by Tom Webster, Edison VP
Radio continues to take it on the chin with advertisers and Wall Street, but finding the root cause of Radio’s doldrums is like peeling an onion. Some point to Radio’s tremendous installed user base and reach and contend that the problem is simply a PR issue. Others observe that Radio is losing the technology battle, and is being eclipsed by new media platforms such as satellite and Internet radio. Or is it consolidation? Content? Global Warming?
Certainly, all of these things represent competitive forces, applying pressure to one or more facets of the radio industry. In business, these forces are all part of life–in fact, let’s roll them up into one term: “change.” The forces of change are constantly surging, shifting and subsiding in any industry. When change happens, winners predict, survivors adapt, and losers react. Only one thing determines which camp a company–or an industry–inhabits: people.
Radio needs to find a more attractive entry point than “music intern.”
The Human Resources issue is, in my opinion, the most serious obstacle radio faces in the next ten years–not satellite, iPods or internet radio. These competing technologies alone will not damage radio–it’s the talent that those competing companies are luring away that will plague radio for years to come. There just isn’t enough innovation in the industry to keep up with competitive media channels AND a loss of talent. Content and technology are not the problems, they are symptoms of an HR disease. Broadcasting is simply not as compelling a career choice today as it once was, and broadcast companies are failing to attract new talent. Want proof? Here is Fortune’s 2006 list of the 100 Best Companies to Work for. See any broadcasters there?
When I got my college degree back in Boston years ago, I had a choice–I could go to graduate school, join some of my friends at the (then) Big 7’s of the world (Arthur Andersen, Price Waterhouse, etc.) or…I could get Matty in the Morning’s coffee for two years in the hopes of landing an overnight spot on Kiss 108. I chose grad school, though (oddly enough) I would find myself working with Matty and Kiss at Pyramid later in life. Radio needs to find a more compelling on-ramp, a more attractive entry point into the business than “music intern.” The type of person who is attracted to that position may or may not become the next Tom Poleman or John Fullam, but until Radio finds a way to recruit great young talent out of college and business schools as well as the clubs, we will continue to field a less than fully competitive team. The Radio industry has no training ground, no management recruiting strategy, and no solid HR strategy to enable it to compete not just against other media channels, but other sectors of American business as well. There is only so much talent to go around, after all.
Radio needs to do better at college campuses, and it needs a new HR strategy for the coming decade that will provide a compelling career path for smart people. With consolidation and automation, many of the spots the industry used to have open for its “farm team” (overnights, for example) are now gone, giving stations a smaller talent pool in which to fish, and the talent pool was thin to begin with. HD Radio solves the wrong problem. Fix the HR problem, and radio will survive and even thrive in the coming years. If station A out promotes Station B, blame Station B’s PD or marketing director. But if TSL declines in the whole market, we need to look a lot higher north on the organizational chart.
Some of this has to do with how radio consolidated itself over the past 10 years. In most industries, when one company seeks to acquire or merge with another, there is a careful exploration of differences in culture, people, benefits and strategy–and HR has a prominent seat at that table. The post-Telecom Act feeding frenzy of the late 90’s, however, afforded no such introspection and analysis. I was a part of five mergers during that period myself, and with each successive iteration I felt the culture changing around me–and rarely for the better. I felt nervous about my future, and no longer saw a clear career path where I was. I was not the only one–and I was also not the only one to move on to seek more solid ground.
I would love to see a whole raft of broadcasters make Fortune’s list next year–to me, there would be no greater sign of health for the industry. The good news is that the answers are not difficult to find–there are tons of successful models out there that radio could adopt to attract and retain great people. Here are a few to ponder:
1. Glaxo Smith Kline rotates its promising young managers through all aspects of its business. Imagine a radio station where top talent rotates through sales AND programming, so that tomorrow’s star PD was yesterday’s LSM–and the sales managers of the future are required to sit in music meetings today. There are some examples of this, but imagine how strong our talent pool would be if one of radio’s worst practices, the separation of “church and state” between programming and sales, became a fertile training ground for only the best talent.
2. The J.M. Smucker company (yup–the jam) offers 100% tuition reimbursement for higher education. With no limit. If we can’t lure MBA’s away from other industries, maybe we should start cooking up our own.
3. SAS Institute has made this list for a decade. The secret? Well, the pay at SAS certainly isn’t at the top of the industry, but when it comes to caring for their employees, they put their money where their mouth is–100% paid health care, an onsite medical clinic, unlimited sick leave and $300 per month onsite child care. A lot of folks would gladly give up some salary for benefits like these, and they do–and SAS not only attracts the best and the brightest, they also proactively keep them healthy and happy. Health care makes a lot of us nervous.
4. Stock options aren’t going to cut it when they are so far underwater your employees will never exercise them. Make it stock, not options. I know a lot of people, by the way, that work for privately-held radio companies and are a good deal happier than their compadres at publicly held companies. This can only be boiled down to a misalignment on some level of shareholder and stakeholder interests. Radio can either invest in realigning these interests, or just do what Richard Branson did when he stopped having fun–buy they company back and go private. How else can you explain Virgin Cola?
5. Invest more in training–Steve Rivers long ago told me about his vision for a “PD University,” like McDonalds’ “Hamburger U.” We fire a lot of people in this business (and deter many more would-be applicants due to the turnover and insecurity of the profession). In many situations, losing your job in radio means moving–pulling your kids out of school, uprooting your spouse. Radio needs to find more ways to retrain, reeducate and reduce turnover.
I guess the thing that makes me most incredulous about radio’s HR problems is the fact that we are so good at finding the little things that move the needle with our listeners. We pay their tolls at the bridge for a day, or buy them a tank of gas. We remember their birthdays. Pay someone’s mortgage for a month. Drop by their offices unannounced and buy them lunch. Little things–little things that build relationships and create love. Can’t we do the same for our employees? Wegman’s (the grocer) made Fortune’s list at number 2 (and number one with big companies) with an impressive 8% voluntary turnover rate. People love working for Wegman’s because they have genuinely created a family atmosphere. If a grocery store can do it, so can you.
What do you think? What are your ideas for Radio’s HR crisis–or do you disagree that it is one? Please leave your comments below or send me an email. I’ll cull some of your thoughts along with my own and present them here in a future column.
Thanks for reading,