The Sale of BusinessWeek--What Went Wrong?

Posted by: Bruce Nussbaum on September 17, 2009

Everyone is asking me what went wrong at BusinessWeek to the point where, after 80 years, McGraw-Hill is trying to sell it. My answer, expressed in my latest installment of Ask The Innovation Guru, is culture. Watch the video above or listen to the podcast, and let me know what you think.

This is a difficult one for me. BusinessWeek is a remarkable brand and I’ve lived in both the print and online “societies” of that brand for many years. I’ve innovated in both print and online successfully. But nearly always the innovation has been vertical—offering up engagement and conversation with an amazing audience on design and then, as design evolved into design thinking, on to innovation.

Deep knowledge, insight and engagement of an active and specific audience has been my kind of business journalism. For the new owners of BusinessWeek, I’d advise them that this is the way to go—build off the brand but know that the brand stands for a wonderful collection of audiences and interests—in technology, innovation, management, global, leadership, and science.

Leveraging those audiences and their interests into a new series of businesses that includes both social medial digital engagements in webinars, customized curating of business information and insight, etc., as well as real-life engagement in salons, conferences, consortiums and “collaboratories” is the way to go. At least that would be my way to go.

Whatever the model the new owner chooses, one thing is certain. There is an extraordinary amount of talent on BW’s print and online platforms. I mean globally world-class in their spaces. Redesigning the networks, platforms and business models around their talent is the way to build future value.

Reader Comments

Rotkapchen

September 17, 2009 8:03 PM

The experience has shifted the brand and the host cannot recognize the new entity or know how to leverage it. It's a 'foreign object' and must be expulsed.

Joe

September 17, 2009 11:46 PM

You're right. Unfortunately, the solution will be to sell it to Bloomberg, which will meld it into it's own formulaic amalgam, and dilute thebrand's sharpness and quality even more. Bye-bye Business Week.

Wow

September 18, 2009 12:24 AM

That's a whole lot of empty words you just used right there. My favorites were "globally world-class" "colloboratories" (which even you had to put quotes around) and "Deep knowledge, insight and engagement of an active and specific audience has been my kind of business journalism," which makes it clear that clear writing and grammar have no place in your kind of business journalism.

yeah, right

September 18, 2009 1:57 AM

What an amusing fellow you are, Bruce. BusinessWeek is full of "remarkable" people, a font of innovation, a precious jewel etc., and the new owners should cherish their acquisition, its, traditions, vitality and senior staff (like yourself). Your ad pages are wretched, your web traffic stagnant and sliding (I'm not counting the crappy slide shows that the New York Times accurately described as the traffic boosters advertisers don't want to know about) -- and this is what the new owner should clutch unto his nurturing breast and preserve at all costs? Bruce, you're in for a hell of shock, but keep on with the self-delusion. There might be a job opening for a humour section in the new owner's magazine, so you may yet still pay your mortgage.

Sergei Dovgodko

September 18, 2009 4:26 PM

Bruce is right, many things are rooted in the internal culture.

One can go even deeper and say, that the failure of BW is based in its weltanschauung.

It lionized those "great" CEOs and their genius strategies (that turned out be wrong 10 issues later). "Jim is doing this" and "jack is doing that". The rest of the company did not matter.

To get perspective, BW interviews the upper management on various issues. Yet, one recent study showed that the upper management aware of less than 5% of issues of operating reality. By relying on people prone to various cognitive biases, BW propagates a skewed representation of companies, markets, and industries.

Also, BW promoted (with some exception) the predominant management ideas, such as "shareholder value creation", that proven to be wrong. It promoted short-term thinking, concentrating on quarterly P&L, etc.

Overall, the magazine reflected mindset of the upper management and the investors. Patriotism and fear of OUS competitors are apparent. That is not appealing stance of a thought leader. Sensationalizing things or scaring people don't help either. Maybe it sells?

Rarely one could see an original ideas or analysis that would be inconsistent with prevailing opinions in the management circles.

Some readers sense the ideological agenda and the disconnect from business realities. They feel that BW is not relevant to them.

With the economic crisis, this disconnect became even more apparent. As a result, people switch to other sources of business news and analysis.

Ted

September 18, 2009 6:26 PM

All the biz mags simply became fanboys in the CEO-as-celebrity culture of the past 10 years of CNBCing of Biz news. In the end it was a dead end like the 100th cover of Madonna on People.
You can keep selling more magazines until one day you can't. Bloomberg might be a good change.

concerned reader

September 18, 2009 7:34 PM

thats a poor answer bruce. BW has not lost touch with its audience. In fact, audience numbers have never been better.

The truth is that there is a business challenge monitizing ad space and reining in reckless McGraw Hill overhead costs.

Every publisher is facing extreme challenges in monitizing ad space.

BW is certainly not unique there.

lenin

September 19, 2009 4:44 AM

This guy should have mentioned that BW was a magazine for investors that consistently took a center-left stance. Add in the fascination with techy gimmicks like reader engagement (readers can engage at thousands of other sites, none costing $21 million to run), and you pretty much have it. Blame it on the female ad buyers, Bruce, if it makes you feel better. Easier than looking in the miror.

Christian Renard

September 19, 2009 2:04 PM

The real-time Web produces such a clutter of information that there is an urgent need for expert analysis and perspective.If I was the owner, I would find a way to "invest on ourselves" and find the right way to keep the value proposition and best talents while adapting to this new world ...and massive audiences.I would also glance at some of those new innovative digital publishing ventures.

KerryJ

September 20, 2009 1:11 AM

Interesting that you mention the ad execs that wanted to go with advertising on social media sites were women - mostly middle aged, some young. What is the relevance/significance of their gender that you felt it needed pointing out?

bruce nussbaum

September 20, 2009 8:27 PM

A number of people commenting on my noting that in the ad agency meetings I went to, most of the people present were women. What did I mean by that?
The answer is--it was an observation that was overwhelming and I don't really know what to make of it. I suspect it is meaningful if one gender dominates a marketing sector. If there are any ideas about this out there, please let me know.

My major point is that I believe a herd instinct is driving ad agency people to pull their clients out of print into online medai, something to the detriment of their clients.

Jeff Hodges

September 20, 2009 8:56 PM

The position of the camera and the tone gave me the feeling that Bruce was talking down to his viewers.

BW should have moved out of New York years ago. What would it have been like if it had located in Nashville or Austin in 1995? Probably a lot less of the "we're in NY and we know more than you do" smugness.

So, what does the Innovation Guru do next?

fred

September 22, 2009 1:35 AM

What does the Innovation Guru do next?

How about a cover story on how readers have rejected genius, and why that's fine with Nussbaum, because swine don't appreciate pearls anyway. There, that will sell a few copies of BW.

ADB

September 23, 2009 8:57 PM

With respect, BW is not a remarkable brand. I'll take you at your word that there's a lot of talent on the masthead, but as a former subscriber, I never got the point. Who exactly is this brand for? People interested in business (as in commerce)? That's a little vague.

Forbes covered the entrepreneurial/ personal investor space, Fortune was great for big company employees, but BW seemed to be the USNews of the sector. Had you picked a segment and tried to solve a problem for it, you would at least have a brand that meant something regardless of the fate of the print pub. (E.g., Fast Company)

Sorry, but I haven't looked at your website in years (before following a link here today from Facebook. And I'm pretty confident I'm in the target segment.) The site might have been spectacular, but you never let me know it was special.

If you're a media brand and you're not distinctive, then how are you going to make money? (And a weekly publishing model does not make you distinctive...) Maybe you have a lot of talent in the building, but the product never delivered.

Good luck to all of you at BW-- but next time try to work someplace where they care about (a) the product (b) marketing and (c) strategy. Talented journalists got let down by weak management.

d. james

September 23, 2009 10:33 PM

Maybe the fact that BW lets people appoint themselves 'gurus' is part of the problem. It's hard for gurus to believe that people don't necessarily want or need to pay for their "brilliance."

Hear Hear

September 25, 2009 9:56 AM

Well put, ADB. I read Businessweek religiously in the Eighties and Nineties, then I let my subscription lapse but still read your website, which I thought was one of the most impressive available. Then that went bad too. About four years ago, I clicked on some rotating image show, realized it was some sort of traffic booster without any real purpose and hardly ever come back these days. Your problem is your culture, I suspect Why would a company ruin a successful magazine, then ruin a successful website. D. James's observation about a publication which allows people to appoint themselves as "gurus" probably sums it up.

hear hear

September 25, 2009 10:10 AM

Just remembered what it was that turned me off BW. A 2005 hit piece on George W. Bush by Leo Hindery. You never mentioned that he was former CEO of the scandalous Global Crossing company, or that he was vying for the DNC top job with Howard Dean. I just googled it and found a thread on your site loaded with angry reader comments. Maybe that explains why BW is in the doo-doo. The more readers you bored or alienated, the more you put your faith in ga-ga gurus.

One question: Is the guy who gave the column to Hindery still working there?

http://www.businessweek.com/bwdaily/dnflash/sep2005/nf20050912_8022.htm

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About

Want to stop talking about innovation and learn how to make it work for you? Bruce Nussbaum takes you deep into the latest thinking about innovation and design with daily scoops, provocative perspectives and case studies. Nussbaum is at the center of a global conversation on the growing discipline of innovation and the deepening field of design thinking. Read him to discover what social networking works—and what doesn’t. Discover where service innovation is going and how experience design is shaping up. Learn which schools are graduating the most creative talent and which consulting firms are the hottest. And get his take on what the smartest companies are doing in the U.S., Asia and Europe, far ahead of the pack.

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