Expressing Doubt in Its Growth, Levy Shakes Up PR

Olivier Fleurot Named Global CEO of MS&L, Publicis Consultants, While Industry Chatter Hints at Merger of Shops

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NEW YORK ( -- With the departure of two global CEOs from his biggest PR shops, MS&L Worldwide and Publicis Consultants, Publicis Groupe CEO Maurice Levy has decided to turn over global leadership of both agencies to Olivier Fleurot, former executive chairman of Publicis Worldwide. Mr. Levy is also initiating an organizational restructuring of the holding company's PR, corporate communications and events practices in the hope of creating a "premier" PR network with MS&L at the fore.

With these moves, Mr. Levy is attempting to spark some growth within a sector he said he believes will be down until 2010 at the very least. In a recent interview with Ad Age, Mr. Levy said he didn't think growth would come back in PR as fast as it would in other operations. In an internal memo, Mr. Levy sent to Publicis employees, he said: "By placing these important assets under Olivier's responsibility, I'm expecting a simplified organization -- one that is swifter, more cohesive and generating more vibrant growth."

Mr. Fleurot, who has no prior history running a PR shop, is in essence replacing three people: John Farrell, head of Publicis' Specialized Agencies and Marketing Services and Public Relations and Corporate Communications groups; Mark Hass, CEO of MS&L; and Eric Giuily, former head of Publicis Consultants. Last July the holding company announced Mr. Farrell would be leaving this summer and that SAMS would be dismantled when he left.

The difference between Publicis' new organizational structure and that of something like Interpublic Group of Cos.' Constituency Management Group -- which oversees its PR, events and sports-marketing agencies and is headed by Harris Diamond -- is that Interpublic's agencies, including Weber Shandwick, Jack Morton and Octagon, all have global CEOs that report to Mr. Diamond. Mr. Fleurot, on the other hand, will serve as acting global CEO of MS&L Worldwide, Publicis Consultants Worldwide and Publicis Events Worldwide. Other agencies he will oversee that currently have CEOs include Kekst, Freud Communications, Publicis Live, Emotion, PBJS and SAS. Mr. Fleurot said while he is acting CEO of those agencies, that doesn't mean he will remain so.

"I need to better understand all these operations and activities," he said. "After I have met everybody I will then decide how to best organize it. It doesn't mean that I am not going to appoint people in certain places."

In the past month, the holding company has seen Mr. Hass step down "for private reasons," Mr. Levy said, and Mr. Giuily resign after presenting a plan for the international development of his agency that was rejected.

But replacing those CEOs might seem like an odd approach, because it was their absence that Mr. Levy saw as the opportunity to create a more efficient and structured operation that would eventually strengthen MS&L's global position.

"We are simplifying our structures and taking advantage of the [CEO] departures and looking to have a leaner organization," Mr. Levy said. "This is something that is not born from any crisis. We have decided to do it now because there has been the move of the CEOs." Aside from simplifying the organization, Mr. Levy said the goal is to keep Publicis Consultants focused on areas such as issues management, mergers and acquisitions, and corporate communication while using some of its assets to strengthen the global network of MS&L. "By bringing those assets to MS&L and through specific limited acquisitions in Asia, we will strengthen the MS&L network," Mr. Levy said.

To some in the industry though, it sounds as if there are plans for combining the agencies.

"What they are doing, without saying it, is combining the businesses," said one industry executive. "One is a French business, the other is a U.S. business, and he is giving the illusion of two companies when it's [going to be] one."

Mr. Fleurot said he will take a pragmatic approach and not merge or combine agencies just for the sake of it, but said it was important to make the most of all available resources. "Most of our operations could benefit from at least cooperating a lot more with other operations," Mr. Fleurot said. "I need to meet all the teams and companies before we make any decisions."

Jim Tsokanos will continue to run MS&L North America, and Wendy Lund will still head up Publicis Consultants in the U.S.

Richard Pinder to lead Publicis Worldwide
Replacing Mr. Fleurot at Publicis Worldwide will be Richard Pinder, former chief operating officer at Publicis Worldwide. Mr. Pinder became chief operating officer in 2006 when his predecessor, Rick Bendel, defected to take on the top marketing job at Asda, the U.K. supermarket chain Walmart acquired a decade ago.

Mr. Fleurot, whose background is in publishing and who is a former CEO of the Financial Times Group, arrived at Publicis at the same time.

Mr. Pinder brings to the top slot a wealth of international experience; he spent time as a regional managing director in Asia at Leo Burnett and also served as Burnett's president for the Europe, the Middle East and Africa.

Now he will have the massive task of reorganizing the Publicis network with an eye on expanding capabilities and boosting its creative chops. "There is still much to be done in growing the network, developing its digital arm and creative capabilities," said Mr. Levy in his internal note, acknowledging that the objectives are "ambitious."

Publicis Groupe, also the owner of advertising networks such as Leo Burnett Worldwide, Saatchi & Saatchi and Fallon Worldwide, among others, recently reported a 4.4% drop in revenue for the first quarter of 2009. Just this week MediaVest, one of its media shops, won the consolidated $500 million Mars Wrigley media account.

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Rupal Parekh contributed to this report.

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