A vexing problem

Until last summer, Reuters was known to be actively developing a consumer-facing news site, dubbed Next, that would draw upon reporting resources the company had already built to serve a business audience. The project was effectively shelved in July, after the project leader left Reuters to run for political office in Canada. It was formally scrapped last month.

After Reuters announced that it would shutter Next, Buzzfeed ran a lengthy piece pinning the blame on Chrystia Freeland, the project leader. In particular they noted that she was an outsider who had tried to build the consumer site without engaging the established staff within Reuters. Author Matthew Zeitlin also reports that Freeland exceeded budgets by significant amounts, in part by hiring outside contractors.

I don't have an inside view of Reuters, and if I did I probably couldn't invoke it, but Buzzfeed's reporting seemed to underplay a couple of important points. David Thompson, chairman of Thomson Reuters, favored Freeland for the Next job, but she still reported to the Reuters CEO.

Andrew Rashbass, the executive who ultimately killed the project, was appointed Reuters CEO in the middle of this year. Big development efforts sometimes flounder when leadership changes.

Too, some of what Buzzfeed reports as Freeland's folly came straight out of the disruption handbook, particularly the need to isolate the new venture from the dominant (established) business. The reality within Reuters was made clear by a former employee, who told Zeitlin:

[T]he direction the company now wants to go in is about giving power back to the profit centers and abandoning any innovation on the consumer side.

In all likelihood, Reuters and Freeland could have better managed the development effort. I'm sure mistakes were made; it's impossible to imagine a world in which a green-field startup inside a traditional media company doesn't step on a lot of toes.

By focusing on Freeland, we have a tidy solution: she made mistakes, was out of her depth and didn't cultivate the right alliances. But we still have a vexing problem, as we struggle to launch vibrant new businesses from a base of traditional structures, systems and processes that actively resist change.

About Brian O'Leary

Founder and principal of Magellan Media Consulting, Brian O’Leary helps enterprises with media and publishing components capitalize on the power of content. A veteran of more than 30 years in the publishing industry and a prolific content producer himself, Brian leverages the breadth and depth of his experience to deliver innovative content solutions.

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