In her annual year-end letter to employees, Carolyn Reidy, CEO of Simon & Schuster, urged her colleagues to fight the price deterioration that has accompanied the rise of eBooks. Ms. Reidy wrote, "We must do everything in our power to uphold the value of our content against the downward pressures exerted by the marketplace and the perception that 'digital' means 'cheap.' "
Seth Godin took Ms Reidy to task in his blog. Godin wrote, "Hello? You don't have the power. Maybe if every person who has ever published a book or is ever considering publishing a book got together and made a pact, then they'd have enough power to fight the market. But solo? Exhort all you want, it's not going to do anything but make you hoarse. Movie execs thought they had the power to fight TV. Record execs thought they had the power to fight iTunes. Magazine execs thought they had the power to fight the web. Newspaper execs thought they had the power to fight Craigslist. . . Smart businesspeople focus on the things they have the power to change, not whining about the things they don't."
Hold that thought.
Over the Holidays, I found myself re-reading Theodore Levitt's classic article titled, "Marketing Myopia." "Marketing Myopia" was published in the Harvard Business Review in 1960, and it quickly became one of the most important articles HBR has ever published. Levitt argued that companies stop growing (and often go into decline) because their leaders define their business in terms of specific products or services rather than in terms of customer needs. In one of the more memorable passages in the article, Levitt wrote:
"The railroads did not stop growing because the need for passenger and freight transportation declined. That grew. The railroads are in trouble today not because that need was filled by others (cars, trucks, airplanes, and even telephones) but because it was not filled by the railroads themselves. They let others take customers away from them because they assumed themselves to be in the railroad business rather than in the transportation business."
No one reading this post needs to be told that printing companies are facing unprecedented challenges. The media landscape and the very ways we communicate have changed dramatically, and they will undoubtedly continue to evolve. The new methods of communication have reduced the need/demand for many kinds of commercially printed documents, and that demand is unlikely to return. In essence, the market has decided that for some uses and purposes, other methods of communication are better or cheaper than print. Those are the facts. And they are beyond the control of printing company leaders. If Theodore Levitt was still with us, I think he would probably say that many printers are in trouble today because they "assumed themselves" to be in the printing business rather than in the communications business or the marketing business.
Printing company leaders cannot control how the market for print is changing, but they can control how they respond to those changes. The specific responses will vary from company to company. Most, if not all, effective responses will require that a company make significant changes to its business model and/or its product/service mix. Many responses will require a company to acquire or develop new business capabilities, and some will entail becoming a different kind of business. These changes will not be easy to make, and they are not without risk. But, for most companies, the far riskier approach is to do nothing.
Dr. W. Edwards Deming put it well: "It is not necessary to change. Survival is not mandatory."