How do you turn a spin-off of a DC-based law firm into a $32 million public affairs and strategic communications agency with offices throughout the U.S., Canada, Europe, Asia, and other key points on the globe? PR NEWS wanted to find out. So we visited Margery Kraus, founder, president and CEO of APCO Associates Inc., which recently changed its name to APCO Worldwide.
PRN: Your company started as part of the law firm Arnold & Porter in 1984. Now you're part of Grey Advertising and you're global. What was your strategy in taking your business into international markets?
MK: When we decided the future of the business was really having more of a global footprint, we took on a management consulting approach to public affairs, whereby we would go into a market in a very integrated way. If you look at APCO's structure, it's sort of overlapping circles, with practice groups. It's very much of a professional services model instead of agency model.
PRN: How does your culture support the model?
MK: We've never done acquisitions as a means of growing the business. Instead we've hired people who were like-minded and shared the same value system. Also, our compensation system does not incentivize people to be competitive with each other. The whole way we're structured is that the client is the center of our universe. We can pull people from anywhere in the world, any subject area - any "home room" as I call it - to come work on that client matter. There's no bureaucratic impediment to that.
PRN: I noticed that you've created a senior level position of 'chief knowledge officer.' How does this position mesh with your business model?
MK: Part of working effectively and in more of a consulting model is making sure you also are not reinventing the wheel. You need to have a way to draw on the smarts of the overall company, and to take advantage of the thinking that goes on around the world on different issues. People are developing best practices, and you have to know that your level of training is sufficient.
We thought this was so important that we wanted someone to be responsible for it. So we appointed Nick Andrews, who works out of our Brussels office. He is an excellent trainer. His specialty field is internal communication, but he also does client work. He works with our human resources person.
PRN: What are some specific examples of the work he's doing?
MK: We're doing a curriculum that's in three stages. At the senior management level we're working very closely with a professor at the Harvard Business School who is an expert at managing service organizations. So he's been through the life cycle at Ernst & Young, or a McKinsey type of situation. His expertise is in helping us think through our future and balancing what he calls a "producer-manager" since most of the people running our offices also serve clients. We constantly have to ask, how do you build and manage a global service organization? How do practice groups get formed, as opposed to geographic hubs, as opposed to process kinds of things like grassroots? He provides us with intellectual benchmarking, because he's doing this with all kinds of organizations. This is the kind of stuff the chief knowledge officer is driving.
PRN: Sounds like a major commitment of time and resources. What are the advantages for your clients?
MK: Right now, a client can walk into any office and be pretty much assured that the quality standard is the same wherever they go - and that we are knowledgeable enough about our own operations to be able to put the best team together for their strategy, and that we're providing them with as much firepower as they need for their account without overstaffing the service.
What this does is provide a much more seamless organization, because we are building off of ideas bubbling up from all of our work and sharing them cross boundaries. Another benefit is it makes people a lot more sensitive to what global issues are, and gives much better peripheral vision to the people doing the work. It's highly motivating for the staff, and you get people who are at the top of their game.
PRN: To what extent do you enforce quality control from Washington? How much autonomy do your international offices have?
MK: My staff hates this word, but I use it all the time because it's descriptive. We are a "glocal" agency. The things that we do on a global basis are more of an organizational management thing. You can never [ensure quality control] just by mandating it. You have to do it by doing it. Well, how do you do it? We find the best people, instead of looking for the best firms to buy. And these people come together because they believe in what we're trying to do. So we're not starting with this resistance between the center and its parts.
PRN: How do you find the best people?
MK: I talked to the multinationals in need of services and asked what they thought the gaps were in the market. I asked them to name names of people who they would just die to have working on their business. And, more or less, the same names come up. It's not a secret who these people are. So then the question is, how do you convince these people that they should be working here?
PRN:Yes, how?
MK: In Washington we found a change in the way public policy was being made, and the way in which corporations were doing their positioning meant there was a real convergence of stakeholders. And the way the media interacted with them was different than maybe 10 years ago. We thought there was room to take this more integrated model into other countries. That was very interesting and intriguing to some of these smart people. There was an instant chemistry.
PRN: So did you recruit an entire staff single-handedly before you opened your doors in Europe?
MK: No. We started with critical mass of eight people. But once we started in Brussels and London, we had clients pushing us, saying, 'if you start in another place, I trust you to just give you my work.'
PRN: Including emerging markets?
MK: Especially in emerging markets. Because why? Well, we've been in Moscow since 1988. What are companies worried about in those markets? They're worried about good advice, about not getting into trouble, about bribes. About ethics. About corporate reputation. So who better to trust than people that you know?
We have two former ambassadors who together have worked on European affairs since the Marshall Plan. They know the heads of state and the history. So if we have a manager who is 35 years old and they really need to validate their thinking on this account, they can walk down the hall and talk with someone who has been there, done that. I just really raises the standard and intellect on the whole thing.
PRN: What kind of opportunity does a former ambassador look for? This is not a job that's just about the money.
MK: If you look at our senior counselors, this is a way for them to take what they've learned in one career and to continue to add value to society and to the economic systems. They are true believers in the parts of the world they spent their lives studying. There's a very important social part to that as well as being compensated.
(Kraus, 202/778-1010)