Cygnus Business Media is moving in a direction it says no other media company is: It is rolling the majority of its brands into four affinity groups that will be headed by four executive vice presidents. The aim of the changes, it says, is to build a framework that is better equipped to handle market dynamics and more effectively execute media strategies.
The new organizational structure comes about 10 months after the trade publishing company emerged from bankruptcy protection with new ownership, a new CEO and $120 million less in debt. It also comes about three years after the company created five director positions to oversee the company’s portfolio of 15 brands.
Here, CEO John French talks with FOLIO: and dives a bit deeper on the reasoning behind the company’s newest transformation:
FOLIO: In announcing these changes, you talked about the idea of being more transparent to the customer. Can you expand on that? How exactly does this new structure improve that?
John French: A couple ways. We’ve seen a lot of announcements from media companies that are going in this direction, that say they need to be more transparent, that they need to bring their groups together, to establish portals and other positions. That all makes perfect sense but, frankly, we believe they haven’t gone far enough. Everybody stops at some line. We think we’ve gone beyond that.
We think that we’re in a position to bring everything together under one EVP. That person is going to spend every day thinking about what’s going on in their marketplace and not be constrained by platform. Our employees, publishers and show directors live in their marketplace and do a good job serving it, but anything that gets beyond what they can control—beyond the magazine, maybe beyond their trade show or beyond online—they have to go and talk to someone else, and maybe they aren’t on the same team.
For us, we’ll have one person at the top, identified in one of the four networks. That person will have three pillars reporting to them: sales, content and marketing. It’s so simple when you think about it, but I don’t think many companies have had the guts to do it, frankly, to make that one final completion where it becomes totally market facing. Cygnus is going to do it.
FOLIO: How many Cygnus brands won’t be rolled under these four new networks? Which markets are they in?
French: About half a dozen, I think. They’re in all different markets, and that’s the problem … These brands are still a vital part of our company. We’re going to stay in those markets and help them to continue to grow. All we’re doing is picking out where there is symmetry around the company and building a position in each one of those marketplaces. We’re not throwing those other products away.
FOLIO: What types of efficiencies on the business end do you expect to realize from this new structure?
French: We didn’t go into this looking for efficiencies or to save costs. This plan calls for more jobs, not less jobs. This company is very well run on the costs side. By doing things this way, using public safety—our biggest position as an example: If someone wants to do business with us, they can do it through EMT, through Officer, Security or Fire. They have to talk to three or four people. With this, we’re going to have one point of contact. Someone comes to us and says they have a big products launch and they want print, trade shows, online, then our people will able to turn it around instantaneously. Today, it’s a complex process. As self-serving as this might be for us, the big winners here are the customers.
FOLIO: You said the new organization will help create new jobs. How so?
French: This is an investment for us. Every time this company has gone through a reorganization of some sort it always meant cutting costs. We’ve turned that around, and that’s why we intentionally termed it a new architecture, not a reorganization. We’re talking about the best practices of marketing at each one of these portals. This won’t be the historic marketing person we’ve all known—the person who sent out the electronic media kits, the updates for the next issue or the attendee brochure for tradeshows. The top marketing person (and their staffs) will continue to do all that but will unify one message that will go to everyone in their industry. They will get one Cygnus message to people who advertise, who exhibit, people who come to our tradeshows and the people who read our magazines.
FOLIO: In terms of the company overall, how’s performance for 2010 year-to-date? What’s up? What’s not?
French: The good news is that we’re seeing some light. In terms of our performance against our plan, we’re beating it. We did very well year-end 2009 and we’re beating our goals for the first three quarters this year.
In terms of platforms, the decline in print is slowing pretty dramatically compared to last year. Online, we just brought on Tom Kohn as executive vice president of digital, and online is doing very well. Agriculture continues to do well for us. We’re seeing the declines in construction, in both commercial and residential, slowing down.
In a lot of ways I think we kind of mirror the economy where everything is a lot better than it was this time last year. At the same time, there’s still caution, and we’re taking it day-to-day, month-by-month.
FOLIO: In addition to the company’s new logo, Cygnus also has a new tagline: “Because the world is changing very fast.” Where did that come from?
French: We believe the world is changing very fast. All the other things we’ve gone through in other recessions, when we thought we’d come out of it with big change, it hasn’t happened. This recession is forcing us to make the big shift to online, audience development and audience engagement.
We’re also using it as an analogy for Cygnus. Not to be over dramatic, but just the fact that you and I are talking right now about what we think are some very positive things for Cygnus, you’ve never had the chance to write about that before. The world is changing very fast and our company is changing very fast. We’re going to stake our claim on that tagline, that says because it’s changing very fast, we’re going to lead it.