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Summary:

Newspaper companies might not want to think of their business as being similar to industrial manufacturing like the car industry, but in many ways it is — and they can learn from what other manufacturers have been through.

Newspapers might like to think that their challenges and woes are unique to the print media business, but there are some broad similarities between the disruption that journalism and the news industry have been experiencing and the upheaval in other industries — including the automotive manufacturing business. As Micheline Maynard, a journalism professor and the former Detroit bureau chief for the New York Times, points out in a perceptive post, there is a lot that newspaper publishers can learn from what automakers have experienced.

As Maynard notes, there are a number of disruptive effects in the media industry that parallel what happened to car-makers — including the outsourcing of non-core functions, something the Chicago Sun-Times did rather dramatically last week by laying off its entire 28-person photography desk. The attempts by newspapers such as the Chicago Tribune to outsource hyperlocal news gathering through third-party providers like Journatic would be another example.

Outsourcing is a reality

This is roughly similar to what happened to car-makers, Maynard says, who found that it was cheaper to outsource the production of their vehicles:

“These days, car companies can find others to do virtually every aspect of an automobile. They can contract out design and engineering work, hire marketing companies, find manufacturers who have the capacity to build their products. Except for Tesla, they’ve already turned selling their vehicles over to franchisees.”

Media companies — and the journalists who work for them — don’t like to think of their business as being similar to manufacturing, but in a broad sense it is: the newspaper is a product that is stamped out at the end of an assembly-line style process that functions much the same way it has for 50 years, with some slight differences. And many of the legacy costs that have driven some newspaper companies into bankruptcy come from that industrial process.

Clay5

Like Maynard, disruption expert Clay Christensen has also talked about how the automakers learned from their newer competitors and became more flexible, both through outsourcing and other means. In a major research paper he wrote along with Harvard fellow David Skok, Christensen looked at how the newspaper business is being dismantled, and what it can do to survive.

Focus on what customers want from you

What’s really interesting about the disruption in the auto business, as Maynard notes, is that everything didn’t get outsourced. What car-makers discovered was that they needed to retain control over some things in order to achieve the kind of design or performance or reliability demanded by their customers — the things that were crucial to their brand.

In the newspaper business, customers are called readers, but the overall principle is the same, Maynard argues: a company has to decide (or learn) what they offer that is unique or outstanding when compared to their competitors, and then focus like a laser on that thing. If you’re the New York Times, maybe it’s foreign reporting — if you’re BuzzFeed it’s probably cats, or at least humor. Which raises the question: Who is the Tesla of the media industry?

“Car companies realized that what they absolutely must do themselves is provide brand character, which is essentially the promise that the company makes to its customers. It doesn’t matter where a BMW is built, whether Germany or South Carolina or South Africa. It does matter how it drives.”

Post and thumbnail photos courtesy of Shutterstock / Donskarpo

  1. There’s nothing the purveyors of MBA degrees love more than this idea that anyone can manage any industry. Clay Christensen’s ideas appeal to people who inherit companies or buy them. His observations about innovation are correct, but are mostly misused by people who cut the line to make money off people who actually make things.
    I’ll own up to significant bias here. My dad started as a mucker in the Lucky Friday Mine, then got an engineering degree, then became a manager, then an executive. He raised me to distrust desk jockeys. I started as a reporter and ended as an executive editor. Along the way, I did everything but page design. What newrooms do can be profitable, but only when it does a job for citizens.
    Companies that make products and services that change entire industries because users get passionate about them (as opposed to finance-driven companies) are run by people who give a crap about the engineering and the crafts that go into their products: Apple, Google (pre 2009), Toyota, New York Times, Patagonia, Boston Brewing, Sierra Nevada, GoPro…They are sometimes less efficient, but they always serve their customers.
    There’s nothing at all emotional or nostalgic about the critics of the Sun-Times’ decision. If you came to journalism via a newsroom and paid any attention at all, the findings of EyeTrack study after EyeTrack study didn’t surprise you: The first and often only thing a readers looks at on the page is the picture.
    Probably 28 was an overlarge staff at the Sun-Times, which covers a tiny geographic expanse. But cutting it to zero without a remarkable plan in place suggests readers get little attention.

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  2. I think the (domestic) auto industry is the perfect parallel for newspapers:

    - Expensive, legacy infrastructure, with technological updates forced rather than initiated willingly
    - Legacy staffing structures and agreements which hamper mobility and nimble redeployment
    - Product philosophy of “we know what you need,” rather than “let us give you what you want”
    - Management philosophy of generating earnings rather than reinvesting for growth
    - Belief that marketing equals sales support, rather than building customer conversations and relationships
    - Slash-and-burn approach to maintaining profit, instead of smart retooling for new opportunities

    I probably missed a few items, but I’m trying to be charitable.

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    1. My two cents on this post, with respect to research: http://researchologist.com/wp/auto-industry-parallel-to-newspapers/

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  3. Who is the Tesla of the media industry? So which media startups own the entire value chain, from design to customer experience? Provide a distinctive product, compared to what traditional competitors offer? And are growing where industry counterparts are flailing? Here’s my shortlist:

    PolicyMic
    http://www.policymic.com

    BuzzFeed
    http://www.buzzfeed.com

    Vice
    http://www.vice.com

    NowThisNews
    http://www.nowthisnews.com

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