Week 12 Leadership Case Charlotte Beers at Ogilvy and Mather

Week 12 Leadership Case

Charlotte Beers at Ogilvy and Mather

April 12, 2005, Waverly Ding

Charlotte Beers at O&M 2

Changing Industry Context since mid-1980s

Decrease in media-related expenditure (traditionally the biggest revenue generator for ad agencies).

Shifting of marketing effort to new channels (direct, telemarking, promotions).

Changes in how ad work is compensated by clients

Merger and acquisitionGlobalization of clients



Internal Challenge

Multi-local structure breed local autonomy—structure is not optimized to serve multinational clients.

Success breed strong, arrogant culture; managers internally focused.

Lack of inspirational leaders since the retirement of the founder.

Strong managerial and financial discipline imposed after 1989 WPP acquisition—exodus of creative and account talents.



Direction Setting: Did Beers have a good vision?

New direction: brand stewardship“To be the agency most valued by those who most value brands”

Two main tenets of brand stewardship– Companies can only compete in the long term by

building strong brands– Role and value of advertising is to build brands by

uncovering the rational and emotional significance of a product in users’ life

Strategy: how to get there?– Brand probe– Brand Audit– Brand Print




Clarity: – Is it clear and specific enough to provide guidance, and at the

same time vague enough to encourage initiatives and remain relevant under varied conditions?

Desirability: meets the needs of key stakeholders– Enthusiasm from clients– Account managers like it– Top creative people are on board– Resistance from local creative people: see it as constraining– Not much offer to the Direct Marketing division

Feasibility: – Provide the rationale to offer integrated services to clients– Leverage O&M’s worldwide presence and strong global

network– Instrumental in reigning in local fiefdoms




Originality: Is it original? How important is originality?– Not that original: similar to the one-bundle

service strategy the firm tried to implement earlier

– Most other major advertising agencies were focusing on brands as well

– But this is not important: most effective visions are not original at all.



Assessment of the Direction Setting Process

Questions to think about in assessing the process:– Was it high involvement? Or was it mostly done by

herself?– Did she involve the right number of people at each

stage?– How effective was she in dealing with internal

resistance?– How did she manage to maintain room for creativity

while setting a direction?



Beers’ Direction Setting Process

Start with her own vision of brand-driven advertising agency model

Select a small group of managers (The Thirsty for Change) and have the idea debated among them

Involve a larger group of managers to further refine the vision and the strategy

More directive at the beginning (Vienna meeting), but more participative at a later stage (Westchester meeting)

Establish WCS: structurally prepare for the implementation of the vision



Communication of the vision

Why were there resistance?– Misunderstanding or lack of trust: e.g., some

local creative people believe that the new vision is to impose constraints on them

– Parochial self-interest: the fight over billings and fees between local offices and WCS

– Different assessment: not everyone if the firm has the same degree of urgency

– Low tolerance for change: e.g., some people view doing a brand audit on existing business as an indictment of what they have been doing



Communication of the vision

How to overcome resistance?– Education and communications– Participation– Negotiation– Explicit and implicit coercion– Structurally align the organization with the new

mission (e.g., create WCS)



Process of Renewing and Transforming Organizations (Kotter Leading Change 1995)

2. Creating the Guiding Coalition• Putting together a group with enough power to lead the change• Getting the group to work together like a team

1.Establishing a Greater Sense of Urgency• Getting people to examine seriously the competitive realities• Identifying crises, potential crises or major opportunities

3. Establishing a Transformational Vision and Strategy• Creating a vision to help direct the change effort• Developing strategies for achieving that vision

4. Communicating the Change Vision• Using every vehicle possible to constantly communicate the vision and strategies• Role modeling needed behavior by the guiding coalition



Process of Renewing and Transforming Organizations (Kotter Leading Change 1995)

6. Creating Short-Term Wins• Planning for some visible performance improvements• Visibly recognizing and rewarding people who made the wins possible

5. Empowering Others to Act• Getting rid of blockers• Change systems or structures that seriously undermine the change vision• Encouraging risk taking and nontraditional ideas, activities, and actions

7. Consolidating Gains and Producing Even More Change• Using increased credibility to change all systems, structures and policies that don’t fit

together or don’t fit the transformation vision• Hiring, promoting and developing people who can implement the change vision• Reinvigorating the process with new projects, themes, and change agents

8. Institutionalizing New Approaches into the Org. Culture• Creating better performance through customer and productivity oriented behavior,

more and better leadership, and more effective management• Articulating the connections between new behavior and firm success• Developing means to ensure leadership development and succession

Documents

Week 12 Leadership Case Charlotte Beers at Ogilvy and Mather