OMD’s 10-year transformation: From a ‘two out of 10’, to media agency of the decade

This week, Omnicom's OMD was crowned Mumbrella’s media agency of the decade. Brittney Rigby speaks to Omnicom Media Group's CEO, Peter Horgan, and OMD's Aimee Buchanan about the decade's best (and worst) moments, including a near-death reality check from its biggest client, an overhaul of its parental leave policy, and the broken elevator which saw a group of the industry's biggest names trapped for 50 minutes.

Ask Peter Horgan to take you back to the OMD of 2010 and he’ll say it was comfortable. Dangerously comfortable.

Four years earlier, James Greet – credited with rejuvenating the agency – had left as CEO. Greet’s successor, Mark Coad, was about to depart to lead Clemenger Harvie Edge in Melbourne (he’d return to the Omnicom Media Group family in 2012, as CEO of PHD). And Horgan was ready to replace Coad.

He was, however, not ready for the agency to find itself face-to-face with death just a couple of years later, in the form of Mark Buckman.

Buckman was the new CMO at Telstra, a client which, a few years earlier, had taken OMD from being mid-sized, to, in Horgan’s words, “genuinely being a big agency”. But fast forward to late 2012, and it was a very different story. The relationship with OMD had become “stale and complacent” – feedback which Buckman says was “landing on deaf ears”. So, with the agency “a hair away” from losing the account, he decided to issue an ultimatum.

It wasn’t a decision Buckman took lightly, but his company deserved better than “mediocre”, or even “best of average”. So he invited Horgan and Leigh Terry (then Horgan’s boss as Omnicom CEO, and current APAC CEO of IPG Mediabrands) to The Westin for an after work beer. Buckman says he thinks Horgan and Terry were expecting a “normal, jovial catch up”, but the “blood rushed from their faces” when he told them that, unless they reinvented OMD, “they’d be toast”.

“I said ‘You guys are believing your own hype. You think you’re a 9/10 and unfortunately, my team is telling you this too, but let me tell you, you’re sailing very close to the wind. Actually, you’re a 2/10,’” Buckman recalls.

“The very next day Horgan was in my office telling me what they intended to do to reinvent themselves.

“Part of this was the appointment of Aimee Buchanan to lead the Sydney office and take day-to-day leadership of the Telstra account. For his sins, Horgan had an immovable monthly catch up with me. At our first meeting, he showed up with a bound Power Point deck and prepared to take me through their progress. I didn’t open it.

“Instead I asked him to tell me, in his words, what was happening, how was it going, what were the obstacles to our success, how my were team going. I wanted to know that, as CEO, he knew my business and wasn’t a Power Point carrying, empty suit. Needless to say, next month … went more smoothly.”

Horgan says Buckman’s feedback was exactly what the agency needed

Horgan isn’t too proud to admit that Buckman’s “brutally honest” feedback was “exactly what we needed”.

“We were lucky that he was a good human who said ‘I can see that you’re making changes, I think there’s an appetite here, I can see you’re a business that has an emphasis on humans, which aligns with me, and getting things right for your staff. But you need to make changes’,” Horgan says.

“He gave us a window.”

And with that near-death experience to start the decade, the only way for OMD was up.

Nice enough stopped being good enough

The year before, towards the end of Horgan’s inaugural year as CEO, he faced his first big loss. It was October 2011 and OMD, according to Horgan, had been “winning by being good, but not great”. That came to an end when it was “outmuscled” by Mediacom, and the Group M agency ripped the Westpac account from OMD’s clutches.

Less than two weeks later, Aimee Buchanan, the agency’s current CEO, joined OMD on the Tourism Australia account. She was impressed by the culture, but also observed that OMD’s focus on people to the detriment of product had made it “soft”.

“It had kind of become consumed with being a great place to work and the focus became so much on the culture that we lost our way holding people accountable and that performance element,” Buchanan says.

Horgan agrees with that assessment, adding that, as OMD was coasting, other agencies were stepping up.

“You had Group M really get its act together, you had UM really start to become a potent force in the market,” he says.

“Being good and nice was no longer nearly enough.”

Buchanan started at OMD in 2011, when it was “soft”

When mapping out OMD’s decade, Horgan places particular emphasis on these early years. 2010 was “a bit comfortable”. 2011 and 2012 were a “big fright” thanks to Westpac and Telstra. And in 2013 and 2014, OMD got its mojo back. Buchanan explains that, in large part, that mojo continues because the agency has accepted the need to prioritise evolution above perfection.

“Momentum’s more important than everything being perfect, because it will change anyhow,” she says.

“That shifted how we looked at the product and the people and the culture as well.”

But Buchanan also leads the agency thinking “there’s a fight around the corner … because if someone pulls their socks up, or you get a new CMO, you need to be ready for that.”

From comfortable to consistent

OMD’s paranoia is accompanied by a genuine belief that sustainable businesses are successful businesses. Horgan says that you have to ensure growth is managed, especially working for holding companies that will hike up targets if you perform too well. If he was facing the prospect of 30% growth in a year, he’d stretch it out over two or three.

OMD took a step back from pitching following its win of the Suncorp account

Committing to sustainability can mean scaling back. As Buchanan explains, OMD has “walked away from $250m in new business because we committed to our people and to Suncorp in particular at Sydney that we wouldn’t pitch for 12 months”.

“They know they’re not getting reeled out in two days time to do another pitch after winning a big fish like that,” she says about what that does for team morale.

“They get to regroup and recalibrate.”

The agency won the $110m Suncorp account towards the end of last year, adding to a client roster that includes the likes of McDonald’s, Mazda, Coles, Target, and, of course, Telstra. This year alone, OMD has been appointed by Super Retail Group, Asahi, Sealey Posturepedic and the Australian Turf Club.

Some of OMD’s major client wins throughout the decade (Click to enlarge)

The agency is not only proud of winning business, but keeping it. Its most recent annual report records a client retention rate of 97%, and 10 consecutive years (yes, a decade) of growth.

If OMD’s 2010 one-word snapshot was ‘comfortable’, 2019’s would be ‘consistent’.

“It’s not a sexy word, but I’ll wear it with pride,” Horgan laughs.

“It sits deceptively close to ‘comfortable’ as well, but pulling those two apart is that distinction. How can we be better, how can we be showing up for clients? Let’s do it in a way that we’re proud of, and let’s do it in a way that we can manage for the long term.”

‘Consistency’ can be a ‘dirty’ word, Horgan acknowledges, but it supports OMD’s proposition – ‘performance with integrity’ – in a cluttered market, and is widely used by industry execs to describe the agency, including Think TV’s Kim Portrate.

Think TV’s Portrate is just one of many executives who think of OMD as ‘consistent’

“The consistency of their work, it’s excellent quality, has always been present for me,” Portrate, who has been connected to OMD in some fashion for the entire decade, says when asked about its reputation.

“I’ve only ever seen them to be incredibly smart and diligent and detailed. They’re a very good agency.”

‘I know this is a place where I can have a family’

One part of OMD of which Buchanan is most proud is its parental leave policy. In fact, she has a newborn and is on parental leave right now.

Two years ago, the agency doubled its paid parental leave from eight to 16 weeks to ensure it retained talented parents. Just 26% of new primary carers were returning pre-2017, a figure that’s jumped to a whopping 89% since OMD not only upped leave entitlements, but backed it up with a formal flexible working policy, handbook for expecting parents, and leadership team that understands pregnancy isn’t a burden.

Recently, three people who are either pregnant or have a newborn joined the agency, Buchanan says. Others want to work at OMD because of its parental leave policy, telling her, “I know this is a place where I can have a family”.

This year, OMD was ranked fourth on the Great Place to Work list, the only communications agency to rank in the top 50 for 11 consecutive years.

OMD has formal parental leave and flexible working policies, along with a handbook called ‘What to expect when you’re expecting at OMD’

“The policy is one thing, but I think it’s the informal structures the business has put around people that has actually made it be successful,” Buchanan offers.

“It’s to do with flexibility, it’s to do with how we let people ease back into the business, it’s to do with work/ life balance, which you get out of sustainable practices.

“In this era, where there’s a constant war on talent, it’s never been more relevant.”

That war on talent isn’t just impacting parents, but teams struggling with mental health and burnout. Horgan admitted in 2014 that he pushed his staff too hard in the aftermath of the Westpac loss.

But he wants to be remembered for behaving “like a leader, for the benefit of all the industry”. Buchanan wants to leave the agency “in a much better place than when we started”, and for staff to also leave better, not just professionally, but personally.

“A big difference with OMD, and I’ve seen it even more under Aimee’s watch, is what they say they’re going to do, they do, and then they report that back to the business,” Horgan says.

“And on the very rare occasions where they don’t, they report that back to the business as well. There’s a trust there.”

Buchanan reinforces that message: “Look after your people, deliver on your commitments to them, be as open and transparent as you possibly can be, and that pays back, both in how they act in the business and their tenure.”

The OMD team

A broken elevator and an Ellen-style selfie

Buchanan’s funniest OMD story – “probably of my entire career” – came during Mumbrella’s media agency live judging in 2017, which involves a jury panel visiting each agency in a whirlwind day of presentations and scorecards.

“We rehearsed, had everything planned, had a big show-and-tell all ready to go,” Buchanan explains.

The judges are required to assess each agency’s culture, which in many cases is informed by an office tour.

“So we escorted them into the lift. And for the first time in my six years at OMD, the lift broke down,” Buchanan says.

“I was stuck in the lift with 12 people, all of the judges, for 50 minutes. One of the judges had a panic attack, was claustrophobic. The fire brigade came. It was an absolute disaster, and we then had to present afterwards.”

She coped by talking a lot, and taking a photo, the file name of which is ‘ellen lift selfie’, referencing Ellen DeGeneres’ iconic 2014 Oscars selfie.

Compare the pair

The incident was already infamous. At this year’s live judging round, Kim Portrate loudly proclaimed we would absolutely not be taking the lift. Stairs only.

“OMD are such a professional outfit. They leave nothing to chance and everything is so organised and so thoughtful and so considered, but the one thing you couldn’t factor in was your elevators,” Portrate remembers.

“I’ve never been trapped in an elevator. Ever. And it had to happen that day, at that moment.”

But her prevailing memory is how impressively Buchanan handled the situation.

“Aimee was a consummate professional under fire,” Portrate says.

“It wasn’t a reflection on OMD’s capability. In fact, it became kind of a celebration of deep bench strength. Because we were like, ‘Wow, if that had been me and my organisation, I don’t know that I could have recovered as seamlessly and proceeded as if they didn’t miss a beat.'”

From hellish to healthy

Mark Buckman thinks that, despite a rough start, OMD deserves the media agency of the decade title. Horgan and Buchanan proved that “it’s not the fact that you fall that defines you, rather how you pick yourself up and what you do from there”.

“There are very few real examples of true transformation, where the end state is so fundamentally different and materially better than what went before it,” Buckman says.

“But that’s what Peter achieved … some might say like a phoenix from the ashes.”

Horgan says Telstra is just as important to OMD now as it was in 2012 – a temperature gauge for the business’ overall wellbeing.

“When they’re happy, we’re good. And when they’re not happy, we need to sort ourselves out,” he suggests.

Horgan and Buchanan emphasise how humbled they are to win the accolade. They’ve seen the agency at its worst, its most complacent, and they don’t want to go back there.

“We haven’t been perfect, but we’ve learned from our mistakes. We’ve seen the effects and we don’t like it,” Horgan says.

“We call each other out on stuff all the time as well. Both of us having been through a near-death experience on our watch, that is an awful place to be. We never pat ourselves on the back.

“We’re not going back to a comfortable place and I think it’s that paranoia which keeps us…”

Buchanan finishes his sentence: “Healthy.”

And perhaps, in an industry defined by uncertainty and volatility – mergers and acquisitions everywhere you look, margin pressures, a mental health problem, shortening client and personnel tenures  – sustained health is the mark of a good agency. No, a great one. One that, by converting comfort to consistency, can go from a two out of 10, according to its biggest client, to media agency of the decade.

The Media Agency of the Decade was decided by Mumbrella’s editorial team after consultation with senior industry stakeholders. It was not an award which agencies paid to enter, but rather an editorial decision.  


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