Turner CEO memos detail changes to TV giant

The Atlanta Journal-Constitution received two memos written by John Martin, Turner Broadcasting’s CEO since January. They outline coming changes to the cable TV giant, including streamlining, which AJC sources tell us mean coming cuts to the work force.

June 2, 2014

At the beginning of this year, I wrote to you about Turner’s four main goals for 2014 and beyond: (1) investing in programming and brands to differentiate our content; (2) using technology in innovative ways to deliver more value to, and deepen engagement with, consumers and advertisers; (3) improving our competitive position internationally with smart investments and increased profitability; and (4) collaborating across Turner to improve efficiency, productivity and the way we set priorities in allocating our financial and human resources. These goals are all related. In particular, the better we do on the last goal, the more resources we can free up to devote to the first three key goals of programming, innovation, and international expansion and the more confidence we can have that we’re investing in those three areas wisely.

In April, I sent a message to you highlighting some of the great progress we’re making, particularly in programming with the success of March Madness, CNN’s extraordinary coverage of a must-see news cycle and our preparations for the Upfront selling season. Since then, we’ve continued to achieve against our priorities for the year.

Today, I want to talk with you about some of the near-term challenges we’re facing; what we need to do to improve Turner’s long-term future in an evolving TV landscape; and an initiative that we’ll be launching in the next few weeks to help us move forward.

In the near term, we have challenges at some of our networks. In particular, some of our largest, most profitable and highest-profile networks have experienced ratings headwinds. This is not news to the people who work at these businesses, or for that matter to anyone who follows the business of television. For all of their programming strengths, their loyal fans and followers, their awards and recognition, their financial over-performance and everyone’s continued great work on their behalf, their ratings performance has not kept pace with the competition or, just as important, with our own high expectations.

We have plans in place for each and all of these brands. We’re increasing investments in programming and content to keep our audiences engaged and bring new viewers to our brands. We’ll also spend on marketing, branding and promotion to break through the clutter and make some positive noise. You saw this strategy at work at our entertainment and news Upfront presentations, where we acknowledged and embraced the need for change, aggressively repositioned our brands for growth and introduced comprehensive new programming plans across the portfolio. We looked confident, bold and ready to address our challenges. We are ramping up collaboration as we develop plans to elevate our global position in the Kids business. And we’ll continue to invest in technology to create compelling, useable, scalable consumer experiences. It may take some time for these efforts to take full effect, but I’m confident we can get there with smart planning and great execution. I’m proud of your creativity, energy and openness and certain that together we’ll make Turner even stronger.

In the longer term, the TV landscape is changing in ways that mean we will need to invest even more (and more successfully) in compelling original programming; in differentiating our network and programming brands in an increasingly on-demand world; in finding new and innovative ways to connect with consumers; in building scale to reach broader international audiences; and in taking advantage of technology to deliver more value for consumers and advertisers, not only through TV Everywhere but also through selective and strategic investments outside the traditional TV environment, such as BleacherReport.com.

All of this brings me back to the fourth strategic goal listed at the outset of this memo: collaborating across Turner to improve efficiency, productivity and resource allocation. In simple terms, we need to shift resources in some instances to fund and fuel our highest priorities. We need to act now to free up resources in the short-term to improve ratings at some of our networks, and to secure the long-term success of Turner.

Accordingly, we are rolling out a global initiative to maximize performance across the entire company: Turner 2020. As part of this process, we will assess every part of the company to ensure it is optimized against our strategic priorities, reducing spending and maximizing growth and profitability. To commit to staying top of market, we need to prioritize programming, monetization and innovation investment while reducing spending in less-impactful areas. I’ve asked John Kampfe and Kelly Regal to lead this effort day-to-day, but ultimately this initiative reports directly into me. The Turner Executive Committee members will be highly involved, will help lead the effort and will be responsible for its successful execution.

We’ll provide more details about Turner 2020 in the coming days, but I expect that it will be transformative in some areas of our company. We’ve been shifting resources already and I would ask that you think carefully about how and where to get the greatest return on the assets you control. This may mean staff changes. In fact, I’ll be surprised if it doesn’t. I want to see Turner vibrant and market-leading in programming, branding, innovation and profitability in 2020 (the 50th-anniversary year of our company’s founding). We need to work hard now to ensure that we reach that goal.

Turner has long been a company that has embraced—indeed, led—change in the TV industry, from pioneering the basic cable industry to launching the first 24-hours news network, spearheading TV Everywhere and creating innovative multi-platform advertising solutions. I am very confident that we’re up to this next challenge and will emerge even stronger.

Thanks for all you’re doing at Turner today, and for what we will do to prepare Turner for tomorrow.

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August 19, 2014

In early June, I described to you one important component of our plan to maximize performance across the entire company, employing an initiative we are calling Turner 2020. In July, we posted a conversation on MyTurner in which I talked about the strategic case for Turner 2020, my expectations for the process and how I believe it will fuel new energy, growth and leadership for and across Turner Broadcasting. Today, I want to update you on our progress and the timing of important next steps.

The 2020 work thus far has been comprehensive and thoughtful. A core team of our colleagues has looked at the purpose, structure and fit of literally every department in the company—more than 700 in all. At the same time, they have researched competitive marketplace practices to understand how other companies—some in our space, and others who like us hold industry-leadership positions—are built and manage wide-ranging work in complex environments. Those benchmarks have been applied to our company to help build recommendations that will move us closer to our long-term goals for Turner.

Division leaders now are reviewing the working groups’ reports on their respective areas of oversight. Over the coming weeks, they will work with me to finalize the organizational changes we will implement. Our plan is to begin communicating in the next two months both general and specific changes we will make to structures, models and roles. You’ll see more information and updates on our progress. Resetting our business operations through the balance of 2014 will position us to move forward aggressively in the new year. We’ll start 2015 a more streamlined, nimble and efficient company focused on driving programming, monetization and innovation, in a culture that emphasizes and rewards continuous improvement.

I fully appreciate the scope and scale of the 2020 initiative and the work being done across our company to support it. I’ve been encouraged by how quickly it has come together and how intentionally we are moving, but that’s a reflection of how seriously people are taking this effort, how invested they are in the future of this company and the certainty that this is what we need to be focused on now. I also understand and appreciate that this work is being done while maintaining day-to-day business operations. Someone compared it to painting a moving train—not a bad analogy, but our goals are much more ambitious than a paint job.

I also appreciate your focus on our ratings and company’s performance. We’ve made meaningful progress in a number of important areas and I have great confidence in our future. Please continue to act where and how you can to help sustain and grow our momentum. Partner with your colleagues to plan and execute responsibly. And support the process of positioning our company to achieve sustained industry profitability and growth rates as we invest in our existing businesses while innovating to create new ones. The work we are doing today is fundamental to Turner’s success tomorrow, and next year, and through 2020.

Best regards,