Beating a Recession – 9 January 28, 2009Posted by David Dirks in business strategy, Increasing Your Profitability, Recession: How to Beat It!, Solving Business Problems.
Tags: chief revenue officer, creating new products, growing revenues, increasing profits, newspaper business model, raising revenues
I think I’ve found my dream job. In the last several years, you might have heard this title being flaunted around and wondered what it meant. Chief Revenue Officer. When I first heard this title I’ll admit I thought it was a bit over the top. Over time, with a bit more insight and study, I see this relatively newcomer position in a different light. I think it actually makes sense!
Most organizations are run with functional silos like sales, marketing, customer service, product development, research & development, and on and on. In a smaller business you’ll surely have less silos like these (as you may be wearing all the hats!), but the ‘division of function’ is usually there in one form or another.
The issue can be summed up in one word: inefficiency. No matter how well your organization does, it suffers to one degree or another from the inefficiencies caused by functional roles. The sales people are responsible for driving sales. The marketing people are responsible for driving consumer interest in your products/services. The customer service people take care of things after the sale. Great people within great functions but the difference is that they generally see into the forest but not over the trees. Everyone is focused on making sure they do their part in the most optimized way but not necessarily able to see the big picture.
Even if all these functions run well, you can bet there are plenty of missed opportunities to drive revenues and profits higher. Enter the Chief Revenue Officer whose job it is to find opportunities for increasing revenues by leveraging existing resources that are underutilized today.
Let me give you a great example using the newspaper industry. Traditional newspapers are struggling mightily to figure out how to stay alive, let alone grow revenues. Everyone is trying to bridge the gap between the printed paper and the digital paper and figure out how to make money at it.
With all that focus on trying to figure out what the business model for traditional newsprint media should be, little has become of it. Instead, we see more newspapers and other publishers going out of business or into bankruptcy re-organization. It’s a dire state of affairs not made any bit easier by this current economic downturn.
The print media is exactly where I’d want to be the CRO. Journalists focus on the great work of producing excellent journalism, as they should. Hiring a CRO who is NOT married to the sterotypes of traditional publishing is who you want. Why? Simply because you need someone who can look over and into the entire organization and be able to QUESTION EVERYTHING.
Why? What? When? Where? How?
If I was a CRO of a newspaper publisher, my task would be to question everything. I would look deep for resources that were underutilized across the organization, not just in one department. I would look to connect the dots on processes that are unconnected and less effective at generating revenue.
As a publishing CRO, here are some places I’d start in an effort to improve and grow revenues for a traditional print media publisher:
Follow the People magazine and Harvard examples. People magazine popularized the concept of creating special ‘Year in Review’ issues are to this day one of their best selling issues even though it’s more of a soft cover book than magazine. Did I mention that it’s very profitable too? Their secret sauce? They take the best and most exciting content pieces written during the year and re-package them into a ‘new’ content piece.
Harvard University has a extremely talented group of professors who are required to publish as a part of their teaching role. Harvard Publishing takes those many content articles produced over the years and creates special edition books that focus one speciality area such as innovation or venture management. What did they do? They re-packaged content and distribute it on a wider and broader basis. Very profitable business for them.
What does a newspaper produce every day? Content. Tons of content primarily sold only in one way: through the daily or weekly paper. Then it’s offered for free on their website the same day (with few ads either). The content that most people like to see is local coverage of newsworthy events or top local issues of the day. What are the most read sections of the paper? Primarily the business section and the sports section.
Here’s the game: How about re-packaging local sports highlights during the year and make it available to readers? What parent wouldn’t want a copy of that to see a photo of their son or see their local team in print? What about a special community ‘Year in Review 200X’ that was composed of some of the best local stories of the year? Why not? If you publish 365 days a year, you’re bound to have excellent content that people will have long forgotten except for a nicely bound softcover magazine that capture those fascinating highlights forever? What about a series of business guides based on stories and columns written on a variety of business subjects during the year?
You get the picture.
I like the idea of hiring an unbiased, objective, question-everything Chief Revenue Officer. What an opportunity to really be held accountable for producing new sources of revenue and increasing the profits from revenue streams already in hand!
More on this in an upcoming post. Stay tuned.