Monday, September 11, 2006

Financial Dynamics Takes a Different Path

The news that Financial Dynamics was being acquired was hardly the world's biggest surprise. Indeed there'd been speculation in the trade media about a deal for some time. What was unusual was the buyer: management consulting firm, FTI and of course that $260m price tag. This news should be welcomed by those in our sector as it shows other industries value the PR world. It also shows that the PR world isn't necessarily destined to be owned by WPP et al. Indeed the deal shows that there is an alternative out there to the 'integrated marketing' message being touted by the large agency groups. That alternative would seem to be based more on integrating a company's ability to reach specific communities – where communications is just a part of the process. At the heart of this new approach would seem to lay the need for 'focus' or specialization. Few would argue that FD was a pretty focused business and it would seem their skill in helping companies manage their profiles in financial circles is to be married to FTI's skill in helping firms solve commercial problems and set strategy. Combined they should be able to offer businesses a way to strategically review their business, undergo the changes that review proposes and manage the communication of that change to the world. Put another way what FTI gets through this deal is the chance to squeeze every last consulting dollar out of some pretty large engagements. It certainly has logic on its side. If they pull this off it could herald a new wave of M&A activity for the PR sector – presuming of course that agencies remain sector focused AND remain connected at the highest levels within their client base.