We Hear: Ogilvy to Operate Under One P&L for All North American Offices

By Patrick Coffee Comment

Publicis Communications recently raised some eyebrows with the latest step in its ongoing effort to remove as many of the dreaded “silos” as possible by arranging its agencies’ P&L (profit and loss) reports by country rather than by network.

This means, for example, that all of Publicis creative entities in the U.K. report to Saatchi & Saatchi CEO Robert Senior, acting in his capacity as a leader of the Communications group in that country rather than his role atop the Saatchi organization.

And it’s not just Publicis.

On September 15, sources tell us that Ogilvy & Mather global CEO John Seifert, who was named Miles Young’s successor back in January, sent out an all-staff memo essentially announcing that his agency would begin doing the same thing.

In what amounted to his formal introduction after assuming the roles of global CEO and chairman of the WPP shop at the beginning of this month, Seifert praised Young’s work and expressed optimism about the future of the Ogilvy brand while announcing that it would, moving forward, operate as one interlocking network in North America with all offices across disciplines (creative, media, PR, etc.) moving to the single P&L model.

As is the case with Publicis, it’s not quite clear at the moment how this shift will affect Ogilvy agencies in terms of day to day operations, and we do not currently know who will lead the North American entity.

But Seifert acknowledged in his memo that change — especially on this scale — can often be difficult, implying that the consolidation could lead to some trimming of the operational fat across Ogilvy’s many North American offices.

The general consensus among our tipsters holds that Seifert, like Arthur Sadoun at Publicis, is trying to “shake up” a model seen as staid and even antiquated. Arranging offices and teams by continent would theoretically allow for greater collaboration and ability to attend to specific clients — a sentiment that recalls talk surrounding the creation of Omnicom’s as-yet-unnamed McDonald’s unit in Chicago.

Ogilvy employees, however, still have some key questions. Chief among them: Who will be in charge? How will the resulting hierarchy operate, and how will the inevitable wins and losses be distributed?

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