While publishers are scrambling to get online, true transformation requires much more.
The closing CEO roundtable at ABM Top Management typically brings together a group of executives to talk about how their companies embody the major themes of the conference. This year, the CEO panel emphasized that the transformation facing publishers isn’t just about adapting online but breaking established, outdated molds throughout their companies. Regardless of whether the emphasis is changing from print to online, the focus should remain smart business. "In my mind, everything we do is still the same," said Harry Sachinis, president of the McGraw-Hill Business Information Group. "If you’re in editorial, everyone is talking about what to do with community. Ask yourself, ‘What is community?’ All that means is if you had 100 sources before, now you have 10,000 sources."
While Vance Publishing had thrived for years with a very decentralized approach, the recent ad recession forced that company to re-evaluate its organization, said president and COO Peggy Walker. "We did due diligence on our own markets as if we were making an acquisition," she added.
The company found that in its decentralized approach, its staff was involved in dozens of different small projects that drew resources away from two or three larger projects that could have yielded bigger pay-off.
While Farm Progress Companies boasted 18 titles, eight of which are more than 150 years old, and a database with more than 2 million names, the company was held back by operating inefficiencies (including 18 different set-up costs for its magazines) and not differentiating its products, according to president Jeff Lapin. "Advertisers recognized us as a strong brand, but said we just did the same content across 18 magazine," he added.
Farm Progress recast its magazines to obtain more of a national and local balance. The company also expanded into new markets, relaunching Future Farmers (a business magazine for high-income farmers) and launched Rural Life, its first entry into the consumer market.
Don’t Skimp On Investment
While cost cutting dominated b-to-b publishing the last few years as the industry struggled through the ad recession, each of the panelists said that investment and fostering an entrepreneurial mindset were the keys to successful transformation. While Vance invested in digital products and infrastructure, it also hired "change agents" such as a new HR person and made the head of IT part of the senior management team, according to Walker.
Neal Vitale, CEO of 1105 Media, spoke of changing the corporate culture from one that focused just on the bottom line. "We want there to be a sense that it’s better to ask for forgiveness than for permission," he said. "If people have a good idea, don’t wait around for approval from the budget department."
"Overhire," advised Sachinis, who described hiring a former astronaut and aviation-industry executive to run McGraw-Hill’s AviationWeek group. "You get what you pay for."