This blog, written by Forrester CEO George Colony, contains ideas, observations, and analyses to help drive the success of other CEOs. George’s goal is to assist today’s company leaders in forming unique approaches to the challenges they face. Read George’s biography.
Quickly: If you are a CEO in the media industry, you must move your company through three stages.
Content: I was shocked when I heard that Conde Nast was shuttering Gourmet Magazine after 68 years of operation. Gourmet had 900,000 subscribers, with total readership of approximately six million. Yes, advertising revenue was off 30%, but clearly Gourmet was a brand and franchise that was destined to morph into an Internet beehive of content, social sharing of travel and food tips, community, and close affinity. And they were on their way with 8,000 Facebook friends, 22,000 followers for editor Ruth Reichl on Twittter, and a YouTube channel. Gourmet could have and should have become the upscale Grand Dame sister of Epicurious.com, Conde Nast's successful recipe site. Why didn't the company get this?
Because much of Conde Nast is stuck in media meltdown.
Have you ever wondered what CEO's really want? Ever pondered on what you'd find in the CEO's head if you could take off the top of his or her skull and peer inside? Here's a short story and simple answers to those questions.
I have spent many years helping technologists in large companies communicate with executive management. Chief Information Officers often speak a different language than the CEO and commonly see the world through a different lens. As a way of signaling to the CEO that a new era of business-focused technology has arrived I have been advocating that the CIO change the term Information Technology (IT) to Business Technology (BT). It's a not-too-subtle way for the CIO to say, "Hey, I'm no longer the insular geek you've come to know and love through the years -- my team and I are about making money, not just tech."
There are no templates for being an effective CEO. When asked how to be a good leader, Jack Welch answered, "Be yourself" -- and I would concur. Especially if you serve for many years, you can't fake it.
That said, there are many valuable lessons to be learned. I get inspiration and tips from fiction (Martin Sheen's President Bartlet on The West Wing), history (Churchill's writings on WW II) academics like Warren Bennis, and from watching other CEOs in action. Recently I've drawn some inspiration from John Chambers, the CEO at Cisco. Here's what I've learned:
Is there anything more boring than raw data? Yes, a blog that spews forth raw data. So I'll keep this short and sweet.
When CEOs doubt the importance of technology in the economy, I pull out a home grown aphorism: Technology is changing your customer, and your customer will change your company. In other words, whether you like it or not, demand will ultimately morph supply. And it's the job of the CEO to have a firm grasp of that dynamic.
So in the spirit of keeping CEOs up-to-date on the changing customer (like my 92 year old mother, shown above reading from a Kindle), here's a super-condensed summary of Forrester's recent survey of U.S. consumers.
A.G. Lafley, Procter & Gamble's CEO (and now Chairman), penned an HBR article in May that I think best summarizes the job of the CEO. Get your assistant to buy it -- and you should read it -- very good stuff.
To give a taste, here's my summary, plus a few of my favorite quotes.
Lafley argues that because the CEO doesn't report to anyone within the enterprise, only he can truly advocate for customers and shareholders. As Peter Drucker, Lafley's guru, stated: "The CEO is the link between the Inside that is 'the organization' and the Outside of society, economy, technology, markets, and customers. Inside there are only costs. Results are only on the outside."
If you're the typical CEO, you are carrying a BlackBerry. But not for long. Once the iPhone is able, in a corporate setting, to replicate all aspects of Outlook (email, calendar, notes, and tasks) with high security, the iPhone floodgates will open and you will have a new device. Here's why:
1) User interface. Despite the annoyance of the glass keyboard, the iPhone interface is faster, more intuitive, more flexible, and more versatile. You can do more, with more content, less instruction, and faster speed.
2) Applications. iPhone has a massive head start in the battle for applications. It's possible that your company already has an iPhone application in the market -- servicing your customers. Don't you wish you could see it? And there may already be applications available that will make your job easier -- I predict that corporate dashboards for CEOs will be a small but influential segment of the iPhone apps portfolio. In some markets, it's changing how customers connect to companies -- here's an example around mobile banking. The application revolution has begun -- and it's not on BlackBerry.
3) iPhone will soon be available from more cell services providers -- starting first in Europe. Once the device breaks out of its AT&T cage, the multiplier effect will kick in -- and the flood waters will rise fast.
Forrester put out a report last week that showed that marketing budgets in large global companies are down 20% this year. Spending on TV, print, radio, magazines, and other branding and advertising is down a breathtaking 60%+. More contemporary channels like social computing and Web sites are seeing only modest cuts, with many companies reporting that they are actually increasing spending in those areas.
What should the CEO take away from this?
1) The report showed renewed focus on return on investment measures for marketing -- this is a healthy development that will help you post-recession. ROI analysis will eliminate, or at least minimize future marketing nonsense.
2) Social marketing is here to stay. It's time for you to understand it.
We’ll look back on this recession as much more than an ugly economic moment. History will view it as The Gateway — a portal connecting two very different eras.
When the economic clouds clear, many prevailing elites will have been swept away, organizational structures will have fallen, and many who were formerly in control will have lost power. Those who can speak digital will thrive, and those who cannot will finally get the message and retire.
The signs are everywhere. Post-Gateway players: Obama; Amazon; Zappos; Jet Blue; Twitter; Facebook; blogs; Craigslist; broadband; Wikipedia; DVRs and iTunes. Pre-Gateway: GM; The New York Times; the Republican party; shopping malls; print advertising; excessive executive pay; TV networks; boards of directors full of aging plutocrats; and the TV-centered Washington chattering classes. Like the US Civil War, which separated an agrarian society from an industrialized economy, or World War I — a death knell for many European elites — the Gateway Recession is exposing fundamental weaknesses in long-standing political, cultural, and economic institutions.
Here are the new challenges and rules that await CEOs on the other side of that door: