Theory meets practice
Earlier this week, Harvard Business School’s e-newsletter, Working Knowledge, interviewed former Random House CEO Peter Olson, who now teaches at HBS. At a time of significant changes in technologies and business models, Olson laments the inability of traditional publishers to develop direct relationships with readers, something he now values highly.
Around the time that Olson’s interview was posted, news broke that HarperCollins is folding HarperStudio, a two-year-old imprint, into the larger organization. It is not clear what will happen to HarperStudio’s innovative initiatives, including lower-advance signings, profit sharing with authors and an attempt to sell books under a “no-returns” policy.
Recently, I was part of an e-mail exchange questioning whether established businesses – larger trade publishers, for example – could truly foster innovation that potentially (or actually) undermined their business model. As a student of disruptive innovation, I answered, “It depends”.
It depends on things like culture, markets, reward systems, leadership, the perceived stability of the traditional model and the nature of the potentially disruptive change. That’s a healthy list, maybe even a long one, and it’s more than enough to justify saying “never say never.”
But reading Olson, I started to question myself. Where was this focus on readers when Olson ran Random House? Why couldn’t the largest U.S. publisher lead the way in reshaping the industry, if the way was so clear?
Parsing the news about HarperStudio, I had the same doubts. Did HarperCollins really expect to shift the business model in under two years?
Or did they find that the parent company’s scale was actually a liability when the time came to negotiate things like non-returnable sales? Certainly a retailer might be reluctant to support HarperStudio and give HarperCollins a beachhead along the way.
If the innovation answer remains “it depends”, the first thing on my list really should be “vision”. Established publishers can survive, I believe, but they will have to act in ways that nurture innovation, even at the expense of the current model.
That’s not a new idea, but living that reality is the new role of leadership.
Comments
I need to go through and read all of these links now. I’ve been meaning to read that Olson interview.....
I grappled with whether or not innovation is harder from inside a big corporation....but given that I’ve never been on the outside, I can’t really answer that. In fact, I even came up with the idea of a book called Skunkworks to help answer the questions for me. A writer named Ryan Tate is in the process of writing it now. http://www.skunkworksbook.com/
In the meantime, I’m taking a few days off to think about the questions you raise in this post.
Posted by
Debbie Stier on 04/08 at 07:00 AM
Innovation might be somewhat easier in a startup situation, Debbie, but not by much. In a startup at least you don’t have to fight internal inertia.
However, either way, you need to fight external inertia. It needs to be understood that the communities served by the innovators (readers, authors, booksellers, et al) also have a very high degree of inertia.
Sure the early adopter or “new shiny” mentality happens with all new business concepts, but those folks are a very small percentage of the ones you are targeting. The vast majority really don’t want to change, or won’t change very quickly, until there is a Malcolm Gladwell “tipping point”.
There is no getting around the fact that innovation is hard, and always takes longer than anyone perceives it should.
Posted by on 04/08 at 08:07 AM
Interesting Piece.
Customer Service which starts with Customer Contact (read: reaching the readers) is neither new nor innovative. But it is time consuming and requires interest and energy. And, as you say, it requires leadership that values such activities.
It is usually more than the average publisher wishes to expend when they can instead lunch with celebrity authors and leave the customer contact to their retailers and title aggregators.
While HarperStudio intended to limit its royalty advance exposure, it may not have been any more “innovative” than that.
A viable publisher needs to be supporting the brand-building of their authors while working with their retailers\aggregators to better hear\serve their readers. This requires getting outside the “management” bubble and into leadership acknowledging the micro requirements of (the actually small) business of publishing.
If publishers will now embrace the true meaning of an “agency model” rather than seeing it as a panacea, then they will certainly be getting much more involved in the nitty-gritty of serving their customers.
SETH GERSHEL
Publishing Consultant
Posted by
Seth Gershel on 04/08 at 08:36 AM
@debbie ... It’s much easier to be a pundit than a practitioner
Good luck as you sort. Let me know if I can be of any help.
@fran ... Good points, as always. I think the resource-challenged start-up (or challenger) is not idyllic, but a lack of resources does tend to sharpen the mind and address the leadership issue (or kill you).
@seth ... I think HarperStudio’s gain-sharing model with authors is more considered than just a cap on front-end expenses. As I understand it, they were looking to partner to extend and build author brands, which is new to the publishing space. Ditto their efforts to move to a “no returns” model.
Engaging with readers is a given, according to Olson. My concern in this post might be expressed simply: Why didn’t you act on this when you had the chance? I think the answer is systemic, not personal.
Posted by
Brian O'Leary on 04/08 at 09:06 AM
Brian I think we all can agree that publishers need to do a better job connecting with readers, however, we all need to think about how readers want to be connected to…
my personal email is already overflowing with emails from companies that want to make a personal connection with me. As a reader, do I want a personal connection with a publisher? Probably not.
Publishers need to see themselves as the conduit that makes connections between the author or content and the reader. They shouldn’t think of themselves as the entity to be connected with.
Posted by on 04/08 at 01:04 PM
Agreed ... the implication there is that some, perhaps many publishers become white-label providers over time.
My thought on Olson’s remarks are less an endorsement of the idea of readers first, which has nuance, and more a look at how people get religion when religion has less of an impact.
Posted by on 04/08 at 01:08 PM
Fran, I agree with you, for the most part. I’m over emailed myself and have pretty much just given up. I’ve never been a believer in the whole email marketing thing because of this—and yet the smart people I know do it.
That said, two things:
1) I try to tell authors this (that the readers want to connect with THEM and not ME—or another marketer) but many many many authors don’t want to have to do that work and want a marketer to do it on their behalf. This is a whole other blog post though—and it’s a challenge I deal with every day.
2) Occasionally there is a place for a reader to connect with a publisher such as if there’s a problem or to let them know about this or that. I often do it on Twitter or Facebook.
Posted by
Debbie stier on 04/08 at 01:10 PM
Debbie,
I agree with point #2, and point #1 is part of that “external inertia” I was alluding to in my earlier comment…
Posted by on 04/08 at 01:32 PM
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