“The Creative Leader”
My guest in this episode is one of the most famous leaders the creative industries have ever known.
He’s also one of the most controversial and most polarizing.
Sir Martin Sorrell has been called many things in the 34 years since he founded WPP.
Some people have described him to me as the most supportive and insightful leader they’ve ever worked for.
Others have been much less charitable. Much less.
I wanted to try to gain some insight into the complexities of a leader who drives so much opinion. To better understand how he sees himself.
What I learned surprised me.
Three Takeaways
Edit the noise down to what really matters.
Act with intention. Be in a hurry.
Develop an interest in what other people have say.
"FEARLESS CREATIVE LEADERSHIP" PODCAST - TRANSCRIPT
Episode 101: "The Creative Leader" - Sir Martin Sorrell
I’m Charles Day. And this is ‘Fearless Creative Leadership’.
My guest today is one of the most famous leaders the creative industries have ever known. Sir Martin Sorrell.
He’s also one of the most controversial and most polarizing.
Sir Martin Sorrell has been called many things in the 34 years since he founded WPP.
Some people have described him to me as the most supportive and insightful leader they’ve ever worked for.
Others have been much less charitable. Much less.
If you look at his career through the numbers, the results are extraordinary. He took a company originally created to manufacture shopping baskets and turned it into the biggest marketing communications conglomerate in history.
At its peak, WPP employed more than 200,000 people, placed media buys of seventy five billion dollars a year and owned global networks that were voted the most creative in the world by their peers. The Cannes Lions Festival of Creativity named WPP the holding company of the year seven years in a row.
But for all the numbers, his personal leadership approach has been the source of frustration and worse for some. He’s been accused of being a bean counter and a micro-manager. Of being combative, insensitive and uncaring. Of putting money before anything.
I had met Sir Martin only twice briefly before we sat down for this conversation.
His reputation is that if you send him an email you’ll get an answer within a couple of hours. A lot of leaders could learn from that, but that’s a conversation for another time.
A couple of months after he left WPP last year, we engaged in a rapid-fire email exchange that resulted in him asking for my observations about his leadership approach.
I sent him a page and a half on how his leadership had benefitted some of the people that worked for him but diminished and in some cases damaged others.
I told him that I thought there were changes he could make in his leadership priorities and gave him some specific suggestions.
He thanked me and offered a self observation that suggested to me he was already thinking along similar lines.
When we sat down for this conversation I wanted to try to understand the person better. To gain some insight into the complexities of a leader that drives so much opinion and so much polarization. To better know how he sees himself.
This episode is called, ‘The Creative Leader’
Charles: “And do you see yourself as creative?”
Sir Martin: “No”.
Charles: “You don't? Really?”
Sir Martin: “Well other people, other people. Far be it from me to say whether I am or not. That's for other people to say.”
The instinctive ‘no’ in his answer is interesting.
Many people I know would violently agree with him that he is not creative.
I don’t.
I think he is.
Creative leadership is about bringing new ideas to life.
About unlocking new possibilities.
And by any measurement he has done that.
Has he led in all the ways that I would have chosen? With enough awareness or concern or care for the people whose lives he impacted? I don’t think he has.
But that does not change the fact that he is a creative leader. An idea that will be hard to swallow for the people who define creativity through a narrower lens.
Creativity is the force behind the world’s most moving expressions of life and love.
But it is also the force behind the world’s most compelling businesses.
And creative leaders, those people who apply original thinking to solve business problems are the most valuable assets in today’s world of commerce.
Being a creative leader, gives you awesome, world changing power.
But until we recognize the full extent of our own creativity, we run the risk of under-using or worse, mis-using our power as leaders to affect people’s lives.
How do I want to affect people’s lives?
As creative leaders, it’s a question we should ask ourselves every day.
Sir Martin Sorrell is 74. My sense is he’s thinking about his answer to that question more than at any time in his life.
Whether you like him or loathe him is up to you.
But, regardless of how you feel, there is a lot to learn from his leadership journey. And his growing understanding of his own creativity.
Here’s Sir Martin Sorrell.
Charles:
Sir Martin, welcome to Fearless. Thank you so much for joining me today.
Sir Martin:
Delighted. I'm eating strawberries at the same time. It doesn't put your listeners. If there are anybody out there, hope it doesn't put them off.
Charles:
When are you first conscious of creativity showing up in your life?
Sir Martin:
Oh, very good question. The very first time. I would say at school. Yeah. I think that was when even you go back to nursery and primary schools, I mean the sort of things that you used to do when you were an infant. Whether it be painting or poetry or whatever, whatever it happened to be when you're in school. So I think when you ask me that, in terms of creativity, it's certainly.. My parents were not heavily schooled. My father was, it depends on how you define creativity. I mean you've defined it quite broadly? My father was very creative given where he started from and what he did with his life. My mother less so, because she was, unfortunately because I think she could have done extremely well too, she was a conventional housewife, a house frau, but you know, she did a lot in the charity sector later in her life. And I think she could have, if she had done it earlier and made a career of it she could have given back an incredible amount.
But if you define creativity broadly, I guess it comes even earlier than nursery school or primary school. It comes from your parents. But it's creativity in a much broader sense. I mean, I get irritated in our industry because people define creativity, in my view, very narrowly.
So I think when you say creativity, you naturally think about the arts and culture and everything else. But you know, when you think about it in a much broader sense, creative decisions, instances, changes come in all varieties. So in a sense, my father was extremely creative and just as my mother was.
Charles:
And he got into business very young, right?
Sir Martin:
My father?
Charles:
Yeah.
Sir Martin:
Yeah. When he was 13 and became what I call a barrack-room lawyer in East London. I mean he wasn't a practicing lawyer. He grew a mustache to look older and was in, I don't know what he did. But I think for businessmen who got themselves into trouble, he tried to negotiate an agreement with them in court, but it wasn't a practicing solicitor at all. And then, he went into radio and television. He was a salesman, originally inside a radio television store with a Russian Jew called Mack Stone who, you know, had Goldwynisms. He, I can't remember what he used to say, but his English, he used to speak in broken English and so everything used to come out, all his phrases used to come out in sort of pigeon English or pigeon Russian-English or pigeon Yiddish-English. And it was very humorous, actually.
Charles:
How did you express your own creativity growing up?
Sir Martin:
How did I?
Charles:
Yeah.
Sir Martin:
Well, I expressed my creativity, if I have any, was expressed in a very different way. I mean a very broad way. I mean you could say we were creative in terms of post university when we started. When I started at Saatchi's with the brothers or when we started WPP in 1985 or where we started S... I think that's practice. Or when we started S4 capital a year ago, you know that to my mind was a highly creative. You start a business, not Saatchi's wasn't started from nothing, but the Saatchi brothers had been running it for a few years, but we created the largest advertising and marketing services company in the world. As we did again with WPP. And I'll see what we do with S4 Capital. So if that's creativity, I mean creativity in the sense of, I'm very proud of it, in the context of WPP, we had when I left was about 130,000 people who reducing the head count now. And indirectly, if you included associates, it was 200,000 people. So it means that about half a million people, 600,000 people, derive their living and depend for their living on the company. Now, in the case of S4 we're up to about 1500 people now after a year in 20 countries.
So probably got about, let's say 5,000 people who in one way or another depend on S4 Capital for their livelihood. And I'm proud of the fact that we started with nothing and we now have a business with that range. So if that's creativity, is that how you define it or people out there in the ether define it? That's the creativity around it. So creating companies, developing companies, building companies. I mean it's true that when you start with zero, acquisitions play an important role, obviously with this, if you can do it in your lifetime, doing it organically is very difficult. But all of those businesses exhibited very high organic growth rates. In the case of S4 capital, I mean we're talking about first six months of this year, 40% plus up and accelerating as we go into the second half of the year, from a small base. So I think that is the definition of creativity now.
Charles:
And do you see yourself as creative?
Sir Martin:
No.
Charles:
You don't? Really?
Sir Martin:
Well other people, other people. Far be it from me to say whether I am or not. That's for other people to say. David Ogilvy didn't think I was. He used to-
Charles:
Although he changed his-
Sir Martin:
... call me an OLS, which the financial times rephrased to odious little jerk. OLJ and we made fun of it in our annual report. Although he did write me that letter. He wrote me a wonderful letter after we met saying, I think it was, was it the biggest mistake of his life or the first mistake of his life? Whatever big mistake, was to judge somebody before you met them, which is what he did. But I was quite subtle about it. I read all his books and I could, he really liked me because I could repeat back to him a lot of his phrases. But he was a very good guy. Became chairman of the company and his wife Herta is a wonderful woman. Still lives in David's pink chateau in the-
Charles:
Touffou.
Sir Martin:
.. Chateau Touffou in the belly of France. In Poitiers, near Poitiers.
Charles:
Yeah, I was working at Ogilvy when you bought it. And remember vividly all of the drama and the dynamics from that stuff. How did you react when he called you that? I mean, on a personal level?
Sir Martin:
Well, I thought, it was what we thought was par for the course because David was always sort of scathing and the letters he used to write, type from Touffou stationary, one of which he said to me, I've got it in my study at home, it was what we expected. But it was planned. Because in the letter I sent Ken Roman, the bear hug letter as it was called, which was the letter we fax. It was phrased ‘the fax attack’ in those days. In 1989, on a Friday afternoon, when Ogilvy was moving its headquarters, we chose the timing deliberately. It was late Friday afternoon, London time. I had had lunch with Arnold Weinstock, I remember very well, Lord Weinstock.
I went back to the office, on Farm Street and we press the button on the fax to send the fax attack letter, the bear hug letter to Ken Roman. And we didn't know that he and his management team were in Upstate New York, I think it was, doing some sort of strategy conference or something or exec committee conference, which couldn't receive anything. I mean, it was telephonically dead. This was in '89, you couldn't reach it. And I think they had a fax machine, but it was very difficult. So, not only were they moving into Hell's Kitchen, the new building that they had moved into and they were going to occupy, well they had leased 12 floors and I think they occupied six. They overestimated. And it was difficult to be fair to estimate what your property needs would be. But they overestimated them saying they occupied half of the building.
And I always remember it was like walking around basketball courts in there. You could play basketball, literally, in the corridors of Hell's Kitchen. Worldwide Plaza was the building. Anyway, we sent off the letter. Now in the letter, the back end of the letter to Ken Roman, n the last paragraph, I said that I would like David to become chairman of the joint company with Ogilvy. And Ken Roman sent that letter to David, but removed that last paragraph. So David never was aware. We knew there was a tension between Ken and David of a significant sort. And there was a friction, a rupture there. We knew that David didn't like Ken, particularly. I think both professed or certainly Ken professed a love for David. But there was a tension, there was a friction. And he removed that last paragraph from the letter.
So, when I met David, which I did after he had called me an OLS, I met with him, I think it was at the Carlyle Hotel, if I remember rightly. We met and we talked and I said to David, "Have you seen the letter?" He said, "Yes." "And have you seen the last paragraph?" He said, "What do you mean?" And I said, "Well, we invited you to become chairman of the company." And he was unaware of that. So, we knew there was that friction, but that friction exhibited itself in that way.
So, was I concerned when he called me that? Well, no because we hadn't met. I mean if he called me that after we met, I would be obviously very concerned. But on the basis of a lack of information, you have to remember that David spent much of his life at Gallup. And he thought that market research and research and data, what we now call data, was extremely important. So there we are. So the answer is no. I wasn't upset by that. I was, in fact, when we met, we got on very well and we developed a very good relationship. And as I said, he became chairman of the company and maintained that relationship. I don't see Herta as much as I would like to now. But we keep in touch and she's a wonderful woman and was a wonderful wife to David. And she was a wonderful supporter.
Charles:
What I'm struck by is my father used to tell the story of you and he having dinner in the mid-late eighties, after you'd acquired JWT and were thinking about Ogilvy. And he said, Martin sat down and said, "I'm thinking about buying Ogilvy." And he said, "People didn't talk like that back then. People never talked in that kind of ambition and that kind of scale. Where did you get the confidence coming from your background?
Sir Martin:
Well, no. I think and those deals, it wasn't about confidence. Those deals, you used to test. One of the techniques or approaches was to test out, if you had a big idea, if you had been creative about a big idea, if you had a big idea, what you thought was a big idea, you would test it out. I mean, I never believed, all these deals were often surrounded in secrecy and should have been for technical reasons. But floating the concept to find out what people thought about it, either openly or narrowly.
In those days, you could do narrow casting or narrow framing. And you could talk to one audience and not everybody at the same time. Today it's impossible. You can't target to that degree, I mean, in terms of public relations. You can target in terms of advertising. But it's quite difficult to narrow cast it. And in those days you could. So, I believe that, actually, you should test it out. Because the chances of you keeping it confidential were, even in those days - today at zero, maybe even less than zero like interest rates - in those days, you had some chance of holding it in and keeping it confidential.
Today that's absolutely impossible. So, but floating it and getting it out there and getting people used to the idea or seeing. See and there were three constituencies you had to do with. You obviously had clients. You have people inside the business and you had share owners. Those are the three big constituencies. And you had to have either equilibrium or positive, certainly not negative, pretty much in all three constituents. In the case of JWT, the showrunners were upset. The people inside the business were upset because Don Johnson had got rid of Burt Manning a year before. And the clients were upset. Ford was pitching the South American business. Burger King had gone. There was a third account that had disappeared. So it was in disarray. With Ogilvy, it was less so. But you know, there was internal strife. Okay. Ken Roman was being pushed hard. Norman Berry, who's the creative director, was not a happy bunny.
And David and you talk about OLS, I mean David used to be, what did he call Norman? The barber. Because they normally used to wear-
Charles:
Those shirts.
Sir Martin:
... those Russian shirts type shirts. So, the people were not happy. The clients were sort of okay-ish. But there were, Seagram's were unhappy I know. What was it? the comment was made, "The fish stinks from the head, by one of the clients that I met. And then, so the clients and the share owners were not exactly happy. So there was disequilibrium in all three constituencies. But so floating it, if there was disequilibrium, sort of made it destabilize further if you like. But it wasn't a question about confidence. I think that’s misreading it. And I'm not sure what the circumstances of that conversation you referred to with your dad, but I certainly, and by the way, JWT and Ogilvy had talked twice before.
David Ogilvy told me that when I met him he said, "Well, I've had two conversations with JWT." Because they were natural bedfellows, client wise. I mean, in terms of ethos and approach to the business, to the industry, they were very similar and in the importance of creative, planning, et cetera. Ogilvy was probably broader. Ogilvy was a business that had its Ogilvy direct. It had Ogilvy PR. It had Ogilvy sales promotion. I mean, it had thought about the business in an integrated way.
Charles:
Ogilvy orchestration.
Sir Martin:
Yeah. Ogilvy orchestration. Exactly. So the two fitted together. And then, if you looked at client pattern, you know, Ford, Unilever were two of the biggest clients. And so you didn't have the conflicts that you would've had, had GM in there or Proctor in there. So, they were natural bedfellows.
In fact, you could make the argument that they were so similar. They were undifferentiable. Now people inside the business would react with horror over that saying no we're totally different. Just like today. If I fast forward 30 odd years to Group M, I always remember, or indeed WPP, when we used to have board meetings. And I wasn't pulling their legs. We would see reviews from Ogilvy or JWT or Grey or Y&R. And you would say, "Well, what's the difference?" Or board members might say, "What's the difference?" And the answer is, apart from conflict, conflicting clients, there wasn't a difference. Similarly, at Group M, Mindshare Mediacom as it then was and now Wavemaker, MEC, and Mediacom. People would think I was pulling their legs. I wasn't. I would say, "Well, what's the difference?" And each Nick or Steve or Charles who's running MEC at the time would say, "Well, we we're different. We treat people differently. We are whatever it happens to be. We put people first" or whatever it is. Well, every advertising media business puts people first or should do.
But they weren't different. And the key differentiation was around conflicting clients. The people running the business thought they were different. There was a difference, let's say with an Essence or an AKQA, in the case of creative businesses it was Digital or Wunderman or whatever it happens to be. But they were basically major multinational advertising or media agencies and there was very little difference. So again, going back to JWT and Ogilvy, they sat together very well. There was a similar ethos, similar approach to the business, similar culture. They would all say, " Well, we're very different." They weren't really. Jeremy Bullmore and Stephen King would have fitted very well inside an Ogilvy, in my view. I don't think they would, if Steven was alive, you could ask Jeremy. But if Steven was alive, I don't think he would dispute that. They had mutual respect for one another and that's the best way of putting it, I think. So they fitted together very well. So it wasn't a crazy idea to say.
Charles:
So the analysis is obviously, absolutely right. I mean everything you're saying makes total sense. I'm curious about where did your interest, where did your desire, where did your ambition for putting together a company like that, what did WPP come from for you?
Sir Martin:
Well, if you looked at the original document, which we issued in '85 when Preston Rabel, and I, here's the stockbroker I bought into wire and plastic products with. We framed it in one sentence, which was we want to build a major multinational marketing services company.
And it's the same thing with S4. I'd devised or thought about four principals around S4 purely digital, the holy trinity of data driving, fueling digital content, and programmatic faster, better, cheaper in a unitary P&L. But it's a bit more sophisticated, in the sense than what they originally had. But the answer was, I mean, in it's root, I don't know whether this is creativity either, in its root. My dad had said to me, "Look, find an industry that you enjoy. Find a company you enjoy in that industry and build your career. Build a reputation in it." It's not a reputation that, you know, people doing podcasts with you or anything. It's reputation within the investment community or the client community, whatever. And then, if you feel like doing something on your own, I was 40 and I wanted to start something on my own. And I was very ambitious for it.
Did I think that in 18 months time, after investing in wire and plastic products, we were going to make quotes, unquote hostile. It wasn't hostile. Jimmy Goldsmith, who was right, it's not hostile to anybody, except the CEO. It was hostile to Don Johnson. It was hostile to Ken Roman, in the case of Ogilvy. The other transactions, Y&R, wasn't hostile and neither was Grey, at the big ones. So it wasn't hostile. It's not hostile to the clients. It's not hostile to the people inside the business. It's not hostile to the share owners. As I say Goldsmith was right. But I didn't think in March of 1985, that in '87 we were going to do what we did with JWT or indeed Ogilvy in '89.
I mean, I had a general plan that I thought the industry could be consolidated and you can build. But I wanted to build a big business. And I think at the heart of it, I always thought there are people who can start things and there are people that will run things and there are people who can, it's very rare that you find somebody who can do both. And it's very difficult because of the skills that needed to start something. And entrepreneurially build it are very different to management.
People often refer to the two as being different on their own, entrepreneurs and managers. And the answer is you have to do both. One is not the exclusion of the other. The other thing is I fundamentally believed, and I was very influenced by a book by Robin Marris at University, at Cambridge. It was called The Theory of Managerial Capitalism. And he talked in that book a lot about the separation of ownership and control in a theoretical way and in a practical way. And I, fundamentally, believe that's the biggest problem. The way you have a separation when managing, if I look at the boards of WPP today, they have no shareholding interests in the company. And therefore, they certainly don't have an emotional commitment to the company. They didn't start it. They came into it. They have no history with the company. They have no understanding of the history of the company or indeed the constituent parts of the company. It's just another slab of meat. It's another company. So entrepreneurs are passionately, as I say, "It's the nearest a man can come to giving birth." Not physically but mentally.
So it's an emotional sort of experience. And so that's the entrepreneurial drive and then you have to ... If it gets to scale, then you have to manage it as well. So different skills, but you put the two together and when you have a significant ownership interest in the business, your mental commitment and emotional commitment is totally different. And the problems arise where you get the separation between the two. I'll always remember doing a corporate governance session at a Microsoft conference many years ago and Warren Buffet was in the room. Charlie Munger was in the room. Jorge Lemann Layman was in the room, and we spent an hour talking about it. And it was with the guy that used to run Sainsbury. And the two of us were doing the session. And we talked for about an hour and half, two hours, whatever it was. Jeff Bezos was in the room and Jorge Lemann hadn't said anything and I knew him from Harvard Business School, the Dean's advisory committee. This was before 3G really got momentum. I mean, he had already been very successful with ABI. And I said to him, "Well, what do you think about corporate governance? You haven't said anything for an hour and half, two hours." And he said, "Well, I don't believe in corporate governance. I believe in management having a stake in the business." And when you think about private equity and the success of private equity, why is it that private equity... I mean, I think it's too short term as a model. Taking a five year view is not my view. My view is you have to take 10, 15, 20, 25, 30 year view of the company in the industry that you operate in.
But when you think about why they're so successful, because they unite, albeit in the short term, the management interest with the entrepreneurial interests. My fundamental belief is people should go out and borrow money against their houses and their children and their cars, and they should invest in the business. Interestingly, that's what we did at WPP in the '90s. Those schemes, which today have now become the fashion. Five-year incentive schemes, right? Five year plans, long term plans, right? Those were based on me and others putting up money. And the amazing thing about it is, probably going on too long about this, but the amazing thing about it was that we got pushback from the institutions. I think when we did the third plan or the fourth plan, so the third five-year rolling plan, we got pushback.
They said, no, no, no, we'd rather management not borrow money to invest in the plan over the five year period. We'd rather they loan the money or not even loan the money. They can commit stock that they have to it. But I think stock ownership in the company of a significant scale where you have a significant amount of stake at stake is critically important.
Charles:
So do you think you have to have skin in the game to be a successful leader?
Sir Martin:
Absolutely right.
Charles:
Every time?
Sir Martin:
Absolutely right. And I think I was reading an article about a very aggressive hedge fund manager in the paper. I think it was yesterday or the day before who made this point. He said what exasperates him was when he sees boards where getting large salaries and they have no stock in the company. In fact, actually from a good corporate governance point of view, non executive directors are not meant to have stock in the company. That makes them not un independent, not independent. I mean which is to my mind ludicrous. I mean I far rather instead of them taking fees, they took stock.
America is slightly different in terms of their approach. But I think that's the key issue. Maybe it's the Maris book having too much of an impact on me. That unification of interest. And by the way it has to be long-term because I think the business round table, the 181 CEOs who signed this. Shareholders are not paramount anymore, it's stakeholders well. Klaus Schwab has been spouting that for years about his stakeholder theory. It's nothing new. And then John Brown put it much better than even Klaus, which was in 1997 he said, "If you're in business for the long-term, you will look after every one of your stakeholders." That's what you do.
So if you think about the long-term... If you're in the old business and you repel the oil in the shortest possible time to get the maximum return without caring about the environment, you're operating in the short term and destroying, and causing problems with some of your stakeholder communities. But if you think about the long term, the interests of all your stakeholders, then I think it's... We over intellectualize all this stuff, I think. It's all about the long-term and that's why coming back to private equity, I think interestingly private equity doesn't seem to be, although it is a very important segment of the market now. Some people estimate 10, 15% of the market and growing rapidly. I mean they're raising about $3 trillion a year, about half a trillion of equity and they lever it up two and a half, three trillions.
I had breakfast this morning with some bankers and they were talking about the WPP counter transaction, which is levered up six times at very low rates, interest rates. So private equity has all this funding, but they are very short term and they're not subject to the ESG governance requirements. The listed sector is. And the listed sector is shrinking, partly because of buybacks because people are short term and they're not investing enough. And also because the charms of private equity where you're not exposed, it is private equity. It is not public equity. We're not exposed to the pressures of the market or the governance of market are much more attractive.
Charles:
So when you flip to the other side of the relationship you just described, so the entrepreneurial side shows up, and then you've got the management side on a day to day basis, if you are, if you-
Sir Martin:
The management side is not day to day basis, is it just a different... The challenges when you start selling from scratch. So when we were sitting here this time last year where we had nothing, is different to yesterday where we reviewed the July numbers. And Victor and I were in Geneva and we were talking to our colleagues who were in Singapore and Tokyo and San Francisco. It's different because we now have 1500 people in 20 countries. So the skills or the demands or the opportunities or the challenges are different even within the space of 12 months. It's different. So you need to have different skills. And as I say, there are people who are very good entrepreneurs who are useless at running a business, and there are people who are very good at running a business who are useless entrepreneurs.
Charles:
Which are you better at?
Sir Martin:
Well I'd like to think I can do both but its for others to say. I mean every day you learn more. Like yesterday on that call, which lasted about three hours and 15 minutes, you learn things you didn't know. So you're continuously learning and you continuously make mistakes. Sometimes you do good things. I mean the trick is to do more things better and make less mistakes.
Charles:
One of the things that some people have said about you is that you have a tendency-
Sir Martin:
I'm sure they said a lot of things.
Charles:
... to micromanage. And I know you've got a point of view about that.
Sir Martin:
I think that's BS. It's not micromanagement. That's just a throwaway line. I don't know who said that, and it may be many people. It's not micromanagement, it's a desire to know what's going on with the thought not of interfering, but that you can make a difference. I mean the biggest challenge I think that anybody has in sort of doing what we're doing is allocating your time effectively, prioritizing what you do and allocating your time where it will have the maximum impact. So what I tend to do is to have an objective for the next month or week or three months or half year or a year to get something done.
And it can be two or three things. But to have some specific objectives. Because you can't spread yourself too much. I mean I travel a fair bit but I want to... So travel time takes a lot of that time, but you have to try and maximize it and that is a great skill. And I don't think I'm brilliant at that. Or I think I could always be better. You could always hone that. But that is the most difficult thing. You have 24 hours in the day. I like to get about six or seven hours. I read an article by Karen Blackett this morning saying she only gets five hours sleep. I couldn't do that. I get even more crusty than I am on five hours sleep. So I need those six, seven, eight hours sleep. So it leaves you, let's say with 16, 17, 18 hours. But you still have to allocate that in the best way time.
And I do work Saturday and Sunday, much to my family's chagrin, but I do. And so allocating the time in the most effective way. Now I do like to know what's going on because I can help. And the reverse is also true. I mean for example, we were discussing it yesterday on the call. There are a couple of things that we initiated which we didn't follow up on and we didn't get an advantage because we didn't follow up on it. And it was because lack of attention to the detail which others might call micro management. I don't think it is. My father was a retailer. Retail is detail as they said. But that should not be misinterpreted as a desire to interfere. That's not true. Otherwise don't bother. Just sit on top of it. Be a manager. Be those people who don't have shareholdings, the WPP board. Just float on the top.
Charles:
There is a remarkable lack of intention among many leaders and managers, isn't there? The point you're making is that be clear about the difference you're trying to make. And I think that is sort of lacking in many leaders. They're not that clear-
Sir Martin:
I remember the chairman of one of the big companies said to me, it was in 1987 just after we got involved with JWT, and he was joint chairman of the company. He said getting to join chairman was like a hundred meter race, a hundred yard race. You spent your career running the race, you breasted the tape and became chairman, and then you collapsed. And I always remember that. And then the average life of a CEO is meant, not life, but business life of a CEO is about five or six years. If you don't have a stake in the company and you've got five or six year run, what's your mentality? Your mentality is short term, stay out of trouble, just get to the end of your term and then pass it on. So it becomes rather bureaucratic. It's not, I want to make a difference. So if it is, if you're right about lack of intention as you put it, it's not about micromanagement or... It's understanding how it all works and just seeing not just how you can make a difference, but what can you do, what resource can you bring to bear?
What person can you bring in our business? What person can you bring in, who will make a difference and get us to where we can achieve that objective? And I really don't believe that you can sail on along on the top of the business without digging in. All the people I've seen who have removed themselves from the day to day and have taken that view to be lumped with what Maurice and Charles did when they brought in Anthony Simonds-Gooding into the business, that was a mistake. It wasn't because Anthony wasn't good, it was because Morris, who was the detail guy, extracted. And Morris was really good. He was excellent. He was superb with clients. He was intellectually very... he got a first at LSE. He was intellectually very good. His manner was good. He presented himself very, very well and it was sort of... And I think in a way it almost came down to a lack of energy.
And I think it's really important to be engaged. But you don't want people that, and maybe inevitably they feel - the person that made the comment about being a micromanager - I was interfering. It wasn't interfering. It wasn't because I wanted to stop things. You know I used to look at the WPP at every hire over $150,000. It wasn't because I wanted - or salary increases over tha - it wasn't because I wanted to stop it. It because it gives you a feel about what's happening in the business where the hirer... I mean the biggest investment we made as the same thing as true for S4 Capital on a much smaller scale. 60% of our revenues invested in people. So WPP, $20 billion, a $12 billion, you make an investment. The investment in things like cars and office, it was $750 million. That's the guts of the business. And so knowing the people flows, where people are hiring, where they're not hiring, where there's a demand, it tells you an awful lot.
Charles:
Do you run the risk that has an impact on the people that are running those businesses?
Sir Martin:
Yeah. But the downside is not outweighed by the upside. Particularly in a smaller business. Maybe in a bigger business, obviously it's more difficult. But I think knowing the levers and how it's all working, is critically important.
Charles:
I want to talk about time management for a second. One of the things you're known for is your email etiquette. How do you do that? You respond almost instantaneously-
Sir Martin:
Well I've got nothing else to do, so I look at my email.
Charles:
Which is clearly not true. No, seriously, how do you do? I mean, your email …..
Sir Martin:
People believe I have robots. I don't have robots. I'm interested. Again, it's about interest. I mean the reason I reply... I mean at first I have a sort of mental rule. If somebody, unless I deem them to be loony, unless somebody writes to me or somebody calls me, I should respond. I think it's rude not to do that. No matter who you are. If it's some mucky mucky who calls or writes, or if it's somebody I don't even know, right? Yeah, I think it's rude not to do that. So etiquette, manners, right? Having said that, it's partly because I'm interested. I mean, everybody has value. I mean, this may sound like a bizarre thing, but I remember the stories that people say that receptionists in companies know more about what's going on than the chief executive or the managing director. And often that’s true.
And when you start a business, this is a really important point, I think. When you start a business from scratch, the marginal valuation of information is very high. Every piece of information is highly valuable. If you sat in a business for 150 years or JWT or less so at Ogilvy, and the institution has been built around you and you've seen it, you take everything for granted. We tried that thing a few years ago and it didn't work, it's not going to work again, right? So the mental attitude is very different when you started the business from scratch. And so everybody can make a contribution. A really important point. And don't devalue - because it comes from a source that you don't think is important - don't devalue it. Because somebody will have a brilliant idea or a brilliant thought that you haven't had that may stir things.
So part of the reason that I answer is that we get a lot of inbound in, we've got a lot of ink on S4 Capital. So the inbound that we get is huge. Every day we get three or four or five people writing and saying, have you thought of this? And I'll ask for further information because often they'll send without some of what I regard as being the vital details, which enable you to figure out whether this is good, bad or indifferent. But it is just an eagerness, because people get information, people have ideas. Coming back to your question about creativity, they can be creative about something, using that word very broadly, and think about something in a way that you never thought of before. And I'm not an engineer, I'm not a software engineer. I'm not a coder. I don't know code and I don't speak it.
So I have to rely on sort of gut and animal instinct in many cases, but listening to what people have to say. So it's not just the email, I mean it's listening as well, is really important. So that's part of the reason. You never know what somebody knows or can tell you. And that's why I always believe that this thing about micromanaging... I mentioned Arnold Weinstock. Arnold Weinstock had the reputation on a Friday afternoon, he would call the plant manager. So he would skip three or four levels of reporting, go straight down to the plant manager at GEC, the UK General Electric Company, and find out what was really going on. That is important because everybody tells you what you want to hear.
Somebody wrote a piece recently saying that they were scared of coming into me with bad news. That's complete nonsense. Complete nonsense. I was more eager to get the bad news than I was the good news, because that old thing about good news travels fast, bad news doesn't. That upsets me. That's another reason why I like to know about the detail, is to find out what was going wrong so you could try and do something about it. Because the natural instinct in bureaucratic organizations is just to hide and cloak the bad stuff. That's why bad news does travel slowly. And the people in organizations do tell you, yes, minister. Do tell you what you want to hear not... So it was completely the reverse. I was more eager to know what was going wrong then what was going right.
Charles:
Why do you think they were afraid to tell you?
Sir Martin:
No, it's not they were afraid to tell me, that generally inside organizations. I mean that's a bureaucratic rule. Give them a good news. Don't give them the bad news. No? So we used to do pretty meticulous reviews and that was to try and unearth the good news. Have the good news and the bad news. I mean, in our industry, people are very good at presenting. So they always present the optimistic view rather than the pessimistic. So you're fine. I believe you should be more optimistic and I believe in Boris Johnson rather than Theresa May. Boris has good EQ, right? I mean, when I'm watching him with Merkel and Macron, there's a smile on my face. There wasn't when I was watching Theresa May. It's like Blair and Brown. It's two different things. So it's always better to be optimistic, but sometimes that cloaks what's going on. And you have to get a balance into what's going on.
Charles:
What's your relationship with fear?
Sir Martin:
With fear? Well, everybody has reservations. I wouldn't say that I'm... If you have a big opportunity or indeed a challenge... I mean, opportunities become challenges if you don't do something about them. I'm not frightened of it. What I think about it is how can we achieve it? So I do believe in what Maurice and Charles used to say, nothing is impossible. I do think that is true. Circumstances... For example, who knows, but I think after the next presidential election, which I think Donald Trump will win, things will get difficult. The Chinese American contretemps is not a trade war. This is something much more fundamental and that's the biggest problem that we face. Brexit is not a sideshow, but it's smaller in comparison. So I think that's the fundamental issue. And it threatens a number of things. I don't know what that solution is, but I don't think the way it's going at the moment, if they made paper with the cracks on the trade spat, but long-term, this is a big issue.
So I think after the election in November of 2020, things are going to get quite difficult. That is going to throw out major opportunities. The big holding companies are going to come under in much more intense pressure. And what you saw with Kantar, it's going to get worse. So WPP, Publicis, even Omnicom and IPG, which are doing better. Densu certainly have [inaudible ] anyway, are going to be restructured. People often refer to them, and I used to get very upset with this, they referred to WPP as a conglomerate. It's not a conglomerates. It's a relatively focused advertising and marketing services company. But the consolidation wave that we saw will be the opposite.
We'll see a de-consolidation, that people will come to the view that these companies, rightly or wrongly, are too big, not fit for purpose and they have to be broken up. And that's going to happen. That will give S4 tremendous opportunities.
Charles:
Why did you decide in your early 70's you wanted to start again?
Sir Martin:
Well I didn't want to... I've seen people vegetate when they retire. I remember, it's very funny, you just reminded me, my first week at Saatchi, so that would be 1987... sorry, 1977, there was a guy... at an agency. It was called [Rodownton], it was in Soho, it was a film agency. And his name was... was it [Eric Downton]? I think it was that. Anyway, Eric... I was there for one week, and he's decided to retire. And he retired on a Friday, and he called me on the Monday and he said, "I've had enough. I want to come back." And he was about 60 or something. "I want to come back. My wife's got fed up with me already. I want to come back." So I think that's always stuck at the back of my mind, "Never retire."
But I've seen people retire. I don't like the idea of doing portfolio stuff because I think you flit from flower to flower and you just don't pollinate anything. So I didn't want to do that. And then, I've seen people vegetate. I see them physically degenerate, as well as mentally degenerate. If you don't have something to occupy your time you become... As somebody else said, came in here yesterday, a guy I used to know at WPP, he's 88, he spends four days a week working, and he lives in Gloucestershire. And one day a week, he has an office in Gloucestershire doing his admin, and he said, "It's a lovely town. All people talk about is their health." And he can't stand it. He's 88, and he's full compos mentis.
And I see for the IMF now, they're saying, "We've got to..." because the rule is you can't be manager of the IMF unless you're 65, and it's a 5-year term, and you can't... you stay until you're over 70 or whatever it is. So they're going to alter the rules to admit the woman who's now... the favorite candidate. So life is changing for obvious reasons as life gets elongated. But I didn't want to vegetate. So I thought, "What could I do that would be interesting?" And it's, come up with the new model. So I'm hopeful that... And our first year has been very strong. We're growing top line by 40%. We're seeing accelerations into the second half of this year. So it's very encouraging. And the people are really interesting, there's a lot of energy, there's a lot of bright people. There is a lot of focus on the old, traditional agency model and whether it's fit for purpose, and we don't think it is.
That wasn't the original intention. The original intention was to focus on digital and build a digital model, which is roughly half the market, a digital model that would be even more effective. It wasn't really to displace or disintermediate. It was really to try and capitalize on where the growth is. So the model is very different to what we saw at Saatchi's and at WPP. That was primarily about globalization, Theodore Levitt, people consuming things in the same way everywhere, Proctor and Gamble, when I was at B school in '66 to '8. Howard Morgans was the chairman-CEO of Proctor and Gamble. His son Jim was in our class. And I always remember Proctor and Gamble had 10% of his revenues outside the US. And it was regarded as being a global company.
So that was the era of globalization. That spilled into WPP and drove WPP. But then in the second 15 years or 18 years of WPP, that was about technology. So the twin... There are twin forces on this, very simplistic, but I think it's true. There are twin forces you have to deal with: geography and technology. Geography was the paramount thing in the first couple of decades. And in the second couple of decades, it's about technology. Now, S4 is not going to go to 113 countries. We're in 20. We'll probably go to a maximum of 24, 25. We'll add Seoul, Korea, Madrid, and Berlin probably. And then, I think, probably, that'll take us to about 24, 25, and I think that's where we need to be. And technology enables you to span countries in a way that you couldn't do when we started WPP. But the primary focus is where... and this is not easy, where in the marketplace is the growth in our industry going to come from? And it's the 500 billion in media, it's the 500 billion in marketing services, and it's the 700 billion that's in trade budgets. So it's a 1.7 trillion industry. So there's enough for us-
Charles:
To go around.
Sir Martin:
... to play with. Yeah.
Charles:
Can you imagine stopping?
Sir Martin:
No, I used to say, which turned out to be true, "I'll stop until they shoot me." No, I'll keep going until... I'll probably drop dead on the job.
Charles:
How do you lead?
Sir Martin:
Well, it's the way I described. I think you lead by being interested and involved. I wouldn't say I have a particular style or try to cultivate a particular style. What you see is what you get. But I'm interested in building... We're now doing it for the second time, the third time I hitched my wagon to the Saatchi brothers, if you like. And then, before that, with Ralph Glendinning at Glendinning, and Mark McCormack at IMG. But I was attracted to people who were building businesses, probably because of what my dad had told me about building a reputation, "Find a company that you like in an industry you like, and then if you want to start something on your own, start something on your own."
I probably regret not starting earlier. Probably, 40 was on the late-ish side, I probably could have done it when I was 35, but the opportunities didn't... and Saatchi was a tremendous. Saatchi was fantastic in terms of the atmosphere, the people, Tim Bell, Jeremy Sinclair, Bill Muirhead. These were really talented people. And it was a great group. And we had great fun. And it was... you could do anything at Saatchi's. You could do anything as long as you didn't get any public credit for it. But it was great, absolutely fantastic. So this is the same.
And I wouldn't say I have any particular style. I'm hungry to know what's going on, the micro-management again. I'm hungry to know... And it's not just micro-management internally, it's micro-management sort of externally. If micro-management is reading the newspapers or watching the news, or CNBC, or News Night, or whatever it happens to be, mea culpa. So my style is to be interested and involved and to be interested and involved in what people are doing. Instant response. I had something read to me last night on the plane asking me to contact a client. I'll do it instantaneously to try and help them. So it's really to advise, and warn, and council. That's part of it. But I wouldn't claim any particular style.
Charles:
Does it matter to you how people perceive you?
Sir Martin:
No, it's not that. I'm glad when we succeed and I'm sad when we don't.
Charles:
I've seen you on stage be controversial. You seem to like sometimes being confrontational with people. Is that...
Sir Martin:
It's not a question about controversial to what you're referring. But when I do an interview with somebody, do your job and what you're doing now, I don't believe in asking them soft questions, if that's what you're getting at. If you've got an audience... I don't mean to taking that specific, but you've got an audience and they're trying to learn something or listen to something interesting, ask them the difficult questions. Ask them... not just be a powder puff and ask them the easy ones. When I did the first Cannes debate, we had four tech companies: Google, and Yahoo, and Microsoft, and there is one other. And the first question was, "Are you a tech or a media company?" And that was the very first question in the Cannes debate. And they all said, "No, we're tech companies." They are, as we all know, they're media companies, certainly in aspects of their activity, not totally. And that chicken is coming home to roost. So I believe it's not controversial. It's asking what's on everybody's mind. It's asking... Instead of just the powder puff, plain, vanilla thing, asking what people really want.
If you asked an audience, "What are the questions that you really want to ask?" It's asking those questions not what's the... it's not a question of politeness. It's a question of getting at the issues. It's bit like you saying to me your dad heard me talk about Ogilvy. If people thought at that time that we were looking at Ogilvy, fine. If we were back here then, and you were interviewing me then, or we were doing a podcast then, if we could've done, you asking me the question, "Are you looking at Ogilvy?" To which I may have said, "Yes, we are," if I thought that was the right thing to say, or "We don't comment on specific rumors." So I think it's asking the questions on everybody's mind. I think that's the right thing to do. I think that's what all good interviewers do.
Charles:
Yeah, I agree with that totally.
Sir Martin:
David Frost, people used to say he was a powder puff, sort of. He wasn't actually. His style was that. But he... in the Nixon interview…
Charles:
When Nixon was... right.
Sir Martin:
... he sucked him in, and then asked him the killer questions.
Charles:
When that final day comes for you, when you keel over..
Sir Martin:
Well, we don't know what happens afterwards, do we? Unless you know.
Charles:
What do you want people to say about you?
Sir Martin:
That's up to them. Got no-
Charles:
What would you like people to say-
Sir Martin:
The building of the businesses, and that's what I'm most interested in. I think it's now morphed from, obviously, from WPP to S4. In the case of S4 it would be that we built, and it is we, built a business which basically saw the changes taking place in our industry and built a model that has become indispensable, indispensable at the moment. That will be proven by how much penetration we get. At the moment, our biggest client is say, $20 million. And I'd like to have in short order, a 60, or 70, or 80 million dollar client, which we will get. I will guarantee you that we will get that. But the model... what we call the Holy Trinity model will develop. It'll morph even further, of data driving content, digital content.
Data's not the enemy of creativity by the way. This is this... people sit in vineyards in the south of France with their rose-tinted... and probably too much Rose, saying, "Oh, the age of creativity is gone, and data is the enemy." Nonsense, data improves creativity. It's more informed. It's more relevant and cuts through more. And so data driving content and driving programmatic. And that will morph that model. And then, I think the faster, better, more efficient... that was redolent of the times, that post-Lehman, that's what clients needed in the era, also walled gardens, that's what they needed. And finally, the unitary model, rather than the holding company, fragmented and out model. The unitary model was more relevant. So I think, probably, the epitaph would be around that. I doubt whether that will be what people will say.
Charles:
Last question for you. You mentioned your dad a couple of times and the advice he gave you. And he said, "Build a reputation in an industry you love." What do you think he'd say to you today if he was here?
Sir Martin:
I don't know. I'll find out when I keel over.
Charles:
I wrap every episode with three themes that I've heard that I think contribute to your success. Let me throw these at you. One is, you clearly have an extraordinary analytical mind. Obviously, that's a God-given gift that you've honed over time. But your ability to take a lot of information and distill it down into the stuff that really matters is clearly a massive asset for you, and you've used it throughout your career. Second, you act with enormous intention. You seem to be in a hurry. I know that when you got knighted that speed and persistence was on your shield. And you clearly have driven... those are really important words for you. And then, third, I think, and perhaps surprisingly, having not met you in any substantive way before this, is as you said, your genuine interest in people. I've always noted in our very brief exchanges how quickly you get back to me. And clearly other people have reacted the same way. You seem to be very, genuinely interested in people.
Sir Martin:
Yeah, I think it's what I said. I really do think... and I'm not saying it for ESG reasons. I really do think that you get insights and information... I've always thought of... You just triggered in my mind, I remember going to Hambros Bank many, many years ago. My dad knew Jules Thorn very well at Thorn Electrical. He was a great entrepreneur, emigrated from Vienna and came here just before the second World War and started a fluorescent tube factory in Enfield, and then built Thorn Electrical into a great company. It was destroyed but great, great, great company, great man, like a peanut, like a small... even smaller than me.
His advisor was Hambros Bank, and there was a guy called Christopher Sporborg whose father was Harry Sporborg who was lead bankers at Hambros. And he said to me, "Go and talk to Christopher Sporborg." So I went into Hambros Bank and they had this magnificent trading room where all the partners of Hambros Bank sat. It was beautiful. I think the Japanese bought all the woodwork or something when they destroyed the building. It was an absolutely beautiful panel building. And all the partners sat in these big desks, huge desks, ornate desks with people around them, maybe had about a dozen people around them. And they were all on the phone. And you could hear what the other partners were saying. So it was like this massive trading room. And I've always thought of WPP or S4 as being a massive trading room.
So during course of the day, the 200, 000 people at WPP or the 1500 at S4 would be talking to clients, talking to themselves, talking to journalists, talking to analysts, whatever. And if you could get access to all that knowledge, that network, like they did at Hambros but in a very non-tech way, that's always been in my mind. And everybody, the receptionist right through to the CEO, if that's one end of the spectrum to the other, gets a piece of information. I'm really hungry for that. And I'm always interested in what people's views are on those subjects or information. It's not gossip. It's information. And I think that's really interesting.
And even in the technology age where you have access to everything, where the marginal cost of access is zero, I think that's a phenomenal, phenomenal... WPP's biggest advantage is it's 200,000 people. And then, just think, even the family members, just think about the number of times that I see somebody... I was in Zurich, and Geneva, and Detroit this week. And the number of people who said to me, "I used to work at WPP," or "I know somebody who worked at WPP," or "I know somebody at S4 Capital," so you think about the web and... not the tech web but the human web, the human web.
Charles:
Yeah, it's extraordinary.
Sir Martin:
Yeah, it is amazing. And it is amazing what you can get from people if you listen. It's amazing, it's extraordinary, and that's my dad, actually. My dad had a phenomenal ability to listen and a phenomenal ability to manage his time as well. So always had time for me or my family: my mother, himself, and me basically. Despite the fact that he was a seven-day a week retailer, and he worked like a dog... worked too hard in my view, and was not an entrepreneur, it wasn't his own business, which I was always upset about because I think he was phenomenal, but he could've been even greater.
But he always had time. Amazing quality he had, that he could, no matter what he was thinking about, how much pressure he was under, and in the retail business you get under considerable pressure, he always had time to talk... my kids, my first wife, always could devote time. Quite extraordinary, and I don't have that. I'm not as good as him. You asked what would my father think. I'm not as good at doing that as he. He was superb. Anyway...
Charles:
Nothing more valuable than what we do with our time.
Sir Martin:
Yeah, and I think he managed it. Some people would say maybe he spent too much time working. I don't think that's fair. He could always... Now, he retired fairly early. In my view he retired too early. But he was very successful on a modest scale in what he did afterwards. But he always allocated his time very well.
Charles:
Thank you for sharing some of your time with me.
Sir Martin:
Very good. My pleasure.
