Eighteen Months Later, GolinHarris' Restructure Begins Paying Off

PR Firms Is Beginning to Bring in New Business, But Culturally There Are Still Kinks

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Big -name brands like Redbox, Cisco and Adidas are turning to PR firm GolinHarris as the dust begins to settle on the firm's "G4" structure, which a year and a half ago flattened the organization, removed generalist roles and whittled down 12 layers of titles to five.

Still, executives familiar with the Interpublic Group of Cos. agency are labeling the restructuring a work in progress as recent staff churn has bred uncertainty about the model's long-term success.

In June 2011, the firm divided most of its 700 employees into four specialist categories: strategist (insights and analytics), catalyst (account management and execution), connector (media and social engagement) and creator (content development).

It was a big change from the typical sorts of layers you see within a PR agency of scale. The intention of the reorganization, based largely on the firm's Nintendo account structure, was to better identify and cultivate digital and creative talent, while more accurately aligning paid-, owned- and earned-media capabilities, the firm noted at the time.

Though it took some getting used to, the approach has translated into new accounts.

Kate Brennan, senior PR manager at Redbox and GolinHarris alumn, moved the account to the agency after just a year of working with Edelman-owned firm Zeno. According to Ms. Brennan, Redbox wants to place more of an emphasis on real-time marketing, and getting there seems easier in light of GolinHarris' restructure.

"We were just energized about what they were doing," said Ms. Brennan. "It's really easy to apply their model to our needs, and it just felt like the right resources could be brought in at the right time. "The real-time marketing was what was most appealing to me," she added, referring to "The Bridge," which is a new department full of staffers dedicated to online engagement and social monitoring.

In addition to Redbox, Golin Harris has picked up business from Adidas, tech giant Cisco and Cotton Inc., according to GolinHarris CEO Fred Cook. "We won a lot of business this year that I don't think we would have won before," he said.

For example, the Cisco brief to "lead a social-media amplification project across 12 countries" will include new software and measurement tools associated with The Bridge.

The staff working in The Bridge have also impressed the firm's longest-standing client, fast feeder McDonald's. McDonald's even embedded its in-house social director at the Bridge during a press conference about menu labeling.

The increased focus on real-time marketing has in some ways demanded new types of talent for Golin Harris. And from a staffing perspective, clients and observers say there is a long way to go. "One of the things they're hoping to accomplish with G4 is the ability to attract, obtain and retain talent in a more targeted and specific way," said McDonald's VP-Communications Ben Stringfellow. "It's not happening overnight."

Clients such as McDonald's, and others familiar with the firm, said they are hopeful that the new structure will be seamless in a matter of years. But for now, recent staff departures and layoffs signal growing pains.

The firm recently let go of a dozen employees in its Windy City outpost. "A year or so into it we found that there were some people it wasn't a good fit for in terms of skills or overall attitude," said Mr. Cook. "That's what prompted us to let a handful of people go in Chicago." He added that the firm had also anticipated some dissatisfaction and turnover as it removed titles, but maintain's the agency's turnover thus far has not been above average.

Along with the wins there have been a couple of smaller client departures, including a piece of its Playtex business, Smithfield Foods and its Hass Avocados. Mr. Cook attributed these losses to natural churn unrelated to the restructure.

Executives familiar with the firm say one stumbling block could be retaining and attracting to talent to work in the specialist positions. Some say they feel that they've been pigeonholed. "It's intriguing to entry-level staff and in new business pitches, but it doesn't play out well for career development or fluid client service," said one executive who asked not to be named.

Mr. Stringfellow said that there might be an opportunity to create more "clarity around the different practice areas" and around "who's accountable for what."

Despite a few roadblocks, most execs close to Golin Harris are still generally upbeat about the changes.

Another executive said: "In the old PR model, titles drove compensation and your status with clients and everything, so making that more of a flat line as a horizontal relationship is a big challenge." However, the executive did acknowledge the potential for success. "The measure of success will be whether or not they can drive the industry to adopt a new approach to how individuals are compensated and recognized for work. At the end of the day, it's as much an internal cultural challenge as external."

Another success measure that could unfold over time is whether other PR agencies replicate the model. "It goes back to the ability to retain talent. If it proves to be a differentiator, we may see some replication, but if it registers as a neutral or doesn't prove to be a competitive advantage, then maybe not," said Mr. Stringfellow. "I like what I've seen so far but some of the cultural changes won't [happen] for two to three years."

Still, the firm's top clients, including McDonald's, are patient. "We've been in business with the firm for 55-plus years. Two years at a time is pretty small scale," Mr. Stringfellow said. "They're our AOR at the national level and we don't foresee that changing anytime soon."

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