Jerry Buhlmann has said he was ready to quit Dentsu Aegis Network because he has been global chief executive for almost a decade and the business is in good shape.
In an interview with Campaign in his London office, where a large map of the world and a framed Chelsea Football Club memento hang on the wall, Buhlmann said he thinks about his career in 10-year chapters and declared: "This chapter is complete."
Buhlmann, who turns 59 later this month and will take a role as senior adviser to Japanese parent company Dentsu in January, was in a chipper mood as he sat, smiling and banging the arms of his wooden chair for emphasis at various points.
He said he was proud of how Dentsu Aegis Network, owner of agencies such as Carat, Vizeum, iProspect and Isobar, had transformed to cope with digital disruption and was bullish about the "robust" agency holding company model – so long as agency groups stay "relevant".
Buhlmann hinted that he could take a new role inside the ad industry or beyond, noting he has previously run a public company on the London stock market and could consider "different types of businesses because those skills are transferrable".
He added that Dentsu Aegis Network, which employs close to 50,000 people, would continue to be "led from London", even though executive chairman Tim Andree, who is adding the chief executive’s responsibilities, is based in New York.
Here is an edited transcript.
Campaign: Why step down now?
Buhlmann: Nine years as CEO is a long while. It’s a very rewarding, very challenging, time-consuming and relentless job. I’ve had a fantastic time and it’s been very successful.
Today, the business is in very good shape. It has a lot of momentum. Importantly, it has a very good management team – very talented, very energised, with the right skills for the next journey of the business.
I tend to think about my career in chapters. I ran my own business, BBJ Media, for 10 years. I then sold that to Aegis Group and, for 10 years, I learned how to run a global organisation. Then I’ve run this group for ten years – well, nine years.
Right now, we’re at the end of a chapter. The business is in great shape – it’s doubled in size since Dentsu bought it, quadrupled in size since 2010.
It’s a complete chapter. Once you have a complete chapter, it’s time to move onto something else.
Campaign: So you’re doing a Maurice Lévy, not a [Sir] Martin Sorrell.
Buhlmann: I couldn’t describe myself as like either one of those. I’m neither. I’m a Jerry Buhlmann.
Campaign: How long ago have you been discussing the plan for you to step down?
Buhlmann: We’ve been planning for a while. I don’t want to give timing.
Campaign: What will you do next?
Buhlmann: I’ve got ideas and I’ve got plans [but I don’t want to discuss them now]. Today is about me stepping down. Today is about Dentsu Aegis Network moving forward strongly with momentum.
Campaign: Could you run another business or are you thinking of non-executive roles?
Buhlmann: I’ve got options and I’ll look at all of those options. I’ve got a long history in this industry. I was also an entrepreneur who set up my own business and I’ve got City expertise.
Because I was a CEO of a public company [Aegis Group was on the London stock market], there is some hinterland in terms of [becoming involved in] different types of businesses because those skills are transferrable.
Campaign: Tim Andree is based in New York. Does that mean the balance of power at Dentsu Aegis Network will shift from London?
Buhlmann: The business will still be operated from London and be led from London. In the broader group, you’ve got London and Tokyo, but there is a growing sense in international business of multi-centres.
If you think about our global network brands: iProspect is heaquartered in Singapore, Isobar is heaquartered in Shanghai, Merkle is headquartered in Baltimore.
Tim is based in New York but he spends a lot of time in Tokyo and he will be spending time in London. There’s no head office move to New York – to be clear.
Campaign: Tim Andree was part of Dentsu before it bought Aegis and he is on the board of Dentsu Inc and you are not. Is there a sense you had gone as far as you could go within Dentsu?
Buhlmann: It’s just not something that’s entered my head because I started this process myself – I stepped down. So that’s not really been a consideration.
If you’re stepping down, you’re not thinking about how far you can go within Dentsu. It’s not an issue.
Campaign: Today, Dentsu Aegis Network is reporting the fifth consecutive quarter of improving growth and the best quarterly organic growth figure in two years. Overall, when you look back over the past six years, have the last two been the toughest?
Buhlmann: We have enjoyed very good growth every single year. We’ve outperformed the market in terms of organic growth by more than two times the industry average.
We have utilised our capital highly effectively. We’ve done 179 acquisitions in that time. Every single year, we’ve had a very good new business track record.
Sixty per cent of our revenue is digital. We have built very strong performance networks and very strong commerce and creative networks.
We’ve got the strategy right for a disruptive market and that’s made it much better for us. Our average growth per year is 15% [including the benefit of acquisitions].
Agencies are momentum businesses and it’s about being relevant. If you’re relevant, you have to have the best talent. If you want the best talent, you’ve got to have momentum. People want to work in agencies that are winners. Clients want to come to agencies that are winners.
Even if you look at last year, when organic growth was a bit tougher, we still had good overall growth – double-digit [percentage increase].
Campaign: But that growth was largely inorganic and driven by acquisitions…
Buhlmann: The balance between organic and inorganic growth can vary a bit but the point is we had growth. This year, we are back to a 50/50 split between organic and inorganic.
Ideally, you want to be outperforming in organic, which we have at twice the market, and you want to be adding to that inorganic growth, which adds to the momentum and brings in new talent and capabilities. That’s how you create a successful business.
The last two years have been tough [for the ad market] because it’s disrupting. Clients are very demanding and their businesses have been challenged too.
If you look at the top 100 advertisers, a lot of them aren’t particularly growing – they’ve had to face that change of model [because of disruption in retail and the rise of agile, local competitors challenging multinational brands].
That manifests itself in pressure on their supply chain, which includes agencies.
You still have to be able to have and execute a good growth strategy even in difficult circumstances. You have to create your own tailwind.
Has it been tough? Yes, it’s been challenging but it’s been really exciting. There have been lots of opportunities. You have to focus on the opportunities. If you focus on the challenges, you won’t get out of bed in the morning.
And if you’ve got growth – this is a really important point – you can afford to manage the challenge.
If you take this year, we have intentionally guided down on our margin as a business for 2018 because we are purposefully investing in systems and platforms to make our business more agile, more adaptable, more consistently global – because that’s what clients need."
Campaign: You said in your farewell message that there has been no better time to be in the marketing services business. But you are walking away and a lot of observers believe the agency business is facing structural challenges…
Buhlmann: I’m not walking away. I’m leaving something really gleaming and high-speed and competitive.
If you can add value to your client’s business, you’re relevant. And if you don’t transform your products and services, then you lose relevance and you go: ‘Oh God, the world is restructuring around me.’ But if you do [stay relevant], then you can win.
People look at Google and Facebook and say: ‘How do I deal with them?’ The way you deal with them is say: ‘What role do they play in our clients’ business?’
If you can be experts in Google and Facebook and experts into how they fit into the plan and how you create content that can inspire consumers on those channels, then you can create value.
Why would that be a challenge to our industry? It’s an opportunity.
Campaign: What are you most proud of?
Buhlmann: I’m really proud of where the business is today. If you look at where the business was in 2010 and where it is today, it’s in a different league in terms of its competitiveness.
I’m proud of getting the strategy right at Aegis Group and disposing of market research [by selling Synovate in 2011].
I was proud of what we were able to do when Dentsu acquired the business and the integration with Dentsu Aegis Network.
I’m proud of the fact we were able to transform. The business is more digitally centric and has less legacy.
I’m proud of the quality people and the high-performance culture we have.
I’m proud of the fact of the 179 acquisitions we’ve done, 70% of the management teams have stayed post-earn-out.
Campaign: Is there anything you wish you could have done differently? Or the industry could have handled differently such as media transparency?
Buhlmann: No, if I look back, I’m extremely happy with the last nine years. Any bumps in the road, I didn’t really notice.
You always could have done things differently. The key point is: have a clear vision.
By the way, we still remain the only holding company that has a vision: ‘Innovating the way brands are built.’ No other holding company has a vision.
Have a vision. Set out your values. Make decisions. Do stuff. Make things happen. You don’t get every decision right. But make decisions. If you make decisions, you get good at it.
Campaign: Are you an optimist about the agency holding company model as the industry looks ahead to the next 10 years?
Buhlmann: Yes, if it’s managed the right way with the right leaders. The agency model is a strong model because it’s about relevance.
Are there opportunities for new, innovative agencies? Of course there are. We wouldn’t have made 179 acquisitions if we hadn’t found new and interesting businesses that do new things.
There’s room for entrepreneurialism. There’s room for corporate entrepreneurialism. There’s room for big groups to be successful if they transform and leverage themselves in the right way.
There is so much room for success… With the right vision, with the right leadership, with the right execution, with the right technical capability and with relentless energy and focus.
Campaign: Could you do another job in the ad industry?
Buhlmann: Who knows about the future? This chapter is complete.