Business / Charlotte Beers Case

Charlotte Beers Case

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Autor:  anton  13 December 2010
Tags:  Charlotte
Words: 780   |   Pages: 4
Views: 419

Charlotte Beers Case, assessment

Background

When Charlotte Beers (CB) arrives in 1992, O&M, previously one of the most creative and successful advertising agency in the world, faced a major crisis. Major advertising assignments have been lost, as the agency was disconnected from the demand of its costumers, revenues are in decline, and staff morale is low. Above all, the company seems to have lost its identity. The network and culture was fragmented (whereas O&M was to be indivisible), and the agency’s pride of creativity, “unorthodoxy” was falling apart.

Beers takes over

Her first moves are for change, and to establish a clear vision, she first listens to client complaints and needs. The message was very positive: CB knows the problem is serious, but instead of trying to do like everything was ok, she said “we’re not going to do that anymore, so let’s talk about what we can accomplish together”. From these meetings CB understood what clients wanted: an agency that understood the complexity and the strength of the brand.

To restore confidence, both externally and internally, the agency needed a clear vision. It will be the brand: building the clients’ brands and reputation.

From this vision, the reorganization of the group takes place. With a – small – group of people she think could share her vision; she creates the first 3 strategies: focus on presents clients, “better work” and financial discipline. She requires more from the individuals, and implements a structure to strengthen these capacities with a reward system and other incentives. The idea here is to be more efficient, and all of this under the framework of her “vision”. To be rewarded, the staffs don’t only need to work more, but it needs to understand CB’s vision and to advertise it: they must be both believers and missionaries. The senior executives who developed the 3 strategies also had this mission.

The first tensions

This idea was very interesting, but Ogilvy's organization and culture were obstacles to this process. These “gentlemen with brains” were working independently, as historically the local presidents exercised a great deal of autonomy. The creative departments also considered this new vision as an attack to their liberty.

The problem was a lack of collaboration and a lack of communication. She always seems to want to involve people to the development of O&M’s vision, but in the end she takes the final decision, generally without considering any of the group’s ideas. Thus “the people who got it” didn’t really understand what they had to do. And as their ideas were not really considered, were they really the best to spread the new company vision? CB’s might have excellent ideas, but I think she did not really succeed in sharing her passion to the employees. Another mistake was to discourage collaboration: those who didn’t accept the changes were not listened, they just had to go. From Asia to Europe, all the agencies had to accept decisions coming from the headquarter, without having been involved or even informed of the process.

The decision was autocratic, and as she didn’t do a good job in explaining the reasons for the change, and didn’t really try to convince people, some tensions appeared.

She discouraged collaboration; she made it seem like she wanted to involve others in the change process but then she ended up making a lot of the final decisions on her own; she was very autocratic in her approach and that seems to have alienated people; she did not do a good job of explaining her rationale for the changes she was trying to make.

A change?

2 years after CB’s arrival, O&M regained several businesses and market shares: the brand stewardship concept was a success. Does that mean CB’s approach was the best? 10 years after, it seems that her approach was not so bad: the company is still one of the largest advertising agencies with the 360 Brand Stewardship concept. What is the consequence of this success? The staff and the managers now identify themselves in the company’s vision. Even if the process was chaotic, an internal cohesion re-emerged: as the money came in, managers and employees started to analyse the success and its reasons, the philosophy behind it.

Everybody hated CB in 1992. The local agencies must have seen her as arrogant and inexperienced. And she was an outsider. Many left the company: those who did not understand her, and those who didn’t want to hear they had to be more efficient. Maybe O&M lost some high qualified and experienced employees. But those who stayed now have a philosophy that still exists today. Maybe not the historical one, but for sure a philosophy adapted to the new needs of the industry.



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