INK TANK

What Would You Do If…

I used to sit on the board of a nonprofit that raised most of its money from an annual fund-raising drive.

“What if you lost that revenue and fund-raising no longer worked?” I once asked.
“Oh, you’re being silly, Eric,” they told me. “That has worked for decades and it’s thriving. It has even worked well in past down economies. “

“Humor me, though. Is there a new way we can generate revenue, so all our eggs are not in one basket?”

As the discussion continued, I drove the point home in my usual persistent manner until they agreed to develop a new form of revenue. This new revenue stream did not replace the fund-raisers, but it increased the income of the organization substantially.

A few years later I played the “what if game” again, because we had not found a way to replace 100 percent of the fund-raising revenue if it were lost. This time they sloughed off my suggestions.

Fast-forward to today. The newer form of revenue has almost dried up and the fund-raising environment is more difficult than ever. The scenario that could never happen has happened.

When I ran a tech company, I learned to examine points of failure. If X breaks down, what backup do you have? I learned it is critical to never assume that things won’t change, and that every business needs to examine every point of failure.

Is it absurd to believe that radio advertising will never dry up? It’s always been there and, though it has dipped, it will come back. Right? Can you invent a few new ways to generate revenue if ad revenue dried up? Can you implement today those things that not only will strengthen your business but will act as insurance if your revenue goes away?

Have you examined the WHAT IFs in your business? What if may seem like a waste of time, but it can act as a protection in the event that income is lost, and it is a great way to spur innovation. This is one time when being a negative thinker is valuable. What if we lose our main source of revenue? What if the FCC were to change its rules about advertising? What if…?

Change happens because nothing stays the same forever. Try to examine every point of failure and vulnerability and develop a backup plan. Doing this has saved my business many times. Developing a contingency plan can save yours, too.

A Demand For Radio Leadership Now

A passionate message from Eric Rhoads, Radio Ink magazine

"Abraham Lincoln did not go to Gettysburg having commissioned a poll to find out what would sell in Gettysburg. There were no people with percentages for him, cautioning him about this group or that group or what they found in exit polls a year earlier. When will we have the courage of Lincoln?"
-- Robert Coles

Where Are Radio's Leaders?

The answer lies in this quote from my friend Roy Williams:

"Leadership and management, in my experience, are virtually opposite skill sets. Management requires wisdom, patience and strength. Basically, it's parenting, bringing forward the best of the past, enforcing the status quo. Leadership requires independence, audacity, and courage. It's inherently defiant, questioning the past, challenging the status quo. True leaders require no authority. They think their own thoughts, make their own decisions, carry out their own plans. They say, 'This is what I've decided to do.' And then they do it. Others see them doing it and decide to follow. Leaders lead from the front. Managers manage from behind."

Radio has mistaken management for leadership. We have bred an industry of great managers, but how many risk-takers, how many rebels, how many people willing to challenge the status quo?

Where are the dashing swashbucklers with swords drawn, engaged in a spirited fight to conquer new lands for radio?

Radio used to be filled with Rebels. Where are they now?

How many people feel secure even suggesting something new or different, let alone taking bold action at their radio station or company?

Every ship needs a captain. Who is determining radio's strategy? Who is leading radio into uncharted territory? Who is boldly speaking out to engage the troops? Though some individual companies have bold, risk-taking captains, there appears to be a void in radio as an industry. We are being led by a committee of managers.

I just re-read Sun Tsu's Art of War. He states that the most critical component of winning a war is having soldiers who believe so strongly in a cause they are willing to lay their lives on the line and follow their leader into battle. A defeated brigade must avoid battle at all costs until they can be rested, fed, and re-energized.

Dying for radio is probably not in the cards for any of us, but we have committed our entire careers to this medium. Many of our troops are tired, in need of nourishment and encouragement. Many have been spent, worn to the bone, abused, paperworked, systemized, and made to operate under battle conditions for months or years at a time. How can radio make strides with worn soldiers?

Sadly, words I hear all too frequently are, "When will it be fun again?" And, of course, some self-assured company leader will respond with, "We're not here to have fun, we're here to make a profit."

Indeed.

But if you believe in Maslow's Hierarchy of Needs, you'll understand that radio soldiers who feel they have a bigger purpose and who feel great joy and  satisfaction in their work are more likely to make a profit.

Leaders don't make decisions by committee. Leaders don't fire people who disagree. Leaders don't threaten careers if paperwork isn't done. Leaders don't await marching orders from their boards. Leaders don't fly their jets across the country for a five-minute meeting to fire someone and then argue over severance that's a fraction of the cost of the flight. Leaders don't look to find everything that is wrong with radio.

Leaders challenge the status quo and take risks. Leaders burn the bridges behind them and make an all-out commitment to change. Leaders frequently engage their troops, present grand visions, and are willing to break every rule if it means potential success in the future.

These are challenging days for radio. The outcome of decisions we face today on Capitol Hill, in the advertising community, and on many other fronts will determine whether this industry thrives or stumbles.

Are you a leader or a manager? We need both, but we need leaders at every radio station in America willing to lead and spit in the eye of conformity. We need leaders willing to risk their jobs and  willing to stand up to those who manage them, and we don't need those who wimp out and kiss up.

We need leaders in programming willing to stop the homogenization and formulaic approach to radio. Sure, it works, but I don't see Americans having a love affair with radio. You can change that. You can make them want to tune in to hear what they've missed. You can entertain and engage them. This is the mark of good programmer, not someone who is a sheep following 30 years of tired and worn science.

We need a true leader at the NAB. We cannot get behind non-industry managers who read speeches written by some novice speechwriter who has never worked in broadcasting and invents lame slogans like "We're the greatest industry in the world" for a leader who's never set foot in a radio station before getting the job. The NAB executive board needs to exhibit leadership and have the guts to hire a true leader.

NAB needs a courageous rebel willing to challenge everything, not a good soldier implementing orders. We need a leader who has spent time behind a microphone, who has attended countless radio promotions, and who has had to make a payroll and has had to call on advertisers. We need someone willing to fight to the death for free speech. Yes we need a lobbyist, too, but we can hire a great lobbyist to follow a great leader.

Everyone, it seems, is lukewarm.

Where is the passion?

Where is the emotion?

Where is the excitement?

Where is the communication?

Where is the guiding star?

I'm tired of calling for change and seeing the status quo maintained. I'm tired of launching conferences with dozens of innovative and groundbreaking speakers and seeing only a few hundred forward-thinking people show up instead of those who need it most. I'm tired of harping about the need to return to important localism, community, and entertainment values and hearing hundreds of radio stations using the same formats, the same liners, the same voices. I'm not living in the past, but I'm tired of CEOs who say, "Eric, those days are gone. You need to face the reality that radio can no longer be about entertainment."

That's like saying the movies can no longer be about entertainment.

Yet I am invigorated when I drive into a small town and hear a young, squeaky-voiced talent learning and growing live on the air. It gives me hope, it's authentic, and in my mind it's more listenable than some slick, golden-throated pro talking about "10 in a row" or "The greatest hits." That may be pretty, but it no longer stands out.

Radio needs a leader willing to stand up against all odds and make change happen. Who is Mrs. or Mr. Radio? We need to find you. We need to hire you. Our future depends on it.

Eric Rhoads

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A Message from Deborah Parenti, VP/General Manager of Radio Ink:

Co-Chairs Bill Stakelin and Lee Westerfield invite you to join us for Radio Ink Forecast 2010, December 8, 2009 at the Harvard Club in New York. Keynotes include former Mike Huckabee, former Governor of Arkansas and presidential candidate and host of Citadel's "Huckabee Report"; Ron Insana of Compass Media Networks and CNBC; and Dan Mason, President/CEO of CBS Radio -- plus our famous radio group heads' panel and deep industry analysis. This is the industry's leading financial event, and it's followed by our reception for the "40 Most Powerful People in Radio." Attendance is limited to 200 people. To register, go to www.radioink.com/forecastsummit or call 561-655-8778.

 

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Is Radio Entering A New Network Era?

The 1930s and 1940s were the network era for radio. Big bands, big broadcasts, big drama, and big talent filled the airwaves. Every show was a major production, often with a live studio audience, an orchestra, and a cast of characters whose names became larger than life. Americans stayed close to their radios as radio reinvented entertainment.

Is radio entering the next network era? I think it's highly probable. Though the jury is still out on how well a national talent like Ryan Seacrest is doing on the air on stations across the country, I think there is a strong possibility that radio will be made up more and more of national talent who do not pretend to be local. Radio networks have, of course, remained strong for decades and continue to be strong, offering morning shows, 24-hour formats, talk programming, and more. I predict that most of the  programming on most local stations will ultimately be network-driven.

As big radio companies face bankruptcies, have little money to operate, and are coming to believe that high-quality national programming is better than local programming, we may well see the end of local radio at companies like Clear Channel, Citadel, and Cumulus. It's already a proven model with talk radio greats like Limbaugh, Hannity, Beck, Ramsey, Stern, Dr. Laura, and loads of others. Talent rules. So why not convert every music station in every format to a national format -- national talent with quality production values, writers, and programming excellence?

 

Frankly, it's hard to argue. Television has been all-national for decades, with little local programming other than the evening news. Much of radio will be the same.

Great content usually rules, and I see little reason to believe that filling radio's airwaves with great syndicated talent is a bad thing. Until the floods, the fires, the riots, and the local disasters. It is at those times that localism rules, and stations that continue to run their national programming without a plan to cut in with strong local coverage will lose their local loyalty. At the same time, they'll reinforce the value of the stations that have remained local.

My guess is that the broadcasters with a local heart, less pressure to cut every possible expense, and no need to achieve high margins will remain local. But can local win over national? Does local TV programming beat Letterman, Leno, and Conan? I've never heard of it happening. But I believe radio is considered more like a neighbor or a close friend than television can ever be, and that stations with true hyperlocalism can survive and thrive even in a new golden network era.

Radio networks will become one of the new growth areas for radio investors and may become the new stars within broadcast portfolios. The bottom line is that content wins, and whoever can provide the best, most relevant, and most entertaining, programming will hold the golden ring.

Eric Rhoads

(Reprinted from the 8/03/09 issue of Radio Ink Magazine)