Ken Michaels - New World Scale Equation


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Hachette Book Group has rebuilt their own digital infrastructure in the past several years to leverage the advantages of scale — scale which they believe can be achieved through efficiency as well as through size. Under the leadership of Ken Michaels, President and COO of Hachette and Chair of the Book Industry Study Group, the company is focused on better providing value to authors by investing in services, capabilities, and agility, rather than relying strictly on volume and size.

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  • Let’s start by challenging some assumptions about scale… Does scale only meangirth in title output? No. To me, scale is a strategic perspective.Scale does NOT equal volume, necessarily, or competitiveness. It’s all about relevance about what you are trying to accomplish as a strategic initiative. It’s not a volume game, it’s an execution gameYes, you can combine for greater volume and negotiation/bargaining power, but that’s not adding value in connecting readers to authors. It’s not size, it’s vision focused to execute. Are you meeting the needs of the environment you are dealt with? Better to invest in Integration & Reach, Find your core competency and focus on that to build a competitive advantageScale for Efficiency & Effectiveness
  • Find your core competency and build on that. Examples of success:Wal-Mart: Logistics (delivery)Huffington Post: content aggregation (they are not the originators of content, but aggregators)NetFlix: Accessibility, and have adapted over time, moving from mail to online streaming. All the while making it easier and easier for their consumers to get to the content they want and when they want it. IMB: reinvented themselves, moving from mainframes to business servicesIntel: has substantial technological rivals, but their research and development budget (upwards of $7 billion annually) is difficult to compete with. Intel’s semiconductor market dominance, rock solid balance sheet, and large R&D expenditure, allow the company to consistently produce cutting edge processors, and when caught off guard, gives them time to adapt to market rivals. There companies gained achieved prominence not through acquisitions but because they found a need, and a gap in the market and they invested
  • Scale won't solve this without smart disciplined executionReachValueDiscoveryRelevantVolume consolidation doesn’t create competition
  • Any of these…Traditionally back office, but can’t think of it as de-coupledNow enablers!
  • PrintDemand & Supply forecasting for “Just In Time”Marketplace feedback loops to constantly improve
  • Data quality is key Simplifying accountability TransparencyPositioned Properly for discoveryData cleansingOnline Detailed Dashboard -Interactive comparative views of data highlighting identified issues Validation - Automated review of metadata using latest BISG Best Practices for Data SendersCertification Scoring - BISG defined metrics for each tested element
  • ChallengeReaching consumers where they interact, share, and influenceReaching consumers’ influence pointsConsumer intelligence on what is workingTargetFacebookWhere Consumers “Flock”Pricing, Merchandizing, On-Sale-Date Tactics & MonitoringSolutions
  • Play to your strengthsWhere you have weaknesses, plug and play with world class providers
  • Goal is to bridge authors to consumers in a cost effective and valuable wayConclusion:You have a choice: invest horizontally or verticallyWhat do authors want?Flexibility and agility to tell their stories FeedbackRich mediaConsumer interactionsAppreciate qualityImage & brand well reflectedWho do you trust your name to?Be careful how you step off (self-publishing)Does scale provide new value to authors?Not about sizeIt’s about services, capabilities, agility, reach, branding, analysisInnovate to new needs and challenges – and do it well – to bridge authors to consumers
  • Ken Michaels - New World Scale Equation

    1. 1. The New World Scale EquationKen MichaelsPresidentHachette Book Group
    2. 2. 2
    3. 3. 3Ways to Scale…Wal-MartLogistics /DeliveryHuffingtonPostContentAggregationNetflixAccessibilityIntelR&DFind your core competency and build on that!
    4. 4. 4Self Publishing TraditionalMarket is now “Over-Served”with huge supply of media choices
    5. 5. 5InfrastructureWhere to focus…ContentCreationContentManagementDelivery DiscoveryTransactionsIntelligence
    6. 6. 6Distributed with Discovery and Reach in mindData Quality& IntelligenceGlobal Rights & MonitoringGlobal integration & interoperability Demand/Supply ForecastingEfficiency & Integration at HBGCommerce Analytics Marketing CommunityContent Created Once
    7. 7. 7Data is the Key to ExecutionFixRetailersMetadataAuthor BioDescriptionBISAC CategoryPresentation &Discovery
    8. 8. 8Challenge Target SolutionReaching consumerswhere they interact,share, and influenceFacebookReaching consumers’influence pointsWhere consumers“flock”Consumer intelligenceon what is workingPricing,Merchandizing,On-Sale-DateTactics & MonitoringReach & Discovery
    9. 9. 9• Changing economic conditions• Dual investment strain (digital and traditional)• Speed and complexity of technology• Service capabilities grow in importance• Skill sets required• Lack of training budgets• Modular attributes• Cloud ScalabilityWhy SAAS is the new business imperative
    10. 10. 10Innovation + Execution = ScaleAuthors’ContentConsumers