Time Inc. Boss Ann Moore to Troops: “Act Like a Private Equity Company…We Will All Get Through This”
Apologies to Time Inc. employees waiting to learn their fate: There’s no new information to offer you here.
But thanks to a source familiar with Time Inc. boss Ann Moore’s meeting today with the senior staff at her “Style and Entertainment” Group, we can give you a very good sense of what she’s telling employees at Time Warner’s (TWX) magazine unit.
In short, it’s a pep talk version–sort of–of the reorg memo she distributed last week: Suck it up, buckle down and get to work. We’re restructuring the company because the economy stinks, but we’re still a magazine company, and don’t lose sight of that.
And while we doubt that any of Ann’s employees would take her words lightly, the folks at the Style group need to pay even closer attention–following the reorg, she now oversees the unit directly.
Again, this is not a verbatim transcript of Moore’s remarks. If anyone wants to offer more details, correct errors, etc, please contact me: email@example.com.
Some insiders don’t see the need for change. They look outside, but outsiders don’t know how to succeed. We need to be insider/outsiders. The rules have changed, and we need to find who within our org can work as a team. Is this re-org forever? We hope not. It’s a two-year plan. Employees need to act like an equity company that bought Time Inc.
Digital performed really well in 2006-07 in the face of the greatest economic recession in her lifetime. The situation today reminds her of the 1978 economy all over again. History repeats–this is a cycle. She relayed an anecdote about renting the top 12 floors to Lehman Brothers one year ago. They spent extraordinary amounts of money renovating, and then they moved out last week. Time Inc. Digital was exhausted and exhilarated at the end of 2007 with double-digit growth. What we are in now is technically not a recession, but it is for us.
Moore said she is working hard at Gratitude. At the quarterly manager’s meeting, her following gratitude points never got picked up by any reporters:
1. Readers are not abandoning print. Net profits are up in 2008. Readers are still reading and buying magazines. They provide relaxation and relieve stress.
2. Digital traffic growth was 72 percent in 2007, with strong revenues outpacing EVERYONE. Traffic is strong. CNNMoney drew 650 million page views, 36 million video streams, 40 million visitors. People.com was up 51 percent in revenue in 2008. This is solid biz; don’t let the media reports confuse you.
3. Editors are achieving short-form video.
4. Print ads are still effective, and the best ROI is still a media mix. Internet display ads don’t work as well as print and video combined. Print is strong because there is still a need for fact-based reporting. (Moore quoted a story picked up by Google–didn’t hear which one. [Ed: Pretty sure she was talking about the United Airlines bankruptcy story, a mix-up that caused $1 billion in damages.]) Moore added, “The algorithm can’t do everything”; trusted content is valuable. We are in an economic tsunami and we need to take extraordinary measures.
Why we are organizing 24 groups into three? Moore said this has nothing to do with digital and 100 percent to do with recession.
1. Centralizing: Decentralization is slow and cumbersome. We need clear authority and faster decision-making.
2. Collaboration: Sharing access across titles. Moore cited Olympic coverage with SI and Time.com. EU and Asia have already been sharing coverage. She cited Andy S. writing for Time.
We need to root for newspapers, she said. Without newspapers this would not be a better world.
Children need to be taught that not all content can be free. Bloggers won’t have reliable information [touché]. Moore quoted Eric Schmidt about trusted news sources and the Internet being a cesspool.
We all need to pitch in without whining, flatten the vertical organization and drop costs (Moore said she learned this from Andrea Jung at Avon). We need a simpler two-year plan and to reduce costs. We need to innovate, create value. Launch two valuable initiatives for Q1, MagHound and Life.com.
These changes will be hard and will sustain a personal toll. Take care of yourself and maintain your internal compass. Trust is a powerful tool. Moore cited a link between trust and corporate performance adding that we need to nurture a healthy internal debate. She quoted John Quelch: “Market your way through a recession.”
1. Maintain market spending and research–don’t cut advertising (resources)
2. Adjust pricing and tactics
3. Stress market share
4. Core Values–Moore emphasized layoffs by the company and how we face difficult times; maintaining quality will not be easy, plenty of work to do, unpleasant for sure…your world has changed…it’s worth controlling your own destiny so no one else will.
Lastly, Moore added, we will all get through this.