A Front Line on Digital Media Publishers - The City Within From West Coast Midnight Run

I sat in on a meeting with Peter Maertin and he blasted a client with his statement, more like he floored his audience with an ice breaker: “a gun for hire is a friend forever”, a comment he made in response to a well-known corporate aversion for bringing in gunslingers from out of town.

And his dead serious tone drew everything from nervous laughs to sarcastic grunts and noises.

And yet Peter was only an in-house corporate counsel and consultant on a due diligence exercise with the management and senior staff of an overseas division that had committed itself to a major acquisition.

Working from the outside has become more difficult than it should be.

The approach used to be an advantage. Better perspective, neutrality, ability to disengage frictional elements and coax cooperation from competing internal factions and incentive-motivated divisional managers out to outgun each other.

Many companies have outsourced their capabilities to groups that specialized in specific markets and had faster response time.

The outsider looking in or supporting a group has become far more common in the manner companies have created cross-industry alliances.

And yet the “embattled” employees continue to display discordant and uncooperative countermeasures, if only they improved the use of stealthier and less obvious tactics - oftentimes sabotaging their very own division and the overall group’s results.

Groups that harbor this culture are often very set in their rationalization and in the conviction of their actions.

And even should the division suffer,
the attitude is that in the current economy, this is really nothing more than job security. The unions may be weaker and gone but this mindset is more harmful than helpful.

Over the past decade, many departments’ leaders and managers may have rolled over hiring new talents or may have shortcut the staffing requirements of their projects, in essence sitting on top of vacant and unfilled posts as a security measure for their own employment - creating what is believed by many as an internal, invisible, safety margin.

And these issues may be difficult to point out with any precision or quantitatively, within any kind of study or survey as this behavior is often illicit and unacknowledged.

The reader should keep in mind that managers are very able and capable of gaming the results should a surveying group or focus group be put together by an outside marketing or research firm. An excellent case in point is the digital publishing industry, software and video.

The digital publishing industry is typically viewed as a manufacturing activity. Software publishing requires an R&D department and prototyping, production/manufacturing, QA/QC and distribution via brokers or retailers.

Yet if looked at closely, this industry is also a contractor’s industry, very similar to construction in the sense that

a large publisher oftentimes parcels out (using contracts) modules of software development, design and manufacturing and sources components from different manufacturers that constitute a support supply chain of contractors.

The structure of the activity is similar to a large prime construction contractor managing a group of smaller subcontractors such as civil, electrical, mechanical, structural and fire/life safety among others.

How is this important?

The digital publishing industry is a border marker in that it can help us gage the winds of change. If the diigital publishing industry has raised the fence for vendors and contractors then other vertically integrated industries are far more along inside the Forbidden Zone for small contractors.

In the past decade more than 300 independent advertising agencies have been swallowed up in acquisitions that paralleled the Exxon/Mobil, BP/Amoco/ARCO, Chevron/Texaco and Conoco/Phillips consolidations.

Four media agency global titans emerged, all new names built from veteran constituents - Publicis, WPP, Interpublic and Omnicom. In the meantime, the titans of Accounting (CPA) consultancies, Price Waterhouse, Lybrand and Coopers, Ernst & Young, KPMG and Arthur Andersen self imploded and re-organized into a tighter smaller group of even more integrated holdings.

In 2009, WPP reduced its staff by 14,000 employees and there are no guarantees the other three won’t follow suit should the measure give them an edge on the market.