Close-Up: Live Issue - JWT's transformation brings rebirthing pains

Is the network in danger of sacrificing its soul in order to distance itself from its outdated business practices?

JWT's recapture this week of the global Smirnoff business from Bartle Bogle Hegarty will be a much-needed morale booster during what has been a reinvention programme of mixed fortunes.

Eighteen months ago, the group ditched its J. Walter Thompson moniker, along with all its historic associations, to put itself through the pain barrier.

Today, the big question is not so much about whether the gain is starting to outweigh the pain, but whether JWT is in danger of sacrificing its soul without any clear or enduring advantages.

JWT's apologists maintain it had little choice but to undergo a catharsis. The agency that gave Britain advertising icons such as the Oxo family and Maureen Lipman's Beattie had become old-fashioned and out of touch with an evolving media world. It could only look on in dismay at the success of younger and hungrier creative hotshops. It either had to adapt or face the consequences of its inertia.

"There has been a false grandeur about JWT's stature for too long," one of its former executives comments. "It has to become sharper, faster on its feet, leaner and acquire an effective new-media capability."

The new strategy

Bob Jeffrey, the worldwide chief executive, decided not only to rechristen the network as JWT, but also to mark this by refocusing on the network's creative output.

To underscore the new emphasis, Craig Davis, the worldwide chief creative officer, set out JWT's creative agenda and the criteria by which work would from henceforward be judged in a tome with the bizarre title of Hold My Skateboard While I Kiss Your Girlfriend.

Meanwhile, all staff were required to sign a partnership contract in a symbolic commitment to the goals.

Some critics dismiss such initiatives as meaningless stunts masking a lack of real substance - not the way to impress clients such as Kellogg's, Pfizer and Bayer with clear ideas about how they want things done and for whom the 30-second TV spot remains hugely important. "You can't do a Honda 'cog' on Kellogg's Cornflakes," a former JWT senior manager says.

But what sceptics see as a flawed plan that is wrong for JWT, others claim is simply suffering teething problems in what will be a protracted process. "It's always going to be hard for an agency with such an extensive FMCG heritage to transform itself suddenly creatively," a top JWT executive argues.

Has it worked?

So what progress has been made so far? At best, it can only be described as mixed. JWT London had a reasonable year at Cannes, picking up four silvers and a bronze for Vodafone and Nestle. That success is tempered somewhat by the agency's current position at joint-top of Campaign's Turkey of the Week league table. In the past 18 months, it has had six Turkeys, for ads including Special K, Andrex, HSBC and Rennies.

Along with Smirnoff, on the new-business front, Kimberly-Clark provided a fillip by awarding the group its European and North American personal care brand advertising. The downside, though, has also been a worrying string of losses, most notably its global Reckitt Benckiser business, which has stripped the London agency of £30 million of billings.

Persil, Rice Krispies, Axa and Weight Watchers have also departed and the agency is facing difficulties on its First Direct account. Indeed, one former JWT London director fears the agency's fortunes may get worse. "I suspect another couple of accounts will go," he says.

"There's no doubt the losses have cast a cloud over what we've been doing," Nick Bell, JWT London's executive creative director, admits. "But, given the volatility of the market, we're reasonably philosophical about it and I don't think there's a direct connection with the changes we have been making."

The client view

For their part, many clients recognise JWT as a work in progress and feel things are moving in the right direction. Peter Stringham, the global marketing chief of HSBC, was instrumental in JWT's appointment as the lead agency for the bank's £350 million budget. He says: "JWT still has much to do, but is working hard and seems to have become a more energised place in the past 18 months. It has tremendous enthusiasm and I'm pleased with the people it has brought in."

Some, however, question whether the new-look JWT has anything truly innovative to offer and believe the agency's investment is skewed too heavily towards the 40-strong creative department, where salaries of more than £140,000 are said not to be uncommon.

"It's a very strong department, but it always has been," a former member of the JWT management team says. "You can't change the agency simply by changing the creative department. Planning was JWT's great strength for many years, but it isn't now. Not only has it got to get some talented planners in place, but also other good people who are empowered to run key pieces of business."

Creative tensions

The less-than-comfortable relationship between Bell and the London-based Australian Davis is said not to be helping progress. "It's no big secret this has never been an easy gig," a JWT source confirms.

Bell claims this is simply the result of the massive ambition both he and Davis have for the group. "Craig and I have our differences because our jobs sometimes overlap," he says. "But our differences have proved inspirational and neither of us regrets that."

Whether or not JWT is endangering its culture and what it has always done best - providing big ideas for big clients - is a moot point. There is a belief JWT had no choice, given its structure and outdated working practices.

"The best thing about the change is it has flushed out the old-school types we were notorious for," a senior creative says. "Sometimes you felt like you were being ruled by people from a different age."

Much depends on the effectiveness of the new management team being put in place by Toby Hoare, JWT's executive chairman. Alison Burns, the former president of Fallon New York, has filled the chief executive's chair vacated by Simon Bolton, while Hugh Duthie, the chief strategic officer of TBWA\Chiat\Day New York, has been hired as the head of planning. More significant personnel changes are promised in the next two months.

Senior managers believe that the picture is by no means as black as some outsiders have painted it. "We're still one of the most profitable agencies in London and we're top of the WPP creative league table," one says. "We're not the disaster people think we are."

Nevertheless, there is an admission that more needs to be done. "We've always been good at advertising that connects emotionally," one agency chief comments. "But we seem to have lost some of that."

The future

Above all, there remains the challenge of convincing clients what is happening will benefit them. "We've not paid enough attention to how what we're doing translates into the way we behave and how we talk to clients," Hoare says.

Will the pain be worthwhile? Most agree it will be another 18 months at least before anybody can tell. And opinions are divided on the outcome. "My fear is that the agency has set a goal, will not be able to deliver against it and that its reputation will not be advanced," a former JWT boss warns.

Bell argues that JWT cannot allow its past to jeopardise its future. "From Oxo to BT and Kit Kat, the agency has done some wonderful populist advertising down the years and I'm a great fan of it," he says. "We're still going to be doing it, but differently."

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