Managing Rapid Growth
With Internet revenues at some publishing companies soaring more than 35 percent a year, you’d almost think it was the nineties again.
In fact, if you work at a traditional magazine company, it’s a lot more complicated because while advertising on Web products is flying off the charts, and event revenue is up nicely, even traditionally strong print products are experiencing only modest growth, and many are flat or down in advertising volume.
How do you make sure that your electronic revenues continue to grow at an accelerated pace, and that you are doing all you can to grow ever faster? Here are some tips to make sure you don’t get ahead of yourself, or fall behind your competitors.
Organize Properly: Many media companies are organized by product. Often, the different groups hardly talk to each other, turfs and internal politics slow down decision making and financial incentives are wrongheaded. Instead, organize by market or audience served. Whether your audience is firefighters, fly fishermen, or baseball fans, you should be structured in a way that all products targeted at that audience are managed by the same team. The Wall Street Journal recently moved in this direction with a new organizational structure. Also, centralization is a great way to save money and increase efficiency, but it can slow down experimentation and innovation, so make sure P&L managers have real authority to move forward without waiting for "corporate" approval.
Integrate Employees Effectively: If you are growing rapidly, that usually means you are hiring lots of new people. When there is so much to do, it’s easy to let new team members fend for themselves. It doesn’t take much effort to orient them effectively, introduce them to people across the company, take the time to train them on processes and approaches, and make them feel part of the team.
Take Risks: You can’t achieve maximum growth if you’re afraid to try new products, change processes or people, and push the limits. You’ve got to be willing to move quickly, even imposing change if necessary. Take something that is working in one area of your operation, like a Web-based e-book, and try it elsewhere, leaving room to customize it for special needs or market
conditions. If you are overly afraid of failure, you’ll miss the bandwagon. (But that also means if something fails, you can’t get into the "blame" game, or you discourage risk taking.) Some companies set up special new-product funds to pay for growth initiatives, so more
cautious executives aren’t worried about losing a bonus if they take a risk and it fails.
Watch the Competition: Sometimes when your own growth is so rapid, you forget to watch the other guy. If you’re growing at 15 percent and think it’s terrific, while others are doubling your growth rates, you’re no genius. Of course, you should be making decisions best for your products and your market. It’s always better to initiate than respond to competitors. Some media executives spend way too much time worrying about what others are doing, but keeping a careful eye on competitors, particularly with respect to new products, is always important.
Perpetually Communicate: This is management 101, but it’s even more important when things are moving swiftly. Be clear about decision making and responsibilities. If one unit is launching a new Web product from a distant location, but the IT director in headquarters doesn’t know about it, that is not helpful. Still, don’t let bureaucracy or matrixed organizational structures stand in the way of moving ahead. Communicate, and cooperate, but don’t wait. It’s a hard balance.
Measure Everything: Disciplined financial reporting and metrics are just as important in a growth
economy as in a recession, maybe even more so. Unfortunately, the industry has not yet developed standardized metrics in the Web world. With so many publishers using different filtering systems, it is difficult to know for sure what is a competitive click-through rate or how your Web traffic really compares to others. But you should at least have internal reports that compare trends and growth patterns consistently, no matter what approach you use.
Be Decisive: Make decisions quickly. It is sometimes better to make the wrong decision than no decision at all. In a time of rapid growth and change, it’s not bad to follow the motto: Ask for forgiveness, not permission.
Jeffrey S. Klein is chairman of 101communications, a b-to-b publisher serving the information technology market.