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A Balanced Scorecard Hall of Fame™ Profile

Media General

HARVARD BUSINESS
SCHOOL PUBLISHING
What is the Balanced Scorecard Hall of Fame?
The Balanced Scorecard Hall of Fame for Executing Strategy™, administered by Balanced
Scorecard Collaborative, recognizes organizations that have achieved breakthrough
performance largely as a result of applying one or more of the five principles of the
Strategy-Focused Organization. These principles, formulated by Balanced Scorecard
creators Robert S. Kaplan and David P. Norton, are described in detail in their book
The Strategy-Focused Organization: How Balanced Scorecard Companies Thrive in the
New Business Environment (Harvard Business School Press, 2001). BSC Hall of Fame
members are personally selected by Drs. Kaplan and Norton.
To learn more about Hall of Fame selection criteria and Hall of Fame members,
visit bscol.com.

The Five Principles of the Strategy-Focused Organization


Each of the five principles of the Strategy-Focused Organization include specific
management best practices that contribute to the achievement of breakthrough
results. These best practices—validated through ongoing research with Hall of Fame
organizations and hundreds of other users of the Balanced Scorecard around the world—
must be embedded in any organization that wants to make strategy execution a core
competency.

Principle #1. Mobilize Change Through Executive Leadership


Executive leadership, driven by a need for change, supports the drive to
establish a new way of managing based on a performance-oriented culture.

Principle #2. Translate the Strategy into Operational Terms


The Balanced Scorecard is used to translate the strategy into a language
that everyone understands.

Principle #3. Align the Organization to the Strategy


The scorecard is used to cascade the strategy to all parts of the
organization and align resources needed to accomplish the strategy.

Principle #4. Motivate to Make Strategy Everyone’s Job


The reward and recognition system is used to align
individual behavior with performance objectives called for
by the strategy.

Principle #5. Govern to Make Strategy a Continual Process


Strategy execution is linked to the budget, and a reporting system
based on scorecard measures is used to provide feedback on
strategic performance.
Balanced Scorecard Hall of Fame Profile: Media General

This 150-year old media company enjoys hefty


Table of Contents growth across its print, broadcast, and interactive
media divisions, thanks to its unrelenting focus on
Profile ....................................................................................1 convergence—a strategy that has eluded many rivals.
Key Results, Takeaways ....................................................9 The Balanced Scorecard has provided the company
SFO Spotlight (best practices)....................................10 an important framework for communicating and
Strategy Map ....................................................................12 executing the strategy.
To Learn More ....................................inside back cover

ABOUT Media General Honing a Regional Growth Strategy


Media General is justly proud of its Southeastern
Industry: Media/Publishing U.S. roots. But its pedigreed image—tracing back
to the 1850 founding of the Richmond Dispatch
Listed on the New York Stock Exchange with a market
capitalization of $1.6 billion, Media General is the
newspaper—belies its robust presence as a dynamic
ninth-largest publicly traded newspaper company and aggressive 21st century media conglomerate.
in the United States. Founded in 1850 in Richmond, The company boasts a commendable growth rate
Virginia, Media General today operates print publishing, and a stock price performance that has significantly
broadcast, and interactive media businesses. Concen- outperformed its peer average and the S&P since
trated in the Southeast, the firm publishes twenty-five 2001. The company has also successfully strengthened
daily newspapers that have a combined circulation of its presence in the Southeastern U.S. by intensively
approximately 1 million. Media General’s twenty-six cross-fertilizing its three media divisions—publishing,
network-affiliated television stations reach more than broadcast, and interactive new media—through the
30% of television households in the Southeast. The
regionally focused strategies known as “convergence”
company also operates more than 50 online enterpris-
es related to its print and broadcast properties.
and “clustering.”
The Balanced Scorecard, which Media General
Headquarters: Richmond, Virginia began implementing in 2001, not only established
a performance measure system that enabled these
Employees: More than 7,700 (2004) core strategies, it also brokered the marriage of two
very different media cultures: broadcast and print
Annual revenues: $900 million
publishing. With scorecards now in place at three
Inducted into the Balanced Scorecard organizational levels—corporate, divisional, and
Hall of Fame: 2004 property—Media General is steadfastly focused on
its corporate mission: to be the leading provider of
high-quality news, information, and entertainment in
the Southeast by continually building its position of
strength in strategically located markets.
Media General’s transformation from a traditional
newspaper publishing company to an innovative
media conglomerate began in 1990, when J. Stewart
Bryan III, a scion of the company’s founding family,
took over the helm as chairman and CEO. At the
time, the outlook for the newspaper publishing industry
was bleak. The retail sector—traditionally a stronghold
of print advertising revenues—was in a period of
intensive consolidation, due to the emergence of
“big box” stores, mass discounters, and mail-order
businesses. The decline in advertising revenues, com-
bined with flat circulation numbers and a nationwide
economic recession, contributed to the company’s

© 2005 by Harvard Business School Publishing and Balanced Scorecard Collaborative, a Palladium company
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Balanced Scorecard Hall of Fame Profile: Media General

lackluster stock performance. It was clear that Media of newspapers and television stations in the same
General needed to make some bold strategic changes market. While considerable deregulation of the
that would protect its more vulnerable print publishing original laws has occurred over the last decade,
enterprises while positioning it to take advantage thus enabling Media General’s clustering strategy,
of changes in the broadcasting industry. the FCC introduced restrictions in its revamped
Under Bryan’s leadership, Media General launched a 2003 rules. These have been challenged, and a
campaign to build “clustered” businesses—vertically decision is pending in the U.S. Court of Appeals,
integrated operations in local markets—in ten states expected in mid-2005.
across the Southeast. In the early years of his tenure, The year 2000 was another milestone for Media
Bryan focused on geographic consolidation, shedding General. Following the $1.4 billion sale of its cable
properties to Cox Communications in 1999, the com-
pany was well positioned to make more acquisitions
in the Southeast. In addition to several Internet
With the advent of the Internet in
businesses, Media General bought five daily news-
the early 1990s, CEO Bryan recognized papers in Alabama and South Carolina, and 13
that innovation in utilizing the World televisions stations. By year-end, Media General’s
publishing division had grown to 25 daily publications
Wide Web would be imperative for and nearly 100 weeklies and other periodicals, while
success in any media business. The its broadcast operations had jumped from 13 to 26
creation of Internet-based information stations.

services presaged the company’s conver- Beyond Building Regional Strength:


Targeting “Convergence” Markets
gence program, which, by 1998, had
With the advent of the Internet in the early 1990s,
become an explicit cornerstone of its Bryan recognized that innovation in utilizing the
corporate strategy. World Wide Web would be imperative for success in
any media business. In 1994—a year widely regarded
as the commercial genesis of the Internet—Media
disparate media properties in California, Oregon, General launched Tampa Bay Online (TBO.com),
Michigan, and other states outside of the Southeast. an online information service affiliated with its daily
In just five years, Media General pared its holdings newspaper and local television station. A year later,
down to three newspapers, three network-affiliated Media General’s flagship newspaper, the Richmond
television stations, a cable property, and a print Times-Dispatch, launched an online information
operation. With the exception of its 40% interest in service, Gateway Virginia. The creation of Internet-
Denver Newspapers, Inc. and a handful of television based information services presaged the company’s
stations in the Midwest, all of Media General’s pub- convergence program, which, by 1998, had become
lishing and broadcast properties were located in the an explicit cornerstone of its corporate strategy.
Southeast by 1995.1 Convergence, a strategy hotly pursued by media
The next phase in Media General’s transformation companies since the mid-1990s, refers to publishing
reflected a more aggressive acquisitions strategy: in and producing information, both news and entertain-
1995 and 1996, the company purchased five Virginia ment, across different media platforms. (See sidebar,
newspapers. In 1997, Media General bought Park p. 7.) According to CEO Bryan, convergence “coordi-
Communications, which included seven newspapers nates different media in a given market to provide
and nine television stations. With the exception of quality information in a way each does best—
one New York station that was promptly sold, all the but delivered from a comprehensive and unified
newly acquired properties were located in Virginia, perspective.” For Media General, convergence was
North Carolina, and Alabama. One of the more not only ideally suited to its existing print and broad-
remarkable aspects of Media General’s acquisition cast operations, it also was a strategy that perfectly
strategy were the challenges created by Federal complemented “clustering”—the well-established
Communications Commission (FCC) regulations, publishing industry practice of creating operational
defined by the FCC’s 1975 ban on cross-ownership and revenue-generating efficiencies by clustering
similar businesses in one local or regional market.
© 2005 by Harvard Business School Publishing and Balanced Scorecard Collaborative, a Palladium company
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Balanced Scorecard Hall of Fame Profile: Media General

With convergence and clustering working hand-in- business units, drawn not just from finance, but from
hand, Media General targeted six specific “convergence” operations, production, HR, IT, and elsewhere. The
markets in the Southeast: Tampa, central and 2001 relocation of Media General’s broadcast and
southwestern Virginia, South Carolina, the Florida interactive media divisions to corporate headquarters
Panhandle–Southern Alabama, and the Alabama– in Richmond helped the executive team mobilize
Georgia state line. for change.
Starting with Tampa, where it owned Florida’s top The Balanced Scorecard was introduced company-
performing network affiliate, an established daily wide in January 2001, and by mid-2002, Media
paper, and an online service that incorporated General achieved its goal of having scorecards in
dozens of community newspapers, Media General place for each of the three divisions (publishing,
would effectively brand itself as the single leading broadcast, and interactive media), as well as BSCs
source of information across three media platforms. for most of the individual properties (business units)
within those divisions.
Introducing the Balanced Scorecard
Media General’s divisional strategy maps contain
With the company’s regional presence firmly
key elements of the corporate map as well as unique
established by 2000, senior executives were deter-
elements related to their individual lines of business.
mined to implement an innovative system that would
It took 18 months to cascade BSCs throughout the
enable them to consistently measure performance
operating units and functional (support) units such
across all the company’s businesses. They had first
as finance and HR. Today, each of Media General’s
considered the Balanced Scorecard in 1998, and in
three divisions has a financial planning manager who
2000—during the company’s intensive acquisition
devotes 50% of his or her time to Balanced Scorecard
phase—executives decided to pilot the BSC within
strategy and activities. Within the corporate group,
the publishing division, the business perceived to
four employees are committed half-time to the score-
be at the greatest risk for financial losses amid the
card program; each person reports to McDonnell.
industry’s steady decline. According to Planning
Divisional reporting takes place on a quarterly basis,
and Budget Director William McDonnell, “At first,
while scorecard reporting within each division takes
the process was informal. We really wanted to link
place monthly.
the budget to the three-year corporate plan. We
saw the scorecard as a way to take the planning Creating a Culture of Convergence:
process to the next level and to streamline the Anatomy of Media General’s BSC
strategic planning process.” The pilot program, In January 2001, the same month that the scorecard
dubbed “Measures of Success,” introduced the was officially launched, Media General also inaugu-
Balanced Scorecard as a general framework for rated its interactive media division, the division that
publishing department heads. McDonnell and the would serve as an engine of convergence across
VP of the publishing division knew that a successful the region. According to senior executives, the new
pilot would be the best way to win executive level division would deliver information and entertainment
buy-in for an organization-wide launch. through the company’s existing Web sites, capitalizing
In mid-2000, Media General brought in consultants on new online growth opportunities, and providing
from the Balanced Scorecard Collaborative to help expanded choices for its advertisers, readers, viewers,
design and roll out the scorecard at the corporate and users.
level, as well as at the broadcast divisions and soon- Despite its venerable newspaper tradition, Media
to-be-unveiled interactive media division. “We General needed to create an entirely new culture that
brought in consultants partly because of the scale would foster the long-term strategies of convergence
of the project,” explains McDonnell. “We also wanted and clustering, a culture in which the “old-school”
an objective third party involved in the process.” newspaper professionals would interact daily with
Backed at the most senior level by the CEO, CFO, their colleagues in the faster-paced milieus of
and COO, the Balanced Scorecard team reflected broadcast television and new media. As CEO Bryan
the company’s top-level commitment to the cross- observes, “Don’t think this is easy. Convergence
cultural challenge of rolling out the scorecard. Led requires strong teamwork, communication, and
by McDonnell, the six-person team was composed a high level of cooperation across divisional, tradi-
of executives from all the company’s divisions and tionally separate (to the point of rivalry) lines.”

3 © 2005 by Harvard Business School Publishing and Balanced Scorecard Collaborative, a Palladium company
Balanced Scorecard Hall of Fame Profile: Media General

Creating a culture of convergence meant, more revenue” in the financial perspective. Besides its
than anything else, that Media General’s executives, traditional measures, the company thus tracks the
journalists, and publishers needed to examine number of cross-promotional campaigns between
and, ultimately, redefine their businesses from a print and broadcast media in regional markets.
customer intimacy perspective. And Media General, In Media General’s internal perspective “Promote
like most news media organizations, serves not one, public trust and identity” refers not only to Media
but two distinct customer bases: consumers of infor- General’s values of journalistic integrity and accuracy,
mation (readers, viewers and now, interactive users) but also to developing community partnerships and
and advertisers. branding information products. For instance, in Media
The BSC, with the corporate strategy map, is the General’s six targeted convergence markets, Web
mechanism for fostering this unified culture. Media sites such as TBO.com provide a branded source of
information at both the regional and local levels. The
news channel at TBO.com has Web sites for each of
By better understanding its advertising 18 local communities in areas covered by the Tampa
Tribune and WFLA, Media General’s network-affiliated
customers’ businesses, Media General station in Tampa. Each community Web site features
can better serve existing customers— information on local events, neighborhood schools,
and real estate, along with crime reports from
and attract new ones—with, for example,
TBO.com’s “Crime Tracker” database.
creative multimarket and multimedia
“Create and acquire new products and services” is an
advertising packages that offer objective whose pursuit is best exemplified by Media
economies of scale. General’s four-year-old interactive media division.
The interactive media division not only oversees the
development of Web sites across converged markets,
it is also poised to take advantage of emerging opportu-
General’s three divisions share a common objective: nities in new media. The division’s 2002 purchase
to provide “accurate, compelling, and relevant” content, of Boxerjam, a producer of interactive games and
so that the company’s publications, television puzzles, brought a fast-growing and new audience
stations and Web sites are the dominant information to Media General: 2.5 million registered online users,
provider in each of its geographic markets. To this and more than 50,000 daily players. Interactive game
end, Media General’s corporate scorecard includes players are today’s version of 20th century newspaper
such traditional measures as paid circulation numbers subscribers who reached for the crossword puzzle
(for newspapers), percentage of newscasts ranked and cartoon section before reading the front page.
for broadcast operations, and number of page views This objective drives customer growth on both sides
(for Web sites). Nontraditional measures include of the customer perspective.
“numbers of stories jointly presented” and “numbers
of stories jointly developed.” According to McDonnell, Media General’s learning and growth perspective has
these measures have been the most successful in evolved since its earliest iteration. With BSC software
measuring convergence. in place, along with a full-time technology specialist
to oversee it, the initial objective “Pursue and
On the advertising side, Media General’s customer evaluate enabling technology” has been achieved.
intimacy objectives include providing advertisers with Today’s objectives include “Promote employee com-
their desired audience at value-based prices, on munication,” measured by internal research surveys;
schedule and accurately. Beyond that, Media General and “Promote a culture of change and employee
seeks to provide innovative solutions to advertisers. empowerment,” which involves nurturing creativity
By better understanding its advertising customers’ and innovation, as well as fostering decision making
businesses, Media General can better serve existing among lower-level employees. The learning and
customers—and attract new ones—with, for example, growth perspective is supported by HR’s scorecard,
creative multimarket and multimedia advertising which focuses on training, professional growth,
packages that offer economies of scale. Increasing employee retention, work-life balance, and employee
the percentage of multimedia advertisers and nurturing empowerment. Next on the agenda, according to
long-term relationships support “Increase (advertising) McDonnell, is the creation of compensation incentives

© 2005 by Harvard Business School Publishing and Balanced Scorecard Collaborative, a Palladium company
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Balanced Scorecard Hall of Fame Profile: Media General

tied to scorecard measures, an area that the company print materials. Feature articles on the Balanced
was cautiously exploring in early 2005. “We are Scorecard also ran regularly throughout 2001 in
working towards running a parallel system with our Media General’s bimonthly company newsletter,
scorecard process to determine if it is feasible with which was mailed to every employee’s household.
developing a more formal structure,” says McDonnell. One lively and highly publicized feature of the
Spreading the Scorecard News communications campaign was Media General’s
scorecard logo, which was created as a result of
Not surprisingly, one of the most successful aspects
a contest the company held among its internal
of Media General’s scorecard implementation was its
graphic designers. The bold green logo “Go MG”
internal communications campaign. Faced with the
alludes not only to the green/yellow/red traffic
task of communicating the scorecard to nearly 8,000
signal coding system for scorecard measures but
employees, Media General’s 10-person BSC launch
to the car-racing NASCAR culture that is hugely
team first interviewed key personnel across the
popular in Media General’s key markets.
organization to understand and analyze the most
effective communication tools used within the Alignment and the “Lean, Mean Initiative Machine”
organization. The team then quickly deployed a Perhaps the most notable example of scorecard-based
simple multimedia tool kit containing a mix of alignment at Media General is the “Pit Crew,” formed
broadcast and print materials: a video presentation in 2002. This 10-person, cross-functional team serves
featuring CEO Bryan endorsing the scorecard, as a flexible and nimble resource for implementing
PowerPoint presentations on CD-ROM, and traditional

Defining Convergence in the News Business

Convergence: it’s a rapidly evolving dimension of the has made Media General’s newsgathering process
information age. It’s where terms like RSS feed and much more responsive. “It has doubled the number of
blog are part of every journalist’s work day, and where tra- eyes and ears in the community.”
ditional and new media overlap through the Internet,
desktop screens, and increasingly, other interactive At Media General, the convergence concept does
communication technologies. Now an established have its boundaries; indeed, part of the beauty of
buzzword in the media industry, convergence refers to convergence, according to senior executives, is that
coordinated methods of delivering news, information, the unique strengths of each individual medium are
and entertainment content across different media. In fully utilized. Chairman J. Stewart Bryan III explains:
the last two years, the rapid development of wireless “We don’t expect our newspapers to be TV stations;
technology, the growing use of cellular and “smart- we want them to use their own particular strengths—
phones” as vehicles for information, and the changing in-depth coverage, historical perspective, and analysis.
demographics of broadband Internet access have Conversely, we’re never going to replace what’s
added even more to the significance of convergence. good about our local TV stations—their strong video
coverage.”
Even before adopting the BSC, Media General regarded
convergence as the cornerstone of its corporate strategy. Tampa News Center continues to be the convergence
In 2001, when its Balanced Scorecard was rolled out, “laboratory” for Media General. In March 2003, senior
Media General had already identified Tampa as the management created a single executive position to
leader of its six targeted convergence markets. oversee all three media platforms in Tampa. Last year,
Tampa is clearly the jewel in Media General’s convergence the sports departments of the three news entities
crown. In March 2000, Media General opened its Tampa were also consolidated. The results demonstrate clearly
News Center, which brought together the three news- that convergence works: in 2002, the Tampa Tribune’s
rooms of television station WFLA, the Tampa Tribune, circulation increased 5.8%; in 2003, it was up by 3.8%.
and TBO.com (Tampa Bay Online) under one roof. Tout- In 2004, the Tampa Tribune continued to outperform
ed as one of the country’s most advanced and innova- the industry average, with an increase in daily net paid
tive centers for media convergence, the Tampa News circulation of 0.9% and an increase of 1.5% in Sunday
Center features an enormous circular news desk where net paid circulation. WFLA is the number one television
editors from the print and broadcast operations station in Florida, while TBO.com is the leading portal
meet daily to produce the news. As a former senior for local information in the Tampa area.
editor from the Tampa Tribune once noted, convergence

5 © 2005 by Harvard Business School Publishing and Balanced Scorecard Collaborative, a Palladium company
Balanced Scorecard Hall of Fame Profile: Media General

strategic initiatives, particularly those related to Study continues to be updated annually, its initial
creating operational efficiencies. As Treasurer John results, released in June 2001, defined “four corner-
Schauss explained in a 2002 company newsletter stones” of newspaper readership—content, service,
article, “In the Balanced Scorecard process, a number brand, and culture—and eight imperatives that
of desired initiatives have been identified, but could increase readership. The publishing division’s
resources aren’t fully in place to implement them. redesigned 2003 strategy map included objectives
That’s where the Pit Crew comes in.” that related the four cornerstones of readership to
With voluntary employee representation from the Balanced Scorecard.
each division and business unit, the Pit Crew is Today, Media General reviews its scorecards on a
highly touted as a “lean, mean, initiative machine,” quarterly basis through multiple management tiers.
empowered to leverage the buying power of the The individual divisions hold reviews with their oper-
entire enterprise to develop and implement strategic ating units to evaluate results and initiatives, while
initiatives. Among the Pit Crew’s earliest successes: support units also meet quarterly to make sure their
centralizing the purchase of office supplies, company scorecards are aligned with division and business unit
fleet vehicles, and telecommunications services, all strategies. One of the company’s most recent initiatives
of which achieved significant savings. By early 2005, was creating a software program that gathers and
the Pit Crew had saved Media General more than analyzes internal survey data on BSC measures and
$1 million, according to McDonnell. The Pit Crew process efficiencies.
has moved well beyond procurement; a new team
Automating the BSC
of volunteers is “working on capital improvements
and looking at many different areas of the company, Until late 2002, the company used spreadsheets and
an off-the-shelf database to collect data and monitor
BSC performance—a tedious, labor-intensive process
The Pit Crew has moved well beyond that inevitably created inconsistencies in information
management.
procurement. A new team of volunteers
In November 2003, Media General purchased stand-
is working on capital improvements and alone BSC software. Implemented enterprisewide, the
looking at many different areas of the software not only streamlines data entry, but also
enables managers to create their own customized
company, such as cash management,
online briefing books. Senior executives—who meet
electronic processing, and accounts quarterly to review the Balanced Scorecard—have
receivable. continual access to results that are updated at least
monthly at the departmental level.
Scorecard reporting can be done at multiple levels,
such as cash management, electronic processing, and performance results are now reported on a
and accounts receivable,” says McDonnell. quarterly basis at the corporate level and monthly
within each department. And although the software
Reviewing and Renewing Scorecard and Strategy is in a straightforward “notebook” format, training on
In its first two years of BSC use, division managers its use is provided by the vendor every two months.
reviewed their strategy maps every year at a spring Linking Planning and Budgeting with the BSC
retreat and a fall meeting. In mid-2002, Media
General’s publishing division redesigned its strategy One of the motivations for adopting the BSC, notes
map, reducing the number of objectives from 35 to Planning and Budgeting VP McDonnell, was to have
17, and, more importantly, incorporating the ground- a way to link Media General’s business plan with its
breaking results of the Impact Study, an ongoing budget, a rather forward-thinking notion and one that
study by Northwestern University’s Readership shows Media General’s early recognition of the BSC’s
Institute. This in-depth exploration of newspaper integrative powers.
readership trends among 37,000 readers of 100 Media General’s long-range strategic plan, which has
newspapers was launched in 1999, driven by the a horizon of three years, consists of key objectives,
belief that the steady 30-year decline in newspaper initiatives, broad-based financial data, and a market
readership could be reversed. While the Impact analysis. The first year of the plan is the basis

© 2005 by Harvard Business School Publishing and Balanced Scorecard Collaborative, a Palladium company
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Balanced Scorecard Hall of Fame Profile: Media General

for the company’s annual operating budget. The by 60% while the division’s 2004 revenues grew by
initiatives and actions approved in the strategic 44%. With the number of U.S. households with
plan are allocated resources in the detailed budget broadband access now at more than 40 million,
process. “In essence,” says McDonnell, “our strategic interactive media platforms are becoming a much
plan and budget are one and the same” for that first more significant ingredient in Media General’s
year. (The budget, of course, provides line-item detail convergence strategy.
for ongoing operations and the resources for the
A Recap of Media General’s Strategic Transformation
chosen strategic initiatives.) While Media General
develops the strategic plan and budget, it simultane- 2000 (Publishing Division only)
ously refines its scorecard to be in alignment with Before rolling out the Balanced Scorecard company-
objectives and sets appropriate targets for measures. wide in early 2001, Media General had piloted the
Constantly Converging scorecard in its publishing division in 2000. Despite
a drop in advertising revenues that year (reflecting,
Media General’s intensive focus on its convergence more than anything else, an industrywide decline),
strategy continues to yield new and productive the publishing division made significant progress with
processes, initiatives, and ventures. The company’s its clustering strategy. Every newspaper the company
online news bank has become a near-perfect tool in purchased in 2000 fit into one of seven clustered
the company’s convergence toolkit. Created in 1998 market areas; conversely, the two publications sold
as a resource for newspapers to share stories and in 2000 were isolated from the publishing clusters.
photographs, it is now used by broadcast and print By year-end, 12 of Media General’s dailies had
editorial staff in targeted convergence markets to increased their circulation numbers.
share resources for tracking story development.
2001
During 2003, when Hurricane Isabel smashed into
the North Carolina coast, Media General’s broadcast, By all measures, 2001 was a year of tremendous
print, and interactive divisions throughout the region transition and growth for Media General. Starting
shared editorial resources. The interactive media with the January launch of its interactive media
division developed a Hurricane Center that appeared division, and ending with its move to a listing on
on Web sites for all of Media General’s North the New York Stock Exchange, Media General pub-
Carolina and Virginia markets. The Hurricane Center licly redefined itself as a highly visible, innovative,
used photos and graphics from a range of regional and efficient force in the Southeast media markets.
print publications and updated information via The companywide introduction of the Balanced
reports from North Carolina’s television station Scorecard early in the year gave executives
helicopter. Unique page views (the number of specific tools for monitoring the new strategies
different individual visitors to a Web site) increased of convergence and clustering. On the publishing
by 55% during the storm, while weather page side, continued weak advertising revenue was further
views jumped 400%. The success of Media General’s undermined by the tragic events of September 11,
24/7 Hurricane Isabel coverage is a testament to the but the division forged ahead—and made measurable
company’s BSC objective of “providing innovative, gains with the new strategies. In North Carolina,
multimedia/multimarket content.” the newly launched cross-selling infrastructure for
Senior management took the convergence strategy five dailies and several weeklies was so successful
a giant step further in mid-2002 with the purchase that it immediately became the prototype for the
of Boxerjam, a producer of interactive games and company’s other clustered newspaper markets. And
puzzles. Boxerjam’s 2.5 million registered users and in the Tampa market, where three news media
more than 50,000 daily players access games and platforms were now housed under one roof, the
puzzles through a variety of new media platforms, upselling of classified newspaper ads (offering an
including the Internet, wireless handheld devices, advertiser ad placement in additional publications
and interactive television. Since Media General or media for an incrementally higher charge) to
acquired the company, Boxerjam has generated TBO.com resulted in an additional $1.3 million in
significant new revenue streams through advertising, revenues. The Tampa team also booked $6.4 million
licensing, pay-to-play, and subscriptions. In 2003, in incremental advertising orders, significantly
the interactive media division’s revenues grew exceeding its target of $4 million.

7 © 2005 by Harvard Business School Publishing and Balanced Scorecard Collaborative, a Palladium company
Balanced Scorecard Hall of Fame Profile: Media General

2002 holdings away from newspaper publishing, an industry


By the end of 2002, Media General’s long-term in long-term decline. By 2000, Media General had a
strategy was creating consistent, measurable results. significant broadcast presence in the Southeast and
Revenues grew 3.7%, and operating income made was also ideally positioned to mine opportunities in
a huge leap of nearly 104%. In publishing, 18 dailies rapidly developing new media. The creation of an
achieved circulation growth, and the combined interactive media division, combined with proven
circulation for the company’s Sunday newspapers success in the company’s ongoing clustering strategy,
passed the 1 million mark for the first time ever. set the stage for innovation within the convergence
The Tampa Tribune, the flagship for Media General’s strategy. The Balanced Scorecard enabled executives
convergence strategy, recorded a circulation increase to create unprecedented and specific measures for
of 5.9%. In Media General’s North Carolina cluster, tracking convergence, such as monitoring the number
advertising revenues grew by 5%. of news stories produced and presented across
different media platforms. Print publishing is still the
Media General’s broadcasting division achieved backbone of this company—accounting for 65% of
significant revenue growth of 45%, partly a reflection the company’s revenues in 2003, while broadcasting
of revenues generated during an election year, but accounted for 34% and interactive media just 1%.
also the result of convergence-driven initiatives, But, thanks to a consistent focus in the long-term
such as the cross-promotional marketing system strategies of convergence and clustering that permeates
established at Tampa. every facet of Media General’s diverse operations,
With the interactive division now more than a year executives can justifiably boast of significant long-
old, Media General had also established an online term growth and innovation in print, broadcast,
presence in each of its markets, and page views and online media.
increased 32% during 2002.
1
In early February 2005, Media General sold its 20% interest
2003
in the Denver Post, its last remaining publishing business
Media General experienced continued revenue outside the Southeast region.
growth in 2003. With revenue growth at 2.9%, the
publishing division—once considered the division
most at risk—performed at the top of its industry
peer group in terms of both advertising revenues
and circulation growth. With the Balanced Scorecard
in use for two years, the tools for tracking convergence
and clustering revealed consistent gains. Jointly
produced and presented stories garnered Media
General’s editorial executives national recognition,
and TBO.com won the coveted Edward R. Murrow
Award from the Radio-Television News Directors
Association. The interactive media division had a
60% jump in revenues, and unique page views
increased by 50%.
2004
Media General’s strategies continued to pay off in
2004. Total revenues increased 7.5% and operating
income increased 22.1%. Net earnings per share
grew by more than 35% in 2004.
Truly Strategy Focused
Media General’s ambitious and successful acquisition
campaign from 1995 through 2000 not only positioned
the company to create efficiencies in concentrated
geographic markets, but it also diversified its media

© 2005 by Harvard Business School Publishing and Balanced Scorecard Collaborative, a Palladium company
8
Balanced Scorecard Hall of Fame Profile: Media General

KEY RESULTS

• Revenue growth in Media General’s publishing and broadcasting divisions has


consistently exceeded that of their respective peer groups. On the broadcast side,
profits rose more than 38% in 2004.
• Paid circulation has improved steadily since 2001 amid a long-term decline in the
newspaper publishing industry. Circulation growth for the Tampa Tribune was an
unprecedented 5.9% in 2002.
• Media General’s commitment to convergence through new media platforms is paying off.
Its interactive media division achieved 60% revenue growth just two years after its launch
and 44% growth by its third year. The division fueled significant growth in Media General’s
advertising revenues, with a 50% increase in 2003 and 2004 in online classified advertising
revenues.
• The company’s acquisition of Boxerjam, the interactive game and puzzle provider,
has brought a whole new audience to Media General, with 2.5 million subscribers.
• The Pit Crew, a team of managers that pursues organization-wide cost-savings initiatives,
has saved the company more than $1 million as of early 2005.
• Strategic communication, cross-divisional teamwork, and executive decision making
have improved.

TAKEAWAYS

• Buy-in at the top is essential; CEO Bryan’s personal endorsement of the BSC as
a vehicle for executing the convergence strategy was instrumental in mobilizing
executives and getting employees on board.
• Having a carefully forged, fully articulated strategy up front helps make the
BSC implementation more effective, more quickly.
• Tailor communications to the audience, and treat BSC communication as an advertising
campaign; repeat the message, in many ways, through different media.
• Cross-functional teams are effective in aligning people across the organization, as well
as in achieving results. They also help give people an investment in strategy execution,
and offer a high-profile opportunity for recognition.
• When it comes to BSC objectives and measures, stay focused on the “strategic,”
rather than on the day-to-day “operational.”
• Branding the BSC program internally helps raise employee awareness and
generate excitement about executing the strategy.

9 © 2005 by Harvard Business School Publishing and Balanced Scorecard Collaborative, a Palladium company
Balanced Scorecard Hall of Fame Profile: Media General

SFO SPOTLIGHT

All Balanced Scorecard Hall of Fame organizations exemplify the five principles of the Strategy
Focused Organization. Media General is especially noteworthy as an exemplar of the following
SFO best practices:

• Vision and strategy clarified: Leaders identified a strategy of regional focus and conver-
gence to leverage resources across various media divisions, and set out to create a new culture
of teamwork and synergy. They saw the potential of new media and understood the value of
integrating it with traditional media. Moreover, they recognized the importance of redefining
their business from a customer intimacy perspective, addressing the needs of their dual
customer base: readers/viewers and advertisers. [Principle #1: Mobilize Change Through Executive
Leadership]

• Program manager identified: The VP of Budget and Planning, who was instrumental
in piloting the BSC, was appointed to oversee a six-person BSC implementation team. The
Budget and Planning department staff was expanded to handle BSC responsibilities and
coordinate with personnel with BSC responsibilities within divisions and business units.
[Mobilize principle]

• Strategy map developed: The executive team carefully deliberated over strategic themes
and supporting objectives, identifying a dual customer focus, branding and public trust,
and new products and services. Strategy maps are reviewed, and if necessary, renewed,
regularly. The publishing division streamlined its BSC objectives by half in 2002. In mid-2003,
it redesigned its strategy map to incorporate the four cornerstones of newspaper readership
(content, service, brand, culture), concepts identified in a groundbreaking industry study that
link to Media General’s core strategy. [Principle #2: Translate the Strategy into Operational Terms]

• Initiatives identified and rationalized: The Pit Crew, the cost-savings initiatives
team, represents an effective approach to initiative management, even branding its
initiatives. Team members are appointed based on their expertise in the specific initiative
area. The Crew’s accomplishments are given high visibility, and service on the team is
considered prestigious. [Translate principle]

• Accountability assigned: Within each division, an individual is assigned responsibility


for BSC management and planning and coordinates with the central BSC program group
within the Budget and Planning department. [Translate principle]

• SBU–Support units aligned: A full-time technology specialist supports BSC software for all
units. In addition, the HR department has its own scorecard to support efforts such as training,
development, employee retention, and work-life balance. [Principle #3: Align the Organization to
the Strategy]

continued on next page

© 2005 by Harvard Business School Publishing and Balanced Scorecard Collaborative, a Palladium company
10
Balanced Scorecard Hall of Fame Profile: Media General

SFO Spotlight continued from previous page

• Strategic awareness created: The company designed and implemented an internal


advertising/communications campaign to educate employees on the BSC, by first surveying
key personnel to determine the most effective media for different employee audiences. It
created a toolkit for managers; branded the BSC effort (“Go MG”); used the company intranet
to teach employees about strategy, values, and BSC objectives; provided access to performance
results on BSC software; ran articles in the company newsletter, and issued a quarterly BSC
results newsletter to management following team review. [Principle #4: Motivate to Make Strategy
Everyone’s Job]

• BSC reporting system established: Media General switched from a spreadsheet and
database to stand-alone BSC software in the fall of 2003, enabling monthly reporting at
multiple levels. Managers can create their own customized briefing books. [Principle #5:
Govern to Make Strategy a Continual Process]

• Planning, budgeting, and strategy integrated: Each year, BSC targets and objectives are
revised as necessary in accordance with the strategic plan and budget. The first year of the
three-year strategic plan, developed annually, is the basis of the annual operating budget;
initiatives and strategic actions are then funded in the budget process. [Govern principle]

11 © 2005 by Harvard Business School Publishing and Balanced Scorecard Collaborative, a Palladium company
Balanced Scorecard Hall of Fame Profile: Media General

THE MEDIA GENERAL STRATEGY MAP

Maximize
shareholder
value

Financial Profitable
growth
Perspective

Optimize
Increase Manage asset
revenue costs management

Readers/Viewers/Users Customers Advertisers


Customer
Perspective

Ensure community Provide


involvement quality service

Be the source Excel at


for accurate, integrity, fairness, Deliver
compelling, and and objectivity desired audience
relevant material

Leverage convergence and southeast focus through the following


Internal
Perspective Deliver Provide innovative
Promote Build
public trust high-quality service strong community multimedia/
and identity through continuous partnerships multimarket content
improvement and sales

Win new Develop and


advertisers and deliver superior content Create and acquire
increase share from and expand circulation, new products
existing accounts viewership, and and services
users

Learning & Attract and Focus on Promote Promote a culture


Growth and retain high-quality career and skills employee of change and employee
Perspective employees development communication empowerment

INTEGRITY QUALITY INNOVATION

© 2005 by Harvard Business School Publishing and Balanced Scorecard Collaborative, a Palladium company
12
Balanced Scorecard Hall of Fame Profile: Media General

TO LEARN MORE
Editorial Advisers
To learn more about Media General and its Robert S. Kaplan
Balanced Scorecard program, see: Professor, Harvard Business School

• The Balanced Scorecard Report article “How and David P. Norton


President, Balanced Scorecard Collaborative
Why to Build an Internal Marketing Campaign,”
Edward D. Crowley
by Patricia Bush, Principal, and Diane Koziel, Executive Director–HBR Specialty Publications
Consultant, BSR May–June 2002 (Reprint #B0205C).
Publisher
• Balanced Scorecard Hall of Fame Report 2005, Robert L. Howie Jr.
which features a brief profile on Media General SVP, Balanced Scorecard Collaborative
and the 17 other Hall of Fame inductees from Director of Research
2004 (Product #9157). Randall H. Russell
Balanced Scorecard Collaborative
• Strategy Maps: Converting Intangible Assets into
Editor
Tangible Outcomes, by Robert S. Kaplan, Harvard
Janice Koch
Business School and David P. Norton, Harvard Balanced Scorecard Collaborative
Business School Press, 2004 (see case study,
Writer
pp. 406–410). (Product #1342)
Emily Hamilton Laux
• The BSC library: BSC portal members with
access to the library can search the keyword Design
“Media General” for a complete list of resources, Robert B. Levers
including conference presentations and executive
video interviews. (For information on becoming About Balanced Scorecard Collaborative
a BSC Portal member, go to www.bscol.com.) Balanced Scorecard Collaborative (BSCol), a Palladium
company, is a global family of professional service firms
• www.mediageneral.com that helps clients use the Balanced Scorecard to successfully
execute strategy. BSCol offers a wide range of services,
ADDITIONAL RESOURCES including education (conferences, publications, research),
training (public seminars, in-house, online), consulting
• For more information on the Strategy- (strategy, performance, change), and technology (“BSC
Focused Organization (SFO) principles, Portal™,” “BSC First Report™,” toolkits). To learn more,
visit BSC Online. Membership is free. Go visit www.bscol.com, or call 781.259.3737.
to www.bscol.com/bsc_online. About Harvard Business School Publishing
• For additional guidance on the SFO principles, Harvard Business School Publishing is a not-for-profit, wholly
owned subsidiary of Harvard University. The mission of
and to learn about best practices in use at other Harvard Business School Publishing is to improve the
organizations that have successfully executed practice of management and its impact on a changing
strategy, go to www.bscol.com/toolkits. Here, world. We collaborate to create products and services in
you’ll find many resources available for purchase, the media that best serve our customers—individuals and
organizations that believe in the power of ideas.
including Strategy Execution Toolkits.
• For access to the largest compilation of Ordering Information
published materials on the Balanced Scorecard To order additional copies of this profile (in print or by
and the Strategy-Focused Organization, visit download), call HBSP at 1-800-668-6705 (617-783-7474
outside the U.S.) and request product #1320 or visit
www.sfo.harvardbusinessonline.org.
www.sfo.harvardbusinessonline.org and insert the product
number into the search field, or type in “Hall of Fame.”
Here you’ll find a list of all available Hall of Fame profiles
and other products for the Strategy-Focused Organization.

© 2005 by Harvard Business School Publishing and Balanced Scorecard


Collaborative, a Palladium company. Quotation is not permitted. Material
may not be reproduced in whole or in part in any form whatsoever
without permission from the publisher. Balanced Scorecard Hall of Fame
for Executing Strategy™ and Balanced Scorecard Hall of Fame Profiles™
are trademarks of Balanced Scorecard Collaborative. The trademarks
referenced in this publication are the property of their respective owners.
The Balanced Scorecard Hall of Fame™ Profile Series
Learn how each of these Balanced Scorecard Hall of Fame organizations
became strategy-focused. Each individual profile provides a source of
information on how to “do it right”, including a profile narrative, Strategy-
Focused Organization spotlight best practices, key results and takeaways.

Chrysler Group

City of Charlotte

Crown Castle International

Economic Development Administration


(U.S. Department of Commerce)

E-Land

Hilton Hotels

Mellon Europe

Mobistar

Motorola’s Government and Enterprise Mobility Solutions

Royal Canadian Mounted Police

Tennessee Valley Authority

Unibanco

U.S. Army

To learn more visit: www.sfo.harvardbusinessonline.org


or call 1-800-668-6705 (617-783-7474 outside U.S.)

Product Number 1320