Feature

The new team hoping to move Engine forward

With a new management structure, new offices and an ambition keener than ever, Engine is ticking over, Noel Bussey says.

Engine...new team, new offices
Engine...new team, new offices

View a guided tour of Engine's new office

Sitting on the fifth floor of their swanky new offices on Great Portland Street, looking out over London, Debbie Klein and Peter Scott, the newly appointed joint chief executives of Engine, look cool, calm, collected, confident. And extremely pleased with themselves.

Not only are they confident of delivering on the promise of offering clients "best in class under one roof", but they are literally sitting on top of a business that has almost doubled its revenue (to £60 million) in the past year. And it looks set to continue growing.

Robin Wight, Engine's newly appointed president and, according to Klein, the "in-house R&D department", is around somewhere, but doing "who knows what".

There is one notable absence, however: Will Orr. Despite being promoted to the chief executive of WCRS last week, he has spent much of the day standing on a station platform in the Midlands.

This situation seems indicative of the man who, while his colleagues bask in their fifth-floor corner office opulence, does his first interview in his new role while on a platform in Tamworth train station.

Orr is one of three friends who graduated together from Durham University with ambitions to reach the top level in advertising.

The others are Richard Exon, the chief executive of Rainey Kelly Campbell Roalfe/Y&R, and Ben Fennell, the managing director of Bartle Bogle Hegarty.

Therefore, his promotion wasn't really a surprise to anybody; after all, he had been covering for Klein while she was on maternity leave. It was the fact that he was handed the temporary reins in the first place that took a few people by surprise.

Despite a broad career that has covered WCRS twice, Mother, Leagas Delaney and BBH, some observers don't quite share the confidence in Orr that his seniors do.

Some question whether the low-profile Orr has the experience to run such a fast-growing agency, while others question his standing within the industry in general.

But it's the opinions of Klein and Scott that matter most, and these are extremely high.

Klein, who will also be the chairman of WCRS and still be involved in running the agency, says: "Will has the ear of the staff and the clients. He's done a fantastic job during my maternity leave. It's now up to him to move the agency forward, which I have no doubt he will do."

However, this may be a bit of an ask, seeing as the agency has recently been through, arguably, the best years of its life. Its billings have escalated tremendously, thanks to wins such as the £75 million Sky -account, and it is in the top ten on the Nielsen billings table.

Orr doesn't see this as a problem, though. "I don't think it's a priority to match the millions of pounds of growth. It's always been about quality growth, not unsustained growth. It shouldn't become an -obsession," he says.

He also believes that being a shareholder in Engine means that he has added incentives to succeed - all part of the Engine master plan (which will be explained later).

But if there are lingering doubts about Orr's ability, there are definitely none about Scott, who more than lives up to his reputation as one of the sharpest, canniest and coolest operators in the business.

Unnervingly, after five minutes of the interview, with not a single question asked, Scott had not only anticipated every tricky question, such as possible flaws in the structure of Engine and speculation about a possible float, but had also given well-structured and intelligent answers to them all.

Question number one, for instance: Wasn't Engine only set up for a quick float that would make its shareholders millionaires? Hadn't the group missed its chance, with the share price of equivalent small marketing services groups collapsing as the industry faces the prospect of a downturn?

Scott says: "Yes. With the eco-nomic climate as it is, we couldn't float just now. If the markets recover, it's always an option. But don't think that we haven't already been approached; we have declined the opportunity on numerous occasions."

Klein then points out that there were similar rumours four years ago, after the management buyout, but that they still own 70 per cent of the company. The rest is owned by Loudwater, an IPO fund, Michael Spencer of ICAP and a "few friends and family who helped out when needed".

"We also completed a £4 million rights issue in March. We all sat around a table and wrote cheques from our own accounts," she adds.

Another point that Scott picks up on, without being prompted, is the apparent disadvantage of the Engine business plan.

Scott has painstakingly built a group of disparate companies under the Engine name, just when the current vogue, adopted by the likes of BBH and CHI & Partners, became building a multi-discipline agency with a single bottom line. He has obviously been faced with this point before.

After all, if each of Engine's subsidiary agencies has its own bottom line, you're going to provoke competition between the businesses, not media-neutral cross referrals."

As one source puts it: "If a client goes to the DM guys and asks for a solution to a problem, they're not going to say ‘you should talk to our branded content guys, are they?"

Scott, however, claims that Engine can offer both. "If a client wants the answer from a number of companies, we can offer that as Engine. If they just want to work with one business, then that is their choice as well.

Some people like silos, some people don't. That is their call."

Another industry executive asks questions of the company's eagerness to flash the chequebook - especially if offering people earnouts - which generally sees a company increasing revenues in the short term, but with talent disappearing once the money has been earned.

However, Scott resolutely points out that none of their companies are actually on earnouts (they get cash and shares in Engine as bonuses) and that there is a lot of -misunderstanding about how the group handles acquisitions.

"There's no sweet equity. We want people to stay here, not take the money and run, so we get companies with the same shares and common interests," he says.

"We don't rush in and buy companies - it has to feel right and they have to fit the culture and the feel of the business. We've walked away from three deals in the past year at the due diligence stage and spent about half-a-million in fees doing it. But the deals just didn't feel right."

And it's this approach that Scott believes will help the business ach-ieve his expansion plans of reaching £100 million of revenue and 1,000 staff by 2010.

This will not only inc-lude moves into search, comms planning, channel planning and brand innovation, but also extending further into PR and public affairs.

As confident as Scott is, it is obvious that he still feels he needs help in realising these targets.

That is where Klein comes in, and he makes no attempt to hide this. In fact, when she gave birth to Joseph (she already has Natasha), Scott sent her a magnum of Champagne and a pair of running shoes with a note that said "hurry back".

With the new building and the full team now in place, there is a tangible feeling of expectation and an eagerness to muck in within the business.

This is personified by the sight of Steve Aldridge, the founder of the recent Engine acquisition Partners Andrews Aldridge, literally getting his hands dirty and lugging picture frames up to their new floor.

Yes, there is an air of confidence that permeates the building. However, Scott is still canny enough to know that there is a chance it won't work.

"If it doesn't work and it all collapses, we'll put up our hands and admit we got it wrong," he says. But you get the distinct impression he knows it will work.

View a guided tour of Engine's new office