Kip Meyer, Managing Director, Custom Partnerships at IESE welcomed a packed room of executives at IESE Business School in New York City, inviting them to, “turn off your certainty, turn on your curiosity.”

The event had a unique three-part format: an introduction setting the context for the discussion, a moderated panel of global business leaders, and interactive small group conversations that enabled the participants to explore the implications of business reinvention, facilitated by Professor Mike Rosenberg.

Vivaldi founder and CEO, Erich Joachimsthaler, PhD, opened the door for curiosity with the introduction, highlighting a recent AlixPartners survey of 3,000 CEOs that found 98% saying they need to overhaul their business model within the next three years, but most did not know where to get started. Joachimsthaler also explained the differences between digital transformation and real business reinvention – it is about reinventing the core, not just leveraging technology but also reinventing the entire business model and even the leadership approach.

The expert panel included Krishan Bhatia, President & Chief Business Officer, NBCUniversal; Tara Bustamante, Group SVP, Business Transformation, Warner Bros. Discovery; and Andreas Fibig, former Chairman and CEO of IFF and former President & Chairman of the Board of Management of Bayer Pharmaceutical.

Over the next 90 minutes, some of the thorniest questions facing businesses today were presented by moderators Julia Prats, IESE Professor, and Anne Olderog, Vivaldi Senior Partner.

• How do you know it is time to reinvent you core and what does this imply?
• When do you integrate new technology?
• How do you navigate a changing business model?
• What are the implications for leadership?

The discussion spanned these 4 key areas:

REDEFINING THE CORE

Industry Boundaries Are Shifting

In times of disruption, industry boundaries are not what they used to be. Krishan Bhatia spoke about the example of how we’re seeing increasingly interactive commerce functionality introduced into the media and gaming sectors, as consumers look for shopping experiences that are as simple and engaging as watching their favorite shows. At Warner Bros, the recent success of the game Hogwarts World demonstrated how media franchises can span traditional media and gaming.

Andreas Fibig spoke of entirely shifting industries during his leadership at IFF – from chemistry to biology, from producing ingredients to co-creating entire solutions.

The Core is Not What It Used to Be

While the core of the media industry has always been defined as content – as Tara Bustamante pointed out, the definition of what content is, evolves at the speed of light. Is it content enriched by data that shows its significance and impact? Is it metadata? Is it content co-created by and with consumers, such as on social media? Is it interaction and discussion around its impact? What trusted/quality content was yesterday may not be what it is in the future, as we are headed towards immersive, engaging, interactive content where audiences are invited to participate in various forms (and share data on their preferences in the process).

Similarly, Andreas Fibig spoke of his reinvention of IFF as a CEO – and the move from ingredients to full products that fit consumer needs. An example is the reinvention of animal protein with plant protein in order to supply protein needs of a growing world population – a need that require new textures, flavors and tastes, much beyond enzymes. This move allows the tackling of big, previously unsolved problems – such as world nutrition – and reinventing taste in the process.

TECHNOLOGY

What Comes First – Technology or Consumer Changes

In that age old debate, Krishan Bhatia’s position is that consumer changes force the reinvention – making business reinvention a must. With the growth of streaming alongside linear TV, the advertising model and technology around it is being reinvented, noted Bhatia, who tested the hypotheses that advertising is best when targeted and relevant. NBCU’s One Platform, which Bhatia leads, offers advertising models – and metrics – suited to both streaming and linear TV. He sees an evolution from one standard of measurement that has been the legacy currency for the TV industry to a multi-platform multi-currency measurement giving advertisers more choice. It’s also a far better fit to measure the complexity of how people are consuming content which is increasingly across multiple platforms.

For Tara Bustamante, media and technology cannot be viewed separately anymore – they are intrinsically liked together, especially as predictive analytics allow new consumer experiences to be created, from gaming to shopping or social interactions. As Bustamante said, media and technology are now intertwined — media operates in tandem with technology to create outstanding consumer experiences, supported by data that allows for precision targeting and personalized paths.

“We view everything through the lens of technology,” she shared.

BUSINESS MODEL

The Rise of Ecosystems As a Business Model

As the core is being redefined with support from technology and data, what we monetize today can be very different than yesterday. Yesterday’s model was monetizing content as an asset to be leveraged, in a traditional pipeline value chain model. Today, as Bhatia pointed out, media companies realize that their core asset is the understanding (through data) and relationship (through technology) with consumers. First, this requires a deep understanding of audiences and their preferences and desires on their own terms – rather than simply defining audiences by product preferences (e.g. Action lovers). Second, the foundation of the business model is no longer the transaction (i.e. selling to consumers media that they consume) but a series of interactions that engage consumers across the content they choose to be a part of their lives. These interactions can include gaming, in-media shopping (or InScene Advertising that NBCU has pioneered), content co-creation, etc.

Media companies have an opportunity to redefine themselves as managers/orchestrators of immersive content organized around key media franchises (or in business terms, Interaction Fields, as Erich Joachimsthaler would call these). For the first time, as Bustamante pointed out, media companies are thinking about how to monetize these relationships as opposed to benefit from on-off transactions.

Traditional Value Chains are Pulled Apart

These ecosystems require a broad cooperation from many players across the industry and outside to be effective, as no one player will have the required capabilities. All speakers spoke of collaboration with a wide network of start-ups and other industry players from across the ecosystem. Andreas Fibig spoke of co-creation with customers – a much different model from creating an ingredient and monetizing it by selling it to customers, in a traditional value chain model. The ecosystem model allows forces and capabilities to be pulled together from across the industry to solve big problems.

LEADERSHIP

Curiosity as Core Leadership Competence

Bhatia echoed the need for inquisitiveness – he actively recruits for curiosity as a core competence, since he sees it as a key success factor for leaders in today’s world of complex ecosystems. This makes experience in the industry less relevant than the ability to calculate backwards from the desired outcome. For the ecosystem economy, leaders can be those who can ask the right questions, since nobody has the definitive answers.

In closing the event, IESE Professor Mike Rosenberg drew a further distinction between transformation and business reinvention, rooted in radical shifts in technology and the world. To cope, an ecosystem approach may be called – to push industry boundaries, search for big answers to big questions – and ultimately reinvent your business.

Is your business ready for the future?

This event evolved from a unique partnership between Vivaldi Group, a global leader in business and brand transformation, and IESE Business School, a global leader in management education ranked #3 worldwide (2022 MBA rankings.) Following the success of the event, IESE Business School and Vivaldi plan to partner to host more events together in the future.

The post Four Key Takeaways from “Reinventing Business” appeared first on Vivaldi.

Formerly the Vice President of Business Development for AccuWeather, facilitating partnerships in Europe and Latin America, Michael brings decades of experience working in television and international markets.

He also previously spent nearly two decades at Axel Springer Group, leading US business and helping it grow into the leading European media company within the US media and agency community. During his time there, he enabled Axel Springer Group to become a world-class digital publisher with a significantly expanded footprint in the Americas.

In this Q&A, Michael shares insights on the evolution of television, the impact of new technologies, and what he most enjoys outside of work.

Q: How did you originally get connected to Vivaldi?

A: I met Erich Joachimsthaler a few years ago through a mutual friend. We have both been active in two organizations with “German executives living in the US.”

Q: Your business background includes time working with AccuWeather, SevenOne Media in Germany and Viacom/MTV in Latin America — how have you seen the television space evolve over the years?

A: Over the last few years there has been a strategic focus of big broadcasters to digitize TV building advanced TV products. Furthermore, there is major consolidation in the TV market to become more competitive versus the big players like Google, Meta, etc.

There are challenges in the TV spaces in terms of digital transformation:

1. TV usage shift/decline: There is an accelerated shift to OTT (over-the-top television) and VOD (video on demand).
2. Fragmented inventory: Various OTT platforms; tech challenges (like ad serving) and no holistic measurement.
3. Market and company structure: Transformation of silo structures internal/external; major change process.
4. Increasing competition: Netflix, Amazon and Disney enter AVOD (advertising-based video on demand) business; Google’s TV attack growing CTV reach.

Digitizing TV will reposition the TV space to secure and lever existing TV revenues and build advertising products to participate in a growing digital market.

While Linear TV is declining over the next five years, Advanced TV (Programmatic TV, Total Video and Addressable TV) will all grow steadily. This will secure and lever ad revenues for broadcasters in the future.

I do see the evolution from linear to digital/addressable TV. Streaming and personalized video formats are on the rise and related business models will drive the future for publishers and all players involved.

Q: How has location/region played a role in the work that you’ve done, knowing you’ve concentrated on different geographic areas? 

A: I have lived and worked in Europe, the US, LATAM, and Asia. In previous years, it was very important to be present locally. I learned a lot about customs and business practices which was very valuable. I traveled very regularly to all the markets I covered to stay in touch personally.

I feel that location/region does not play as big of a role today. You can perfectly do your job from anywhere remotely and it is more accepted, especially after covid. If need be, you can always travel and meet clients or colleagues in person.

Q: What are some current trends or challenges that you’re paying special attention to in the media and entertainment space?

A: The future is based on three building blocks: content, data, and tech. The combination of those three will drive the next years (e.g. Apple, Netflix …)

Also, cryptocurrency. There will be a massive runway ahead as the number of consumers trading crypto will double in the next 12 months. Crypto is expected to power ecommerce, video gaming, data, and NFTs. It’s going to become a mainstream payment method. Even on the ad side. It will be totally integrated. But it’s not clear what it will look like yet.

Q: How are you seeing the pandemic and work-from-home impacting what’s in store for the future of media?

A: Increased consumer time spent with technology and media has been sustained coming out of the pandemic. As the entire growth curve has shifted upwards, more consumer time will lead to new opportunities to grow and build businesses.

We will see more and more IoT (internet of things) such as AR/VR to go mainstream — in businesses as well as in households. Gamification will create access to Web3. In terms of ecommerce, in 2025, 10% to 15% of all automobiles will be sold online. Other categories like jewelry and furniture are expected to grow.

Q: What do you see the future of entertainment looking like? What opportunity areas do you believe are on the horizon?

A: With Web3 kicking in we will see more and more interaction of consumers in the metaverse. Real life is morphing into digital and the other way round. Brands needs to ask for support and knowledge to identify possibilities.

Video games are the next technology leading to the metaverse, and search, social, shopping, events, and banking will increasingly take place inside of video games.

Reach super users (26% of all users) account for the majority of time and money spent on ecommerce, VR, music, and video games, and super-serving them will be critical to drive growth.

Q: Looking over your career roles, including time in digital publishing with Axel Springer Group and in Business Development at Blockbuster Video, what would you say is the most valuable lesson you’ve learned?

A: The most important lesson is to stay in touch and nurture the relationships with business partners, clients and old colleagues. Never burn bridges with old employers, as the world is very small and even more connected — you always meet twice.

Q: What is a book or podcast you’d recommend, and why?

A: Bharat Anand’s “The Content Trap.” It talks about how to do well and not become a victim of digital transformation. It describes great case studies (Tencent, Shibsted and NYTimes) that are relevant lessons with learnings to avoid mistakes in digital transformation. A key takeaway is how content enables customers’ connectivity in a connected world.

For a podcast: Amobee Out Loud “Live from the Croisette,” talking about this year’s Cannes Lions.

Q: What’s a passion of yours outside of work?

A: I’m very passionate about sports — tennis, swimming, race biking, and skiing. I used to do track and field competitively. I’m also interested in political science and arts and enjoy history. Traveling is a big passion of mine. It opens your mind and puts things in a different perspective.

I left home at age 10 and went to boarding school in Switzerland. People were from all different countries, different religions, different food preferences. You really learn to understand people. It really helped in my career when I’ve traveled for business or private life. I’m able to have connections with people in different areas of the world. That’s the beauty of travel.

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