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Management Lessons from the News International Crisis

Guest Blogger — Tue, 26 Jul 2011 10:50:32 +0000

Did you watch Rupert and James Murdoch giving evidence to the Select Committee last week?

I did; I found it riveting, and that was long before the shaving foam appeared. It started me thinking about the line between the “organisation” and the staff, and who’s responsible when things go wrong.

We also looked at some of the legal aspects of the accountability of businesses in our tips for preparing for the UK Bribery Act 2011

Actually, UK law does recognise the concept of holding the “organisation” to account (especially for safety), and directors of companies and trustees of charities are legally accountable individually and jointly. This means they can be sued for something an employee did. They have to make sure there are proper systems and procedures, and that staff know and understand them, and they have to monitor that the systems and procedures work and that staff comply with them.

Getting back to Messrs Murdoch, their main message was “We knew nothing”.

Imagine a similar scene: you’re discussing with one of your staff some major disaster that’s happened in their department, and they say “I had no idea what was going on.”

My guess is you might reach one (or several) of the following unattractive conclusions:

They’re clearly remote / out of touch and not making an effort to find out what goes on
Their staff are clearly too scared of them to tell them honestly what was going on.
Their management is so lax they don’t notice anything and their staff can get away with murder.
They did know what was going on but they didn’t think there was anything wrong with it.
They did know what was going on but they’ve been “selectively” ignoring it or they didn’t care as long as staff got results.
They did know what was going on but bottled out of dealing with it.

Now imagine you have to sit in front of a judge or your most important customer and explain what happened and why. Scary!

Management and Leadership Tips – What Can We Learn?

So what can we learn from all this for our own organisations? I think there are some common-sense do’s and don’ts.

If you don’t already – you might want to make sure that your organisation is doing the following:

Do have policies or codes of business ethics making clear what your rules are, and make sure staff see them and understand them.

Do have regular discussions with everyone about what’s ok / not ok for people to do and why – not just covering what’s unlawful, but especially what’s legal but unethical as far as your organisation is concerned.

Do make clear to managers that they must be role models and that they’re responsible for knowing what’s going on and for making sure staff act appropriately.

You can use appraisals and quality systems to help ensure people act appropriately.

Do help managers by training them to deal with difficult people and situations (see our post on dealing with difficult people).

Don’t “selectively” ignore an illegal or inappropriate practice because it’s difficult to deal with or because it saves cost / increases profit. It will come back to bite you!

Do take action as soon as you see something wrong happening.

If you or your organisation needs help with any of the aspects listed above, you might like to consider some of the following training courses:

As for the Murdochs and News International … who knows what’ll happen next.

Thanks to our Management Trainer Christine for providing these tips

The Future of Journalism or The Death of Journalism

Andy Trainer — Fri, 26 Feb 2010 14:22:57 +0000

The Future of Journalism: Is Journalism Dead?

The recent BrightonSEO event was a great opportunity to hear more about the booming SEO industry, an industry often talked about but rarely in the public arena - let alone in a Brighton city centre pub! Want to learn more about SEO? See our Social Media & SEO training courses in Brighton, Sussex.

Many have noticed how online media such as Twitter and Facebook are the first to break news events, and we even wrote a recent blog post on this which received some interesting reader comments. Newspapers are already attempting to harness the power of social media, such as the New Zealand Herald, but how viable is this in the long-term? Doesn’t it simply reinforce the growing dominance of social media and the attraction of real-time news?

Newspapers now need to defend what they stand for – news that is unique, substantial and stimulating. Whatever standpoint we take it’s clear that they need to do something differently.

Why the newspapers are struggling against Google?

“Both the national Chicago papers don’t exist, the Evening Standard went from a million to half a million and now has to give itself away…” – Jeremy Spiller, WhiteHat Media, BrightonSEO.

Until recently the newspaper model was based on CPM. That model is now broken

Propellernet’s Jack Hubbard says: “The print costs are going up, the cost to hire a decent journalist is still there and [newspapers] are really struggling to find a business model that’s going to be sustainable. Google – new kid on the block – blindsided them by basically analysing all their links and drawing conclusions as to who should be promoted to the top or the bottom… [So the newspapers are] losing all their advertising revenue to Google AdWords”.

160 newspapers in the US and the UK went under last year, meaning newspapers need to look at other ways to make money. Many feel that Google and the SEO industry need to start giving the newspapers something back.

How the newspapers are changing their business model

The newspaper industry is already making some very drastic changes to adapt its business model. And the truth is it needs to - even Rupert Murdoch’s losing money, and he’ll be the first to test a new model when on May Day News International (The Times, The Sun, The News of the World) goes behind a paywall. We’ve all got very used to free content and until recently it was assumed that paying for online content was just not going to happen. But the newspapers are desperate and things are changing - consumers are changing - check out my earlier post on the iPad Age; as the book and music markets reveal, people are investing more and more in online content.

For News International to succeed they’ll need to provide unique, competitive content that people will pay for; this is good news for the consumer who’s fed up with the magnitude of low quality content and poor quality free newspapers such as the Metro - distributed on public transport. Even the free papers have seen their revenues slump in the last couple of years, and many are taking this as a sign for the approaching return to paid news.

In late October 2009, Newsday, the US Long Island paper (that was bought for $650 million) put its web site, newsday.com, behind a pay wall. It was one of the first non-business newspapers to take the pay wall plunge. Three months later, how many people signed up to pay $5 a week, or $260 a year for access to newsday.com?

The answer: 35 people. Maybe we are just not ready for payed news. Maybe it will only work for big national papers.

The newspaper industry is in a situation where it now needs to fight for its own survival.

The Content Factory: the death of journalism?

Demand Media are an existing company specialising in selling content on demand – in the region of thousands of articles and videos every day. They pay hundreds of freelance writers, editors and filmmakers around $20 for a video clip and $15 for an article of a few hundred words. This is peanuts to the aspiring a writer and a fraction of what newspapers have paid in the past - as many are complaining, this is no route to encouraging quality content.

This model is highly profitable, but highly depressing for the writer or filmmaker who wants to spend time on their work and knows that quality is dependent on this. As noted in a recent Guardian article, Demand Media and similar companies are going from strength to strength; this is terrifying stuff for journalists. Rather than try sell ads to support content that costs a particular amount, the company has slashed production costs to make advertising more affordable.

Demand employs 7,000 freelance writers, editors, and videographers, and it produces a staggering 4,500 pieces of original content per day—most of it housed on such websites as eHow.com and tailored to pop up in response to almost every conceivable Google search. Steven Kydd, Demand Media’s executive vice president in charge of content, wants to partner up with magazines.

Demand’s approach is similar to what newspapers and other publishers have done before, creating content attractive to advertisers like a gardening or homes section that they know advertisers will pay well to be in. News organizations looking to generate revenue from content on the Web can see that Demand Media’s model does make money. News companies could learn from Demand’s approach, not for mainstream news, but for niche sites that are focused on reader demand and generating revenue. But this is content creation, not journalism; journalists create things that editors believe readers want or need to know about, some of which will be attractive to advertisers, some of which will not.

Newpapers could employ a strategy like Demand’s, using advertising to support other news efforts (just like they do with bridal sections). Niche sites would have to focus on topics such as travel or gardening, which would be attractive to advertisers.

At the Brighton SEO event Jeremy Spiller recalled the example of The Daily Telegraph: “they’re evolving into different revenue streams… they’ve got things like registration so therefore they own data… they’re profiling people, they’re setting up business clubs and gardening clubs…. They’re profiling people… [and] that’s an asset in itself, because then you can sell that on to travel companies etc etc“. Newspapers are already busy adapting their business models, and it’s still to be seen where this will lead.”

Beating Google

In a recent incident Google was attacked for its “parasitical nature”, causing Google’s Marissa Mayer to jump in defense. However, blaming Google is taking the easy option – newspapers need to fight back.

There’s no question that good content costs money, and don’t people crave quality more and more in a world of consumables? Poor journalists aside, this is an exciting time for the news consumer.

Microsoft Attacks Google with News Corp Deal

Andy Trainer — Mon, 23 Nov 2009 15:51:01 +0000

Since Microsoft launched its new Bing search engine out of the ashes of Windows Live back in May, it hasn’t made many inroads on Google‘s dominance of the search market.

That could be set to change, if a new deal between Microsoft and media giant News Corp announced today comes to fruition. In a bold move, Microsoft has held discussions with Rupert Murdoch’s firm around a deal which could see News Corp “de-index” its news sites from Google, granting exclusivity to Bing.

News Corp owns some of the world biggest newspapers, including the New York Post and The Wall Street Journal in the USA, and The Sun, The Times and the News of the World in the UK.

If information is power (which it certainly is when it comes to seach engines) – this move to effectively censor the information Google can display in its SERPS could be a key move in winning market share for Bing. Market share for Bing is currently around 10-12%, which is embarrasing compared to Google’s share of over 50%.

In terms of service – at present Bing doesn’t really offer anything that Google doesn’t already have. This new line of attack is about taking away from Google, rather than adding anything new or innovative to Bing.

Rupert Murdoch has made his intent to charge for online content clear for some time, using the argument that “quality journalism doesn’t come cheap”. Most major newspapers currently publish the majority of their content online for free, which has had a major impact on sales of papers from newsagents.

The argument over for whether news should be made availalbe free online or not will continue, but what is clear is that if the way we consume our news online moves to a “paid-for” model, the search engine with the publishing rights to the major players’ content will hold a distinct advantage.

Could this be the beginning of a turn in the tide for Bing’s fortunes?

Let us know your thoughts on this…