CLOSE-UP: LIVE ISSUE - PROCUREMENT. Agencies decide: if you can't beat them, join them

Grey has taken on its very own procurement director, as Rachel Gardner reports.

In recent years, client procurement experts have been the cause of numerous headaches for agency chiefs with their unwavering "value-for-money" approach. How quickly things change.

Grey London's recent appointment of its own commercial director to handle procurement from the other side of the fence is further confirmation that agencies are finally responding to the involvement of these specialists in their new-business negotiations.

Indeed, rather than working against them, it seems procurement specialists are fast becoming a phenomenon to be embraced, as agencies seek to scrutinise their own costs in an attempt to deliver "better value" across both their internal and external affairs.

Moreover, in a time of continued recession, procurement has emerged as a ubiquitous factor in an increasingly competitive marketplace.

In this climate, Tina Fegent takes up her newly established role as the commercial director of Grey in September after being poached from Orange by Grey's chief executive, Garry Lace.

She joins Abbott Mead Vickers BBDO's Emma Nussey, who was also hired as a commercial director back in October.

It is undoubtedly a brave leap into uncharted territory, but one both agencies believe will pay rich dividends financially, while helping to develop more solid relationships with their clients.

The widespread presence of client procurement specialists is well documented with the industry body ISBA recently revealing that 48 per cent of clients now involve purchasers in renumeration discussions.

There has been an unquestionable and relentless growth in their power over the past six years as advertisers continue to search for value from their agencies.

Traditionally, marketing spend - once regarded as something of a sacred cow - has been one of the very few large areas where procurement has not been involved.

But Nussey, who spent eight years in procurement consultancy at British Airways before moving to AMV, believes the move toward agencies employing their own procurement specialists is a natural progression that is destined to become more than just experimental.

She says: "Whether it succeeds for AMV this year may well determine how many other agencies follow in its footsteps.

"There is undoubtedly an element of risk in what AMV is doing. It is sitting in the marketplace and saying: 'We do a good job but now we are going to be transparent about it.'

"In order for this approach to work it needs to both win and maintain clients."

Previously at AMV, account teams and finance people would have been forced to handle the clients' purchasing demands, often resulting in tough negotiations between the advertisers and its agencies.

AMV, which has a number of key clients with well-established procurement departments, has essentially brought in Nussey to be a proactive diplomat to stop any client who is tempted to shout: "I need, I need, I need."

Along with squeezing margins, it is her remit to predict what the client is going to demand, while being open and honest about exactly what they are getting for their money.

She says: "My role is about getting the right balance between meeting costs and understanding company's commercial needs, while helping them understand where it is that we add value.

"When meeting clients' demands, I try to be fair, reasonable and logical."

However, some agency chiefs may argue that the procurement specialists, by the very nature of their role, drive a hard bargain while retaining little respect for creativity.

This new breed of agency procurement experts may know better than any what the clients' purchasing department wants, but are they guilty of trying to push down costs with little thought for the creative campaign?

Cilla Snowball, the chief executive at AMV, thinks not: "It is about applying specialist skills to the way that we buy and sell. Financially, it is an investment that has brought us huge benefits.

"But it is very important that Emma is on brand and understands the price of creativity."

Fegent adds: "People say you can't put a price on creativity, but everything has a certain price at the end of the day. But once you step over the line and have a view on the creative, you have crossed over into marketing."

Like her AMV counterpart, Fegent comes armed with bags of experience in purchasing.

She launched her career with Cellnet, now O2, back in 1991 before leaving to set up purchasing marketing support at SmithKline Beecham five years later.

Most recently, she joined Orange where her brief was to replicate her success at SKB.

At Grey, she will be responsible for all aspects of the agency's business, from buying stationery to choosing where to source services while producing savings for clients.

She says: "This will be a real challenge for me. But it's a good opportunity to use my skills in a very different way.

"I believe my arrival will allow the creative teams to continue with the work they do. It will be my task, not to stifle the creative but to make sure the costs are right and that the creative work produced is the best for the money."

According to Lace, it is all part of his plan to make the agency more commercially accountable.

He says: "I think for far too long companies have had the idea that agencies rip them off.

"We want to give clients the sense that we are taking it seriously and doing something about it. We want to have relationships with clients that are totally unambiguous."