After 10 years with M&C Saatchi, China CEO Angela Hsu has parted ways with the company. The decision comes with the news that M&C Saatchi will join a joint venture with Chinese agency aeiou.
Originally established in China as a joint venture, M&C Saatchi completed the transition to 100% ownership in 2007. The 100% ownership marked a shift in the agency strategy and culture, with M&C Saatchi now able to more freely extend its unique brand identity and corporate culture into the China market.
Starting off firstly as director of client services, Angela climbed the ranks eventually becoming China CEO in 2011. During her tenure with M&C Saatchi she transformed the agency from traditional to digital driven, opening a second office in Beijing and attracting some of the best local and international talent. The client profile grew from local SMEs to large state owned enterprises and amongst the international clients were famous brands such as Lenovo Mobile, Gold Coast Tourism and VW Group.
Whilst the staff were fiercely loyal to the M&C Saatchi brand, the news of a joint venture has prompted almost the entire M&C Saatchi team to leave the company.
How would you describe the culture of M&C Saatchi China?
A joy of walking into the office in the morning, passion for great work, and having fun to work with colleagues.
Why was the decision made to go back to joining a joint venture?
It was a purely financial decision.
While the Beijing office was being established, revenue kept stable but expansion costs increased. The decision to return to a JV has been taken to avoid investing in early stage expansion costs.
My view on JVs, since 2011, has remained unchanged. I saw it as necessary to build around our core capability (strategy) and grow with leading edge technology (tactics). I believe that once you have a strategy, employing it as a matter of willpower.
Having said that, while a CEO faces a list of priorities, he or she may also need to in blend of all aspects’ benefits. In Garry Kasparov’s words – It’s sport, art, AND science.
What benefits are hoped to be gained in joining a joint venture?
I believe short-term financial benefits are seen as the top priority. However, in my view a CEO should try to find the best blend of both companies’ visions, sustainable positioning and clients’ and employees’ benefits.
In your opinion is the JV a good move for a boutique creative agency like M&C Saatchi in the China market?
All change comes at a cost. Bigger isn’t always better, especially if it comes at the cost of motivation or client service.
To go for JV is a tough decision. How to find the perfect balance of synergy, vision and culture is crucial.
Why did you make the decision to part company with M&C Saatchi?
One cannot always determine the battlefield… I had a clear view for building the M&C Saatchi brand in China market over next 5 years. Having said that, as a CEO of the China operation, I respect my network’s decision as well as being certain and confident of my own viewpoint. I have to admit it was a very tough decision to make.
Do you think that international agencies view China as a place of numbers, where double digit growth should be expected?
It is easier to expect its double digit growth while you are sitting in the west, than to project the business for an emerging market like China. As a CEO in China, managing expectations of your HQ is as important as managing your business growth and competitiveness in the market. An international firm requires a broad strategic view to understand the time element and value growth of its investments.
What is the importance of organic growth in building an agency brand in China?
There are always many ways to build business in China market. Since 2008, China, has not only been a rapid growth emerging market, its people have enjoyed great confidence about their future in terms of national pride, economy power, as well as growing an understanding of quality and true brand value. The result is that it is very competitive to build business in China – To build a business and sustain it in China, it is important to any international agency CEO to have a big picture and long term plan concerning the value and cost of organic growth.
How would you describe the team at M&C Saatchi?
Believing in Simplicity, Nothing is impossible (Can do Culture), Seeking for consensus in the team to reach the same goal (we had round table meetings), and always having fun at work.
Why have most of the team decided to leave upon announcement of the JV?
Since we have became a 100% owned entity in 2007, my team and I have been working very hard to deliver agreed business objectives. The objectives were achieved. However, the strategy for china changed in 2013 – it has been very difficult for my team. I have been affected as well as my people and my clients. However, to join the new setup or not is purely an individual decision – I ‘guess’ it is because of the new culture and whether they have found a good fit in the new organization.
How supportive have your team been over your 10 years with M&C Saatchi?
It’s a small team of 50ppl. Most of us played 1-3 roles at the same time which was the challenging as well as fun parts we had together.
Believing in simplicity – no politics we need to worry about, but only seeking in consensus in the team and aiming for great work for existing clients and winning business.
And simply to create a joyful working environment – a pure fun of being in the creative industry.
What was the performance of the agency like before the announcement of the JV?
If we were talking about Q1 in 2013 – it was a great momentum. Good business pipelines, great pitch invites, and a big win we were longing for was announced.
Back to 2012 – we did make a big investment in people and money to set up Beijing office from the Shanghai office – it was a big stretch in terms of people, time and money.
While we believed it was a game-changing move for our position in China, it required strategy, planning and determination to make it happen and it needed HQ support over the investment period. And it is never easy.
The expansion of the company in China with the opening of the Beijing office was surely because of positive performance?
Maybe I could refer to the interview that the chinaSMACK did for us last time.
“Finally, what has been the proudest moment in your career to date?
Building the Beijing office from nothing. I told my Shanghai team in January 2010, we need to have an office in Beijing. We all had a consensus of making our goal to establish a Beijing office. Come October 2010 we won one client, so we could build a proper team. By April 2011, we had won another client, which meant we could build a proper office space. I am very proud of my team and how we worked together.”
We wanted to have a Beijing office to extend our influence in the China market; and we won sufficient business to launch the office. Since then, my team and I wanted to make it a great office. From market access’ POV, we had a well blend of international and local business – having local knowledge and expertise to help international clients as well as international level of performance to assist local clients. It was 50% local vs 50% international clients and our team are well blend of local and international talents.
The average agency client relationship in China is around 6 months, how would you describe the relationship between M&C Saatchi and its clients?
It is a phenomenon in emerging markets – business mostly moves on quickly resulting in short term business relationships. Having said that, we have had a very long term business relationship for 6- 7 years with certain clients. And most new business wins were referred by our clients. My team and I were very proud of it. And we have cherished and guarded it with our name.
Do you think that the unique agency culture will now be lost in China?
The industry is very big, and there are different ways to run the business. My judgment may be proven wrong. Although most of the team is leaving, which must mean a loss of the existing culture, naturally I hope that the new set up will succeed and that a unique culture will emerge.
How important is culture within an agency?
It’s what the agency lives in and breathes for.
What are your feelings towards M&C Saatchi?
It remains unchanged as my loved brand. I have worked for it, built it, been proud of it. Personally I admire Lord Maurice Saatchi and respect Mr. Moray MacLennan enormously. Professionally, I have a disagreement on the change of China strategy. Therefore, I have to move on.
Having said that, I am a big believer in the China market and I feel positive, energetic, and excited about the future opportunities.
Is there anything you would like to say to the team you have worked with over the last 10 years?
My dear every of you in M&C Saatchi China.
In the past weeks, I have received messages and calls from some of you… Thank you so much. I know how much time, efforts and energy that you have put to this work with me in the past years. I would like to offer my appreciation, albeit at a distance.
I believe that most of you have heard about our company has a different Plan to China. Sometime we feel uncertainty for the future, at work, in life. Here I want to talk about some other things – the value of working. We can easily see its tangible value, such as social status and monetary rewards – those represent sense of security and the importance of our existence. But I think, most importantly – it’s about how much we feel we are in control and confident about for our future. That is what we have accumulated through every night and day’s hard-work. And all of you have it with you! You must know that and believe in yourselves.
With all the best wishes from Angela
Thanks for speaking, Angela.