OPINION: News Analysis - Can a demoralised B-M now rise from the ashes? Burson-Marsteller's fee income has declined in comparison with competitors in recent years. PRWeek charts the recent history of B-M in the UK

The agency Harold Burson built - for decades a byword for good business nous in PR - has gone through some pain as it tries to recapture former glory and the staff morale of a decade ago when the double act of Martin Langford and lively New Yorker Edna Kissmann made B-M the happiest agency in London.

The agency Harold Burson built - for decades a byword for good business nous in PR - has gone through some pain as it tries to recapture former glory and the staff morale of a decade ago when the double act of Martin Langford and lively New Yorker Edna Kissmann made B-M the happiest agency in London.

B-M London last month made 13 senior staff redundant in a move to redress its chronic top-heaviness. Last week saw the departure of James Harkness, MD of its change management practice and a B-M man for less than a year.

MD Allan Biggar told staff the job losses were part of a plan to create a healthy and profitable business. Whatever the rationale, one thing is now clear: B-M is no longer a Top 5 agency in the UK, having achieved near zero growth last year against a 15 per cent industry average.

Biggar denies his job cuts were to strip out costs, insisting they were part of a plan to flatten the organisation, inspire young staff and establish London as B-M's creative powerhouse. And yet former B-M employees - who by and large welcome Biggar's work for a firm that engenders loyalty among even disaffected ex-staff - disagree.

One former B-M executive blamed its malaise on a vast army of 'Eurosuits,' expensive consultants, HR, IT and finance people who are a constant drag on the bottom line. The work of Biggar and European CEO Dermot McNulty is designed to remove this tribe from the equation. As much as it causes bad blood between erstwhile colleagues, this work is necessary to help B-M regain lost ground.

In reality, B-M's problems run deeper than a year or two of poor growth. Former staff cite self-obsession as the worst of the agency's crimes. 'There was little celebration of hard achievement in my five years there,' says one source. 'The language of strategy, or whatever the current buzzword was, distracted people from the business of getting journalists on the phone and the client's name in the paper.'

The problems of self-obsession and top-heaviness are related. B-M recruits bright and ambitious graduates, many of whom then leave because of the lack of a healthy streak of mid-level account handlers. 'There are too many queen bees with endless titles as head of this, SVP for that or chairman for the other,' says one ex-staffer, 'and not enough intelligent drones to roll their sleeves up and do the work.'

At the heart of this is confusion about B-M's direction. Former global CEO Tom Bell conceived of it as 'McKinseyite,' based on that management consultancy's enduring success and concerned with high-end high-fee strategic advice.

The reality, as Biggar admits today, is that clients want their PR agency to do implementation as well as strategy, and for too long, according to former employees, B-M considered this aspect of work a little infra dig. Biggar vigorously denies this and says the agency accepts it must strike the right balance in this respect.

The urge to work as a top-level advisory firm led Bell, and then European CEO Ferry de Bakker (one of four in as many years) to create a practice-led structure which did away with country MDs. These roles disappeared in favour of the skill set, for example public affairs, being a profit centre in its own right, irrespective of the practice head's location.

B-M's final UK head before Biggar was Alison Canning, who left the agency four years ago and who blames the management shift implemented by Bell for what she terms 'the death of B-M'. Bell has since left B-M's former parent of Young & Rubicam, following its takeover by rival marketing services giant WPP.

Canning is deeply critical of the practice-led p&l structure: 'B-M imposed a one-market strategy across Europe because it was a success in the US,' she says. And yet Europe is a dozen or more markets, she maintains, and thus the new arrangements were doomed from the start.

B-M has now reverted to the old system in what European chairman Alan Watson describes as a 'rebalancing of practices against geographies'.

By the time B-M realised this error - and McNulty is still reluctant to accept it as an error - it had lost the talented Canning to her own start-up.

In part the implementation of the practice-based system was a function of a US-centricism that has long plagued B-M. When Angus Maitland was appointed the first non-American to B-M's global board as vice-chairman in 1991, it was considered so novel even The Wall Street Journal covered the story.

Maitland's experience is also instructive since it points up B-M's ability to blow even good fortune away. An agency which in the past housed Maitland - in charge of his own successful consultancy now - and Financial Dynamics' Tony Knox, has been unable over time to build a successful corporate and financial offering in London. This is another thing Biggar hopes to change, and he is understood to be in early stage talks with Brunswick alumnus Andrew Grant's recent start-up Tulchan concerning a joint venture.

With these problems have come client awareness. The relationship between B-M and Unilever is still intact, but the client's fee spend has dropped in recent years and the company now uses a range of agencies for accounts it would previously have handed to B-M.

It must now be safe to call the turnaround on B-M's London office. Biggar - who has the support of WPP chief Sir Martin Sorrell - admits he has made enemies in his quest to get the agency back to its pre-eminent market position. 'Our critics are a year out of date,' he insists, pointing to recent new business wins from 3i, B&Q, eBookers and the Magistrates' Association. The future can scarcely be less bright than the last five years.


1989-92: Joint MDs Martin Langford and Edna Kissmann run a steady ship

1995: UK CEO Alison Canning leaves as B-M creates a practice-led structure

2000: Country structure is back with Allan Biggar in charge

2001: A fresh start for the newly lean B-M?

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