SCLAM - OMNICOM & PUBLICIS GROUPE

Bringing people together

The leader in facilitating cross-cultural business-to-business mergers

Omnicom & Publicis Groupe Merger SCLAM

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OUR TEAM


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GETTING TO KNOW US

SCLAM Enterprises will help your organization achieve a clear vision of

the company’s goals and cultural integrations

Help to define the place of the managers and the integrations of new talent staff

Help to quickly integrate the new system that support and reinforce the new

cultural inspired vision of the company.

Reinforce the value of transparency and improvement.

Clarify the company’s vision.

Eliminate top down hierarchy and introduce collective communications.

Each company has to decide on the outcome that they want to achieve

from this merger


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WHAT WE CAN DO FOR YOUR COMPANY


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We will take your company from a closed system where the exchange of

information and opinion are controlled and monitored, to an open system where

options are presented and there is a free exchange of information.

To go from a system of tight control, and where rigid system and procedures are

in place, to a loose form of communication where flexibility and the ability to

adapt is not foreign but commonplace.

We don’t want to impose our styles of management but to help your company

surface the culture within. When an international organization can seamlessly

integrate into an international global environment, then we have done our job!


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OMNICOM - THE AMERICAN TITAN OF

COMMUNICATION


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THE COMPANY (1)

• One of the world’s leading media services corporations.

• An American global advertising, corporate communications, and marketing

company. Its headquarters are situated in New York City.

• Provides services to more than five thousand clients in more than one hundred

different countries.

• Networks: BBDO, DDB, DDB Worldwide, TBWA Worldwide, Diversified

Agency Services (DAS) and Omnicom Media Group (OMG).


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AIM

• Providing marketing and communications services in advertising, customer

relationship management, digital and interactive marketing, strategic media

planning and buying, public relations, direct and promotional marketing in

addition to other disciplines in communications.

• Additional investments in research, emerging media, digital media, analytics and

data, entertainment and sponsorship.

REWARDS

2006-2013: “Most Creative Media Agency” by The Gunn Report

2008, 2009 and 2011: awarded with Adweek Global Media Agency of the year 2005,

2009 and 2011: Media Agency of the Year by Advertising Age


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PUBLICIS - THE FRENCH GIANT OF

COMMUNICATION


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THE COMPANY (2)

• A French multinational communication company, headquartered in Paris. The

company regroups 1298 agencies in 108 countries and is the 3rd largest

communication worldwide

• In 1988 The company expanded worldwide, by acquiring companies from all

around the world

• Publicis’ brands include digital agencies (DigitasLBI, Razorfish, Rosetta),

healthcare communications (Publicis Healthcare Communications Group),

creative agencies (Saatchi & Saatchi, DPZ) and media strategy (Starcom

MediaVest Group, ZenithOptimedia).


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AIM

• Publicis aims at anticipating every change that is currently occurring in the global

communication with the development of digital platforms and technological

innovations.

• Publicis Groupe intends to cover every part of the communication tools and to

bring creativity, surprising experiences and emotions.

• In addition, Publicis Groupe’s focus is to develop a corporate culture that almost

works as a family and be attentive to its employees’ well being and rights.

REWARDS (3)

2004-2012: The Gunn Report: Publicis Groupe was ranked first in Creative Performance.

2012: The Cannes Lions International Festival of Creativity: Publicis Groupe won 154

Lions

2012: In The Gunn Report, the Top ten of the world’s most awarded agency of the year

(Leo Burnett, Saatchi & Saatchi and Publicis Worldwide)


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WHY COMPANY CULTURE IS IMPORTANT


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Omnicom & Publicis Groupe: embracing cultural diversity will allow mutually beneficial

relations to be created.

Culture as a framework of reference for starting your new business:

- Offering the possibility of increasing efficiency at various levels, finding

behaviors that will allow the best performance possible

- Helping to understand the new organization as an entity, as a collection of

individuals & serve as a framework of reference for future situations

The culture content of your new organization must:

- Survive in the external environment through its missions, strategy, structure &

processes

- Integrate human aspects such as common language and relationships

- Take account of the national culture in which it is operating

The corporate culture and values that we are going to help you create and implement

should be here for the long run. They will:

- Give direction and guidelines for day-to-day behavior

- A lack of concern for those values will undermine leadership and commitment


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How To Find Out About Your Company Culture


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In order to help you understand the importance of assessing company culture during a

merger, we have created a table below that compares both your companies’ cultural

dimensions that have been established by Geert Hofstede (5).

As you can see, there are differences in your results and even though some of them

match, others don’t.

We are going to help you understand why & how to go from your cultures A & B to your

new culture C in the next pages of this handbook.

Parameters Value = 1 Value = 10 Omnicom (Culture A)

Publicis Groupe (Culture B)

Omnicom Publicis Group (Culture C)

Power Distance Low High 4 8 ?

Individualism/Collectivism Individualistic Collectivistic 2 2 ?

Masculinity/Femininity Masculine Feminine 2 8 ?

Uncertainty Avoidance Low High 2 5 ?

Short/Long Term Orientation Short term Long term 2 2 ?


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POWER DISTANCE

- Extent to which the less powerful members of society expect power to be

distributed unequally.

Omnicom (6)

• As an American company, Omnicom is subject to a low power distance.

• The superiors are easily accessible and the managers rely on their employees and

do not hesitate to consult them for their expertise.

• Information about the company is widely shared and spread among the staff and

communication is informal, direct & participative.

• The relationship of the brands with head quarters is very weak. The brands

consequently are very free in their strategies for doing business and have a

decision-making process that is determined by them.


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Publicis Groupe (7)

• Publicis Groupe remains a company influenced by its French roots and values.

Even though the group expended worldwide, the corporation’s headquarter is in

Paris, France and its organizational structure tends to reproduce the typical French

company’s hierarchical structure.

• A corporate culture at the group level but also cultural differences at the brand

level. The group gathers many brands and each entity keeps their autonomy in

their managing style.

• Still a top-down decision process. In order to integrate each brand to the group,

integration programs were developed like the Welcome programs, the Brand

Orientation, the HR processes and Mentoring.

• Common Code of Conduct and Ethics, a brochure listing the principles and the

values of Publicis, and information on the history of the company. Consequently,

the power of decision is quite centralized, and the brands have a close

relationship with the headquarter.


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UNCERTAINTY AVOIDANCE

- Is the dimension that deals with how a society is willing to take risks and trust the

future, or be precautious and avoid hazards.

Omnicom

• Omnicom is very willing to take risks and as a result of its high decentralization

has a low level of uncertainty avoidance. The group is driven by an innovative

energy by constantly seeking new partnerships, and adapting to trends. The

environment of technological change and of the new digital era has offered to

Omnicom a new opportunity to invest, take risks and innovate.

Publicis Groupe

• Since the power of decision is centralized, it shows that the headquarter needs to

control and avoid hazards. Indeed, decisions are taken in order to guarantee the

shareholders’ interest and since the company is in the stock market, there are

more regulations. However, Publicis Groupe’s history and internationalization

show that the company is willing to take risks and to innovate.

• Due to its size and its tendency to acquire foreign companies show an ability to

adapt to uncertainty, which is often difficult to achieve in a typical French

company because France has one of the highest score for Hofsted’s uncertainty

avoidance dimension.


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INDIVIDUALISM V. COLLECTIVISM

- This dimension is the degree of interdependence a society maintains among its

members.

Omnicom

• Omnicom is very individualistic. Its employees are expected to be self-reliant

and encouraged to take initiatives. The hiring and promoting decisions are based

on merit. The company focuses on talent development and leadership is a key

priority for them because they cultivate a culture of excellence that aims to attract

(& retain!) top talent in their agencies. This cultural factor is found in the fact

that they are rewarding senior staff with stock based on their performance. The

business model of Omnicom is built to evolve around its clients. The fundamental

premise of the group is to deliver their services and allocate their resources

based on the specific requirements of their clients.

Self-expression= Individualism.

Publicis Groupe

• Publicis Groupe’s corporate culture reflects the individualistic behavior that is

often observed in the French culture.

• Even if the final result is what matters; it is not important for the client to know

how the project was conducted but rather the final outcome, every employee

works for himself and just ifies his presence by how effective his work is.


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MASCULINITY V. FEMININITY

- A society with high score in that scale is based on masculine trait like competition,

success and being the number one. On the other hand, a feminine society will more focus

on life quality, on people’s well being and caring.

Omnicom

• Omnicom is a masculine environment in the sense that it puts an emphasis on a

very competitive culture that is focalized on success and being the number one

(no matter what). The system of meritocracy and rewards is also a element of

masculinity among the group and conflicts are resolved more on the individual

level. The group runs more like a financial rather than communication

corporation.

Publicis Groupe

• Publicis Groupe has a feminine way of leading its entities because the group

cares for its employees so that there is a good balance between work and private

life.

• For instance, there is a real respect for the employees’ rights; they can enjoy

holiday leaves and maternity leaves.


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SHORT-TERM V. LONG-TERM

- The extent to which a society shows a pragmatic future-oriented perspective rather than

a conventional historical short-term point of view.

Omnicom

• Omnicom is very short-term oriented. It measures its performance on short-term

basis with its profits and losses statements being issued quarterly (8). The culture

of the group that is focused on innovation and desire to be number one pushes its

employees to work hard in order to achieve quick results.

Publicis Groupe

• Publicis Groupe remains short-term oriented because the company’s corporate

culture is based on the story telling of the founder Marcel Bleustein and how the

company was created. The group’s line of conduct is based on the extension of

the founder’s vision of Publicis.

• In addition, quick results are expected to satisfy the shareholders and that is why

quarterly reports are appreciated. Besides, it allows the company to adapt more

easily to any changes, which is still related to the need to avoid any hazards.


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MERGING COMPANY CULTURES (9)

Objective: Creating a Cross-Convergence Cultural Organization - Two Companies’

Cultures Forming a Third New Culture.

• This is what we are looking to avoid:

• The goal for Omnicom & Publicis Groupe is to create Omnicom Publicis

Groupe, a real union where both cultures are integrated to create a unique

culture, and the headquarters location choice in Netherlands shows that none of

the two companies will impose its French or its American culture.

• Despite the cultural differences that exist between the two corporations, Publicis

Groupe & Omnicom share similar core values that will work as a basis to the

new culture that is going to be implemented.


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INTEGRATING INTO ANOTHER COMPANY CULTURE

• Decision makers need to be identified in each company and an organizational

structure needs to be put in place.

• Communication and transparency must be maintained between both companies.

• Individuals must identify weak spots in the merger and bring them to the

attention of their manager. This includes communication and process.

Each company maintains core values and principles that help to form the company

culture. This has been achieved in each company through clearly defined objectives and

missions of the group as a whole. This not only helps on an individual level but as a

collective.

The giganticness of Publicis Groupe and Omnicom creates several challenges across

many departments. This includes reorganize the brands within both organizations by

identifying their individual identity and understanding their place in the organization,

while being part of a bigger collective.

The next step will be to have the managers and employees define the current culture

and find agreed upon ways to improve the culture. Thus creating a new culture that

eliminates a top down style of creation.


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Departments

HUMAN RESOURCES

The Human Resources department has a crucial role in the merger Publicis Groupe &

Omnicom because 85% of the mergers failed due to the underestimation of human

resource integration (10). That is the reason why you will need to play a pivot role between

the employees and the managers. An integrated communication process will be

implemented to facilitate the horizontal and the vertical integration of both companies.

Two Key Words: Pro-Activity & Communication

NEGOTIATING (11)

• As the process of a merger can be long, it is important for the HR to include the

reassure the employees. FEARS: the unknown, lay offs expected.

• Internal communication with employees is crucial. The HR function: giving

updates, transparency, employees=contributors

• Vertical communication with the top-level management: emphasizing the

importance of human resources, talents and skills


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CREATING UNIFORM POLICIES

• Publicis Group has unified policies concerning vacation plans, salary bases,

benefits, maternity leaves and communication system.

• In Omnicom, brands are completely independent and there are many different

employees’ policies. Since both companies are already international, they had to

comply with the country’s policies therefore it might help the transition.

• Human Resources’ role: communicating with the other party. Need for an

horizontal and vertical communication. It will be easier to follow Publicis

Groupe’s policies because if employees get less rights than they had before the

merger, there will be strong resistance.

BLENDING CULTURES

• Omnicom and Publicis’ corporate cul tures are really different in the way power

is distributed. Omnicom is much more decentralized than Publicis Groupe and

thus brands at Omnicom might not accept to depend more on the headquarter.

• Solutions: Teambuilding, Communication with the employees, transferring some

employees to the other company, in order to smooth the process. Result: less

resistance to changes.

• Since, culture can be developed at the brand level it can be achieved more

smoothly. You need to help the top leaders to reorganize the groups in way that

brands with similar cultures can be integrated.


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DOWNSIZINGS

• To avoid overlaps, mergers may include layoffs, and you have to be really careful

in how you will handle this situation. Solutions: Assessments and evaluations of

employees are important, balance talents and the ability to adapt. Too much

resistance from an employee, will have a negative impact on the rest of the team

and it will be bad for the company and for the employees.

• Tensions can be avoided by giving responsibilities to employees that are natural

leaders or role models that employees tend to follow. Being part of the process

will motivate the leaders to persuade positively the rest of the team. This

employee-employee relationship is necessary to build trust.

TRAININGS

• Trainings=communion between teams of the two companies. Instinctively,

people will stay with their peers; therefore, it is important to decide beforehand

the teams that are going to be created.

• Those trainings will include exercises so that each team gets aware of its own

culture so that its members can be more tolerant and adapt more easily to the

other culture they will work with.

• Trainings will be a test to see what the best fits and the best combination are and

assess the time that will be required to create a new culture.


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ADVERTIZING

Since advertising is the essence of the two companies, you need to be aware and

understand the difference of what it means to each company to advertise. The French and

the American have different ways of interpreting that definition due to cultural

differences (12):

• American advertisements: designed to inform and persuade consumers to buy a

product or a service by giving them reasons why they should. PRODUCT’S

EFFICIENCY, USEFULNESS AND FUNCTION.

• Use of Hard-sell tactics, pushing the product to consumers without

circumlocutions; overt, direct and clear message. E.g. instructing viewers on a TV

advertisement to call a certain number right away to buy a product before the

promotion ends. Stressing the merits of a specific brand, and thereby

discriminating other brands.

• French will be reluctant to do so. And that is because French have an “unhealthy

relationship to money”(13); they always have this impression that advertising is a

kind of manipulation, and thereby somehow corrupting. French

advertisements=seducing the consumers. French advertisers call on emotions

and feelings instead of reason.

• 4 characteristics: seduction, show, love and humor. So, the definition of a good

French advertisement is one that attracts, tempts, fascinates and charms

consumers; one that expresses romantic notions and is amusing.


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LET US SHOW THIS CONCRETELY TO YOU (14):

• This advertisement for Levi’s loose jeans is a typical French

advertisement; for it tells a romantic story by meanwhile

incorporating concepts of seduction and humor.

• Consumers are able to see in a nice way that the Levi’s jean is loose

and fitting.


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AN AMERICAN ADVERTISEMENT FOR AN AMERICAN EAGLE JEANS:

• This American advertisement explicitly says and shows the main feature of the

jeans it is promoting: the pair of jeans is extremely skinny. This ad focuses on the

product’s function and usefulness. It is also a good example to show how

American ads use hard-sell tactics. It puts pressure on consumers to buy the

product by saying that it’s only for a limited period of time and then consumers

won’t be able to buy it.


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MORE DIFFERENCES

• The advertising industry in France has developed strong professional ethics and

established a very comprehensive set of rules and laws.

• French regulations forbid advertising in certain product categories such as tobacco

products, abortion services, contraceptive methods, etc. This shows that the

French advertising industry has a sense of responsibility and is really concerned

about the public interest, and this is mainly why the French advertising industry is

more regulated than anywhere else.

GUIDELINES TO HELP YOU ORGANIZE YOUR DEPARTMENT (15)

Realize and recognize that the cultural differences are real and important

Respect the point of view of the other

Try to understand the way of thinking of the other

Consider all relevant cultural elements, even subtle ones.

Be willing to make some changes in the techniques as well as tones employed

Work together in order to find a common ground

Differences in the way each country prefers its advertising are critical to international

advertising firms and to multinational corporations.


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ACCOUNTS SERVICES


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• Data gathered by Deloitte in the situation of a merger in the banking industry.

Similarities: ATTACHMENT TO THEIR CLIENTS (16).

• Transparency and communication with your clients is crucial. During this merger

between two financial institutions, Deloitte wrote in its study that “Approximately

75% of customers of these merging banks state that they received information

about the mergers from a third party, rather than their bank.”(17)

• Keeping the work flowing into the agency by establishing good relationships

with the clients and make sure that the work is being done.

• Omnicom’s policy: offering a wide range of quality and personalized choices for

their clients to choose from in order to satisfy them the best possible way.

Publicis Groupe offers the best possible choice to their clients right away by

going ahead of the clients’ needs.


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• Big challenge: the employees will have to make sure that all those elements are

safe and secure as well as keep good relations with the clients and reassure them

through the entire process.

Solution: to adapt as fast and efficiently as possible through this major cultural

change and we are here to help & guide you through the process.

• Being proactive & maintain a good working relationship and environment

because with no clients, there is no agency.

• As the account director you are a very strategic and disciplined thinker that

provides excellent creative briefs when necessary & assists the successful

direction & execution of each campaign.

• Retaining & attracting new clients: maintaining multiple agencies to manage

multiple client relationships and avoid cases of potential conflicts of interests.

• Patience & trust: TAKING TIME.

Possible issues: Client conflict that you will have to face with Pepsi & Coca Cola.

E.g. WPP, they serve clients who operate in the same market segment but they

have adapted to turn this into strength for their business (16). For this kind of

conflict therefore, the importance is be sure to keep the same agency to serve

them.


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GUIDELINES TO HELP YOU ORGANIZE YOUR DEPARTMENT (18)

1. Create an agenda

• Establish detailed steps & timetables to achieve the needed results

• Allocate the resources necessary to make it happen.

2. Develop a human network for achieving the agenda

• Establish an adapted structure for accomplishing planning requirements by

staffing this structure with the individuals that will be the more fit to maintain

your client base (& attract new clients!).

• Delegate responsibility & authority to carry out the plan by providing policies &

procedures to help guide people & create methods or systems to monitor the

implementation.

• Remember that you will be working with people that come from a different

cultural background than you. To implement this plan, referring back to our table

on cultural differences among Omnicom & Publicis is useful.

• Communication and transparency: vital among your staff. Goal: AVOIDING

RUMORS. The messages should also be spread among the staff in a clear &

unified voice.

• Tackling cultural differences: Trainings to answer any question from the clients

and from your employees. You should share issues when they surface in order to

be able react fast.


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3. Execution

• Controlling and problem-solving: monitoring your results in order to identify

where the main problems will come from (for e.g. client conflicts between Pepsi

& Coca Cola) and then plan & organize accordingly to solve these problems.

• Thinking like your customers. Communication is key and a successful merger

communications strategy maintains an open two-way dialog with clients by

seeking their input and listening to it.

• Competitors will be more than ready to seize the opportunity of stealing your

“weakest” clients. Those clients are the ones that you should focus on. You will

have to communicate effectively with them and go beyond just reassuring them.

During this phase you will have to leave behind you masculine to leave place to

the feminine aspect of management. You have to customize this communication

strategy to each unique, specific client.

4. Outcomes

• They will have to produce a degree of predictability & order and have the

potential of consistently producing key results that are expected by your clients.


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MARKETING

Be involved in the conversations of your audience. Cultural marketing helps you to

develop strong relationships.

. Terpstra & Sarathy (2000) stated that the success of a company would be in being able

to align their marketing strategies.

In order to adapt your strategy, marketers will need to focus on elements of the culture

that they are marketing to. These include language and values.


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Language(19)

• Breakdown the barrier of language. It is critical to have an understanding of the

language at a national level as well at the organizational level. It is important to

understand tenses and meanings of words. What is an acceptable word in your

language may not mean the same thing.

• An Otis Engineering Corp. display at a Moscow exhibition produced as many

snickers among the Russians as it did praise. "completion equipment" as

"equipment for orgasms."

• Japan's Olfa Corp. sold knives in the United States with the warning "Caution:

Blade extremely sharp. Keep out of children."

• Frank Perdue Co. slogan, "It takes a tough man to make a tender chicken," read in

local language something akin to "It takes a sexually excited man to make a

chicken affectionate."

• General Motors Corp.'s promotion in Belgium for its car that had a "body by

Fisher" turned out to be, in the Flemish translation, "corpse by Fisher."


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Values

• Market segment will have different values in each country. Each market segment

in American and France must be recognized to achieve successful integration, and

understanding. American values are present oriented which means that they

prefer instant gratification, and prefer benefits at the short term. France is more

future oriented. This means that the degree to which the collective encourages

and rewards future-oriented behavior. It is imperative to understand the values of

each market and how to connect with them.

• As technology has become a necessary means of through which to communicate,

how each culture uses technology must be investigated and applied.

• The voices, choices, and expression of self must be investigated and understood at

a deeper level in order to understand your market. As each segment market will

have varying degrees of each, understand the way in which the market utilizes

these, and attune to the market. For example a country that has high power

distance will not have the level of expression that a low power distance country

has.


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• A market that is more comfortable with choices should have many of the

company’s products available to them, whereas market segments with low degree

of being comfortable with choice should have fewer products available. In the

area of expression of self, the markets that have a high degree of self-expression

must be responded to in a quick matter to settle any disqualifying news regarding

your organization.

• As we use marketing across international borders, it is important to engage your

target audience in their language. Their own social networks, and adapt to

platforms that your audience is used to. The merger of Omnicom and Publicis will

give you the upper hand on the digital market. It is important to navigate your

markets carefully though these mediums.


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Thank You For Your Trust!

SCLAM - OMNICOM & PUBLICIS GROUPE

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