Bonanza for Bcom3 owners is also a double-edged sword

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By the time you read this, several better-known names in the U.S. ad community, and many lesser ones, will be exceedingly wealthy. They are all executives who will profit from the acquisition of Chicago-based Bcom3 Group by Publicis Groupe. The list is headed by the Bcom3 board members: CEO Roger Haupt, Chief Operating Officer Craig Brown, former Leo Group CEO Rick Fizdale and former Bcom3 Chairman Roy Bostock. For their 9% of the company, they stand to split millions (though likely less than the $312 million estimated last spring).

They aren't alone. If anything, managers at Bcom3's D'Arcy Masius Benton & Bowles, because of different share ownership structures, may do even better than their Burnett counterparts. D'Arcy CEO John Farrell and Chief Branding Officer Susan Gianinno will make eye-watering sums-although Burnett CEO Linda Wolf and Starcom MediaVest Group CEO Jack Klues will hardly be paupers. Other managers will make sums ranging from enough never to need work again to being able to pay off the mortgage. Many more will not make those sums.

Sound familiar? Young & Rubicam went through its initial public offering, and then its subsequent acquisition by WPP Group, to the mind-boggling enrichment of a small, but not negligible, minority of employees-and the festering resentment of the majority. It, too, was a situation where several experienced senior executives were potentially able to leave almost simultaneously. Many did. Others played at staying-for a while.

No mistake about it, the switch from private to public ownership is a seismic jolt for any ad agency. But Bcom3 management has had time to learn from Y&R and others. There will surely be, for example, tighter handcuffs on valued senior executives.

Recent layoffs, in particular, were a shock to Burnett. Publicis CEO Maurice Levy has said there will not be mass layoffs but history suggests there will be further attrition. History also teaches that morale is probably the greatest challenge facing whoever the remaining managers may be.

This is exacerbated at D'Arcy by the threat of its break-up. It is difficult to see the long-term alternative. Publicis has too many agency networks that are not quite perfectly formed-with gaps that bits of D'Arcy could help fill.

This sounds terribly cold, but it's reality. We are so far from the days of Raymond Rubicam and Leo Burnett as to make comparisons odious. Whether one believes they would approve is equally immaterial. One might also argue many of those cashing in are merely the custodians of 75- and 96-year-old brands. In the context of today's reality check, so what?

Rubicam, Burnett and the other giants of the ad industry built their companies and made their pronouncements in a long-gone era. Globalization and public ownership have since transformed the advertising landscape with remarkable, almost breakneck, speed.

The most obvious resulting change is that this business is so much more about business. The tyranny of quarterly reporting forces a focus on money. Deals that enrich some and disenfranchise others are the inevitable consequence. Like it or not, this is the business we have now chosen.

Stefano Hatfield is editorial director of Creativity, and

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