Our Achilles' heel" is how one Omnicom source described the holding company's position in Asia following HSBC's decision to consolidate its £350 million account into WPP in May 2004.
Now, the world's biggest holding company wants to beef up its performance on global super-pitches as well as netting local business in Asia and evolving a deeper understanding of its clients' needs in the region.
It is the first of the "big four" to dedicate a heavy-hitter to Asia.
Michael Birkin, 46, has two titles: vice-chairman of Omnicom, and president and chief executive of Omnicom in Asia.
He is the former worldwide president of DAS (or Diversified Agencies Services, to give Omnicom's largest network its catchier title). He joined the holding company when DAS acquired Interbrand, the company he co-founded and of which he was the global chief executive, in 1995.
Birkin has just moved from Manhattan to Tokyo. He'll be making regular trips to Omnicom's new office in Shanghai, and doesn't rule out eventually living there. He appears to have the appetite for a demanding role in a dynamic region: his plane touched down on 3 April and he reported for duty the next morning.
He is clear about his remit, and sets out his aims, stating: "I want to build market share in Asia by focusing on clients and providing better services. I'm not going to go on an acquisitions binge."
Why is Birkin the right man for this mammoth task? Crucially, he's an Omnicom veteran. "I can get decisions made quickly because I know the way Omnicom thinks," he says. He also subscribes to the company's non-interventionist management style, commenting that "John (Wren) allows his managers to manage."
As well as a healthy rapport with Wren, the Omnicom chief, Birkin says he enjoys strong relationships with the heads of its creative networks, TBWA, DDB and BBDO. "Jean-Marie Dru, Ken Kaess and Andrew Robertson are not only colleagues, but friends. I've known them for years and have total respect for them and like to feel that they do for me," he says.
Birkin will be assessing the health of these networks in Asia, and not all of them are in the best of shape. TBWA is the exception: over recent years, it has proved its creative firepower; its "vertical football" campaign for Adidas was an awards magnet last year, for example, and Birkin describes the network as "fabulous".
Yet compared with their strength in North America and Europe, DDB and BBDO are under-performing in Asia. Richard Pinder, the president of Leo Burnett EMEA who was Leo Burnett's regional managing director in Asia from 2000 to 2004, says: "BBDO and DDB, although not insubstantial businesses, lack the cohesion and the profile of Ogilvy, Leo Burnett, JWT and TBWA."
He adds: "If a client goes to India, China or Korea, they need to feel that they're buying a cohesive plan; the Asian mindset rewards that."
Birkin faces enormous challenges from WPP, whose momentum in the region is maintained by the likes of Miles Young, the chairman of Ogilvy & Mather, Asia's biggest network.
"Martin (Sorrell) has done a good job on holding company pitches and we're getting better at them. But there's much more business to be won by being the best local providers for clients, rather than putting up the odd good team that just happens to win the odd big bit of business.
Not winning HSBC wasn't something that put an Exocet in the middle of Omnicom; our results were outstanding last year," Birkin says.
Results may have been impressive - Omnicom's total revenues increased 13.1 per cent to $9.7 billion in 2004 from $8.6 billion in 2003 - but they were primarily driven from business in the US and Europe. A look at the geographical breakdown of holding-company business shows that Asia provides the lion's share of the "rest of world" figures. These numbers alone demonstrate why Birkin has a job on his hands.
Birkin is not working towards any specific Omnicom targets (at least, none that he wants to publicise) and his former DAS role means that he is no stranger to Asia. And, if you'll pardon the HSBC reference, he doesn't underestimate the importance of local knowledge either.
"I'll be relying on local talent, even though I am the ultimate authority, because the style of Omnicom is collaborative rather than autocratic," he says.
Perhaps because of its apparently strong spirit of collaboration, the HSBC result hurt Omnicom. Even though Birkin dismisses claims that his appointment was a knee-jerk reaction to the result, he does concede that it played a part. "We were disappointed, but I like to think that my appointment would have happened anyway," he says.
"I want our total business in Asia over the next five years to show exponential growth, but it is hard to say 'we are going to grow X per cent by Y'. If I don't get Asia to 20 per cent of Omnicom's revenues in three years' time, it doesn't mean I've failed; I'd rather judge myself in terms of competitors in Asia than against my colleagues in other parts of the world."
HOLDING COMPANIES' REVENUE SPLIT BY REGION
North America Europe Rest of world Total sales
(dollars m)
Omnicom 55% 37% 8% 9,747
WPP 40% 43% 17% 9,291
Interpublic Group 58% 28% 14% 6,141
Publicis 43% 41% 16% 5,623
Havas 42% 50% 8% 2,196
NOTES 1. IPG figures are analysts' estimates. 2. WPP figures include
Grey (pro forma). 3. Omnicom assumes "non-euro currency" European
countries, ie. Switzerland, Turkey, Norway, Denmark, Sweden and Eastern
Europe, are calculated at 4.5 per cent of revenue and Canada is 1.5 per
cent of revenue.
Source: holding companies, analysts' estimates.