Radical Restructuring At Publicis Groupe

In a bid to serve clients better, Publicis Groupe is turning its organization upside down in a radical restructuring that will take effect on January 2, 2016. That’s how company CEO Maurice Levy put it in a video to company staffers explaining the moves.

The company is reforming into four major groups, including:

Publicis Communications, led by Arthur Sadoun as CEO, which will house all of the company’s creative networks including Publicis Worldwide (which Sadoun previously led); MSL, Nurun, Saatchi & Saatchi, Leo Burnett, BBH and Marcel. It will also include production operation Prodigious.

Publicis Media, led by Steve King as CEO, which will house media agency networks Starcom MediaVest Group; ZenithOptimedia (which King previously led); Vivaki; Performics; MRY; Moxie and related entities.

Publicis.Sapient, which was created with the acquisition earlier this year of Sapient and which will continue to be led by Alan Herrick as CEO. It includes the company’s digital operations Sapient Consulting, SapientNitro, DigitasLBi, Razorfish and related entities.



Publicis Healthcare, led by Nick Colucci as CEO, which will continue to focus on healthcare marketing.

Laura Desmond, who has been global CEO of Starcom MediaVest Group, is taking on the newly created role of Groupe chief revenue officer. Reporting into Desmond will be the company’s corps of chief client officers — one for each client — who are tasked with seeing that clients receive all the services they require companywide. Desmond will also chair a U.S. committee (there will be one set up in all of the company’s “main countries") designed to “coordinate and best take advantage of all the Groupe’s assets.”

The company has also created a new unit called Publicis One that will serve all countries outside of the top 20 countries from which Publicis Groupe derives some 90% of its revenue. Clients in the countries outside the top 20 revenue producers sometimes don’t receive the attention they need, the company said. And Publicis One, led by Jarek Ziebinski, is designed to address that. In Publicis One countries, all business entities will be “reunited under one roof and one management team,” Levy said. “They will ensure a better coordination of all client services while respecting strict confidentiality rules.”

Levy told the troops in his video remarks that the digital transformation was profoundly disrupting businesses in every sector, including advertising and marketing. There is a perception, he said that the holding company’s model was “now too complex,” often generating “useless delays.” Whether true or not, Levy added, “in our business perception is reality. We must change reality, not perception."

At its core, he said the new model was designed to put the clients at the heart of the organization by breaking down all silos. And he stressed that individual brands are often perceived as silos. Several times in his 20-minute video address he used the phrase “no silos, no solos, no bozos” to emphasize the point that clients must have ease of access to all services within the holding company and that it must redouble its collaborative efforts to facilitate that.

If the plan works as envisioned, Levy said, the “alchemy of creativity and technology” will be unleashed to better serve clients. That alchemy, he said, is “a touch of magic that makes all the difference.”

The new plan crystalized over months of brainstorming and meetings that began in April and concluded at a big company summit in San Francisco in September.

The company’s supervisory board approved the restructuring today. In sum, said Levy, the plan is designed to better help clients find ways to grow and boost market share. “Now let’s roll up our sleeves and win this battle together.”

In a note to clients Pivotal Research, Senior Analyst Brian Wieser characterized the "bottom line" on the restructuring this way: "In the wake of weak results and a year where Publicis has faced more operating pressures than its global peers, Publicis announced managerial and structural changes 
on Tuesday. The most significant news involves the shift of reporting for the company’s media agencies and a more significant embrace of “horizontality.”

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