In this first episode, Ashley talks about the operational cost models of traditional (old) vs digital (new) media, and in particular, the challenges of building sustainable levels of profit to fuel growth. Ashley dives into how the variable costs of serving a digital business cause companies to chase their tails, and how our investment models of early stage venture fuel a marketplace where digital companies are not likely to survive, but rather must be bought by traditional media companies to deliver returns to investors. The chasm between early stage start ups and publicly traded companies is vast and impacts today's media value chain, according to Swartz.

Porter's 5 Forces: TV & Video

In episode 3 of 12 in the series, "Building the Adaptable Media Enterprise", Ashley looks at the 4Ps of marketing for TV; Product, Price, Place and Promotion, and explores why marketing is key to re-imagining a media business model to ensure survival and sustainable profitability. She suggests that perhaps the 4 Ps of advertising are a bit different, given the convergence of video across platforms including television, desktop, mobile, and OTT, and require better Planning, Productization, Packaging, and Pricing strategies.

Everyone has heard or used the phrase, "upper right quadrant", but what does that mean? Well, the BCG [Boston Consulting Group] matrix is a steadfast strategic tool of MBAs and overpaid consultants to analyze a market or company’s health. In episode 4, Ashley maps the TV, Video, distribution and technology players on this matrix and for the purpose of evaluating the health of our industry, its players, and who makes for a good investment.

Most Fortune 500 companies have implemented some form of continuous improvement in their supply chain or manufacturing processes. The Japanese call this Kaizen, or simply ‘change for better’. Although in media we are not making tangible, physical products, why would we not leverage best practices from other industries to power our enterprise, improve efficiency, and reduce waste and costs? By bringing her experience from other industries and applying them to media, Ashley presents her hypothesis that the simple Kaizen framework of “PLAN, DO, CHECK, ACT” is required to build an adaptable media enterprise. The best practices that are part of Kaizen, when powered by data, are poised to greatly improve a media organizations’ performance, across the entirety of the enterprise including production, distribution and advertising. Ashley takes us through why this management principle is hard for media, but identifies actionable ways for organizations to create, define and improve core business processes to ‘learn’ or continuously improve performance.

General Stanley McChrystal radically changed how the US fights its enemies while leading the Joint Special Forces Operations in Iraq and Afghanistan, and likens his experience at war to the challenges many companies face today. With enemies that were organized in decentralized networks, non-hierarchical with distributed decision-making, leveraging new technologies to communicate in real time, the US military was required to reconsider their battle and modus operandi. Silo’d and hierarchical structures would no longer work. Individuals needed empowered, walls between departments broken down, and information needed to flow more freely across their teams enabling speed and accuracy. Sound a little like the media landscape today? In this segment, Ashley, inspired by General McChrystal’s book, “Team of Teams”, presents her thinking on what highly functioning and agile media organizations must do to thrive. With talent, organization and workflow strategies as cornerstones of success, they must change for media companies that want to straddle the chasm of convergence and win. Knowledge must be distributed freely and quickly across teams, which require that everyone in the organization have a holistic awareness of what qualifies as “victory” and a shared consciousness as to the part they play. This is very different from today’s typically silo’d teams, who are often not powered by technology, but rather held back. She provides her perspective on some best practices and thoughts on how to mitigate the challenges of the complicated media landscape of today.

If you can’t predict, how can you make a plan to get to where you want to be? The lack of hard or tangible goods in media, like other industries, and a ratings systems that is imperfect has created an industry [media] where forecasting is not as important as it should be. A good forecasting process assures a company works to understand its customers and the market. Ashley’s time in manufacturing instilled a strong belief in the value of an accurate and integrated forecasting process for a company to maximize financial results and keep their customer’s happy. Demand and inventory forecasting mean different things in media from other traditional manufacturing industries, however in media the common separation of revenue from inventory forecasting is a critical fail point in business process. In this segment, she discusses the importance of refining internal revenue and inventory forecasting for media companies, and provides her thoughts on how improve business results can and will improve with better forecasting.

Shrinkage is an allowance made for a reduction in the earnings of a business due to waste or theft. Sound like ad fraud and viewability issues we are plagued with now as an industry? TV doesn’t have this problem, however TV companies do because their audiences are spending more and more time on digital platforms. Perhaps not a big problem on owned and operated properties, however publishers often rely on syndication partnerships for audience extension to fulfill buyer demand for premium video. Mitigating risk and exposure of ‘shrinkage’ in media today requires an adaptable media enterprise to prevent, act and react quickly. This is a great business challenge that can be addressed if some of the business processes and best practices discussed in previous episodes in the “Building the Adaptable Media Enterprise” series are implemented. Portfolio level visibility, better forecasting and ‘Kaizen’ or continuous improvement would enable publishers to predict and prepare for the unique challenges of digital video. Ashley provides some suggested processes and best practices for organizations to maximize digital video revenue and minimize revenue loss from shrinkage.

When you read the analyst reports or industry commentary, one thing that is clear is that profitability is often a reason for a loss in confidence by the market. Earnings Per Share (EPS) is a clear metric as we all know for wall street. What I am continually dumbfounded by is the fact that profit is not something we talk about in media often. The 800 lb gorilla in the room is that we all know it instinctively, but seldom acknowledge it publicly; Digital businesses are way more expensive to run than traditional media. In this episode, Ashley discusses the importance of including profit as part of decision making when looking at new sales channels, platforms and expanding your digital business.

We have all heard the marketing buzz word omni-channel. It means the blurring of advertising channels, and the need for agility and a new approach to reach one audience, across multiple screens. Media is not the first to use this phrase, or have the need to transform businesses to adapt to these types of challenges. The phrase omni-channel has been used by companies that have needed to transform their supply chain as their businesses became more complex and global for more than 15 years. Ashley looks to blueprints for tested supply chain optimization and transformation strategies and contextualizes them for media in this segment.

Just because we sell intangible goods or ‘time’ and space, media is not that different from other industries. More importantly, many of the challenges we are facing in today’s media enterprises, and the resulting competencies we must develop, take a page out of other industry handbooks. Inventory management is one. Inventory management or yield management is something that is getting a lot of momentum as new media is becoming a larger portion of total revenue, and old media is being blown up by addressable advertising. This is because there are more ad formats and platforms, the combination of which equal a new product, making oversight very difficult. In developing software to help media companies manage their inventory and optimize yield, Ashley looks a lot to the best practices learned of when running pricing strategy at the world’s largest component manufacturer in the world, who manufactured over 100,000 products. There are some steadfast best practices your teams can implement to remain adaptable in this omni-channel world which we live today, which is the topic of this segment.

In the 12th and final episode in the series, Ashley challenges the industry and her peers to all work together to move media ahead, solve the right problems, and get better, faster, and stronger. Oh, and to try and have more fun while doing it!

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