What Should Lew Do With Citadel? Eric Answers That Question
March 14, 2011
Lew Dickey is tenacious. Whether or not you like him, his company, or the decisions he makes, you have to admire the fact that he managed to get the deal done to acquire Citadel Broadcasting. Why did it happen?
First, because Lew is a masterful chess player in the financial world. He meticulously lined up his capital a year ago, patiently worked to determine his prey, then pursued it at high speed, never letting up. When most others would have given up, Lew proved his worth to his board by finding new openings when every door seemed to be shut. This deal involved some of the most masterful maneuvering ever seen in radio financial circles.
Dickey also won because the Citadel investors and board saw him as the lesser of two evils. In spite of industry grumbling about Cumulus' operating style, its approach doesn't discourage the financial community. It encourages them. Tougher operators with tighter controls mean more profits.
And we must not forget the perspective of those sitting on the Citadel board. They had other offers to choose from, but Dickey convinced them his offer was the best and he would provide the most promising future.
Of course, Farid Suleman is also a master financial politician. But one big difference is that Lew Dickey is a likable chief executive and Farid, to be frank, is not. Remember the old saying that it's easier to attract bees with honey? I know from communications with Citadel board members that they had tired of Suleman's approach to motivating employees and thought his ability to take the company further could be limited by his personal style. Dickey has plenty of personality. He's likable, articulate, and has a plan.
It's tempting to send a message to Lew Dickey asking him to take advantage of this opportunity and return the new company to radio's days of wine and roses, but that's a dream that cannot come true. We're not living in the 1980s anymore. Though we know deep in our souls that radio had more personality, more localism, more personal involvement in those days, the reality is that these giant operations can't be run that way and get the margins necessary to service their debt and make a profit for investors.
Though it would be nice to see radio's biggest operators run with the sensitivities of companies like Emmis or Bonneville/Hubbard -- groups that understand the theory of honey, entertainment value, investing in people and innovation -- operations like Clear Channel and Cumulus must squeeze out higher margins.
So I'm not naive enough to believe that Lew Dickey is going to return his company to the halcyon days of radio. It's not financially possible. But there is a huge opportunity to overcome the "Farid factor."
This is what I would consider doing if I were taking over Citadel.
1. Build a new senior team. Though Farid's top people may have taken on his personality traits to survive, it's probably best to create a new senior team that gives Citadel employees hope that the reported leadership-by-intimidation will stop. Start by looking within Citadel for untapped brilliant leadership. There is value in corporate history.
2. Do a quick fly-in with all Citadel GMs and SMs the moment you can legally do so, and listen to them for three days. Don't preach. They have valuable insights about their company, markets, and employees, from which you can learn. If nothing else, they will be grateful for a chance to be heard.
3. Rehire the greats. Yes, they were more expensive, but there were a lot of great people who built and operated great radio stations for Citadel. The giant former ABC Radio properties had superstar money-machines like Mitch Dolan, Mickey Luckoff, and others who have proved their worth.
4. Give Citadel employees time to trust again. If you pick up an abused dog in the pound, he will be skittish for a long time until he knows his new owner won't kick him.
5. Rebuild their self-esteem. Citadel has valuable people who can make valuable contributions, with good minds and experience. Give them the framework they need to operate within, then allow them the autonomy to perform. They have been praying for a white knight to rescue them.
6. Don't micro-manage. It's not possible. Give great people a chance to thrive.
7. Create the Cumulus X-prize. Big reward for great accomplishments. Radio can be better. We need to find cost-effective ways to return to great localism, a great sense of community, great personality, new revenues, and new digital alternatives. Citadel's people will invent it in an affordable way if you give them the incentive.
8. Focus on being bottom-up instead of top-down. Though every company needs directives and has to make operational decisions, Peter Drucker always told us that the best ideas come from the field. Ask what will create superior performance.
9. Don't take a "not invented at Cumulus" attitude. You may have systems internally that you're in love with, but there are great things within Citadel, and they might be better than what you have. Keep an open mind. Just because Suleman is an unpopular leader doesn't mean that there aren't many brilliant initiatives and systems within that company. For instance, some of the Citadel Media digital initiatives are among the best in the industry. Combine the best of both worlds.
10. Return the network to greatness. Invest in finding the greatest talent and offering radio great leadership. The network business is a lot like the movie business: Most of the success comes from the talent. Everything else is just bookkeeping.
11. Don't put all your eggs in one basket. I told John Hogan when he started at Clear Channel that placing all the stations under one programming team, one research company, one sales director was risky because they might be wrong. Why not run Cumulus and Citadel like two companies, with two teams, to spread your risk?
Though some suggest that Lew Dickey's takeover of Citadel is just another wolf in sheep's clothing (though the previous wolf didn't pretend to be a sheep), I am excited about the transition.
Though I do not personally know Farid Suleman aside from a casual hello at industry events, everything I've heard makes me think he's not the kind of leader I want to see controlling the lives of radio employees and creating radio content. My personal impression is that he puts his own needs before the needs of the company.
Wishing for someone "better" than Dickey is simply a waste of time. No matter what is said or believed about his operating practices, I've talked to many of his managers and employees, and I do know him personally. And I think this is a giant improvement for Citadel. What he does over the course of the next two years will tell the real story. We can only hope it's good for radio.
or post comments below
(1/3/2013 3:13:58 AM) |
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(3/15/2011 8:33:10 PM) |
Radio Ink should have credited Lew Dickey as the author of this nonsense.
(3/15/2011 7:18:42 PM) |
Are you kidding? Did he pay you for this? This corporate rat is following standard takeover protocol,,,slah and burn the victim, rape it of if its value and continue the process with next victim. Citadel was on its way to profits and the owners could of sold their shares but they also follow the slash and burn method. Local radio will consist of rush types 24/7 everday! Hows that for a new future. It wont work longterm since satellite radio, smartphones and ipads can access info that radio
|- Bob bitchen|
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