Clients and agencies alike will seek structural as well as strategic change

A story in The Wall Street Journal this week detailed Cisco's still-new management structure, created in the wake of a dismal earnings announcement to the tune of a 46% profit drop for the quarter.

A story in The Wall Street Journal this week detailed Cisco's still-new management structure, created in the wake of a dismal earnings announcement to the tune of a 46% profit drop for the quarter.

“But chief executive John Chambers said there are signs the economy likely reached a ‘tipping point' during the quarter,” the article said, and vowed to bring the company back to “double-digit growth.” Let's hope he's right. What was most interesting about the piece was Chambers' pointing to management structure changes as a key driver for growth going forward.

The structural changes are coming in the wake of Cisco's attempts to diversify into some two dozen new areas “from consumer camcorders to giant TV screens for stadiums,” according to the story. In order to make this happen, Cisco is replacing its top-down structure with a system of executive-populated committees. According to the Journal, the company now has 59 of these committees.

The strategy has its skeptics, mostly those who believe that it speaks to a lack of focus for the company, and confusion in the message as well as decision-making processes. The article addressees alleged difficulties with the structure, felt from the C-suite down.

I am not in a position to assess the viability of the structure, but it's hard not to appreciate the notion that even well-established companies need to find new ways to drive innovation and leadership. It is doubtful that many in-house PR teams or agencies are taking this moment to evaluate, “Are we doing things the best way possible?”

This week we had a chance to meet with Olivier Fleurot, chief executive of Publicis' new PR structure, which includes MS&L, Publicis, and Kekst & Company, among others. He and MS&L's North America president, Jim Tsokanos, are keen to take on the presumptions of agency structure that have driven the agency business during the last 10 years, and longer, including questions of scalability, as well as PR brand.

This will be an interesting one for industry observers to watch, particularly because of the top clients that are in the mix, namely Procter & Gamble and the new-world-order GM, both companies who are equally testing their limits in the new economic and global reality.

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