A

Case Presentation on
New York Times
Presented to :
Prof.Krunal Joshi

Presented By:
Jagruti Gammar (A-13)
Neelam Malik
(A-19)
Ankit Mehta
(A-29)
Minesh Prajapati(A-43)

Introduction About Case

Scott

Meyer ,GM of NYTimes.com website for

New York Times Newspaper
Lisa Desisto ,GM of Boston.com website for
Boston Globe which is Englands largest
regional portal.
Both websites were operated by New York
Times Digital(NYTD),a division of New York
Times Company.
Meeting on September 28,2001,the main focus
is on Possible changes to NYTDs
Organizational structure.
Martin Nisenholtz,CEO Of NYTD

The New York Times

Company
In 2001,Company owned a variety of

media properties like New York Times

newspaper, the Boston Globe,
Worcester Telegram & Gazzate and 14
other regional newspaper,located
primarily in the southern U.S.
Broadcast media Properties accounted
5% of Revenues and NYTD Accounted
for 2% of Total Revenues.
The New York Time -Brand as a most
valuable Asset
Won 79 Pulitzer Prizes more than any

Organizational structure and leadership

Steve

luciani, 2 employees from the news desk

and an advertisement executive were assigned to
the new web side project.
Expert Martin Nisenholtz was hired as a president
of NYTD.
There was Chinese Wall between Editorial and
business side of org.
Company increase investment in online operation.
AS newspaper staff and NYTimes.com was
supervised closely there was similarity in culture
and decision making biases.
Insufficient resources devoted to NYTimes.com

 Two

major decision:
New operating decision which report directly to
Corporate rather than news paper management.
tracking stock which raise capital at internet
valuations.
NYTimes.com experimented with several org
structure.

Culture and values

The

NYTNP was steeped in tradition and

operationally vary conservative.
AT the time of separation distinct internet culture
created.
Experimental culture. Bureaucratic
controls,procedure and paper work minimized.
Team approach was emphasized.
Culture was modern and diff from corporate HQ in
NYTD.

Hiring and Compensation

Hiring

policy were modified to support distinct

culture.
Young, smart, ambitious and with .com experience
were hired.
Remove of pension program.

The Budgeting Process

Budgeting
process
was
completely
integrated with the corporation.
Financial commitment.
NYTD invested aggressively in creating a
world class IT infrastructure which is
dedicated to interactive media, that
supported news paper operation.

Cont

NYTD developed bottom-up approach to

budgeting.
To help generate ideas, NYTD constantly
reviewed usage data for its websites.
Promising ideas were assigned to
product manager.
Evaluation would be done by senior
executive team, by using combination of
loose net-present- value analyses and
experienced judgment.

Lot

of guesswork involved in
projecting revenues.
In late 2000 and early 2001, the
financial resources become primary
constraint.

Performance Evaluation

Financial performance vs. forecast and

budgets, and long term path to
profitability would influenced the
performance.
Other dotcoms revenue growth become
the most significant influencer.
In 2000 they get the revenue which is
double what they had budgeted.
Positive impact on the value of the New
York Times brand.

Conflicts with the core business

Editorial Operations and New York Times Brand

Newspaper industry had adopted the separation
of editorial and business operation
Some of more innovative and successful
additions are coming from cross functional
collaboration

Advertising Sales
Traditional newspaper customers were not ready
because
1. They Dont understand the new media
2. Hesitant to put customer relationship at risk
3. Digital sales were expected to be very small

 Subscription

Sales
offering free newspaper content on the internet
would have a negative impact on subscription
sales
Compare the readers of website and
newspapers
web readers are different audience- younger,
affluent & geographically dispersed
Survey & focus group failed to support fear of
online newspaper
Websites are viewed as complementary assets
than as competitors
Websites become trial use of the newspaper &
become the source of new subscription

Questions
Question 1:
Describe NYTDs evolution to
date.
What is the strategy of NYTD?
Are the Organizations and control
consistent with the strategy?

New York Times Digitals Evolution

NYTD

had developed and was operating two

websites: NYTimes.com and Boston.com
NYTD also responsible for managing the
Companys Digital Archive Distribution Business
There is a Sophisticated Information Technology
systems automated significant portions of the
process of converting newspaper content to
website content.
Access to NYTimes.com free .
User Registration to website with Demographic
information which serves advertisements to Target
Audience.
All Revenue for NYTimes.com was generated by
selling Advertisements on websites.

NYTimes

managed its own sales force and

selling display ads.
New products were introduced regularly to
website.
Strategy of NYTD
1.Advertisement related strategy
2.Free online Registration
3.Decentralize to Centralize
4.One website for all information
5.Classified advertisements
6.Crossfunctional operation
Yes, the organizations and control consistent
with the strategy.

Que.2 What the impact had on the rest of the company?

Many

senior newspaper executives would have been

actual uncomfortable with entrusting priceless New
York Times brand to an operating unit that they didnt
control.
Developed values and culture similar to newspaper
Decision making biases
Tracking Stock(Tracked the performance of division
within a corporation) ,NYTD enable to raise capital at
Internet Valuations rather than newspaper Valuations.
A team approach and a spirit of openness were
emphasized/
Information was shared. Decision making was
Transparent.

Hiring

Policies were modified to

support the effort to create a distinct
culture.
Budgeting Process was completely
integrated with that of corporation.
Performance evolution more based
on financial data or other qualitative
metrics.
Several Areas of friction were at top
of mind due to overlap between the

Q-3 : How does the way NYTD is managed compared

to the way a Venture capital firm manages a Start
Up? What insights if any, do you draw from this
Venture

1.
2.
3.

Capital:
Different stages of finance
It might bring culture which may not be suitable for
growth
Increased intervention may increase lead time of
product development

.Company:

1.
2.
3.
4.

Company managements decision would be the final

decision
Company can increased its investment in any condition
They can choose their own culture
Bottom up Approach

Que .4 What Impact do internal perception of NYTDs

performance have on its operations?
Initially

they focus on revenue generation only, not

concerned about expenses.
Performance evolution based on
forecast revenue-achieved revenue
Company revenue- competitors revenue
By the end of 2000, they are having pressures to achieve
profitability, and for that they were increasing the operating
efficiency by centralizing operations.
Performance

evolution based on operating problems

Initially the two divisions editorial and business were operating

separately. But Some of more innovative and successful additions
are coming from cross functional collaboration

Que :5
Would you change in NYTDs existing
organizational structure?
Yes

as a manager I would change

organizational structure.
Environmental changes and organizations
increased product line compel to change in
structure.

Que.6
(A)

How would you change the culture and leadership style?

There

should be informal culture as they

are hiring young employees to retain them.
There should be some necessary distance
between senior executive and other
employees.
Internets culture should meet with culture
of head corporate.
Should be coordinating leadership and
decentralized functionality.

(B)
How would the change in NYTDs likely Budget?
AS

there is already lot of investment in IT infra,

there should be less investment in it further.
Employees salary structure should be revised.
Outsourcing of HR activities which are necessary
for new projects of NYTD.
There should be long term budget but changes
should be updated weekly or when most
necessary.
Senior staff should be paid as per there experience
and caliber.
Proper allocation of finance to have necessary
resources.

(c).The way NYTDs performance is

judged?????
NYTDs performance is primarily
evaluated by the following questions:
1. Can we tolerate the loss we are
generating?
2. Are
we having any significant
operating problems?
3. If any damages being done to the
core business or the core brand?

(d). The way new ideas for the

websites are generated?????
Cross functional culture

Innovative ideas from employees

are appreciated.