Powell Tate's Post-Merger Exodus

By Judy Sarasohn
Thursday, February 24, 2000

The Washington government/public relations world is buzzing these days about the former Powell Tate people leaving for other shops now that Powell Tate has been taken over by Shandwick Public Affairs.

One by one, for various reasons, a half-dozen or more have left Shandwick Public Affairs-Washington in recent weeks. Some former Powell Tate staffers and competitors say more are expected to bolt.

Among those who have left are Read Scott-Martin for The Rasky/Baerlein Group; Ken Vest for his own firm, Vest Communications; Jackie Nedell for Porter/Novelli; Thomas McMahon for Brodeur Worldwide; and Julia Sutherland for Ketchum.

Shandwick International, one of the largest PR companies in the nation and itself bought in 1998 by Interpublic, acquired the Cassidy Cos.--the parent company of Powell Tate--late last year.

Few Powell Tate folks wanted to comment on the record other than to look forward to their new opportunities. It was clear, however, from current and former employees, as well as competitors, that the uncertainty over the merger and a potential clash of cultures at the Powell Tate and Shandwick operations were significant factors. Powell Tate people generally are more senior Washington operators, while Shandwick Public Affairs people are said to be younger, high-tech specialists.

"When we knew this acquisition would occur, I did some soul-searching on whether I wanted to be part of a global operation. Powell Tate was a special place," said one person who decided to leave.

"Shandwick is a very, very large company," said another public affairs specialist. "If you were a person romanced by working for a company that was bootstrapped up by Jody Powell . . ."

Jody Powell, who burst onto the Washington scene as President Jimmy Carter's press secretary, said that the departures are "not a grave concern" to the company and that the newly constituted Shandwick Public Affairs is bringing new people on board at the same time.

"It's almost inevitable that you lose some people in a merger like this," said Powell, now chairman and CEO of Shandwick's public relations operation here. "I'm a paternalistic guy and I hate to lose anybody. . . . There's always a certain amount of to-ing and fro-ing."

A reason for the wave of departures, he said, is that people who might have left over a longer period of time stayed on through December to vest in the company's employee stock ownership plan. "It was eight months of normal attrition packed into four weeks" because of vesting.

Powell, who has an employment contract at Shandwick, acknowledged that he had had concerns about being part of a giant company years ago when he made the move to Cassidy to avoid becoming part of the WPP Group conglomerate. "I changed my thinking a couple of years ago. The world has changed. . . . [Clients] want an agency of record that can do it all for them."

He also said he has "no doubt that [he's] running a much stronger company now" because of Shandwick's added resources and new people joining the office.

A number of the other former Powell Taters were grateful for their time there even though they decided to leave. "The company did well by us," said one. "It made all of us more desirable in Washington."

Branstad's State Focus

Former Iowa governor Terry E. Branstad, a four-term Republican who left office last year, has joined Kaufman-Nelson-Pattee, a consulting firm that specializes in building partnerships among clients, state leaders and the federal government.

Other members of the firm, one of the Dutko Group Cos., are Ronald Kaufman, finance chairman of the Republican Governors' Association and former political director at the Bush White House; Craig Pattee, a former Bush administration official at the Department of Education and former staff chairman of the National Governors' Association's Economic Development and Natural Resources committees; and former Democratic Nebraska governor Ben Nelson.

The firm will be renamed Kaufman-Nelson-Pattee-Branstad. Branstad will open an office in West Des Moines, focusing on agriculture, environment and transportation issues.

The consulting shop's client roster has included AT&T, Coca-Cola, 3M, Eli Lilly, Winstar Communications and Harley-Davidson.

Although a lot of organizations have focused on Washington, they are now also "looking to connect" with state political leaders because of the "power shift to the states," Branstad said. Governors and other state leaders, for example, are increasingly playing a role in international trade, he said.

Nelson, by the way, announced yesterday that he will run for the seat being vacated by Sen. Bob Kerrey (D-Neb.), who is not seeking a third term.

A two-term governor, Nelson lost a Senate bid in 1996 to Republican Chuck Hagel. Nelson, who expects to remain part of the consulting shop during the campaign, is the only Democrat in the hunt.

Hooking Up With Microsoft

Edward Tobin, the US West vice president for public policy who was an aide to former Massachusetts governor William F. Weld (R), is joining Microsoft Corp. as senior director for corporate affairs.

Tobin will oversee the software behemoth's federal, state and local government relations activities, as well as its political action committee. He succeeds Kimberly Ellwanger, who left the company late last year to spend more time with her family.

Greer, Margolis, Mitchell, Burns & Associates, a D.C.-based advertising and PR shop that specializes in public policy issues, has won the advertising account of the Campaign for Tobacco-Free Kids. It's a big-bucks effort of the anti-tobacco group, although spokesman Vince Willmore declined to say how big.

Willmore said that the previous shop, Alexandria's Smith & Harroff, had done "very good work" but that the Campaign had decided "to compete" the account to get the best ideas for delivering "an aggressive message and delivering it effectively."

GMMBA was involved in getting California's Proposition 10 passed last year. That measure increased cigarette taxes by 75 cents a pack.

And on the other side, Tom Lauria, who helped peddle the tobacco industry's message at the Tobacco Institute before the lobby group was dismantled last year as part of an agreement with the states, is now speaking out on behalf of Guest Choice Network, the coalition of restaurant and tavern operators that fights government restrictions on how they serve such items as alcohol and tobacco and that sponsors the Nanny Awards, given to "those activists, organizations and bureaucrats who work tirelessly to restrict our food, beverage and lifestyle choices."

"It certainly lined up with my libertarian interests," said Lauria, director of communications for the coalition. "Restaurants are a battlefield."

Going With the Flow

Tom Curtis, former deputy director for intergovernmental liaison at the Environmental Council of States, has been named the new deputy executive director of the American Water Works Association. He will oversee the group's governmental affairs work. Curtis earlier served as director of the Natural Resources Committee for the National Governors Association.

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