As the overall market for interactive services experiences continued weakness, New York-based shop Agency.com is rearranging its executive and account management ranks in an effort to better win and service clients.
The changes include the departure of the company’s chief financial officer, Charles “Charlie” Dickson, and its North American president, Kevin Rowe.
Additionally, the firm, which is in the process of being bought out by interactive agency holding company Seneca Investments, said it had enacted a new organizational structure, designed to put more decision-making and management ability in the hands of regional client managers in Europe, the Eastern U.S., and Western U.S.
The heads of the 12 Agency.com offices in those areas, formerly presidents, will become managing client partners, with an eye to becoming more involved in handling specific accounts. Additionally, over the past several months, the firm has been elevating top account managers to the recently-created post of client partner.
“A lot of [the regional presidents’] time will be dedicated to clients,” said Agency.com spokesperson Melissa Holden. “They’ll still have some management and administrative duties … but they will also be billable, and responsible for both generating new work from clients and managing work that we’re already working on with our clients.”
“The company has always been entrepreneurial as part of its roots,” she added. “But as we grew, we got away from that, as part of our growth. The reorg is really an effort to decentralize, to have our resources dedicated to these regions that we’re now organized by, and to give people in these regions power to make decisions with their clients.”
The new plan also includes the elimination of a number of central company positions, including Dickson’s. Michael Jackson, who holds the posts of chief accounting officer and vice president of corporate finance, will take over Dickson’s CFO duties. Agency co-founder Ken Trush, who is executive vice president and head of corporate development, will pick up the title of treasurer.
“Charlie came to Agency.com to take us public — he’s a public-company kind of CFO,” Holden said, adding that the situation has changed due to the fact that the firm is likely to go private through Seneca’s buyout bid.
Executive vice president James Imbriaco, who is also Agency.com’s general counsel and secretary, will take over the company’s human resources administration following the departure of Mary von Herrmann later this month. Training, recruiting and career management functions will be managed in the local regions, the firm said.
Agency.com also eliminated chief technology officer Larry Krakauer’s position. His duties will be overseen by regional technical staff, reporting to local presidents.
The cuts were attached to last month’s company-wide layoffs, Holden said. Those reductions affected about 19 percent of the company’s approximately 1,050 employees.
“Our new structure enables us to deliver focused attention while at the same time being more effective and efficient, which is important given this challenging market,” said Agency.com chairman and chief executive Chan Suh in a statement. “I am confident that the changes we have made will further solidify Agency.com as a leader in the interactive services industry.”
“I am confident that our new organizational structure, led by this select team of experienced managers, will allow Agency.com to meet the changing demands of the interactive marketplace,” he added.
In addition to an overall decentralization, there’s also a new focus on reshaping the company into practices specializing in particular industries. Agency.com’s client partners will be aligned along seven specific client categories — retail banking, insurance, pharmaceuticals, telecommunications, consumer packaged goods, travel and hospitality and high technology — that the company sees as key. Client partners across the firm’s three regions have been appointed to head up each vertical practice.
“It makes a lot of sense for us, in terms of getting very senior people in front of clients, and giving clients a very experienced person on the account to oversee all the work,” Holden said.
The new organization also entails a number of executive shifts. Anthony Laudico, Don Scales and Eben Lenderking all become presidents of Agency.com’s East U.S., West U.S. and European divisions, respectively. Laudico and Scales both hold newly created posts, and while Laudico and Lenderking had formerly served as chief operating officers of their regions, Scales had been regional president out of Agency’s Dallas office.
Laudico also takes on the second title of North American president, pushing out Rowe, who had held the position after he joined the company with the 1998 acquisition of Chicago-based online ad agency Eagle River Interactive.
Overall, the effort to establish specific industry practice groups is reminiscent of the models favored by the largest traditional consulting firms — who increasingly are winning business typically handled by the interactive agencies.
But Agency.com isn’t the first interactive shop to mimic the big consultancies. Atlanta shop iXL earlier this year launched a high-profile restructuring of its business around attracting and retaining high-paying clients in specific industries.
iXL, which is currently merging with onetime competitor Scient, also made an effort to woo client partners away from consultants like Accenture and PricewaterhouseCoopers.
While most of Agency.com efforts are geared at decentralizing management and refocusing it around vertical industries, the firm did create two new posts to oversee business development and product delivery. Michael Mathews, who formerly held the post of president of Agency’s European division, will now serve executive vice president for global demand. David Krunnfusz, former executive vice president of project management, similarly becomes executive vice president of global delivery services under the new system.
“The marketplace in this industry has changed a lot, and companies like us need to change with it, and possibly, ahead of it,” Holden said. “That will help us serve clients better and hopefully become profitable.”
