Last year was the seventh successive year of record growth in both revenue and profits for Harrison & Star (H&S), an Omnicom agency. Growth has averaged 20% per year over the last five years, and chairman and CEO Larry Star says 2007 yielded “impressive” financial results.
“We have a solid foundation and continue to build on it,” Star says. Much of last year's growth was organic, including new wins from Abbott Laboratories, Bayer HealthCare and Novartis. The only significant loss was Genentech's Lucentis (a treatment for blindness) business, which the agency chose not to repitch (Genentech remains H&S's largest client).
Headcount stands at 300, up about 75 over 2006. Star says the agency's biggest challenge is retracting, retaining and motivating staff, and he's always looking for creative ways to recruit. This year H&S will have a booth at a job fair at the American Society of Clinical Oncology's annual meeting. “We have a number of oncology accounts, and we're going to look for people with advanced degrees who are looking at career change,” Star says. “We've hired a number of people like that.”
Star doesn't notice a decline in competition for talent, and he thinks culture is the ultimate distinguishing factor among agencies. “We have competitors who offer our people wheelbarrows of money,” he says. “I'm constantly shocked at the kind of money being offered to attract people—and we're competitive with compensation. You have to make the reason to stay more than just about money.”
Last year a VP left the agency for an offer she didn't think she could refuse, but was back at H&S by May.
“It's not an unusual story for us,” Star says. “When people see what life is like at a lot of other agencies, the gap between the experiences is glaring. We always depart on good terms, stay in touch and tell people to please call if things don't work out. Some people take it personally when employees leave. It's kind of crazy. There's a limited talent pool. If you find people that are good, stay in touch and continue that relationship.”
Star adds that “there's no better PR internally” than having an employee leave and come back.
As clients continue to increase tech investments, the agency's interactive division, 22 Clicks, has grown 150% in the last three years. He cites Sermo, an online physician community, as an excellent digital channel to communicate directly with physicians.
In the overall pharmaceutical landscape, Star sees signs that the US might be losing luster as a market for pharmaceutical investment. “There's more growth in Europe than in the US, and there's certainly more growth in terms of percentage in emerging markets—Russia, China and potentially India. Companies decide where they think growth is going to come from, and it's not going to be a slam-dunk that it's the US.”
Star's outlook for this year is positive. He'll continue to “invest heavily” in technology and talent.
In January, three directors of client services were promoted to SVP, managing director positions. The change reduces the number of people reporting to president Ty Curran and leverages experience across brand assignments. “We pushed more responsibility down to provide senior level strategic counsel to clients,” Star says. “We expect to see them continue to take more of a role in leading the agency.”