Tuesday, October 13, 2009

Henry Ford, Publishing Needs You

I've been thinking about Henry Ford a lot lately.

Ford is often credited as the father of the assembly line (he was probably more its godfather). Despite developing mass assembly factories that used interchangeable parts, he was an individualist. He was also blunt, pragmatic and optimistic--all qualities that appeal to me a great deal.

I can usually find a Ford quote to suit any occasion. Today's quote:
History is more or less bunk. It's tradition. We don't want tradition. We want to live in the present . . .
I was reminded of that quote when I read an article in last Wednesday's New York Times here with the depressing title of "Book Sales Are Down, Despite Push."

The story focussed on the disappointing sales of blockbuster titles like Dan Brown's The Lost Symbol, the late Ted Kennedy's True Compass and Audrey Niffenegger's new book after The Time Traveler’s Wife.

The Times went on to say: "And over all, according to BookScan, book sales were down about 4 percent compared with the same week last year . . ."

Henry Ford, where are you?

We all know publishing is first and foremost a business. Corporate heads roll with depressing frequency. Last Monday, Publishers Marketplace reported:
"After just five months as chief executive at the Headline group in the UK [owned by Hachette Livre, which also owns Grand Central Publishing], Kate Wilson has left the company by 'mutual agreement' according to a brief statement . . . Wilson was supposed to be taking over from Martin Neild as he prepared to retire from the company in 2010."
Two weeks before that, Steve Rubin--whose position as president and publisher of Doubleday was eliminated in December--announced he'd be leaving Random House, the parent company of Doubleday, after 25 years.

With these kind of examples, you can understand why New York is risk-adverse and very focussed on the bottom line. The problem is that this reluctance to take risks has publishers placing large bets on a small group of celebrities and best-selling authors.

Thinking that well-known names are more likely to sell than unknown names, the New York houses compete at auction, offering huge advances to obtain the rights to a few releases they hope will become blockbusters.

You can see the problem. In an effort to avoid risk, publishers gamble millions of dollars. If it works out . . . fine, they can relax next summer at that rental in the Hamptons. But if it doesn't work out . . . splat!

Because all of them follow the same (supposedly conservative) strategy, they are inadvertently contributing to greater risk for all by bidding up the price of books. Instead of offering more safety, this herd mentality is actually increasing the risk.

Last December here, I talked about the Boston Matrix as a model for assessing product lines. The problem publishing faces is that they are pouring too much money into their "cash cows" rather than investing money into up-and-coming writers who could become "stars."

While I'm at it, I also take issue with the way media reports book sales, including that New York Times quote about sales being down four percent compared to the same period last year.

According to a June, 2008 article in the New York Times, Nielsen's BookScan "usually tracks about 70 percent of sales." BookScan collects information from over 12,000 locations weekly, including bookstores (like B&N, Borders and college bookstores); discount stores (like Amazon.com and Target) and non-traditional stores (like Kroger and Starbucks). While they are working toward making their results more meaningful (they added the non-traditional category just last year), BookScan misses segments of the market. As examples, they don't capture either Wal-Mart's sales or e-book sales.

Even the Census Bureau, which releases retail sales each month, doesn't include used book sales. The Book Industry Study Group (BISG) reported that 8.3% of all books sold in 2004 (one out of every twelve) was a used book. They anticipated that number would be one out of every eleven by 2010.

Consider. Rather than overall book sales being down, perhaps consumers are shifting venues. It's possible in this slow economy the reading public is purchasing used books or shopping for new books at Wal-Mart where they can get a deeper discount.

I'd also argue that it's possible consumers are buying e-books instead of hardcovers.

I've said it before. The publishing industry needs to pay more attention to their consumers . . . and their consumers' reading and buying habits.

And, of course, Henry Ford has a quote for that, too.

It is not the employer who pays the wages. Employers only handle the money. It is the customer who pays the wages.


Jonathan E. Quist said...

Ford achieved great things, but the thought of his assembly line techniques applied to publishing are alarming. Each worker on the line was assigned one very specific, limited task - so one worker might tighten the support bolts on the left rear leaf spring. Another did the same on the right side. All day long, all month long, all year long... one single specific task.

That doesn't work well in any creative field. To carry the analogy to a ridiculous extreme, would you have one editor for punctuation, another for dangling participles, ... ?

What we can learn from Ford is his frugality. For example, during production of the Model A, Ford gave suppliers very specific specifications for packing of components, down to the size and species of wood planks making up the packing crate. At the Ford assembly plant, the parts were uncrated and sent down one line, while the empty crates were sent down another - where they were disassembled, and the component parts used for the Model A's floorboards and body structural members. (Model A bodies comprised metal panels attached to wood frames.)

The little waste remaining went, along with waste wood from Ford's sawmills, into production of charcoal briquets - eventually branded Kingsford.

Minimizing waste was as much a part of the cost-squeezing process as minimizing the cost of labor.

How does this apply to the publishing business? I have no clue.

Electronic books can certainly reduce production costs and increase re-use of components. If they are used as an excuse to reduce creation costs - that is, to reduce payments to authors (and agents and editors) - then the model is flawed, as this would be a disincentive to product creation.

I have heard comments from many people that the physical quality of books "just isn't what it used to be". If these observations are, in fact, related to cost reduction, then the publishers are certainly working to find the balance between cost and saleability. But realistically, I can't remember ever passing on a book purchase because of too-thin paper or foul-smelling ink, if the author or title appealed to me. If that is what it takes for the publisher to get the product in my hands at a price I'm willing to pay, so be it, particularly if it means more variety in new books.

But is there any real waste to be cut in the system? That's the tough question.

I just hope that editorial management gets as much say as the accountants.

Maya Reynolds said...

Jonathan: I said nothing about applying Ford's assembly line techniques to publishing. New York does that very well already by churning out books that chase trends.

To use an overused phrase, Ford thought "outside the box." He kept his eyes on the customer and on the bottom line.

Chasing after the crowd was never his style. He helped create his own market.

You've given me a chance to offer another Ford quote:

"Most people spend more time and energy going around problems than in trying to solve them."

If New York would stop wasting time worrying about DRM and how to protect their p-books, they might figure a way forward.

You have it backward. E-books offer writers freedom from the traditional publishing industry. New York dominated because they owned the only means of production.

Thanks for giving me the subject for my next post.

Peter L. Winkler said...

"E-books offer writers freedom from the traditional publishing industry."

"Freedom's just another word for nothing left to lose."

Kris Kristofferson

Right now, the alternative to a contract with a traditional publisher is self-publishing, which, for most writers, is worse.

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