CLOSE-UP: LIVE ISSUE/TRUE NORTH - Why True North now faces a true test of character. Hiring a new chief is only the start of the US group’s worries. By Claire Cozens

Wanted: one chief executive to turn around the fortunes of an advertising company with sluggish growth, internal culture clashes and an over-dependence on too few international clients. Responsibilities include gladhanding Wall Street and smoothing over troubled relations between the company and its subsidiaries. Salary: approximately dollars 1 million.

Wanted: one chief executive to turn around the fortunes of an

advertising company with sluggish growth, internal culture clashes and

an over-dependence on too few international clients. Responsibilities

include gladhanding Wall Street and smoothing over troubled relations

between the company and its subsidiaries. Salary: approximately dollars

1 million.



Not your usual job ad. But chief executive of True North, the holding

company of FCB and Bozell Worldwide, is no ordinary post. And after

seeing the description of the task prepared by the executive search

company, Heidrick & Struggles - and leaked last week to the US trade

magazine, Adweek - it will be a brave candidate who volunteers to take

over from the outgoing Bruce Mason.



The search document gives a damning verdict on the state of affairs at

True North, and its publication adds to the concerns raised when the

company announced Mason’s imminent retirement without having a

replacement lined up. It says the new chief executive must ’improve

relationships with the subsidiaries and the board which (it is fair to

say) are not currently as good as they should be’.



It warns potential candidates about the fragmented nature of the

company, describing it as having ’two and perhaps three different

cultures’.



In a statement to Campaign, True North dismissed the Adweek article as

’vintage tabloid sensationalism, rife with an overabundance of ludicrous

inaccuracies’.



But an internal memo from David Bell, the president and chief executive

of Bozell Worldwide, reveals a more serious attitude to the article. He

describes the report as inaccurate and ill-timed, but goes on to say

that there is nothing in it that should surprise anyone, adding: ’We

should be pleased that the company has the will and resolve to address

its issues head on and to develop the strategies to move smartly ahead

during their resolution.’



The divisions highlighted in the report have made it difficult to find a

new chief executive from within True North. Chuck Peebler, the chairman

of Bozell Worldwide, was the favourite to succeed Mason, but the choice

of someone from the smaller network is understood to have been unpopular

with executives at FCB. Meanwhile, Brendan Ryan, the chief executive of

FCB Worldwide, is thought not to want the job.



With less than a month to go until Mason retires, True North looks

rudderless.



The appointment of Heidrick & Struggles highlights the difficulties

advertising groups have in finding leaders who understand Wall Street as

well as the ad industry. An inability to play to Wall Street was

considered one of Mason’s major weaknesses and his successor will have

some repair work to do.



The loss of Kimberly-Clark’s global tissue business last week dealt a

further blow to FCB, which has already lost substantial business from

clients such as Levi’s and Campbell’s in the past year or so.



At the same time, the brutal exposure of True North’s weaknesses have

led to speculation that it could now be a takeover target.



’True North is still very dependent on a few clients and the loss of

Kimberly-Clark will hit very hard,’ a former senior FCB manager

says.



’In the next few years, we will see the number of global players in the

ad industry come down to three or four major companies. True North would

be attractive to the likes of Omnicom or Young & Rubicam, and would make

a very credible third-string operation for WPP.’



Maurice Levy, the chairman of True North’s former global partner,

Publicis, has made little secret of what he regards as the US company’s

lack of ambition and inability to turn itself into a truly significant

player.



As Publicis is a True North shareholder, Levy - who mounted a takeover

bid of his own at the end of 1997 - will not comment on whether the

company could be a takeover target. But he warns that it cannot go on as

it is.



’There is no room in the market for a holding company with two weak

networks, and both FCB and Bozell need to be strengthened on a global

basis,’ he says.



’For many years now, the only growth at True North has been through

acquisition.



At the end of 1997, the stock was trading at dollars 28 a share and I

was offering dollars 30. Since then, the stock market has gone up by

about 25 per cent and True North’s stock is still trading at around the

dollars 25 to dollars 30 range. So they have added no value at all.’



But others believe that the predictions of True North’s demise are

ill-founded. Roger Edwards, group chairman and chief executive of Grey,

says the company will ride out the current storm.



’True North is strong financially and it would be difficult for anyone

to buy a business like that unless the management agreed,’ he argues.

’It is not in play as a conventional, publicly quoted stock over here

might be. The leak will be damaging from a recruitment perspective, but

I doubt that it will do any more long-term damage.’



Michael Bungey, the chairman of Bates Worldwide, agrees: ’Nobody wants

to read that kind of thing about their agency - it’s hardly a

morale-booster.



But headhunters aren’t necessarily the world’s leading experts on

running ad agencies.’



Whether recent events prove to be the beginning of the end for True

North, or no more than a blip in its history, one thing is certain:

whoever takes over at the helm of the company will earn every cent of

that fat pay packet.



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1 Job description: Digital marketing executive

Digital marketing executives oversee the online marketing strategy for their organisation. They plan and execute digital (including email) marketing campaigns and design, maintain and supply content for the organisation's website(s).