Media: All about ... The creation of Havas Media UK

A new structure will unite Havas' UK businesses. Alasdair Reid reports.

Even the Havas media properties, it seems, must have a matrix. Well, why not? Everyone else is at it. All of the major holding company players at any rate - the likes of Interpublic Group, Omnicom, WPP and Publicis.

The whole point of the big holding companies is that they each have a portfolio of media agency brands that they've built up into global networks. A couple of planning and buying brands, say, plus PR or research or sponsorship or content development specialists.

And each of these networks tends, naturally enough, to have a global chief executive plus regional chief executives and an (often substantial) administrative secretariat. But over the past few years, we've also witnessed the emergence of additional, complementary structures, implemented on a national and regional basis, in an effort to ensure that these individual agencies work in an integrated fashion at a local level.

Thus the matrix: on some issues, your loyalties will be lateral; on others, the pull will be horizontal. Last week, Havas Media joined the matrix club, with Mark Craze, previously a managing partner at the UK office of MPG, stepping up to become the chief executive of a new Havas Media UK organisation that will "gather together" the group's various UK operating units - MPG (including Media Contacts), Havas Sports, Arena BLM (including BLM Quantum), Cake and Archibald Ingall Stretton.

The HMUK board will meet roughly six times a year. Its members will include: Steve Booth, the chief executive of Arena BLM, Jon Ingall, the managing partner of AIS, Mike Mathieson, the chief executive of Cake, Keith Impey, the chief executive of Havas Sports, Marc Mendoza, who has been promoted to the position of chief executive at MPG UK, plus, of course, Craze himself.

For the biggest agency groups, one of the functions of a group structure is the ability to conduct leveraged group negotiations with media owners. HMUK won't be doing that. It will, however, begin to oversee some back office functions such as finance, IT and research. There will be no centralised P&L.

Havas sources insist that this new structure will bring in its wake fewer of the political and turf war problems that have bedevilled matrix structures at Havas' larger rivals. Havas' individual media networks are, as yet, relatively weakly constituted - and the group is small enough for it to find an easy balance between national synergies on the one hand and network demands on the other.

They add that "advisory boards" have worked well in other markets - and the fact that the newly acquired UK companies are subject to earn-outs will tend to guarantee a continuing spirit of flexibility and collaboration. HMUK's focus, they say, will be on shared intelligence and personnel issues.

1. Havas entered a new stage of development in the UK back in January when it acquired BLM for £20 million and integrated it into its second-string international media network, Arena, which has offices in France, Spain, Portugal, Argentina, Chile and Colombia.

2. In April, Havas bought Cake, a UK branded content agency, which also has ambitions in the US, for £12 million.

3. In May, Havas announced it was to raise its minority stake in AIS - and, having taken control, was to use the UK agency as a platform to launch a network of AIS-branded agencies in Spain, Portugal, the US and Mexico.

4. The advent of HMUK will not affect existing formal reporting lines within the group's four main networks. MPG's global chief executive is Maria Luisa Francoli; Arena's global chief is Joaquin Bohorquez; and Havas Sport and Entertainment (which embraces Cake) is run globally by Lucien Boyer. The fourth network, Havas Digital, is not as yet established formally as a brand in the UK, but it is expected that AIS and Media Contacts will eventually he housed under this banner. Havas Digital's global chief operating officer is Gabriel Saenz de Buruaga.

5. Craze will report to Alfonso Rodes Vila, the global chief executive of Havas Media. Alfonso and his brother Fernando Rodes Vila, the chief executive of the Havas holding company, will also attend HMUK meetings where possible. Craze will be expected to have informal day-to-day contact with fellow HMUK board members and will have a client-facing role where appropriate.

WHAT IT MEANS FOR ...

HAVAS MEDIA

- Corporate managers with MBA degrees will, if left to their own devices, instinctively seek to create ever more gratuitous levels of management superstructure - and some of the bigger holding companies have, perhaps, in recent years, been guilty of over-complicating things for themselves.

- Havas insists this clearly isn't the case here - in addition to Craze, the Havas Media UK staff will stretch to a finance director and a personal assistant.

- Just as well, really, given the current economic climate. It would be careless in the extreme to be seen to be adding superfluous costs and building a top-heavy structure at a time when redundancies further down the scale are perhaps inevitable.

- It is almost certain that there will be occasional conflicts between the imperatives of UK market collaboration and the world-view as seen by the global bosses of individual Havas media networks. So it will be interesting to see how UK operating company heads, some of whom have been beholden to no-one for years, now react to having not just one boss, but, as if by magic, two.

ADVERTISERS

- It irks senior holding company bosses to be reminded of this - but advertisers (in private at least) tend to be rather sceptical about the merits of structures designed to sell them group synergies. But they will undoubtedly welcome Havas Media's avowed determination to underwrite quality of service through shared intelligence and the transfer of best practice that this new structure will seek to achieve.

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