Layoffs at GSD&M

By Matt Van Hoven 

AgencySpy has confirmed that GSD&M Idea City in Austin laid off a number of employees last week Thursday following news that they did not win the BMW US media account. A source familiar with the situation says a total of 33 employees were let go, less than half of the rumored 75.

The news that BMW chose Universal McCann for their media account came as something of a surprise considering the client recently awarded the creative account to GSD&M. Nonetheless, it is no surprise that the layoffs occurred.

A statement from the agency: “As a result [of losing the media business], we were left with more jobs than work to be done and we had to eliminate some positions. This was not a process we approached lightly and we did everything in our power to protect as many jobs as we could. We were able to move some people into new roles as a result of our recent new-business successes (BMW global creative and Ace Hardware), some people were offered the option of working a reduced schedule and we had to say goodbye to some of our valued people.”

It is our estimation that there is frustration among the rank-and-file in GSD&M who for many years have witnessed the shop inject it’s large GCD team with money. It’s known to be top heavy and something of a retirement home for creatives. We use that phrase as kindly as possible, but many of the GCDs have been there for quite some time.

One top creative we’re particularly interested in is noted author Luke Sullivan who some say is the best internal candidate for the ever-tumultuous ECD spot. The position was recently freed up when after about a year in the position, former Crispin CD Mark Taylor was fired. Many, including us, saw that one coming as Taylor had not been central to much of the agency’s latest work, including pitches.

Sources tell us the ECD spot will likely be filled by someone with the creative chops (natch) but who also understands their role in the shadow of company head Roy Spence. GSD&M’s representatives insist that Spence has taken a back seat to his former role, but sources familiar with the agency say whoever takes the ECD spot will have to salute when Roy enters the room.

It’s our estimation that having spent a few years in the GCD group, Sullivan knows Spence’s personality and when to bit his tongue. And considering the last out-of-town ECD didn’t make it, it would make some sense to hire internally. The GCD group already needs preening, and placing Sullivan at the top would help meet that end.

But it’s also the GCDs’ salaries that come in question. Certainly those totals are expected to be high, but compared to their younger, less titled counterparts, we’re told some of the top creatives are earning gobs more. This may be due in part to a promise Spence made a few years back. In or around the year 2000, three of GSD&M’s top GCDs left the agency in a month of one another. Hoping not to lose anyone else, Spence allegedly offered huge salaries to his remaining team (6 or so) &#151 we’ve heard upwards of $400,000, each &#151 not bad for Austin. Years later, that amount has yet to be paid out, but the salaries have grown toward it.

And so the rabbit tumbles. More on this later.