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BURNETT CEO LYNCH EXITS; SHOP STUNNED FIZDALE DELAYS RETIREMENT TO HEAD AGENCY AGAIN; JENNESS ALSO DEPARTS

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Leo Burnett Co. stunned the advertising world Friday by announcing the resignations of Bill Lynch, president-CEO, and Jim Jenness, vice chairman-chief operating officer.

Though Burnett has been hit by a number of big account losses in the past year, the news was a startling act of drama for the staid Chicago agency that carefully grooms and promotes executives from within. Burnett had worldwide billings of $5.65 billion in 1996. In '95, it ranked No. 1 in the U.S. with gross income of $371 million.

Chairman Rick Fizdale, 57, who had planned to retire by yearend, put those plans on hold and was voted back into the CEO job by the agency's board of directors in a regularly scheduled board meeting Friday.

A spokesman said he will keep that job "for the foreseeable future."

OATES, CONRAD MOVE UP

Jim Oates, 53, effectively replaces Mr. Jenness, 50, moving to president from group president-Asia/Pacific. Michael Conrad, 52, becomes chief creative officer; he had been sharing that role with Mr. Fizdale.

Agency staffers were dumbfounded by the news. But executives who had left the agency in recent years were not.

"My level of surprise is zero," said one.

Though Burnett has been winning media buying business in bunches, it has lost a number of large showcase creative accounts in the past year, including three worth more than $75 million each: United Airlines, McDonald's Corp.'s Arch Deluxe line launch and Miller Brewing Co.'s Lite beer.

It also has struggled with other clients, including Reebok International and General Motors Corp.'s Oldsmobile division. Most recently, its portion of the Ameritech Corp. account, worth $30 million or more, has gone into review.

By far the worst loss was United. Burnett prides itself on long-running client ties, and the loss of a 31-year relationship with a company in its hometown struck a severe blow to the agency's soul.

"The heart and soul of that [agency] is its attitude about itself," said one industry executive. "And that attitude isn't what it used to be."

LACK OF CHARISMA

Insiders said Messrs. Lynch and Jenness had support within the agency, but only from certain quarters. To many staffers, they lacked the charisma of earlier leaders. One former executive said people thought the agency was "going back to being run by suits

. . . too much by the numbers."

Several others complained that Mr. Lynch, 54, was too cliquish to effectively lead an organization of thousands.

A spokesman said Messrs. Lynch and Jenness offered their resignations to the board. Mr. Lynch told the board he determined it was time to turn the agency over to "leadership of a different orientation," the spokesman said.

Messrs. Lynch and Jenness put Burnett "in a far stronger financial position than at any time in recent memory," Mr. Fizdale said in a statement. He also lauded them for developing the agency's "vision and mission" and continuing its global expansion.

Burnett officials who knew how the drama in the boardroom played out could not be reached at press time. Mr. Fizdale had installed Mr. Lynch as CEO in March 1993, after only 13 months in the job himself. Last week, executives close to Mr. Fizdale said he had eagerly been looking forward to retirement.

A number of years ago, Burnett instituted a practice making 57 the normal retirement age for senior executives. Mr. Fizdale now looks likely to work past that age. Friday's events may also lead the board to re-evaluate that tradition.

None of the executives promoted Friday in a dominolike series of moves is much younger than 50.

Besides Messrs. Fizdale, Oates and Conrad, the following were promoted: Vice Chairman Albert Winninghoff, 54, to chief operating officer; Kerry Rubie, 57, from group president-Europe/Middle East/Africa to vice chairman-client services worldwide; Linda Wolf, 49, from president-USA to group president-North America; and Jeffrey Fergus, 48, from regional managing director-Asia to group president for all regions except North and Latin America.

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