Industry analysis: Mark Read appointed WPP CEO

Given the message management of the past week, today’s confirmation of Mark Read as the new CEO of WPP plc comes as little surprise but brings one chapter to a welcome close as another opens.

His rise has been as consistent as it has rapid. There’s no doubt he understands WPP thoroughly and has good contacts with key customers.

However, despite his alleged proximity to investor relations over the years, his City profile is less clear, so he will probably have to work on that soonest.

As usual, what is not being said is probably more interesting than what’s being said. Chairman Roberto Quarta has been at pains to stress that this was a hard-fought race between a talented field of candidates. We’ll never know for sure, but the word is that it was a stinker of a recruitment brief and that a number of potential leaders declined to engage.

Resetting such a massive, sprawling business is a huge task and nobody should want to do such work in public. Early assertions of ‘focus on growth’ are all very well but any competitor could say that too. Again it will be what happens behind the scenes – acquisitions, disposals, mergers and reorganisations – that will probably create competitive advantage (or not).

Mark Read is NOT Sir Martin Sorrell. He won’t be found at Davos, discussing global politics. He won’t opine on ‘bathshaped’ economic recovery, or the frenemies of Google and Facebook. Media appearances could be few and far between. In contrast to SMS, he might even be a little grey.

However, he is the right choice for WPP CEO right now. Why? Because he knows the culture and background of WPP, and he can work consensually with senior colleagues on the reshaping of the group. He is also the preferred insider and can crack on immediately, whereas any external candidate would need many months to get up and running. That’s time WPP does not have.

In the last 2 years WPP has experienced a sharp decline, losing a third of its stock market value as well as its founder and sole CEO. Revenue growth has ground to a halt. So the company will be hoping for a turnaround story, and Mark Read’s remuneration package will reflect the success of that turnaround.

Read should understand better than most which areas of marcoms and consulting WPP can prosper in and which areas it should exit. Meanwhile, disposals should be expected as there is a case for slimming the group; elsewhere, WPP’s below par performance in the key US market will need to be improved.

WPP critics will point to the Man Utd/David Moyes parallel – in other words, do you really want to be the guy that replaces the legend that was Sir Alex Ferguson (or the uber successful SMS, in this case)? Is there a risk here for Mark Read?

In reality, as long as he follows his own path and takes clients with him, he can be a big success for WPP. Share price will go up and all stakeholders will be happier.

But if he isn’t, then the group break up will really be hard to resist.

Now Read’s been appointed WPP are firmly on their way. Expect him to take a very different approach to the hands on style/command and control that Sorrell built into his project of a lifetime – he’s already talking about how WPP is a people business, the type of language that Martin Sorrell rarely used.

New faces gives WPP the license to define a new vision, purpose and direction for the organisation – good leaders should take their time to set their course.

Speculation continues as to whether WPP will be broken up into smaller parts, Mark Read has already been very vocal around building on their culture to attract and retain the best talent for clients, but in order to do that they need to properly simplify their offering around technology, data and production – the idea being that you can use these services to properly empower creativity and release the power from the very best talent.

Selling off businesses the likes of Kantar may be seen as way of simplifying things, but the problem for WPP is that they’ve become such a hugely dispersed organisation that has pockets of excellence for tech, data & production across 100’s of businesses. The real challenges is how they go about combining those powers under a simpler structure: selling stuff off may mean that they’ve simplified things on paper but have also managed to lose some of the capability that is so vital to the future.

Don’t forget that this is a business that is under increasing pressure from numerous sides – the power of Facebook & Google,ongoing issues around client trust, the invasion of consultancies into the media space and the mere fact that genuine creativity and agility is increasingly coming from smaller independent organisations.

So the real question is around how much time Mark Read can take to set the vision, move quickly to simplify things and more pressingly move in such a way that they can work to counteract the forces around them.

To the casual observer WPP’s board have, in choosing Mark Read as their new CEO, played it safe. He’s the company insider with a track record of success at Wunderman who can be trusted to steer the ship, make that fleet of ships, on a safe passage to the new world. No shipwrecks. No mutinies.

Counterparts at rivals Omnicom, Interpublic and Publicis will see him as a known quantity and feel pretty confident that, as “one of them”, they can predict how he will look to reshape the business. The brash disruptors from the world of technology consulting probably won’t be feeling too worried either.

But any air of familiarity and continuity could be misplaced and provide some cover for the radical changes Mr Read acknowledges that WPP has to make. He’s spoken of a process of evolution, but this may turn out to be an intentional mis-direction, because the one thing that the company doesn’t have much of is time.

Moves to cash in on investments such as AppNexus, and leave the Mayfair HQ for pastures new paint the picture of a man who isn’t wasting any time implementing his plan. Bigger, bolder moves probably aren’t too far over the horizon, and they could leave his co-workers and competitors wondering if they really did know Mark Read after all.