PERSPECTIVE: Holding companies face a grim future if led by figures alone

There are some fantastic rumours circulating at the moment, the full details of which would be wonderful to share if truth and libel were not such preoccupations.

Like the story this week about an agency chief and a media chief plotting to buy Cordiant. Or the one about the holding company negotiating with a London independent to rescue its ailing third-string brand. Or the holding company chief executive wanting to up sticks and join the client side because he's fed-up and frustrated by the challenges of the job.

All cracking stories, which, in the detail, make enormous sense. Some of them might even be true one day. And let's not forget the one about the holding company so embroiled in financial scandal that it's being investigated by the US Securities and Exchange Commission - just to prove that there are no stories more ridiculous than the true ones.

Now feverish speculation seems matched with an ominous sense of change ahead. There are rather too many frustrated but talented and ambitious people around for the status quo to continue. So Rupert Howell's timely feature on page 22 raises the question of the rationale for the communications supergroups. Howell argues that although the holding companies are powerhouses of talent, that talent has not been orchestrated to suit client needs.

Rather than being led by credible senior business partners sitting at the hub of this array of talent, the supergroups are orchestrated by educated suits "who are really salesmen of downstream solutions", Howell says.

He thinks the prognosis for the supergroups is gloomy as long as their existence is only justified on a financial basis, particularly when growth by acquisition is increasingly difficult. Is disintegration the inevitable outcome for the global holding companies, Howell asks.

It seems inevitable that Cordiant will be the first to implode. The sorry state of Bates London, this week braced for the loss of around a quarter of its income as Woolworths and Royal Mail depart, is a timely example of how an injudicious holding company with an ill-defined strategy and undisciplined acquisition plan can ravage those companies in its span.

If Bates' parent, Cordiant, had made sounder investments in marketing services, Bates London might be in a stronger position today.

So perhaps it is time for a new solution. And it's no surprise that Howell himself (yes, a master of PR among other things) is working on a new model for harnessing talent in the service of the client. The question of who will be next to challenge the supergroups will no doubt keep the rumourmongers in business for many weeks to come.

- Caroline Marshall is on maternity leave.