Tuesday, October 20, 2009
What's Really Next?
What's really next for media companies?
Smaller - leaner - more outsourcing.
The chart to the right reflects a related growth curve between staffing and corporate efficiency, or productivity.
The way this applies to radio is at the core of its frustration with attracting more loyal listeners.
There just has not been any investment in the product in over a year at a time when radio is competing with media that understand the importance of creative content.
Radio has its own set of rules and at this point, generally, most radio companies can ill afford to invest in the one thing that will help their business grow: personnel and content creation.
Economies such as the one we're experiencing in late 2009 no longer lend themselves to the operations models which allowed companies to staff more robustly.
The benefit to that kind of structure is that if companies staff responsibly, employees reach their maximum potential to deliver for the company by reaching their own competency levels.
What has led to this redesign of culture is the reduction in staffing and a reduction in quality output. Once highly-competent employees have found themselves delegated more and more work often outside their area of specialty or comfort.
This tends to result in staff that are not competent at the new tasks and somewhat less competent at their old tasks. This amounts to a severe reduction in efficiencies and production which further drives down business cash flow.
This cannot be sustained.
Something's got to change. And this is what we're experiencing.
Change can be uncomfortable.
Ultimately, change is for the best.
Therefore, the best option is to reduce workload to a more comfortable level where talented employees can do their jobs at levels that will again produce positively for companies. Operating in this culture will allow companies to regain traction and begin to rebuild.
This means a shrinking of the business as a whole in every aspect.
It may be "circle-the-wagons" time for the media industry - certainly it is for terrestrial radio - and concentrate on core competencies until things return to a less volitile marketplace.
Yet, despite this reduction in services, companies must also understand they cannot grow by cutting. Business development can continue to be a part of the mix.
For radio, an industry that still experiences respectable profit margins, this will mean figuring out a way to reinvest some of that profit margin back into their businesses.
I'll reveal how to do that, in my next blog.