Incoming WPP CEO Cindy Rose has a giant job forward when she steps into the position in September.
Because the Microsoft exec takes the reins from Mark Learn, who’s departing after seven years on the helm, she inherits a enterprise in decline that’s struggling to maintain tempo with an business in flux.
Along with addressing WPP’s structural and monetary issues—it issued a shock revenue warning and downgraded its 2025 development forecast final week—Rose should stave off continued consumer losses and switch round morale at its businesses.
Business leaders agree that Rose has the AI and know-how experience wanted to carry WPP into the long run. However what’s most important is that she develops a transparent imaginative and prescient for a enterprise that’s lacked one for a while.
“Hopefully the WPP board are clear about what its new technique is, as the present one has not delivered,” mentioned Ajaz Ahmed, founding father of Studio.One and former CEO of WPP company AKQA.
1. Reviving WPP’s inventory
Because the chief of a public firm, Rose must cope with shareholders impatient for WPP’s inventory to bounce again from historic lows. This will likely be troublesome in a sector that’s “going through actual strain,” mentioned Ahmed.
“Rates of interest are nonetheless excessive. Budgets are tight. Platforms like Meta, TikTok, and Google supply more and more subtle advert instruments that bypass businesses,” he mentioned. “Consulting corporations and unbiased businesses are successful share with a extra engaging worth proposition.”
In that strain cooker, Rose’s strategic selections will, largely, be dictated by the board’s finish sport: Does it need to create an actual technique for WPP’s future, or wouldn’t it be higher off promoting the corporate for components?
“There’s the monetary engineering facet—what is going to produce probably the most worth for shareholders unbiased of the suitable technique?” mentioned Brian Wieser, principal at Madison and Wall. “As a result of the inventory is so, so very low, it might very effectively be that the board would moderately see some instant advantages.”
Martin Sorrell, CEO of S4 Capital and former CEO of WPP for 3 many years, mentioned it comes down as to if the enterprise “could be higher off being dismembered into its nonetheless standing constituent components or consolidated elsewhere.”
“Corporations that have been as soon as a part of WPP, equivalent to Kantar, VCCP, FGS, and Globant have thrived as unbiased firms,” Ahmed identified. “The query is, might WPP notice the worth in a few of its property earlier than it’s too late, or does it need to merge and consolidate its businesses additional internally?”
2. Growing a transparent technique
If the board does need to pursue a future for WPP on this present state, Rose wants a transparent technique and viewpoint for the enterprise—one thing observers agree has been missing.
“The large concern for shareholders and staff isn’t simply the construction; it’s the absence of a transparent, credible plan,” Ahmed mentioned. “For some time now, it’s felt like WPP has been making it up because it goes alongside.”
For Wieser, that problem will get to the center of an existential business situation: “how do you set up a contemporary company group, and what ought to the company companies business seem like?”
Whereas Learn merged businesses below WPP to streamline its unwieldy operations, he hasn’t gone so far as his friends in working the corporate as a single model. As a substitute, he’s touted the significance of company manufacturers as levers for attracting shoppers and expertise, Wieser mentioned.
However that method has drawbacks for WPP, together with including “layers of non-billable overhead each on the central degree and inside the businesses,” in addition to “large duplication of companies,” Ahmed mentioned. “Ogilvy has change into a holding firm inside a holding firm, which isn’t precisely simplification.”
Wieser agreed that company mergers weren’t an actual technique. “That was desperation,” he mentioned. “There’s a recognition these will likely be loss-making entities on their very own, so let’s do the naked minimal.”
Coming in as an business outsider, Rose must shortly develop a viewpoint on the position of company manufacturers and determine the suitable construction to take WPP into the long run.
“Being each a holding firm and a client-facing model similtaneously managing dozens of company manufacturers with their particular person cultures, management groups, and operations is complicated, and this mannequin hasn’t labored for WPP,” Ahmed mentioned.
3. Making WPP Open repay
Underneath Learn, WPP invested hundreds of thousands of {dollars} into WPP Open, its inside AI platform. Will probably be Rose’s job to make that guess repay—and set WPP up for an AI-powered future.
“The numerous funding into WPP Open hasn’t yielded the expansion that was hyped a few years in the past,” Ahmed mentioned.
In line with Jay Pattisall, principal analyst at Forrester, WPP selected a tech government with an AI background for precisely that motive: “The choice of Rose is designed, partly, to additional commercialize WPP Open,” he mentioned.
Ahmed agreed that Rose’s expertise at Microsoft, which “hasn’t precisely been shy about reinventing themselves through the years,” will likely be helpful in pushing WPP to adapt to automation.
However whether or not that’s sufficient to remodel the legacy holding firm’s enterprise mannequin stays to be seen.
“WPP is a companies firm, not a software program firm,” Pattisall agreed. “Modernizing WPP itself, because it reconciles with automation and alter, will likely be no small job.”
“I’m not satisfied that businesses can construct a SaaS-type enterprise in competitors with software program firms like Adobe,” Sorrell added.
4. Boosting morale
Rose is taking on a enterprise the place morale is low and consumer relationships are tenuous.
WPP has misplaced a number of main shoppers this yr, together with Mars and Coca-Cola. In the meantime, ongoing layoffs and a botched return-to-work mandate have led to discontent and anxiousness amongst workers.
Sorrell pointed to what he views as a misguided simplification technique below Learn, which collapsed manufacturers like J. Walter Thompson, Younger & Rubicam, and Wunderman, as the rationale WPP has misplaced “not solely many gifted leaders, however shoppers consequently too.”
Nick Emery, CEO of company Jellyfish and a former WPP Media exec, believes Rose’s largest problem will likely be to “struggle for, shield, and champion the numerous good individuals who’ve given their all to the corporate—and to craft a method that makes them happier, drives development for shoppers, and absolutely embraces the position of AI to meet the promise of know-how.”
Rose’s consideration right here should be “24/7, laser-focused on the USA,” based on Sorrell, which is “undoubtedly the middle of the consumer world and the place WPP persons are in all probability most demoralized.”
“It’s a must to hope—should you’re hoping for good issues for WPP—that she’s a superb supervisor,” Wieser added. “That’s in all probability the only most essential situation.”
5. Her outsider standing
Rose’s business outsider standing may very well be a problem or profit, relying who you ask.
Ahmed described her as “a protected pair of palms” as “an inside candidate with an exterior vantage level.” Sorrell mentioned she suits WPP board chairman Philip Jansen’s standards as a know-how and AI-forward government.
However Wieser identified that along with this being her first CEO gig, her solely advert business expertise has been by the vantage level of sitting on WPP’s board.
“You actually haven’t really lived and breathed the business,” he mentioned of Rose. “It’s believable that your views on the business may be incomplete.”
Nevertheless, he added, “it will possibly additionally imply contemporary eyes, which isn’t a nasty factor in any respect,” pointing to Michael Roth’s profitable tenure at IPG.
What’s essential is that Rose surrounds herself with executives which have “readability of imaginative and prescient.”
“It’s going to come back right down to good administration,” he mentioned.
