Outgoing CEO David Bell, now co-chairman, hands Mr. Roth a much steadier ship than he inherited. The third-largest holding company has made headway on financial issues under Mr. Bell's tenure. But several senior agency executives within Interpublic Group of Cos. said operational decisions regarding underperforming ad agencies and the company's media shops are now overdue.
"The frustration of many agency heads is that difficult decisions need to be made at the holding-company level," said an executive at an Interpublic-owned agency. "Bell seemed to be more interested in servicing individual accounts and client relationships. Often the shutters were getting painted while the interior walls were crumbling."
To help the company complete a turnaround that could last until 2006, Mr. Roth will also have to trim debt and contend with an ongoing accounting investigation by the Securities and Exchange Commission.
It's a list of formidable tasks, but Mr. Roth has the support of Interpublic's agency heads, many of whom cite as key strengths his deep financial background, honed as the chairman-CEO of financial-services holding company MONY Group, and a street-smart, action-oriented sensibility. In the eyes of some of these executives, Mr. Roth is a welcome foil to the David Bell, Interpublic CEO since February 2003, better known as a client and account manager than a leader who could marshal the sprawling company through its turnaround.
By his own account, Mr. Roth's first priority will be tending to a media buying and planning offering that's been diminished of late, with Initiative Media and Universal McCann suffering major client losses. "We want to be more competitive on the media side," he said in an interview. "It's a top priority for us."
`down to business'
Mr. Roth was vague about other priorities, saying, "The rest is getting down to business. We have to grow revenue, look at our cost profiles and increase profitability."
Although Interpublic has strong agencies, such as the powerhouse McCann Erickson and Draft Worldwide, it has its troubled firms in addition to the media agencies. For instance, a new management team is trying to fix Lowe & Partners Worldwide, which has been battered in recent years by a rash of client defections.
It remains to be seen whether Mr. Roth can adapt to the comparatively sensitive business of dealing with marketing clients, as well as some agency brands owned by Interpublic that loom large in advertising history. Mr. Roth is best known for overseeing the sale of MONY Group to France's AXA.
But one Interpublic agency cautioned against reading too much into his background. "Michael has a lot to learn, but it would be very wrong to pigeonhole him as a finance guy," this executive said.
Mr. Bell will move into a more client-focused role. In an interview, he defended his tenure, pointing to strides made settling shareholder litigation, strengthening the balance sheet and dumping the notorious ill-fated motor-sports venture.
Challenges for Roth
Michael Roth has been named to lead Interpublic through a turnaround that could last well into next year. Here's what he has to do:
Fix a media buying and planning offering that has stumbled of late
Trim back a sprawling company by fixing underperforming agencies or network offices
Spark more positive chatter about the agency brands to attract a deeper level of talent that will allow it to better rival the creative powerhouses of, say, Omnicom Group