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Proposals and Cost Estimates

Posted on Thursday, July 09, 2009 at 1:51 PM

A few months ago, we received a call from a publisher. He was looking to have a comprehensive management audit conducted on his operations. My firm and several others were being invited to submit proposals. He offered to provide a lot of background documents to help in preparing the proposal. His request for proposal specified that the a detailed description of the methodology that would be used in conducting the audit must be included along with pricing information.

We're always pleased to give free ballpark estimates based on a clients description of a project. However, this publisher was looking for something we honestly couldn't do.

Giving a detailed description of how we'd carry out an analysis of this client's business would require that we first acquire a detailed understanding of the business itself. No two publishing operations are the same. There are different people and personalities, different sizes of operations, different resources and facilities. And they all impact how we would conduct an audit and make recommendations. It's just not possible to get sufficient insight only from documents provided by the client.

That's why we have a long-standing policy of declining invitations to bid on large, amorphous projects like this one. (We can, however, prepare such proposals on a retainer basis.)

We offered this client an alternative: We would conduct a preliminary analysis of his operations for a modest price. This would involve starting with the client's self-identification of problem areas, making our own assessment, taking stock of strengths and weaknesses and of the organization's readiness for change, and finally of its resources for supporting and effectuating change. The result would be a detailed assessment report including recommendations.

This made a lot of sense to the client, and we went ahead with the project. Our feedback shed light on key issues that needed to be addressed, and suggesed approaches for a remedial course of action. The client was both pleased and surprised. What surprised him most was that this preliminary analysis actually accomplished all he was looking for from the "comprehensive management audit" that he was seeking bids on. And we were able to provide it to him for a fraction of the cost he originally envisioned.

Posted in Consulting (RSS)

Distressed Print Publications Making Mistakes

Posted on Thursday, July 09, 2009 at 1:49 PM

It's no secret that a lot of print publications are suffering. Advertising is down. Subscriptions are down. The only thing that's up is the number of casualties. Some major publications have already shut down, along with a host of smaller ones.

Many publications, however, are transitioning from print to online as a means of cutting costs. After all, with revenues down, it would seem to make good sense to reduce costs wherever possible. Switching to an online presentation can almost instantly cut out a big chunk of expense: paper, printing, distribution.

For most publications that have been print-only, developing an effective online strategy is long overdue. Today's readers have different expectations for how news and information should be provided to them. The print-only model for many is a relic of yesteryear.

That doesn't mean that there's no role for print in the mix. There are still a lot of things that can be provided with greater utility in print than online. But the idea of all print all the time has little relevance today.

That said, many distressed print publications are making transitions to online that are ill advised.

Coping with a recessionary period has always put a strain on publishers. Usually, when companies that use media advertising start feeling the pinch, advertising budgets are among the first to be cut. As a result, publishers are among the first to feel the pains of recession.

My consulting firm has worked with publishers through quite a number of recessionary periods. As a result, we've been able to observe some general patterns that seem to repeat themselves each time. We've seen publishers that are able to withstand tough economic times with only a minimal amount of sacrifice. For some, business even improves. Others, however, have their very existence threatened.

What's the difference? Why do some thrive, while others fail? My own observation is that the publishing companies that ran into the most trouble were operating with troubled business strategies in the first place. When times were good, they were able to coast along and even turn a profit. But when the going got tough, they didn't have the inherent strength to keep going.

That process reminds me of awhile back when my car was overdue for a tune-up. When I cruised along on a flat stretch of road, it ran with no apparent problems. But, if I drove up a steep hill, the engine would start to sputter and cough, and the car had trouble making it up the hill.

In past recessions, when publishing companies in need of a strategic tune-up began having trouble making ends meet, many realized something was amiss. That led them to address the primary dysfunction that existed in their business plans and strategies. As a result, many were able to pull through the recession and emerge even stronger.

The problem today is that instead of having that epiphany and subsequent adoption of new business strategies, the publishers are merely opting to cut out the major print-related expenses and go online. That's a mistake.

It's true that they begin saving money. But in the end they're not saving their publications. That's because they haven't routed out and changed the old dysfunctional business concepts that led them to the trouble they're in. What many publishers are doing is simply taking their print-style content, along with their old business models, and moving them online.

They're buying some time with this move. But they haven't fixed the underlying problems. In effect, they're masking the symptoms rather than addressing the cause.

Solid, sustainable results from publishing operations are best achieved by using a sound, synergistic business model. An economic downturn is a wonderful time to fix longstanding flaws in your business model. Doing so will help you survive the tough period. And it will also put you in a much stronger position for attaining even greater levels of success when economic conditions rebound.

Posted in Advertising (RSS), Economy (RSS), Online (RSS), Print (RSS), Strategy (RSS)

Client References?

Posted on Thursday, July 09, 2009 at 1:49 PM

We used to provide client references to prospective clients, but stopped. The reason is that we came to see how that practice was compromising the interests and confidentiality of existing clients. Let me give you a few examples of incidents that led us to that conclusion.

Item: We had been providing services to Client X for a number of years. A competitor saw Client X's name on our list of clients, familiarized himself with our writings, and thereby was able to formulate insightful competitive strategies against Client X.

Item: We had done extensive advertising sales training with the staff at Client A. Client B was not a competitor of Client A, but had a sales staff that was underperforming. Instead of addressing the staff's underperformance, Client B attempted to hire away sales people from Client A, realizing that they had already received our extensive sales training.

Item: A prospective client was interested in developing greater readership for her publication. She requested the names of clients for which we had previously done readership development work. Soon afterwards, we received complaints from those clients. The prospective client had begun pestering them to tell her the specific lessons they had learned from us, in an attempt to get the essence of our advice for free.

Item: A man called requesting help on a start-up, and asked for references. One of the clients we put him in touch with was a past-president of one of the major broadcast networks. After speaking with that client, the man called back saying, "You should give that guy half of everything you make," in response to the positive comments that were made about our help. What then unfolded, however, was that this start-up entrepreneur was operating in a very unsavory area of publishing that bordered on illegality. Of course, we regretted very much that we had put that character in touch with our prominent client.

That last item was the final straw. We weren't about to start checking references on prospective clients before putting them in touch with existing clients. Thus, we concluded that the best policy for serving the interests of clients is to consider their identity as a confidential matter, and to decline requests for client references.

Posted in Consulting (RSS)

A Unified Strategy

Posted on Thursday, July 09, 2009 at 12:04 PM

A magazine publisher called us in because, she said, they were not achieving the level of success that she wanted at her company. She believed her staff was at fault. But she asked me to analyze things to find out who were the main offenders. I started by meeting separately with key staff members: the ad sales director, the circulation marketing manager, and the editor-in-chief.

When I met with the ad sales director, I asked him, "What's wrong here?" He replied that his sales team was doing a great job selling advertising. The problem is that the circulation manager was selling subscriptions to the wrong people, to people without an interest in buying what was advertised. As a result, advertisers would go away when they got little response to their ads.

Then, I met with the circulation marketing manager and asked her, "What's wrong here?" She indicated that her department did extensive testing and had developed highly targed marketing approaches that were very successful at bringing in new readers. The problem is that the editor was writing to a different audience. The articles he was publishing didn't resonate with the new readers, and they rarely renewed.

Finally, I met with the editor-in-chief. I asked him, "What's wrong here?" He said that he and his staff did a masterful job of creating highly interesting and insightful articles. The problem is that the ad director is filling the magazine with irrelevant advertisements, and the marketing manager was selling subscriptions to the wrong audience.

Each of these key managers believed that he or she was doing a good job. And, from what I could see of their work, they were right. The ad sales team was doing an effective job of salesmanship. The subscription marketing group was using the best practices in subscription sales. The editorial staff was producing really excellent articles.

What was wrong there was that there was no unified strategy. There was no synergy. Each department had its own vision for the magazine. But the visions didn't match up. If ever there was a need for a unified strategy, it was with this company.

Posted in Personnel (RSS), Strategy (RSS)

The Assessment

Posted on Wednesday, July 01, 2009 at 1:53 PM

The purpose of an assessment (sometimes called an audit) is to survey an organization's strengths and weaknesses, identify problem areas, and indicate likely solutions. It also identifies underexploited strengths deserving of greater attention. The assessment examines the structure of the organization, the quality of staffing, the financial resources, the market position, and the processes it uses to do its work.

Typically, we will examine your:

--organizational goals and objectives,

--structure and organizational dynamics of your team,

--use of technology,

--workflow practices,

--division of responsibilities between staff and outside suppliers,

--management systems,

--staff and freelance competencies,

--resources available for accomplishing your mission, and

--impact upon key constituencies.

An assessment can provide an early warning of impending problems and identify unperceived issues, or it can relieve doubts or fears. The results of an assessment can help an organization to direct its attention and resources in ways that will be most productive for both the short and long term.

The cost of an assessment usually ranges from $3000 to over $50,000, depending upon the size and complexity of the organization and on intricacy of the dilemmas it faces. In cases where an extensive assessment is needed, we recommend first conducting a simple assessment, and, based on its findings, devising a plan for a more thorough and targeted assessment. This is usually the most cost-effective approach.

We are experienced at doing organizational assessments of for-profit and non-profit organizations. That means we'll get to your key issues right away, and won't take up your time unnecessarily. We know exactly what to ask and what to look for. You'll get the insights and advice you're looking for -- without running up an excessive bill. One client had budgeted $30,000 for an assessment. We were able to deliver one for just under $5000, and provided far more insight and specificity than was expected.

Posted in Consulting (RSS), Launch/Relaunch (RSS), Strategy (RSS)

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