BACKGROUND
Charlotte Beers became Ogilvy & Mather's first outsider CEO after its acquisition by WPP Group Plc in 1991. According to her memo dated May 19th, Beers' objective was to "re-invent" the mega-agency, whose inertia and complacency had eroded its competitiveness since the 1980s. In fact, Beer's tenure at Ogilvy constituted a re-creation of the agency, redefining its aims, processes, people, and structure in reaction to the demands placed by the changing advertising industry.
ANALYSIS
The main issue that confronted Beers was initiating and instituting organizational change at the core level. She assumed the leadership of Ogilvy at a time when the organization was internally bleeding. Charismatic founder David Ogilvy's resignation as CEO in 1975 had created a leadership vacuum which none of the succeeding leaders had been able to fill. In addition, the economic boom of the 80s had created a false sense of security that rendered the firm stagnant, unable to either anticipate or react to the changes taking place in the advertising industry. Most significantly, the absence of a strong leader caused the organization to devolve from "One Agency Indivisible" into individually ruled "fiefdoms." The firm's deficiencies came to the fore in 1989-91 when it lost more than $100M of advertising accounts from major firms that had grown tired of the highly politicized organizational environment at Ogilvy.
NEED FOR CHANGE
Since Ogilvy's vision at the time was constrained to "just keep doing the same thing, better," the firm's re-creation was necessitated by external factors & events. For example, the central office had been unwilling to rein in its autonomous local offices' spending after the 1987 stock market crash even as...
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... of understanding and commitment to the Brand Stewardship philosophy on the part of lower level employees. In order to provide this support, Beers should better leverage the management team that developed Ogilvy's philosophy in the first place. The problem in 1993 is that CEO Beers and perhaps WCS Director O'Dea appear to be the only executives promoting change. Yet change should not be "pushed" onto the regions from the central office, nor onto subordinates from management. This would be counterproductive, and result in mere conformity. Instead, Beers should establish and train senior managers and local executives as extensions of her leadership. Yielding a degree of objective empowerment to gain symbolic empowerment, local executives could then help Ogilvy's lower level employees redefine their roles & responsibilities to promote the Brand Stewardship strategy.
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Ogilvy & Mather Worldwide is among the largest advertising agencies in the US, specialized in so-called brand stewardship.
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