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Star Tribune Cuts More Staff; Downward Tailspin Continues
In business school, I took a great class in my first year on organizational behavior. It was one of the most interesting classes I have ever taken and I find myself recalling information from it more than almost any other. One of the books we read was Peter Senge’s The Fifth Discipline, which is one of the few business books I have ever enjoyed or thought worth reading. I don’t remember all the details, and the following summary is wildly simplistic, but Senge identifies the characteristics of a learning organization and the vital importance of systemic thinking. His basic premise, as I recall, is that success for a business depends upon the extent to which it can learn faster than competitors and truly think objectively about the organization, its influences, its environment, and the cause and effects of various strategic and tactical decisions. One of the areas covered in the discussion of systemic thinking is reinforcing cycles, both positive and negative, and what it takes to sustain or turn them around.
In all my years of work, I have never seen a more explicit example of a negative reinforcing cycle than what is happening to the Minneapolis Star Tribune and most other daily papers in the country. The Star Tribune announced yet again this morning that they were going to make drastic cuts in staff in response to the decline in ad revenue, mostly in classifieds. This is just the continuation of the cycle that began years ago when daily papers started losing readers and advertisers for various reasons (high prices, complacency, monopolisticly poor customer service, better alternatives online and offline, ignorance of the web, failure to innovate, etc.). In response to sagging revenue, the dailies cut costs and staff to preserve profit margins. This in turn further reduced the quality of their value proposition, so they lost more readers and more advertisers. They then made more cuts, lost more readers and revenue, and the cycle has and will continue unabated until they either go out of business, reach some new point of equilibrium with a very different looking business model, or make some drastic change that forces the cycle to stop. Unless Par Ridder takes steps to break out of this cycle, and it will need to be in dramatic fashion, the path he and the Strib are on can only end in oblivion.
[tags]Death of Daily Newspapers, Decline of Dailies, Publishing, Media, Star Tribune, Death By A Thousand Cuts, Peter Senge, The Fifth Discipline, The Learning Organization[/tags]