roadmarking
The high turnover of CEOs on Madison Avenue affects huge numbers of other executives. At the current rate, almost 50% of the largest agencies will have a new CEO within the next four years. If you’re a senior team member in a firm with a new chief executive, your career now depends on the views of a person you may not be familiar with. What’s more, your history of successes may not count for much. Firings, organizational reshuffles, and changed strategies often result in abrupt and unwelcome career changes for a host of senior managers. And this, of course, affects their clients directly, who may wake up one morning and find that the key people on their business have been removed.
To understand what happens when a new chief executive takes over, Harvard Business Review examined the turnover rates of proxy-level managers and other senior leaders. In companies where the CEO remained constant, the rate of involuntary turnover was 7.5% of senior management. Where an internal executive had moved up the corporate ladder to the top spot, the rate of involuntary turnover jumped up to 12.5%. When the CEO came from outside the company, involuntary turnover rate at companies with average performance was 24%, while the rate at poorly performing companies was 31%.
Ogilvy has seen major turnover at the executive level since newly hired Andy Main took the helm a year ago as CEO. Main was recruited by head of WPP Mark Read from consulting firm Deloitte a year ago. Recruiting outsiders is usually the result of a critical failure to nurture and develop new leaders within the organization. Since joining, Main has been busy replacing most of the agency’s top leadership.
He tapped former McCann exec Devika Bulchandani as North America CEO and chair of global advertising; former Leo Burnett exec Liz Taylor as global chief creative officer; and Anibal Casso has been named Chief Strategy Officer for Ogilvy North America.
As Main reshuffled top tier, resignations began percolating through the ranks. The president of Ogilvy’s marquee NY office, Lauren Crampsie, left in May. Jason Lonsdale, who headed up brand strategy and planning, left Ogilvy for Deutsch LA this month, shortly after Ben Richards, global chief strategy officer, stepped down. Ogilvy’s global group planning director Jonathan Daly also departed this month. Edward Kim, who headed up commerce, left Ogilvy Consulting in June.
Main is shaking up the leadership of Ogilvy’s subsidiaries too. Kate Cronin, head of Ogilvy Health, left, as well as Ritesh Patel, chief digital officer for Ogilvy Consulting, where he focused on digital transformation for healthcare clients, and Andrew Thorn, EVP, head of planning at Ogilvy Health, also left recently.
New Ogilvy hires included Edelman veteran Julianna Richter as global CEO of Ogilvy PR, Erin Jacobson for the newly created role of head of digital and advocacy for North America, and Accenture exec Steve Soechtig as leader of its experience business. Bob Poulin was hired this month to lead Ogilvy’s D.C. government practice.The company also onboarded HR exec James Kinney as global chief DE&I officer and North American chief people officer.
Hiring a chief executive from the outside (incidentally, for only the second time in Ogilvy’s 73-year history) is usually an admission of underperformance, or a significant change in the ecosystem which requires a leader with different skill set. For over a decade, since the retirement of the larger-than-life Shelly Lazarus, Ogilvy has not been the dominant agency it has been throughout its illustrious past. Read is smart to go outside and hire Main. In times of trouble, you need a fresh pair of eyes and a new strategy to steady the ship. This is even more so when the advertising business transitions from analog to digital platforms.
However, the pace of leadership transformation seems risky. Unlike Read, who replaced the management team at WPP gradually deliberately once he took over, Ogilvy’s changes could be disruptive. Wholesale changes and fewer familiar faces tend to make people, even the people that you want to keep, consider their options to stay or to leave. The advertising industry, just like many other sectors, is facing an unprecedented talent drain. Not only it is harder to hang on to talent that feels threatened, but it’s also doubly difficult to attract top talent from the outside.
Ogilvy’s changes are not unique. Droga5, McCann, McGarry Bowen and DDB are going to senior level changes as well. But nowhere near the wholesale changes at Ogilvy.
