WPP’s new acting COOs Mark Read and Andrew Scott (below) have surfaced publicly for the first time with a memo to WPP’s staff (nobody seems to know quite how many there are – 130,000? 200,000?) outlining the way they see things. And it’s much as before.
The memo from Read reads:
“Over the last four days I’ve spent as much time as possible speaking to our people and clients. There’s universal admiration for Martin’s achievements, and sadness about his departure. At the same time, there’s a huge amount of support and goodwill for the company, and no shortage of confidence about the future.
That confidence is well founded. The companies and client teams that make up WPP are exceptionally good at what they do. They are major organisations in their own right, with their own strong leaders. The clients I’ve spoken to have all been clear: they value their partner agencies and teams, they expect them to continue to deliver, and they have no doubt that they will.
Andrew and I have been given a very clear brief by the Board.
First, to run the business on a day-to-day basis. I’m looking after people, clients and companies and Andrew is focused on operational and financial performance and managing the WPP portfolio.
And second, to move forward decisively on the Group’s strategy. We have tremendous strengths within WPP, and we plan to build on those while bringing our own perspective and ideas.
WPP’s greatest strength is the depth and diversity of our talent (meaning you). We’re working closely with the leaders of our companies, and listening carefully to their views, as we develop our plans.
Some things we know already: we’ll get even closer to our clients to better understand and meet their needs and to help them grow in a world of disruption; we’ll get closer to technology partners like Adobe, Facebook, Google, Microsoft and others; we’ll make sure our structure and offer make it as simple as possible for clients to access our services across the Group; and we’ll put data, technology and creativity at the heart of what we do.
There’s been speculation about breaking up the Group. We don’t believe this makes sense. In a world where clients need faster, more agile, integrated solutions, we need to get closer together, not further apart.
We’ll share more as soon as we can but, in the meantime, if you have questions let us know and we’ll do our best to answer them.
WPP is a great business with outstanding people, world-class agencies and most of the world’s leading companies as its clients and partners.
Nothing that’s happened in the last week has changed that.”
You wouldn’t really expect anything else at this stage but the problem for the new duo is that WPP’s fate isn’t solely in its own hands. Shareholders have seen a near 40 per cent fall in their investment and will also be fretting about WPP’s relatively high levels of debt. The first thing an incoming CEO should do is scrap the dividend and the second is sell something: research operation Kantar, the PR businesses or WPP’s multifarious investments in various media companies.
He or she should also look at the earn-outs WPP is going to need to fund over the next few years. Big earn-out costs in a rapidly slowing market are what unhinged Saatchi & Saatchi’s bid for world domination.
Executive chairman Roberto Quarta could choose to move on some or all of these fronts. Read and Scott will be aware of the issues but they will be free to tackle them? They seem to have already ruled out some useful options.
An outside predator might do the job for them.