Into the Limelight

The challenges of running a modern industry holding company became only too obvious during the 787-day tenure of former Interpublic Group chief John Dooner, whose distinction as sole industry adman among CEOs at the Big Three holding companies did little to impress Wall Street. So when IPG made the surprise choice of David Bell as Dooner’s successor, there was division among its operating-company executives, with some believing his demeanor sent the wrong message. Even though Bell came into the job with investors’ blessings, the 59-year-old was viewed by many within IPG as a throwback to the era of the joke-cracking, long-lunching ad guy in the gray flannel suit.

In the five weeks he’s been on the job, the quintessential account exec is playing to his strengths: working the phones, visiting IPG operating units, sending out weekly e-mail communiqués. Bell is doing a good job of selling himself to the troops.

“You see his picture in the trades over the years: the bow ties, the suspenders. You meet him and, yes, he really is like that,” says one IPG operating head who’s being won over. “You associate that style with someone who doesn’t work hard and who spends a lot of time at lunch. He may be a traditional, old-school guy, but once you get beyond that, it becomes clear he’s got a currency about him, and he does work hard. He really does get the game.”

A primary focus, again playing to a strength, has been Bell’s wooing of IPG clients. Last week, for instance, he jetted to Switzerland to visit Nestlé. That client focus is a point of distinction for IPG, whose chief competitors are run by executives with financial backgrounds. WPP and Omnicom are holding companies born during the throes of industry acquisition and consolidation in the mid-’80s, their growth fueled by market resources. As a result, CEOs like Martin Sorrell at WPP and John Wren at Omnicom became closely identified with the financial community as they raced to build the kind of mass that IPG had the luxury of developing over the two formative decades it was run by Phil Geier.

Created in 1960 and launched as a public company in 1971, IPG enjoyed early years of double-digit increases in organic growth. Geier, a longtime McCann executive like his successor, John Dooner, capitalized on his client-handling instincts and developed relationships with marketers. That defining characteristic is important to Bell. “IPG has always had a practitioner as its CEO and had a client-centric culture,” he says. “That’s ongoing.”

Bell’s work day begins at 4:30 a.m. at his Manhattan home, and he’s in his 44th-floor office by 7:15. He’s lost little time in tackling IPG’s woes. In Bell’s second week on the job, IPG raised $800 million through a convertible-debt offering to pay off the nearly $578 million in zero-coupon notes that would have been due at the end of the year. He says IPG’s sale of NFO WorldGroup is on track to close this quarter, although he won’t comment on speculation that the price will be less than the $500 million IPG wants. Bell and presiding board member Frank Borelli have hired an outside financial adviser to suggest options for IPG’s troubled Octagon Motor Sports unit. Bell says he has “no idea” when the SEC will complete its formal probe of IPG, but says the company will emerge unscathed from the investigation. He dismisses the IRS audit of the company’s tax returns from 1994-1996 as “old news”—something that’s been ongoing for the past six months and unrelated to the SEC inquiry. The hunt for a chief operating officer at IPG continues, with Bell now spearheading it.

He describes some of the problems IPG has faced as “unfortunate communications about the balance sheet,” claiming the company is actually in better shape than it was 12-18 months ago. “I think we owe the market and our employees an improvement over the untidiness of how it played out,” he says.

When asked whether clients appear concerned about the distractions and morale issues that have beset IPG and its operating units during the past year, Bell is nonplussed. “Clients are concerned about the overall state of the economy and geopolitical issues. Those things are paramount,” he responds. “Clients want to make sure the people they deal with on their business are happy, comfortable and supported so they can work well—but that’s always the case.”

After he joined IPG following the sale of True North to the holding company in 2001, Bell, as vice chairman, was responsible for two operating divisions: the amalgamation of units called The Partnership—composed of the Lowe Group, Bozell, DraftWorldwide, Deutsch and Initiative Media—and Advanced Marketing Services, which includes Magna Global, NFO and Weber Shandwick. That role didn’t exactly thrust him into the industry limelight, but Bell has always carved out a profile through his extracurricular activities: He’s chairman of the Ad Council, as well as the Advertising Educational Foundation and Pro-Ad PAC, the industry’s political action committee. He’s also served as chairman of the American Association of Advertising Agencies and was twice chairman of the American Advertising Federation.

One top Partnership exec sees the value of those back-slapping endeavors: “He’s well-networked, and he leverages those contacts. He doesn’t hesitate to pick up the phone to help you out.”

In 2001 he did just that, making a call to Household International on behalf of IPG’s Gotham, which ended up winning the business. That same year, Bell was instrumental in Verizon’s consolidating its account at Lowe. (More recently, as Bozell was being merged into Lowe, he was a key frontman with clients, explaining the benefits of the merger.) He played a role in the consolidation of Burger King business at IPG last year and helped win BofA in February.

“As much of a client guy as he’s always been, he’s been a big fan of integration. He’s very good at cross-selling,” says Larry Weber, CEO of Advanced Marketing Services. “He’s a big believer in collaboration. He really understands the resources of IPG and how they can be brought to bear on a client’s business. You saw that with Bank of America.”

Bell is also a big believer in communication. In trying to forge a transparent management style, he’s fast become known for his weekly staff memos, which have ranged from explanations of the convertible-debt offering to his dealings with Wall Street to his views on the role of an industry holding company. Addressed in corporate speak to “The Organization,” the memos are the typically upbeat rallying cries of a turnaround executive. One, however, titled “Drink From the Fire Hose” (as opposed to the “pool of negativity,” as he explains within), bluntly addresses a shortfall in attitude that he’s observed during IPG’s tough couple of years.

“I’m sure you’ve noticed that there’s a fair bit of denial that goes on in our dealings with each other,” the e-mail reads. “The harsh economy that battered our clients and us these past two years made it easy to look for excuses when things went wrong. … Let’s be done with the victim mentality. Victims belong in hospitals, not the kind of company we are trying to build.”

Earlier in the memo, he offers this pep talk: “Don’t put off decisions, make them—especially the hard ones. Action begets action, procrastination gets nothing accomplished. Start meetings on time and end them early. Hold your colleagues, your direct reports and, most importantly, yourself accountable for getting things done.”

Bell lives by his own advice. As vice chairman, he handled uncomfortable chores such as firing one high-level executive. As well-liked as Dooner was within IPG, Bell’s decisiveness and hustle is already being favorably contrasted with Dooner’s more labored decision-making process.

“David’s very action-oriented. People felt that was the problem with Dooner,” says one source. “He didn’t take action fast enough.”

Not surprisingly, though, the tone of Bell’s e-mails—and the volume of them—has drawn some snickers among jaded execs at the operating companies. “There’s such a thing as being an over-communicator,” says one.

One longtime industry friend says Bell—like fellow Midwest adman Keith Reinhard, the DDB CEO who sends weekly “Any Wednesday” missives to his staff—just has a different, more grass roots way of dealing with people.

“It’s an issue of Minneapolis versus New York. He’s very Midwest,” says the friend.

Adds Weber Shandwick CEO Harris Diamond: “He’s a bedrock of Midwest virtues, and that’s a good thing.”

In talking to Bell’s associates past and present, he’s inevitably described as “ethical,” “honorable,” “gentlemanly.” He diligently replies to all his e-mail; his Blackberry is on during meetings.

There’s been some speculation about whether Bell lobbied behind the scenes for Dooner’s job as the freshman CEO stumbled—a maneuver that would be at odds with such descriptions of character. IPG conspiracists feel that Dooner tried to limit Bell’s visibility—with the vice chairman’s role well off the larger IPG playing field—given the financial community’s high regard for Bell’s tenure at the head of True North. (Even up to the end, Dooner’s job was thought safe because there was no obvious successor in-house. Dooner did not return calls seeking comment.)

IPG presiding director Borelli dismisses the notion that Bell played any role in Dooner’s replacement: “Absolutely not. David was strongly recommended by John himself, who wrote to the board and said this would be in the best interests of the company and shareholders.” He also dismisses theories that Bell got the job because he was the only one who could hit the ground running, with inside knowledge of IPG as well as credibility on Wall Street, and that he’s a short-term fix. “This is not an interim position,” he says. “He’s been appointed the permanent chairman, CEO, and we expect him to stay at the company until the formal retirement age of 65.”

Wall Street, which helped drive IPG board concern as the company’s stock plummeted, seems pleased with Bell so far. “Bell has clearly steadied the ship by stabilizing the balance sheet and bringing an increased focus and credibility to the efforts to fix the fundamental issues at the company,” says David Doft, executive director of equity research at CIBC World Markets. “From here we expect that there is still a lot of work to do before the business grows again, but it seems like they are moving in the right direction.”

One critical step is reviving flagship McCann WorldGroup, where Dooner is now back in place as CEO. Bell says the two have “a great deal of respect for one another.”

Others see the relationship as one born of mutual interest. “John Dooner and David Bell are codependent in this turnaround,” says one IPG agency head. “They’re forced into finding a way to make David successful. David’s success and John’s success are linked. And David is gracious enough to not make it awkward for John. If he’s political, he’s political that way.”