Week 12 Leadership Case
Charlotte Beers at Ogilvy and Mather
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 acquisition
 Globalization of clients
April 12, 2005, Waverly
Charlotte Beers at O&M
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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.
April 12, 2005, Waverly
Charlotte Beers at O&M
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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
April 12, 2005, Waverly
Charlotte Beers at O&M
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Direction Setting: Did Beers have a good vision?
 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
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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
April 12, 2005, Waverly
Charlotte Beers at O&M
5
Direction Setting: Did Beers have a good vision?
 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.
April 12, 2005, Waverly
Charlotte Beers at O&M
6
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?
April 12, 2005, Waverly
Charlotte Beers at O&M
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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
April 12, 2005, Waverly
Charlotte Beers at O&M
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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
April 12, 2005, Waverly
Charlotte Beers at O&M
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Communication of the vision
 How to overcome resistance?
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April 12, 2005, Waverly
Education and communications
Participation
Negotiation
Explicit and implicit coercion
Structurally align the organization with the new
mission (e.g., create WCS)
Charlotte Beers at O&M
10
Process of Renewing and Transforming
Organizations (Kotter Leading Change 1995)
1.Establishing a Greater Sense of Urgency
• Getting people to examine seriously the competitive realities
• Identifying crises, potential crises or major opportunities
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
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
April 12, 2005, Waverly
Charlotte Beers at O&M
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Process of Renewing and Transforming
Organizations (Kotter Leading Change 1995)
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
6. Creating Short-Term Wins
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Planning for some visible performance improvements
Visibly recognizing and rewarding people who made the wins possible
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
April 12, 2005, Waverly
Charlotte Beers at O&M
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