J. Walter Thompson has thrown out the old concept of setting up
full service shops in every major market of Asia-Pacific.
Under the leadership of new chief operating officer, Kevin Ramsey, the
agency is currently in the midst of setting up a structure which
examines the needs of each market and works to satisfy just those
needs.
It learned the hard way that the old concept was unrealistic when the
regional economy slumped in the late 1990s, resulting in about 17 per
cent of staff being laid-off.
Mr Ramsey, who was previously JWT's Australia area director, said the
recent poor economic conditions had forced the agency to make cuts,
including on staffing levels, in order to maintain its
profitability.
"We handled the cut-backs strategically; we took out the poor
performers, streamlined the administrative processes and made people
more accountable," he told MEDIA.
But JWT International group president Miles Colebrook added, "You could
see how fat we had gotten during the boom period, because of the 17 per
cent of people who were let go, we estimated that about eight per cent
went without anybody noticing."
The fact that about half of the departures went unnoticed got the agency
thinking about the wastage that occurs from setting up full service
shops in every city of Asia-Pacific.
"You need the core competencies in each market you're in but you don't
need to have a mirror reflection of yourself everywhere you are.
"For instance, it makes sense to have interactive specialists in places
where there is strong consumer interest in hi-tech items like in Hong
Kong, Singapore, and Korea, but not in a place like Indonesia, where the
Internet take-up rate is still very low," Mr Colebrook said.
He said the "one-size-fits-all" model of the past did not work any more
and the key in today's world is to identify potential and actual client
needs in each market.
The structure that the agency is rolling out in Asia-Pacific follows
closely the model that Mr Ramsey has introduced in Australia.
In that market, a dozen key, specialist companies have already been
established by the agency, including sports marketing, event management,
healthcare, sales promotions and interactive firms through acquisitions,
joint ventures or affiliations.
"Only those disciplines that are needed will be set-up," Mr Ramsey
said
"In the past 12 months, it has given us growth of 25 per cent (in
Australia)," he added
The end result, he noted, is that the agency has realised that it needs
significantly different types of operations in the different markets it
has a presence in.
In Hong Kong, for example, the focus is on telecommunications, new
media, finance and property. In Indonesia, on the other hand, the
emphasis is more on packaged goods.
After Mr Alan Fairnington quit the top Asia-Pacific job in 1998, the
region has been - until now - reporting directly to Mr Colebrook in
London.
Ostensibly, this arrangement was favoured to finding a replacement,
because of Mr Colebrook's experience in guiding JWT through Europe's
economic downturn in the 1980s.
With prospects for Asia-Pacific back on an upswing and with a
restructuring taking place, a regional head became a necessity,
resulting in the appointment of Mr Ramsey.
With a new agency structure and clients once again spending more on
advertising and branding, Mr Ramsey said JWT Asia-Pacific was back on
investment mode.
This, he said, included hiring more people "but only where needed and
only the best".
