In a move that underscores the immense cultural changes under way inside the city’s most storied advertising agency, Leo Burnett Worldwide went outside of its organization for the first time in its 69-year history to find its next chief executive.
Tom Bernardin, 50, the head of troubled Lowe New York, was named president of Leo Burnett Worldwide and CEO of Leo Burnett USA, and he will succeed Worldwide CEO Linda Wolf when she retires in 12 to 18 months, the agency announced Tuesday.
The move is unusual for the $10 billion shop with a reputation built on its work with key blue-chip clients like Kellogg Co., Altria Group Inc., Nintendo Co. and Procter & Gamble Co., among others.
Known for its usually smooth, lock-step internal management changes, the move marks a departure from the historical practice of bringing someone up from the ranks of the company, which founder Leo Burnett started in the middle of the Great Depression.
Bernardin’s hiring follows a tumultuous year in which two key executives left the agency late last summer after fallouts with key management, including Wolf.
The departures of Robert Brennan, president of Leo Burnett Worldwide, and Stephen Gatfield, Burnett’s top international executive, within weeks of each other were the result of a power struggle following Burnett’s buyout by Publicis Groupe more than a year ago.
Since then, Wolf has been trying to calm nervous clients and re-energize the company’s new-business unit in an effort to jump-start interest in the agency among potential new clients.
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Whether this move will help is unclear. Burnett’s tight-knit culture has long been its asset–and Achilles’ heel. It has not always been a welcoming place for outsiders.
Insiders said Publicis CEO Maurice Levy, who led the search, had been looking for a replacement for Brennan for months. As part of the process, through New York executive search firm Marcus St. Jean, Levy wanted someone who could step up to replace Wolf when she decided to retire, sources said.
On Tuesday, Wolf said that the agency searched inside and outside to find her replacement. But following the departures last year of the two executives who once were thought of as successor candidates, it was clear the agency was going to go outside.
“Overall, we wanted to have the right person in the right place for the long term, and we needed someone with the breadth of experience to do that,” Wolf said in an interview Tuesday.
Bernardin, relatively unknown outside of New York, is a native Midwesterner who went to college in Michigan. He leaves Lowe New York at a time when the agency has had a series of setbacks. He was tightest with its huge-billing client Verizon Wireless, but in a major blow to the agency, Verizon announced in mid-January that it was putting its $300 million business in review.
Before that, Bernardin oversaw Bozell prior to its closing and eventual merging into Lowe. Lowe is owned by Interpublic Group of Cos., as was Bozell.
Insiders said that Levy also talked to James Heekin, the former CEO of McCann World Group, but Heekin opted to take the global Euro RSCG job in New York late last month.
Wolf, 56, said that the agency had been talking to Bernardin since October. On Tuesday, Wolf said there was no concern about the problems at Lowe in deciding to hire Bernardin.
“In this business we’ve all gone through ebbs and flows,” she said. “We were looking for the right person who, over the long term, has been successful.”
Wolf, who was named global CEO in 2000, will leave as one of the few female advertising CEOs in the country. She has been with the agency for 25 years and has worked with several of the agency’s clients, including P&G and, most recently, the U.S. Army.
But during the past year, the agency has been stung by a series of client cutbacks, including the loss of the Delta Air Lines and Polaroid businesses.
Wolf says she has no regrets.
“Given all the change this agency has gone through, I actually think we’ve done very well,” she said.
In other moves at the agency, Nick Brien, a rising star in the Burnett and Starcom MediaVest Group organizations, becomes global CEO of Publicis’ new marketing services unit Arc.
Paul Eichelman, European finance director for Burnett, was named worldwide chief financial officer, and Richard Pinder, former regional managing director for Leo Burnett Asia Pacific, becomes president of Burnett’s European region.
Michelle Kristula-Green takes over as head of Burnett’s Asia Pacific region.