"Anybody can head an agency; it depends on the person's equity": Nagesh Alai

In the Indian advertising industry, it is usually the suits - and occasionally a creative head - who go on to chair agencies. But in the case of FCB Ulka, Nagesh Alai, erstwhile chief finance officer, executive director and general counsel, went on to become chairman of the agency.

Alai joined the agency in 1990 as vice president, finance and subsequently went on to head the agency's finance operations across Asia Pacific and Africa. About 15 months back, he was made chairman of the agency.

Over the years, Alai has been active in industry forums. Speaking of which, when he was named president of AAAI (Advertising Agencies Association of India) four years back, there was substantial din about how a "finance guy" was elected for the role. There's something very Martin Sorrell-esque about Alai's success - (the knight was finance director at Saatchi & Saatchi before he went on to create history, remember?)

When asked why the transition to his current position was such a quiet one, he says, "At the end of the day, you are representing your company to your overseas parent. There's no point talking about these changes in public. We don't explain ourselves to anyone. That's our culture and I don't want to be apologetic about it," he says, staying true his agency's, and perhaps his own, DNA.

Though he insisted his current position is "not a big deal," we tried our best to tell him why we think it is. We also asked the CFO-turned-chairman of FCB Ulka why elevations like these are so rare in the agency system.

Edited Excerpts.

Edited Excerpts

I don't know. Perhaps people are caught up in conventional thinking, perhaps they don't get enough opportunities... fact is, there are exceptionally strong finance people in the industry.

It has been rare in the advertising industry, but if you look at any other industry, whether it is pharma or engineering or any specialist services industry, there are people from all streams at the top. It is a fundamentally wrong notion that only people with a particular set of experiences or from a particular discipline can go on to head the organisation. Anybody can get there; it depends on your aptitude and attitude.

Years ago I was in Boots Pharmaceuticals; DM Gavaskar, my boss at the time, who was the finance head, went on to become managing director of the company. I then moved to John Wyeth, another multi-national pharma company. Had I continued at John Wyeth, take it from me, I would have headed it. I am not saying this out of over-confidence; I am saying organisations are fair and there's nothing wrong for every person who is above average to think they can head the company someday.

I'm sure you'll see more of it happening. At the end of the day, we're in the 'people business'. There are creatives, suits, strategic thinkers, media experts, finance guys, IT guys... anybody could become head; it depends on the person's relevance, the person's equity.

My appointment is not going to be a trigger for that to happen, though. It depends on the right person being there.

To be honest, FCB Ulka does have a certain way of looking at things. We have a different philosophy in terms of the team being more important than individuals. It is a supportive, enabling environment. The team plays together; if one person is not performing well on a given day, somebody else steps in. So I guess, there's something about FCB Ulka. It's something incalculable.

The top management has been there for 24-25 years. The top 75 people have been there for 15+ years. There must be a solid reason for that. We are not famous for our creative but we are famous for our brand successes, long relationships with clients and a stable team.

Completely wrong. I agree we are not famous for winning awards but if our creative is as bad as it is made out to be, we would not have had so many brand successes, long term client relationships and new businesses.

Look at how we are structured. We have strong CEOs responsible for various verticals. If you have strong CEOs looking after important businesses, there is no point in diverting their attention from staying focused on the clients. Why dilute their attention? So I have an alternate theory: you should continue to allow the CEOs to do what they are best at - networking, knowing their client, knowing their competition and knowing the consumer.

Yes, I'm saying it.

And this is not to say that if somebody else had become chairman, he would have done a lesser job of it. Obviously the person would have done an equally good job, because it's not rocket science.

How can you say that? These heads have an army of lieutenants - a second-line - that does a great job. Without that exceptional talent to support them, sooner or later these heads would be under pressure.

The success of any organisation depends on the extent to which it has developed its second line.

Well it suits to people to say that, doesn't it? That's a psychological game played by competition to raise question marks in our clients' minds. They had the same thing to say when Anil Kapoor (former chairman, now chairman emeritus of the agency) joined. Had he been weakened by that talk, we wouldn't have been where we are today.

I remember a famous person saying derisively about some agency, 'the agency is run by accountants' but the person who said it has shut shop! It is all unfortunate stereotyping. It's because of this shortsightedness in thinking that we have gone down the totem pole of relevance, gone down in the eyes of clients... that is why all the assignments are going out on a project basis.

People feel advertising is only about the creative that you see. Agencies are not purveyors of creatives. Agencies have to realise that they are in the business of business. And there is nothing glamorous about the advertising business; it's a 24-by-7, backbreaking business. So let's not get carried away.

We will not get into any client relationship which doesn't make commercial sense regardless of the pressure from the account management team; we are not here to handle a romantic product because the public perceives it as a romantic product.

A creative person who doesn't have commercial sensitivity may not look into these aspects. You will get into a problem if the head of creative is the only person who can take a call on the resources required and go haywire with the spending. You need to have a finance or account management person who steps in and says, 'Listen, this does not make business sense.' Every action you take has a financial implication. If that action does not translate into some kind of bottomline dollar, then you cannot stay invested in the business.

Maintaining our position, maintaining our sustainability and profitability, keeping our people motivated and ensuring we deliver day in, day out.

Relatively speaking, we are a homespun agency. Today, just about two to three per cent of our business is 'global business', whereas our key competition has around 30-50 per cent global business. So at one level, they are in a comfortable situation compared to us. Hence, the degree of tension that the management here faces is vastly different from that faced by other agencies.