Wednesday, June 16, 2010

The Demise of the Local MD

It used to be the plum job in Australian publishing, to which every young thruster who joined the industry, and found he or she liked it, aspired. It offered status, good remuneration, regular overseas trips, five star hotels, business class travel, wonderful camaraderie and lots of other perks.

I can remember how fiercely the ambition to make it burned in my breast. It was a privileged club, an elite grouping of men and women with real power to shape the emerging and evolving local publishing industry.

But today it seems that job - Managing Director of the local subsidiary - is fast disappearing. If it exists at all, it is a pale imitation of what it used to be.

Last week McGraw-Hill announced that they would not be replacing their Australian MD, Murray St Leger, who is returning to England. Wiley did not replace me when I retired nearly two years ago. The current MD has a much diluted job. Cengage removed the MD position and now run the local operation from Singapore. There is no CEO overseeing all Pearson operations in Australia. Simon and Schuster diluted the top job after giving it to Lou Johnson by deciding to run the service operations out of the UK.

The flip side, ironically, is that where strong MDs remain in Australia (Gabrielle Coyne and Margie Seale, for example), additional responsibilities for Asian operations have been tacked on to their roles. This just proves my point: a purely Australian focused MD position is no longer thought necessary, desirable or sustainable. Australian operations, at one level or another, are being folded into larger, more global configurations.

Is this important? I think it is, because in a real sense we're seeing a neo-colonisation of the Australian publishing industry. The real independence of Australian management, which was fought for over decades previously, is seriously in retreat. As globalisation increases its grip on formerly multi-domestic corporate structures around the world, local entities in the various territories are losing their identities and cultures and thus their ability to serve their specific marketplaces with focus, vigor and authority.

Ultimately this is a losing formula for globally organised companies. As the local operations become hollowed out they very quickly become uncompetitive. They lose traction. They become unattractive to talent. Key managers, editors, marketers and operational staff spend most of their time talking to global colleagues and serving on global committees. Their focus is inward. Policies, procedures and practices become globally 'harmonised'. Local customers, authors, projects and suppliers are increasingly subject to filters testing their relevance and significance in the global corporate matrix. Australia is once again reminded what a small and relatively unimportant place it is. Australian initiatives - even at benchmark levels of excellence - rarely succeed in getting the green light. Adaptation and acceptance, not innovation or creation, become the norms, under the guise of cost saving. We're all Good Global Citizens. 

Of course there are exceptions. There always are. But the trend is definitely there, and I judge it an unfortunate and self-defeating one. Where Australian culture and society is best served under this publishing paradigm is in the vitality of our locally owned companies like Allen and Unwin, Hardie Grant, Text, Scribe, Black Inc, and many more. Their existence, their endeavours and their financial survival are increasingly more important to Australia.

More stength to their bow.