He spoke with ADWEEK about how these changes will position McCann for what’s next.
ADWEEK: Why make these changes now?
DARYL LEE: The pressure on AORs has been building on the creative side. Clients are going to be able to execute a lot more, either in-house or with scaled production companies. The way in which we relied on AOR strength—the consistent repetition of executional tasks—cannot be the ground for a long-term business.
We’re shifting to things that we think [AI] can’t do very well, which are upstream, but away from the things that we are sure it’s going to do well with human intervention, which is execute. We’re not just competing with other companies now. We’re competing with machines. So [we must] remind ourselves and our clients of the value of the upstream things that we do.
AW: Is the business currently in its ideal structure?
DL: McCann, Futurebrand, MRM, and Craft will be strong brands in the future with strong connective tissue. We know how to work together on clients. We’ve been clearer about our go to market. Whether the Worldgroup structure will stay is an open question as we go into a new formation next year.
AW: How will people’s roles be impacted by these changes? Will there be more layoffs?
DL: The majority of the changes already happened. I can’t say definitively that we’re not going to make any changes for the rest of the year, but there are no plans to do another reshaping of the organization. Now we have to execute.
AW: McCann still has AOR clients. Are those relationships heading toward project work?
DL: The AOR world is not over, but it’s no longer growth. We’re focused on more consultative, creative, project-based models, including commercial models like deliverable and outcome-based pricing.
Every client is a combination of AOR and project. Our goal on all of our global clients is to always have an AOR plus project. Projects are, frankly, where we force ourselves to be more competitive, but also allow us to say to clients, ‘Here’s a problem you didn’t brief us on. There’s a solution for it.’
We used to give away a lot in the AOR model. We’d give people proactive ideas, and then get paid for the production. That’s, frankly, a bad way to run a business, because [that’s] the most valuable thing we do.
