Tuesday, June 3, 2014

Dismembering Time Inc: A Critique of the Conglomerate Strategy

Typically, management is assumed to be a skill or practice that enables a person so trained to work in virtually any company, regardless of what the sector happens to be. A manager is presumed fully able to go from managing a bank to managing a restaurant. Organizing is the common thread; passion for the particular output is not. Yet surely product-specific knowledge and indeed fascination must count for something. This point struck me as I read the ideas of one journalist regarding what should come of Time Inc. once separated from the mother-ship of Time Warner. If the parts of Time Inc. are indeed worth more as parts of different companies than as remaining as a whole, then it is worth asking whether it makes sense to assign each part to a company oriented to the same theme or domain. If so, then the particular theme of a publication, or business moreover, should have some bearing on a manager.

Playing with how a freed-up Time Inc. might be internally dismembered, Michael Wolff suggests that Time’s InStyle magazine might go to Hearst or Condé Nast; Entertainment Weekly to The Hollywood ReporterSports Illustrated to ESPN; and Fortune to The Wall Street Journal.[1] Although management dogma has it that the practice can enable a non-publishing company to effectively take in any of Time’s magazines, synergies in terms of content would doubtless have value if the purchasing company not only publishes already, but also in the same subject matter. Adding to the latter, I submit that collecting together managers who have a particular interest in a certain subject-matter, such as sports or finance, and having those managers fully occupied only in it, has both financial and psychological value. The balance could in fact be tipped away from the conglomerate enterprise should the concept of a shared, intense passion take hold in a managerial setting.

Accordingly, the salience of the content of what is being managed—the particular subject-matter of a product or service—may render managerial skill not as much of a passport as currently supposed or taught in business schools. Just because a person has a MBA does not mean that he or she could manage a magazine for a few years then move on to manage a restaurant; the delimiting question would be: what interests you other than management? Perhaps then the world would see more managers of flesh and blood—fully alive even at work—rather than mere stand-ins composed of sanitized skeletal bone. To be viable, management may have to transcend itself into specific, non-transferrable content.

[1] Michael Wolff, “The Once and Future Time Inc. Is in Flux,” USA Today, May 27, 2014.