Wanted: chief financial officer for global communications group.
Must always shun the limelight and never court popularity. Should not be
afraid of telling the chief executive what he may not want to hear but
must never make him look a prat in public. An interest in advertising
desirable but not essential.
If one of the major agency holding companies put an ad for a finance
chief in the sitvac columns (which it never would) and opted for a
brutally frank job spec (highly unlikely), the result might appear
something like the above.
A diplomat, keeper of the corporate conscience, financial visionary and
feet-on-the-ground pragmatist, today's multi-disciplined chief financial
officer has been described as the consigliere to the chief operating
officer's Godfather.
He must be trusted and respected - even if he isn't much liked - and not
shy away from speaking his mind. As Peter Mead, Omnicom's deputy
chairman, puts it: "Your financial director must never be afraid of
you."
The passage of the person holding the purse strings from agency
bit-player who chastised executives for not submitting their expenses on
time to a place alongside the chief executive officer mirrors an
industry grown increasingly mature and sophisticated over the past two
decades. Today, independent shops are as concerned about the bottom line
as advertising and marketing leviathans.
Sir Martin Sorrell, the group chief executive of WPP, remembers the
earliest agency finance people as little more than book-keepers, often
unqualified, whose duties barely extended beyond looking after the
managing director's petty cash. Now group chief executive officers and
their finance experts must think as one.
Michael Bungey, Cordiant's chief executive, describes his chief
financial officer, Art D'Angelo, as "my right arm" whose advice is
crucial when deciding whether a takeover target is pursued or
abandoned.
Maurice Levy, Bungey's counterpart at Publicis, goes so far as to claim
that a good financial director can improve a company's results by
between 10 and 15 per cent. And he talks of an almost telepathic
understanding between himself and his long-serving financial chief,
Jean-Paul Morin.
"We know each other's thoughts so well that on many occasions I don't
have to consult him," Morin says. "I know what his answer will be."
The emergence of the publicly quoted communications supergroups with
their huge turnovers and stringent demands on them by Wall Street and
the City have transformed the status of the finance director who now
needs a range of skills going far beyond just a head for figures.
The defining period for that changed status began when agencies started
going public in the 80s. Book-keepers were replaced by ambitious young
executives whose work for major consultancies exposed them to
advertising's burgeoning and sexy world. Sorrell, who joined Saatchi &
Saatchi as the finance director in 1976, was typical of this new
breed.
Agency senior executives spotted the best talent and often returned to
claim it for themselves. "Once you got big and corporate enough, you
went back to hire the smart junior partner who worked on your audit,"
Mead recalls.
Recently, US groups have increasingly been recruiting their finance
people from business schools and even from merchant banks. But it is a
trend some fear will upset the balance that financial directors need to
strike between strategic planning and financial control.
"Chief financial officers with banking backgrounds are always thinking
about how to make deals happen but lose interest in nitty-gritty
issues," Levy claims.
A good chief financial officer certainly has a difficult tightrope to
walk. Not only must he carry the corporate message to the investment
community but know where to spend his company's money - and when to get
it out if the plan isn't working. "That's not always easy when the
executive creative director tells the chairman he's on his way unless he
gets another £100,000 a year," the former Publicis UK group
finance chief, Chris Whitworth, now at WWAV Rapp Collins, says.
"He will inevitably be involved in a lot of decisions that won't be
popular," Bungey warns. Yet, as Sorrell points out, an understanding of
the numbers has to be balanced by a sensitivity for the business. Bob
Willott, a financial consultant and editor of the industry newsletter
Marketing Services Financial Intelligence, claims this can mean having
to sustain the chairman's self-esteem.
Chief financial officers will always be backroom rather than
front-of-house figures. Chief executives who don't want the burden of
financial responsibilities when they are building their business and
working with senior clients want it that way, as, indeed, do the
analysts.
Levy goes so far as to suggest that chief financial officers must be
almost monastic in their resolve not to be seduced by the "fun" of the
agency and keep their eyes fixed purely on the numbers. His financial
alter ego concurs. "I love advertising," Morin says. "But I never look
at any until I get home."
SEAN ORR - INTERPUBLIC
Title: Executive vice-president and chief financial officer
Age: 45
Career highs: The $2.1 billion takeover of True North.
The 26 months since Interpublic drafted him in from Pepsico to take
charge of financial affairs have not been entirely smooth for Sean Orr.
Much of the turbulence stems from the questions raised by financial
commentators over events leading up to this year's takeover of True
North, catapulting it above WPP to become the world's largest
communications organisation.
The controversy revolves around Interpublic's massive $160
million pre-tax write-down of its investments in internet-related
businesses.
Had this been reflected in IPG's figures for 2000, the group's post-tax
profit for that year would have been nearer $260 million than the
$359 million actually reported and may have had a material impact
on the proposed terms for the True North bid, experts claim.
Should the deterioration in the internet investment have been treated as
a permanent impairment in value requiring a write-down against profits
or was it a temporary hiccup?
Orr, a summa cum laude maths graduate and former KPMG Peat Marwick
partner, argues that this was a "non-cash accounting adjustment". Bob
Willott, the editor of the industry Marketing Services Financial
Intelligence newsletter , isn't convinced: "Lost cash is lost cash."
Certainly it's a debate IPG could have done without. The recent
intervention of IPG's chief, John Dooner, to quash sell-off speculation
after Orr's public prediction that Interpublic would begin "pruning" its
portfolio, suggests the new relationship has yet to bed down.
PAUL RICHARDSON - WPP
Title: Group finance director
Age: 42
Career highs: Overseeing the $4.4 billion purchase of Young &
Rubicam.
There must be times when Paul Richardson feels doomed to be cast
perpetually in the role of the sorcerer's apprentice. When it comes to
financial alchemy, few can match Sir Martin Sorrell, the WPP group chief
executive. And, while Richardson is respected across the group for his
dedication and professionalism, it's clear who wears the magician's
hat.
Richardson came to Sorrell's attention at Hanson where, as the assistant
treasurer, he was part of a head office team that accessed the
international debt and capital markets to provide funding for many of
the acquisitions taking place 15 years ago.
It's a measure of Richardson's talent - as well as the depth of the
doldrums into which WPP had sunk in the early 90s - that Sorrell twice
tried to prise him out of Hanson, succeeding at the second attempt in
1993 and appointing him the director of treasury. "Given our situation
at the time, treasury skills were very important," Sorrell
remembers.
As the finance director for the past five years, the personable
Richardson has built a reputation for running a corporate headquarters
that is lean, structured and focused. "Paul is very good at driving
WPP's financial machine according to the directions on Sorrell's map,"
one colleague says.
RANDY WEISENBURGER - OMNICOM
Title: Executive vice-president and chief financial officer
Age: 42
Career highs: Orchestrating the sale of Maybelline to L'Oreal, buying
out Abbott Mead Vickers for BBDO.
During the five years he has had control of Omnicom's finances, Randall
J Weisenburger has built a reputation for being well ordered and
precise.
"I've never seen Randy's home," Peter Mead, Omnicom's deputy chairman,
remarks. "But I bet it's very tidy."
A key figure in the negotiations culminating in Omnicom's BBDO
subsidiary assuming full control of Britain's Abbott Mead Vickers - "He
was tough but fair," Mead recalls - Weisenburger is at the heart of the
younger management team running Omnicom since the late 90s.
The old guard, as personified by Bruce Crawford, the former Omnicom
chief executive officer, and Fred Meyer, its legendary ex-chief
financial officer, have given way to John Wren and Weisenburger.
The changes not only signalled a new phase in Omnicom's growth strategy
but, in Weisenburger's case, a break from the past with the arrival of a
chief financial officer out of merchant banking rather than
auditing.
His brief: to maintain Wall Street's respect for Omnicom's management
and help sustain its stock price and a climate enabling acquisitions to
take place.
"Not only does he have a broad range of experience but a mind like a
steel trap," Mead comments. "Yet he can also be engaging and
amusing."
Weisenburger developed his financial acument at the University of
Pennsylvania's Wharton School of Business, where he graduated top of his
MBA class, and honed them at Coopers & Lybrand and The First Boston
Corporation.
But it was as a buyout specialist that he made his name, having spent
more than ten years identifying and carrying out acquisitions for the
New York investment bank Wasserstein Perella.
JEAN-PAUL MORIN - PUBLICIS
Title: Chief financial officer
Age: 56
Career highs: The $1.9 billion takeover of Saatchi & Saatchi.
Jean-Paul Morin is known as Dr No. "I'm the most unpopular person in the
Publicis organisation," he says in a proud proclamation of his
parsimony.
Even his boss, Maurice Levy, is forced to conceed that Morin is "a very
difficult person, very inquisitive and very tough". And he is only part
jesting when he adds: "When we're in acquisition negotiations I play the
good cop and Jean-Paul plays the bad cop. The difference between us is
that Jean-Paul isn't acting!"
Much of this stems from a fierce loyalty to Levy stretching back three
decades in his role as the financial guardian of the Bleustein-Blanchet
family, the Publicis group's majority owner. Levy has often relied on
Morin to help drive through a tough negotiation. During last year's
aborted takeover of Young & Rubicam it was the pair of them alone who
confronted the massed ranks of Y&R's top management.
All this has clearly taken its toll on Morin, 56, who, according to
insiders, has been hampered by the group's almost total lack of
integrated financial systems. "He always gives the impression of being
hopelessly overworked," an executive who has sat across the negotiating
table from him remarks.
Morin talks about retirement - "I spend all my time on planes" - and has
begun divesting some of his responsibilities in preparation for it.
Nevertheless, he remains in charge of all financial aspects of the
group's major acquisition negotiations, a job he admits remains
powerfully addictive.
HITOSHI HANATSUKA - DENTSU
Title: Senior managing director
Age: 62
Career highs: Orchestrating the formation of Bcom3 with the Burnett
Group and MacManus Group.
The personal style of Hitoshi Hanatsuka belies his status as the Dentsu
organisation's biggest financial hotshot. Softly spoken and seemingly
unthreatening, he is an attentive listener who enjoys a joke. He spends
an hour before work walking his labrador retrievers and devotes much of
his spare time to helping the Japan Guide Dogs Association.
On financial matters he is the man Yutaka Narita, Dentsu's president,
will always defer to and some think he could be Narita's heir
apparent.
The pair are said to consult two or three times a day. Indeed, Dentsu
insiders say Hanatsuka's financial power is absolute so that not even a
modest investment of $1 million can be made without his
approval.
Hanatsuka cites patience, caution and rigour when weighing up a
decision, and courage to make it at the right time, as the essential
pre-requisites for a good chief financial officer. They are qualities
which have served him well. He was a key figure in the development of
Dentsu's partnership with Young & Rubicam, has helped orchestrate the
group's IPO (planned for this autumn, despite Japan's economic slump)
and was one of the architects of Bcom3.
"The biggest mistake you can make is to take advantage of his
unthreatening manner and presume on his friendship. He won't allow it,"
an associate says.
He joined Dentsu in April 1966.
JACQUES HERAIL - HAVAS
Title: Chief financial officer
Age: 49
Career highs: The $2.1 billion acquisition of Snyder, the owner
of Arnold Communications and Brann Worldwide.
Jacques Herail sounds almost too good to be true. He's the finance
director everybody likes. It's not so much that Herail is in perpetual
good humour - as the group has grown, his crushing workload has been
known to fray his temper. But those who know him say this is
counterbalanced by his easy accessibility, warm personality and his
ability to simplify complex financial matters so well that even
advertising innocents can understand.
What's more, he doesn't share a moneyman's inbuilt mistrust of creative
people. "Not only does he love advertising but he likes and understands
the people who work in it," an associate says.
Herail began his professional relationship with Alain de Pouzilhac, the
Havas chairman, when he quit his job as an audit manager at Arthur
Andersen to join HDM in 1984.
.jpg)
.jpg)