Capgemini AUNZ has folded The Works, making at least half the agency redundant including a number of its senior leaders, B&T understands.
Douglas Nicol, partner; Damian Pincus, creative partner; and managing director Julie Dormand are all understood to have departed the agency in a wide-ranging round of redundancies. Staff were told of the changes last Thursday, B&T understands.
In a statement, Capgemini told B&T: “As we are in the process of integrating The Works into Capgemini AUNZ, we are preparing our organisation to ensure we meet the evolving needs of our clients and the market”.
Several sources close to the matter have not denied that The Works would be closing when pressed by B&T, despite the vagaries of the official Capgemini statement.
The Works has been on something of a saga in the last 10 years. In 2017, it was acquired by ASX-listed tech business RXP.
At the time, The Works founder Damian Pincus said the response from the creative agency’s staff and clients was “Thank goodness they didn’t sell to a multinational.”
Then in 2021, it was. After announcing its intention to acquire RXP in 2020, French multinational Capgemini acquired the business in a deal worth $95 million.
At the time, The Works was a footnote in the deal, with the penultimate paragraph of a press release noting:
“In addition, RXP’s creative agency, The Works, will open a new chapter for Capgemini in Australia, complementing the capabilities of Capgemini Invent to enable the design and delivery of end-to-end amazing and differentiated digital experiences for clients.”
In its most recent half-year financial results, Capgemini reported that its revenues were down 2.5 per cent year-on-year with its operating margin down two per cent. Its Asia-Pacific revenue was down 3.7 per cent.
“As expected, our growth trajectory started to improve in Q2 and is trending in the right direction in almost all businesses, sectors and regions. The recovery is particularly visible in North America. However, the slope of recovery in the second half will be affected by the recent deterioration of the outlook in the automotive and aerospace sectors and the slower recovery in financial services. In this context, we now expect a low single-digit constant currency exit rate, and target a constant currency growth rate of -0.5 per cent to -1.5 per cent for the full year. Despite this, we confirm our operating margin and free cash flow targets for the full year, demonstrating the resilience of the Group,” said Aiman Ezzat, CEO of the Capgemini Group.
“Client demand is primarily focused on improved efficiency and cost transformation. The traction for our value-added services in the fields of cloud, data & AI, sustainability, and intelligent industry remains strong.
“In an environment that remains soft in the short term, all our resources are mobilised around growth. As demonstrated by the performance of our Strategy & Transformation business, we are well positioned to capture the market upturn.”
In April this year, the agency hired Jerome Gaslain as a growth creation partner.
“As The Works embarks on its long-term vision to be a Growth Creation Company, we needed to find a creative leader who is an innovator and has a deep understanding of the capability of digital and social channels to drive growth for our clients,” said Pincus at the time.
Last year, it came fourth in the national ‘Great Places To Work’ ranking and in December, it announced four promotions across operations, project management, creative and finance — amid what it called “some of the highest staff retention levels recorded industry-wide.”
More to follow.
