Birkin extols asia success

When it comes to succession plans, Michael Birkin poses the Asian industry’s most intriguing guessing game. Birkin, who took on the job of Omnicom president and CEO for Asia-Pacific in 2005, is widely believed to be one of three contenders to succeed global CEO John Wren.

Observers speculate that CFO Randy Weisenberger and BBDO Worldwide CEO Andrew Robertson are also in the running. Each is being groomed equally, but differently.

But among the three contenders, Birkin may be having the toughest time contemplating his future. Sources say that the former worldwide president of Omnicom’s largest unit, Diversified Agency Services, was moved into the Asia-Pacific job because Wren believed he had the strategic skills but needed to bolster his operational experience. An Omnicom source says: “Birkin has made clear his intention to get back to New York. The worry is, if doesn’t get the job he wants in New York, where will he go? He is ambitious and staying in this role in Asia won’t be an option for him.”

As speculation over his future mounts, the question is: after more than three years in the region, has Birkin achieved what he set out to?

To put things into perspective, it’s important to look at the challenges Omnicom faced in 2005 - a time when the holding company was tangled in leadership issues, and getting outsmarted in the public debate by chief rival WPP.

“WPP were creating a lot of noise about the investments they were making. I understand why they did that and give them credit for doing it,” says Birkin. “We were clearly in danger of being seen as being more focused on other parts of the world and not Asia. That was starting to count against us, both in Asia and in global pitches.”

In New York, this became glaringly clear when holding company pitches arrived. The pitch for HSBC in particular, won by WPP in 2004, seemed to highlight a lack of cohesion within Omnicom. Critically, its scale and credibility in Asia could not match that of WPP and the region appeared to be a poor relation to other parts of the word. As an Omnicom source adds, by managing Asia through the agency brands, “there was also a labyrinth to get things to New York”.

All of which came at a costly price - underperformance. The remit was to raise Omnicom’s profile and grow its operations in a region that had come to play a greater role in global reviews.

“The objectives of my role weren’t specific,” says Birkin. “John [Wren] trusted me because of my background and the different companies that I have been in charge of. The briefing was three minutes, but with John and I it never needs to be more than that.”

The weakest link in Asia, arguably, was BBDO. “The previous regime at BBDO was not doing what it needed to do. That was the most pressing issue we faced, as well as perception.”

Chris Thomas was brought in to turn around the ailing BBDO network and, in 2007, Omnicom, according to Media’s New Business League, spectacularly closed the gap with chief rival WPP.

Indeed, last year, all of its agencies reported a positive year, led by major wins, including the regional Johnson & Johnson (OMD), Wrigley (BBDO and DDB) and Singapore Airlines (TBWA) accounts. In terms of revenue, the group ended the year just $10 million behind the leader.

Creatively too, it’s agencies have been leading rankings through the TBWA and BBDO networks.

But, in 2005, while Asia was gripped in a series of acquisition announcements, Omnicom conspicuously remained on the sidelines.

“It was never my brief to buy revenue and buy companies,” Birkin points out. “WPP have been more acquisitive in the region both prior to my arrival and whilst I have been here. I’ve looked at a number of the companies they have bought and with one exception I am happy that they bought them and not me because the prices were astronomic. Focus Media, WPP, Publicis were buying in this gold rush and we didn’t want to be part of that.”

In fact, reports suggest that WPP has found it hard to generate strong returns from its buys, and acquisition-led growth strategy will be tested more severely as economic conditions worsen.

“It may not get column inches, but it is important that we build the capabilities within the construct of our companies,” Birkin continues. “Rather than trying to buy marketshare with a bunch of companies, you really have to ask yourself, where are they going and where are their entrepreneurs now?”

Of the 10 deals Birkin put on the table, DDB's JV partner Citic Guoan, Unisono, Consultech and Shunya materialised in China. WPP meanwhile charged on with its buying spree, signing 16 acquisitions in the mainland. But as the would-be barrister and accountant would argue (and competitors agree), these, together with Gotocustomer in India, added enviable branches to Omnicom’s family tree.

The field marketing acquisition in particular was critical. India is a market where Omnicom has been hampered by relationships it entered into years before Birkin arrived. Some progress has been made in recent years with OMD’s entry and TBWA’s buyout of its local partner. But more work clearly needs to be done if Omnicom is to catch up with rivals there.

It’s not just agency assets that Birkin has been after, however. Talent has topped the agenda and there have been senior level hires such as former Unilever vetran Keki Dadiseth, who holds a non-executive role, and global director for Unilever Asit Mehra from Lowe. The appointment of Jason Kuperman as Omnicom’s digital head in Asia, meanwhile, should allow the holding company’s brands to map out a clear long-term digital strategy.

One of the key aims for Birkin has been to raise the profile of Omnicom. “There has been much more coverage of Omnicom’s activities out in Asia since he came and both he and Serge [Dumont, senior VP and president Asia-Pacific] can claim the credit on that,” says a WPP source. “It is not just external press coverage either. Asia has taken on more importance internally at Omnicom and it is mentioned in all their earnings calls and releases.”

Indeed, by dispatching Birkin to Asia and committing parent company resources to the region, Omnicom signalled that Asia was a priority. Birkin says: “We are not going to lose a piece of business to WPP now because we are seen as being smaller or less ambitious. Getting to their size may take longer, but it will happen over time.”

While Birkin refuses to be drawn into succession plans, the question of Asian leadership persists. An Omnicom insider says: “It will be interesting to see if he is replaced and, if so, by whom when he returns to New York.

“Does Omnicom need that role in Asia? It has moved forward as an operating company, but is this because of Birkin? BBDO has had success but you could argue that is down to Andrew Robertson. TBWA and OMD had their own momentum before he arrived and DDB is still not sorted. If Birkin wants the top job, New York is the place to fight for it. Wren rewards loyalty. But by staying in Asia, Birkin is risking fading into the background.”