Wednesday, September 17, 2008

The dangers of relying on insiders (to save you from dire straits)

Slate's new online magazine, a business and financial news hub called The Big Money, had an interesting piece yesterday on the mutual demises of Lehman Brothers and Merrill Lynch--and offered an insight into why one of them was able to find safe harbor through acquisition while the other simply imploded.

The difference, suggested writer Henry Blodget (yes, he of the Merrill Lynch securities scandal, but who has since rehabilitated himself as a business and tech writer), lay in the fact that Merrill has been helmed for the last year by an outsider brought in to save the company, whereas Lehman continued to be led by a long-time insider.

The story suggests an important lesson for news organizations and the challenges they face.

Granted, financial organizations are imploding due to a crisis of their own making, whereas news organizations are being battered by external forces. But the net effect is the same. Both industries have been facing dire straits. It is possible that the lesson from the Merrill / Lehman parable is that a clear-headed, dispassionate outsider may be better able to find the way forward than one whose understanding of the world--and identity--is wrapped up firmly "inside" the box.

In the news business then, the way forward may be found by news organizations that bring in outsiders--to lead, to set priorities, to make the hard decisions about what beloved elements of the news business will be jettisoned and what supposed travesties will be adopted--rather than relying on long-time journos to try to invent futures for the institutions they hold dear.

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