Sir Martin Sorrell has made his move and Rodney Fitch is to return to Fitch as chairman of the group he founded some 40 years ago. But is it a fairytale ending to a drawn out saga? And what are the challenges and opportunities the group and Fitch himself will face over the coming year?
From the outside it looks like a move that couldn’t be better timed. Fitch Worldwide has been through the mill, partly, like its peers, because of the global economic downturn, but also because of internal wranglings. The group is still a relatively loose conglomerate of creative interests brought together through a fast-track acquisition spree.
Consolidation of these interests has been held back by four changes in ownership in three years (see Fitch Facts, right). After so much disruption, a clear line from the top is precisely what is needed to give the group a rallying point and a renewed momentum.
Fitch says he feels ‘very, very good’ coming back to the organisation he left in 1994, though he is ‘circumspect’ about what he will find. ‘I don’t know enough yet,’ he admits. ‘However, though his own deal has yet to be finalised, he is quick to diagnose the problem.
‘Fitch Worldwide has had no shortage of management, but a dearth of leadership,’ Fitch asserts.
The offices in Seattle and San Francisco are ‘supposed to be strong’, but other areas demand attention and the whole needs bringing together, he adds.
‘As a bystander, I feel there is no sense of focus in the business,’ he says. ‘[The constituent parts] have been rammed together with cultures that aren’t like-minded.’
Fitch London is a case in point. The merger of London sister companies Fitch, Bamber Forsyth and PSD under one banner led to strife at the start of the year, with the subsequent departure of most of the senior management team put in place by Cordiant Communication Group to run the company.
Now the team in London is led by former managing creative director Tim Greenhalgh and former client services director Lucy Unger, who Fitch says, in common with their global counterparts, ‘have done terrific jobs in extraordinary circumstances,’ and will remain in their roles.
Jane Simmonds, now a director at Conran Design Group, was the first of four managing partners to quit the group. She says Fitch’s return is a ‘smart move’. It offers the chance to ‘bring clarity to the market, re-anchor the Fitch brand and return the [group] to a cornerstone position [in the industry]’.
Fitch’s personal traits will be welcome too, she says. ‘He will bring colour and dimension to an industry increasingly characterised by corporate greyness.’
But Fitch London is only a part of the empire. Paul Stead, erstwhile chief executive of Fitch Worldwide, and to whom the Fitch management board reported, also left in May this year.
Stead’s replacement, Kevin Roche, was predictably gung-ho about the group’s prospects last week, though he has since left.
‘It is an enormously powerful organisation, run by around 25 [influential] people,’ he said. ‘Despite being bought and sold four times in three years in an unforgiving [economic] climate the organisation still stands, with 18 offices around the world employing some 500 people.’
Bringing ‘leadership and strong values’ to the group as whole is important, says Lippincott Mercer senior partner Rune Gustafson, who was director at Fitch before his departure in 1992.
‘The Fitch brand has the potential of being one of the best-known design brands in the world. But over the past few years it has had too many managers and not enough leaders. Working with the likes of Greenhalgh, Fitch can bring back a strong sense of leadership and a focus on what made the group famous.’
Fitch himself agrees strengthening the brand and corporate culture will be a priority. Though he will be based in the UK capital, his vision extends way beyond.
‘I can contribute a revitalised strategy,’ he says, ‘and re-establish what it was in the old Fitch business that made it unique. The design business is based on history, culture and content and I will try to re-establish that [in Fitch Worldwide].’
He is keen to re-introduce ‘sociability’ and enjoyment back into the business, ‘though I am going to avoid doing what we used to do because we used to do it’.
Given his experience in south east Asia he also wants to ‘improve Fitch’s clout’ in the region – a real asset to Sorrell, given his predictions of an upturn on the back of the Asian economy in 2004.
Sorrell has also acknowledged that some 85 per cent of purchasing decisions are made at point of purchase, regardless of above- the-line activity. Fitch’s extensive retail experience will help reinforce this focus.
‘The great purpose of life is shopping, everything else is mere detail,’ Fitch claims. ‘I want Fitch Worldwide to believe that all things lead to this great truth.’
You can guarantee though that when he becomes chairman, he won’t be thinking so much of buying new businesses as of consolidating the purchases others have made before him.
1963 Rodney Fitch joins Conran Design Group
1968 Rodney Fitch becomes managing director of CDG
1972 Rodney Fitch and three other directors buy CDG from Burtons
1973 CDG changes name to Fitch & Company
1982 Fitch & Company becomes first design group to be quoted on the Unlisted Securities Market
1984 Fitch gains full listing on London Stock Exchange
1988 Fitch acquires US product and graphics group RichardsonSmith and changes its name to Fitch RS
1992 Fitch RS changes name of holding company to Fitch in June
Shares suspended at 41p on 28 July
Rescue deal announced on 25 September proposing cash injection by Sir Terence Conran and Vrand Trust, sale of Fitch Benoy to its management and disposal of Soho Square lease
1994 Rodney Fitch quits Fitch, setting up Rodney Fitch & Company with Richard Branson’s backing
1996 Rodney Fitch & Company takes a majority stake in brand design group Wickens Tutt Southgate; Rodney Fitch joins WTS’s board
1997 Rodney Fitch & Company opens Bangkok and Hong Kong branches
1999 The Virgin Group sells its 50 per cent share in Rodney Fitch & Company
Rodney Fitch finances purchase of Virgin stake by selling his controlling share in WTS to founders Mark Wickens and Paul Southgate
Fitch delists from London Stock Exchange following acquisition by US group Lighthouse Global Network
Rodney Fitch & Co begins moving into e-commerce and European market
2000 Fitch owner Lighthouse Global Network acquired by Cordiant Communications Group
2002 Rodney Fitch & Company goes into receivership
Rodney Fitch joins Portland Design as a director
2003 CCG stablemates Fitch London, BamberForsyth Fitch and PSD Fitch combine under single Fitch banner
Cordiant Communications Group acquired by Sir Martin Sorrell’s WPP Group
Rodney Fitch returns to Fitch Worldwide as chairman