I’m always surprised when people or businesses delude themselves into thinking they can be the best at everything, that they can excel at whatever they do and don’t need help from others, even if others are the experts. Perhaps it’s part of the “believe in yourself” culture that focuses exclusively on self rather than on teamwork or, more likely on greed, the idea being that profits can never be shared. More generously, maybe, in part, it’s because of human nature, fear and the practical experience that it’s difficult to make money when having to share the pot among too many beneficiaries. Furthermore, experience shows that it is not uncommon for such agreements to go wrong when one party realises that the other is actually profiting from the contract.
With global turnover of over $30bn just from the top handful of corporations in the professional information market, albeit from the totality of their endeavours rather than just professional publishing, I suspect they are not inclined to be lectured to on such matters and would expect due acclaim for their size, scale and ingenuity. Yet, there are few who praise them unconditionally, not least their shareholders in some cases, for their legal and professional publishing work and their ability to grow in these markets is limited. On that score, the advice continues to be that Reed Elsevier should sell Lexis Nexis, articulated again recently by Ian Whittaker of Liberum Capital in a detailed research report. I wonder to what extent, if any, a problem is that it is increasingly difficult to know what they stand for, what they are good at and whether or not the idea of a “one stop shop” is credible?
Still, it is probably the case that if you have the scale and brand power of Thomson Reuters, Reed Elsevier, Bloomberg or even Wolters Kluwer, you can achieve almost anything and have the theoretical capability to approach every opportunity or problem by using the entire arsenal of weaponry that is conceivable. Also, where minor failures and disappointments occur, they can be lost in the totality of the piece. Moreover, the market leaders tend to be in control of the vocabulary of the landscape, constantly redefining and describing it to match and justify the past directions they have taken. It’s somewhat akin to the idea of history being written by the victors. In contrast, though, the Liberum report says of Lexis Nexis:
There are few top-line or cost synergies between the various assets. Ex-legal publishing and Risk Solutions, where the latter uses legal publishing’s infrastructure and which drove many of the cost savings from the Choicepoint and Seisint acquisitions, it is hard to think of any natural synergies (either top line or bottom line) between the various assets.
Whether or not, however, the best people to write software, provide litigation support, give advice, assess risk, etc., are publishers and their colleagues, or vice versa, might be debateable. In any case the theory is that if one doesn’t have the skills one can bring them in or find them somehow. The issue, however, might be as to how customers perceive the effect of such brand extension.
In truth, the question of the benefits of collaboration, partnership and joint-ventures, is probably more appropriately discussed in relation to the smaller entities; those with limited resources but more grand growth ambitions. Personally, and on many occasions, I have found myself talking to publishing businesses that allow, literally, years to pass, during which time they do not tackle new challenges and develop new initiatives. So often the reasons are not the good ones, such as assessing markets and risk and making positive or negative decisions as a result but rather simply that they don’t know how to do it and are not inclined to share the honours with someone else to achieve the outcomes. One sees such people simply not knowing how to evolve, not being capable of understanding processes and technical elements and being hostile to change. This is particularly the case in fear-inducing territory for people with publishing, particularly editorial backgrounds, where it is thought better occasionally to watch stagnation and decline than find innovative ways to entice existing and new customers. That in this day and age, we need still have meaningful and necessary debate on such antiquity as loose-leaf publishing is testimony to conservatism and fear.
What tends to happen to these sorts of professional and other publishing businesses is that they fear but accept their limitations and sell out to their larger actual or aspiring competitors who relegate them and their people who remain to editorial content process work, putting the development and management activity in the hands of others. One might envisage a not too distant future in which professional publishing is not a business in its own right but a departmental function within larger media entities that simply wish to maintain relationships with and profits from certain market sectors, such as lawyers, accountants and tax advisers. In this way, the necessary partnerships and cross-functional activities are achieved but within individual large corporations, at a cost to the independent ones and, in certain respects, at a loss to customers.
Therefore, it is uplifting to read of those examples, at all levels of professional information publishing, where partnerships and joint ventures, ideally but not necessarily of equal parties, are established in order to achieve outcomes that either would have been less able to do independently. One thinks of the holders and managers of valuable added-value content, collaborating with solutions-oriented businesses, software providers, managers of social or business community networks and the like, where different skills, strengths and approaches can be effectively employed. Similarly, relationships between publishers and professional and trade bodies can achieve better outcomes, one with business, commercial and technical skills, the other with access to and trusted relationships with markets.
When I commenced my career as a professional publisher and in the time that followed, I wanted to be in and had an educational background that favoured information publishing, not software and business systems, logistics, customer service, facilities management and suchlike. Still, one has to recognise that these and other functions create the totality of the piece and they need to be tackled in order to thrive. Given a choice, I’d much prefer to have someone else do these things than tackle them myself. There should not be an option, though, to do nothing. Furthermore and not least, different activities, depending on the extent of their added-value, tend to produce different levels of profitability so better to be further up the chain.
I noted recently, for example, that Lexis Nexis had, like many other publishers have done, reached agreement with OverDrive to create customized an eBook lending and management service offering electronic books for lawyers. Likewise, Wolters Kluwer’s work with OFS and XCM Solutions are, I would imagine, all good arrangements. They make sense to me, as clearly each of the respective parties has great but complementary skills. It would be good to see more of this, particularly among smaller, more interesting professional publishers. Even more significantly and intriguing, with news that Thomson Reuters and Wolters Kluwer Law & Business will join forces to offer select Wolters Kluwer current awareness content on Thomson Reuters Westlaw online legal research platforms and of the sale of a minority stake in Lexis Nexis SA, perhaps this is further confirmation that even they can’t do everything without some (perhaps marriage) partners.