Launch comes as M&C Saatchi faces 3 February bid deadline.
M&C Saatchi has recruited two executives from Accenture Interactive to set up a digital business innovation consultancy that will help clients to diversify revenues and create new digital products, services and ventures.
Michaeljon Alexander-Scott and Lilian Tse, the co-founders of Thread Innovation, previously worked together for five years at Fjord, the design studio owned by Accenture Interactive, the digital marketing arm of consultancy giant Accenture.
M&C Saatchi said the launch of Thread showed the group was pushing ahead with its “strategy to deliver meaningful change for clients by further investing in data, digital and technology”.
The digital innovation consultancy will start as a team of three but is expected to have about eight employees by the year end and will draw on a global network of around 60 consultants on a project basis.
Wendy Dixon, chief growth officer of M&C Saatchi, described Thread as a “plug in, play out” model with “diversity of thought at speed and scale”.
The timing of the announcement about Thread’s launch carries additional significance as it comes just a day before a 5pm stock market deadline on 3 February for AdvancedAdvT, an investment company, to confirm whether it is making a formal takeover offer for M&C Saatchi.
However, it is understood that Alexander-Scott and Tse have been working with M&C Saatchi on the plans for Thread since autumn 2021 before AdvancedAdvT’s bid approach in January 2022.
M&C Saatchi is positioning Thread as a more agile operator than the big consultancy giants, such as Accenture and Deloitte, which have moved into marketing services in the past five years because of the growing importance of digital customer experience.
Alexander-Scott led the insight and strategy practice at Fjord/Accenture Interactive and has previously worked at M&C Saatchi – in its global and social issues division – as well as at the BBC, Isobar, The & Partnership and Manning Gottlieb OMD. Tse was a design director at Fjord and previously worked for Frog Design, Gartner and McKinsey.
Traditional consultancy model is “too slow and too expensive”
Alexander-Scott and Tse said: “We’re focused on helping ambitious clients reinvent their business in the face of relentless competition and changing customer expectations. As business leaders at management consultancies and design studios, we’ve seen what works and what doesn’t.
“The traditional consultancy model makes corporate innovation too difficult, too slow and too expensive, so we’re absolutely delighted to join M&C Saatchi Group and offer clients a new and more dynamic way of collaborating that is built around their needs and priorities.”
M&C Saatchi added in a statement: “Thread is an antidote to the rigid approaches and long timelines of traditional consultancies and design studios, offering clients a more flexible and dynamic way of collaborating for corporate innovation.
“Thread combines the commercial rigour of strategy consulting and the creativity of design studios with the pace and experimentation of start-up teams to develop and build high-growth digital products, services and ventures for clients.”
Moray MacLennan, the chief executive of M&C Saatchi since January 2021, said: “Clients increasingly recognise the importance of developing new digital products and services to diversify their revenue streams. Thread, and the experience that MJ and Lilian bring, enables us to expand into this growing territory and continue to accelerate our investment in differentiating digital capabilities.”
Alexander-Scott said there is “huge demand” from clients, citing research that showed only 6% of executives are satisifed with their company’s current innovation efforts. “The number one route to growth, especially in the post-Covid period after that cost-cutting phase [at the start of the pandemic], is new products and services,” he said.
Thread will focus not only on strategy but also practical implementation – with an initial focus on sectors such as finance, retail, health, technology and social impact, Alexander-Scott and Tse added.
Setting up Thread as a standalone unit will give the founders “freedom and empowerment” in an entrepreneurial environment, Dixon said.
M&C Saatchi, which was founded as a breakaway from Saatchi & Saatchi in 1995, is part of an established agency sector that has faced growing competition from new “challenger” groups, such as S4 Capital and The Brandtech Group, and the consultancy giants, which include Accenture and Deloitte.
AdvancedAdvT has said M&C Saatchi can grow faster by ramping up M&A and investing in digital, analytics and data, although M&C Saatchi has maintained that it is already focused on digital.
The independent directors of M&C Saatchi have rejected AdvancedAdvT’s initial bid approach and a subsequent improved offer. City regulators could extend the deadline for the M&A talks beyond 3 February if the two sides want to continue talking.
M&C Saatchi would not comment on the M&A process.
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