The Path From Madison Avenue to Corporate CEO

How Eric Hirshberg and others made the transition

Eric Hirshberg | Photos: Karl J. Kaul/ Wonderful Machine

Since 2010, Eric Hirshberg has been CEO of one of the giants of the video game industry, Santa Monica, Calif.-based Activision Publishing. But everything he needed to know about how to succeed running the place—home to time sucks like Call of Duty and Angry Birds—he learned in the top ranks of Madison Avenue.

“In my life in advertising, I got very used to the pressure that comes from having to choose the right creative ideas,” says Hirshberg, who spent 13 years at Deutsch LA, ultimately rising to co-CEO and chief creative officer. “Your success and the success of the company depends on your ability to get the right ideas out of people, to make those ideas better and, ultimately, to identify the ones you’re going to bet on. So in that regard, my experience in advertising equipped me very well for being a corporate CEO. The difference is scale—the bets are just so much bigger.”

It is a rare breed of advertising leaders who have made the transition to chief executive of a company of considerable size and importance outside the agency world—and some have clearly been more successful than others. And yet, recruiters contend that their increasingly multifaceted, digitally focused and brand-centric skill set make these prospects more attractive today.

“Agency people are in a world of constant change, and they’re an adaptable breed,” says Steve Cannon, president and CEO of Mercedes-Benz USA since December 2011, who moved up from the vp of marketing spot he assumed there after serving as a principal at The Richards Group from 2002-07.

Cannon notes that, given the intense churn in media and marketing over the past decade, agency leaders have had to become more adept at solving problems across disparate departments—creative, production, personnel, finance, client service—compared to many of their counterparts outside the industry.

David Kenny, The Weather Co.’s CEO and chairman since January 2012 and a former leader at Publicis units Digitas and VivaKi, agrees. Today’s agencies “aren’t just billing out hours,” he points out. Running one, he says, “is much more complex in terms of having a bigger set of skills than even just a few years ago. It becomes more true as digital is part of the mix and agencies go public or become parts of public companies.”

And yet, while it is not so unusual for a senior agency executive to transition to CMO of a business outside of advertising, or for an agency leader to sit on a corporate board, the mantle of CEO has proved largely elusive. “The club is so small,” concedes Cannon, as agencies traditionally are “the last place you go looking” for a corporate boss.

Ironically, agency executives tend to suffer from, of all things, “a branding problem,” according to Renée Richardson Gosline, assistant marketing professor at MIT’s Sloan School of Management. She says recruiters and corporate boards have long perceived agencies as second-tier organizations—useful and interesting enterprises but relatively frivolous and not on par with producers of durable goods and global services. By extension, agency heads are sometimes perceived—fairly or not—as lacking the gravitas and business skills to run a large corporation.

Leaders of even highly respected agencies aren’t always a shoo-in for a corporate CEO gig—not surprising when one considers that traditional media including television, radio and print are notoriously difficult to measure in terms of driving client success.

“There is a certain artistic fluidity that makes it very difficult to apply hard and fast business metrics,” says Steve Hall, publisher of the blog Adrants. “The creative itself is not easy to quantify in hard terms. And because of that, agency CEOs develop a skill set that matches this fluidity more than it does hard and fast KPI-style ROI metrics.”

And when recruiting a CEO, corporations tend to be risk-aversive, favoring candidates from consulting or finance (Bain, McKinsey) or those with deep (some would say “siloed”) experience in specific categories.

Of course, in recent years agencies have transformed into more tech-centric, ROI-focused organizations with a reputation for helping clients of all shapes and sizes solve the most complex business problems. Today, ad shops are more akin to highly specialized consultancies—hardly fitting the three-martini-lunch cliché. “Does the Mad Men model even exist anymore?” asks Cannon.

As ad shops have become more data-driven and results-oriented, businesses outside advertising have leveraged digital communications to build consumer loyalty and drive sales over the long haul. Energy drink Red Bull’s assertion that it is, in fact, a media company speaks to the sea change, underscoring that marketing is being encoded into corporate DNA from the top down, with CEOs at companies of all stripes ultimately finding themselves in the media business.

“It’s happening right now—the role of marketing is coming closer to what a CEO would understand and have to grapple with,” notes Catharine Hays, executive director of the Future of Advertising program at the University of Pennsylvania’s Wharton School. Hays believes agency leaders are particularly well-suited for CEO roles in this emerging landscape, as they are media-savvy and understand how communications drive the sales cycle.

Continue to next page →

Adweek Blog Network