by 10 per cent.
Then came the WPP results, worse even than the most pessimistic of analysts had predicted. Alongside the fact that pre-tax profit fell by almost half for the first six months, the world's biggest marketing services group also confirmed that it had made substantial staff cuts, with employee numbers down by 6 per cent on last year.
I've frequently had people say to me during this recession that Campaign's approach to writing redundancy stories is the right one - and it's true, we have taken the decision not to unnecessarily dramatise situations that damage people that work in the business.
But it's also true that, by and large, the big redundancy stories haven't been there to write. And I don't believe for a minute that it's because redundancies aren't being made. Calls to the Nabs helpline have risen by more than 100 per cent this past year and the vast majority of those calls concern redundancy or contract termination.
Redundancies are horrible and destructive for the people involved. But in this market, they are also, often, necessary - and few agencies seem able to grasp this particular nettle with any conviction. Instead, most are chipping away at headcount, six people here, nine there, avoiding the regulatory and legal red tape that comes when big cuts are made in one go.
This strategy also avoids headlines, but at what cost? There can be nothing worse for staff morale than the constant worry that your neck will be the next on the line. One London network agency has even earned the sobriquet "trapdoor" because of the number of people that are currently vanishing out of the office without warning.
Making a load of redundancies all at once may get you a bit of negative press, but it's a much better way to go about things than taking a drip-feed approach.
For one thing, if you communicate the reasons properly, you can get a certain amount of buy-in from staff to any plan. One BBH-er told me this week (with the usual cult-like gleam in her eye), that the redundancies were "a shame" but were necessary to make the business stronger.
For another, it allows you, as BBH is doing, to take a good hard look at your business and focus on proper, well thought-out, structural change that could have a major impact on the future.
Change on this scale, even at what is (compared to clients) a relatively small company, is very hard to make without some downside.
And what's going on at BBH is fairly fundamental. Expect more news once the consultancy period is over at the end of next month, but in essence, the agency is planning to add data, commercial and technology people into its creative and strategy departments while reducing the number of people in account management.
It wants more numbers in planning, and more technology in creative. It wants to work faster and cheaper, because that's what its clients want. It no longer sees the need, it says, to be precious about client relationships in the way it used to be.
Of course, this is basically integration by the back door. But it's a sensible way to attempt it. BBH is lucky as an independently run business that it has the freedom to make difficult decisions - but it should also be applauded for having the balls to face the pain that is an inevitable result of major change.
- Claire Beale is away.
This article was first published on campaignlive.co.uk
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