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It’s the operations, stupid – media transformation case study

hromadske's experience underscores importance of managing process and operations at media

Editor’s note: The following is a summary of the transformation case study of hromadske, a leading Ukrainian non-profit media, which took place in March-September 2020. In-depth change programs are relatively rare in media. To provide some perspective, and possible guidance, to other media looking to turnaround their operations, the transformation team (note: The Fix editor Jakub Parusinski helped develop and advised on the transformation programme), prepared a detailed overview of their experience. The current article provides an overview of some of the key points covered in the full report.

Media successes and failures happen in public. Or, at least, that is the conventional wisdom.

Much of a media organization’s work – particularly on the editorial side – happens out in the open. Like an open kitchen at a restaurant, social media posts and editorials expose everything from the reporting to internal disputes. Any misstep is immediately visible to the entire world and everyone has an opinion on what kind of content will make things right.

It’s easy to forget that anything else goes into the equation. Whenever a news publication is in trouble, people focus on the most visible part – the articles, the videos and the podcasts, as well as the people who produce them.

But focusing on the “product” paints an incomplete and misleading picture. A lot of companies succeed despite having middling products (think Starbucks coffee, or a telecom call centre). In turn, even great products can fail because of flaws in how the companies were run.

When hromadske, a 7-year-old non-profit Ukrainian media ran into an existential crisis in early 2020, there was no shortage of ideas on how its coverage should change. But the real problems were hidden deeper beneath the surface.

In March 2020, hromadske’s leadership decided it needed a fundamental transformation of the organization to put the media back on the right track. For over six months the model was reworked from top to bottom. This article aims to summarise a few key points (for the complete media transformation case study, check out the in-depth report here).

The hromadske story (and its challenges)

hromadske was founded in 2013 by a group of journalists eager to challenge the declining press freedom and dominance of oligarchic media under the regime of authoritarian president Viktor Yanukovych. It was set up as a non-profit, NGO-based news organization (TV, website and social media). The goal: provide “active citizens” with useful, informative and inspirational content.

It was a timely decision. The Euromaidan Revolution was around the corner and the public welcomed the new organization with unprecedented enthusiasm. Ukraine’s biggest crowdfunding campaign at the time raised over 1 million hryvnias (around $120,000 or €90,000 at the time).

In the coming years hromadske continued to grow, becoming unwieldy and even unmanageable, according to critics. Various semi-independent theme-based teams ran donor projects with limited alignment. Meanwhile regional units – set up to provide national coverage – broke off and went their own way. Similarly, an award-winning investigative team Slidtsvo.info decided to splinter off.

The reasons for what went wrong would require their own, lengthy analysis, but the fragmented financing played a role. Funds typically came from over a dozen different donors (17 in 2019), each with their own priorities and administrative requirements. The result was a Rubik’s cube of semi-independent projects.

The rebellious culture of a journalist-driven organization, as well as an unmanageable governance structure did not help. hromadske was designed to oppose an authoritarian regime that constantly threatened its independence. Multiple mechanisms ensured journalists (and especially NGO members), could protect their decision-making powers.

The cure proved worse than the sickness – by 2020, the organization had 4 distinct governance bodies with various oversight and veto powers. This only worked if a few people held multiple positions across the various bodies, which negated the whole idea of decentralized checks and balances.

Equally problematic, there was no way to manage conflicts of interest. Many of the NGO members had left the organization, often on bad terms, but would attend meetings to essentially sabotage the process or headhunt staff.

Turnover in people spiked, exceeding 100% in 2019, and morale was at rock bottom. Team meetings regularly turned into shouting matches. People were unhappy, and many were leaving. Then, in winter of 2019-2020, a crisis in leadership led to the departures of the CEO, Head of Organization and Editor-in-Chief over just a few months. Understanding that things could no longer go on without radical change, the new leadership decided to rebuild hromadske.

More from The Fix: Op-ed: hromadske case exposes inherent weakness of non-profit media

Human resources crisis

When people think about big changes at media, they usually see them through the prism of changes to the editorial coverage (what program was cancelled, how an issue was covered…). It is rare for people to focus on the transformations taking place within the organization.

To make this transformation happen, hromadske’s new leadership team first needed to deal with a festering human resource crisis – people were leaving every week and the atmosphere was toxic.

The high turnover rate meant that the average staff member had been at hromadske for less than a year. In practice, though, the 100+ staff members (down from a peak of about 160), were split between a dwindling “old guard” that had been there for years, a continuously rotating crop of fresh faces (often straight out of university), and a middle layer of people who did multiple “tours” at hromadske, sometimes using it as a safe harbor between other projects.

The problem was particularly acute in terms of management. Teams were built around personalities (those who stuck it out), rather than organizational needs. Moreover, prioritizing journalistic over business goals caused frustrations. A lot of good managers and potential leaders left.

Huge resources were being lost training staff and getting them through the first few months of low productivity. If costs were allocated in line with productivity, that meant hromadske was spending twice the amount it should – more if you considered that leadership had to continuously train new staff members.

It also impacted overall working conditions. An early-March survey found an astounding 83% of staff claimed they never received proper feedback. Close to two-thirds were negative or neutral on whether their leadership cared about them, as well as their career prospects at hromadske.

The first thing to done to address this was to hear everybody out. Over the next two months most of the staff came in for at least one session (some did many). The HR function was specifically strengthened for this purpose. Previously it mostly administered payroll. Growing personnel and team-building were added to its responsibilities.

Next was to make sure these conversations were happening within teams – setting an organization-wide goal of conducting feedback with all members at least once every two months. Holdouts persisted, but a lot of people started talking – and sharing what worked and what didn’t rather than bottling it up and erupting occasionally.

With internal feedback flowing in, the organization was restructured around functional areas. It started to go about the task of setting a vision for the future.

But two distinct challenges stood in the way. Firstly, identifying the results the team wanted to achieve (more on that shortly). Secondly, people had to change what they were doing, and how they were doing it.

Culture change

“Culture eats strategy for breakfast,” management guru Peter Drucker famously quipped. It is also one of the most difficult things to change. Organizations go through stages of grief (also known as the Kubler-Ross curve – see graph below), just like individuals who experience trauma.

Culture change requires a mix of group and individual work. Every individual adapts at their own speed and falling back to comfortable routines is commonplace. It also combines “therapy,” hearing out peoples’ challenges and concerns about working according to a new set of principles, and motivation, encouraging people to experiment within the new paradigm.

One should also remember how painful transformations can be for those taking part. Some may find there is no place for them in a new structure (regardless of personal and professional qualities). Or that they need to change their role in a way that leads them to question their very identity.

At some point it is no longer practical to deal with employees who are unwilling or unable to adapt, or who sabotage the process. But you should make space for people’s personal struggles. One role of HR in the transformation was to listen and provide guidance to individuals at the bottom of the curve.

Focusing on results

Culture change itself, though, was not enough. The team – and the media’s resources – had to quickly tackle a highly prioritized list of goals. hromadske faced a funding gap in 2020, donors worried about missed targets in previous years (and threatening to cut funding), and a team worried about the future and voting with their feet (basically, a general “sinking ship” feeling).

To deliver hromadske took a page from the world of tech giants: OKR or Objectives and Key Results approach. Famously pioneered by Intel and expanded by Google, OKRs are now the process and goal management tool of choice at companies ranging from DropBox to LinkedIn (but still a rarity in the world of media).

The basic idea is simple. People commit to a set of ambitious and inspiring objectives defined by key results (as specific and measurable as possible). If key results are met, the objective is deemed complete.

This essentially flips the way an organization is managed. Leadership is freed up from monitoring and managing activities. They simply approve the goals people are working towards.

Meanwhile teams have the space to come up with creative solutions on how to deliver. It is also a convenient tool to ensure different parts of the organization are working toward the same ends.

One of the areas where this approach was the most successful was in the sales and marketing department. Prior to the transformation, hromadske rarely made it past the bar of 1-2% of its budget covered from non-donor revenues.

A few months into the transformation, however, it was able to generate upwards of 10% of monthly budget revenues (and was on track to more than double the full-year results for 2020 vs. 2019).

Given that COVID hit early in the transformation, freezing advertising budgets, the decision was made to prioritize the launch of membership. This delivered a quick boost to the organization’ coffers.

Partner projects (i.e., native advertising) then became the priority. The decision to de-prioritize non-commercial partnerships freed up time (it turned out cancelling them produced no noticeable results).

A focus on delivering results helped the organization overcome an unexpected challenge in August of 2020. hromadske had passed the bar of 1 million hryvnias in commercial revenues (not including membership fees). That meant that, based on Ukrainian legislation, it had to register for VAT.

Yet tax authorities twice refused to do so, incorrectly claiming this was not possible for a non-profit. Only after the entire organization started a public and private campaign did authorities dust of the rulebook. Then, they discovered their prior assessment was incorrect.

More from The Fix: Innovate or die: reader revenue revolution in Ukraine

Making the most of OKRs means spending a lot of time discussing goals and prioritizing the most impactful efforts. It is also important to track implementation and understand why objectives were not achieved. Basically, use OKRs to create a cycle of continuous improvement.

Audience analytics as a second language

From its foundation hromadske was a deeply mission-driven publication – as is often the case with non-profit media. But focusing solely on lofty goals made it easy to lose focus of the audience’s needs and preferences.

Making sure the “voice of the audience” finds its way into planning and decision-making is no easy task. Importantly, it is not enough to collect data – that data needs to serve as a basis for decision making. hromadske historically devoted resources to gathering data (including audience studies, and traffic analysis). But it was rare for that data to make it into senior management decision-making.

To make this happen, hromadske decided that all major meetings would start with facts. All discussions would start with an update on analytics and performance, making numbers part of the company culture.

Together with work on creating a clear and understandable brand, more detailed target audience definition, as well as improvements in the technical product itself, this helped put traffic on a record growth trajectory (hromadske would end the year at its highest position historically in Ukrainian rankings of news media and trust).

What worked for the website also transferred to YouTube, which became a priority channel given the declining relevance of TV. According an Internews study TV in Ukraine dropped to being a news source for just 52% of the population in 2020, from 66% in 2019 and an impressive 85% in 2015.

The purpose of hromadske was to be an alternative TV station that broke the oligarchic dominance of the market. But it had to adapt to the changing reality in the media landscape. In 2020, that meant going into digital channels favoured by younger audiences. It also meant constantly testing and experimenting with the content until it got the mix just right.

Accepting (and building) a new story

There are multiple lessons in the media transformation case study of hromadske. Among them is the importance of operations and organizational design to building teams that can prevail and deliver long term.

By focusing on process and results, hromadske managed to increase the traffic and engagement across virtually all its platforms, increase revenues, improve the level and satisfaction of staff, redefine its brand and perception in the media – and all this while cutting the budget by 30% and amidst a global pandemic!

This will not always be the case. Other media may not be able to replicate this success when faced with similar challenges. But the experience of hromadske suggests the media sector needs to look beyond the sexy part of the industry (editorial). It should get dirty in the engine room instead.

It also carries a philosophical lesson.

Working in media tends to be unpredictable even during normal times – and transformations are by no means business as usual. It is important to be flexible and be ready for things to fall through. It might be a key person who resigns out of the blue, a piece of funding that falls through. Or a million other things.

Moreover, mistakes will happen along the way. More than once during the transformation hromadske picked the wrong people. This was not necessarily a case of the people not meeting criteria. It was rather that they did not fit the organizational culture, or had a mismatched skillset.

It is important to anticipate and accept that mistakes will happen, and be ready for when they do.

It’s good to have a few guiding principles like “prioritizing what is impactful now” or “avoiding roads that leave fewer options”. These may sometimes be contradictory, so you need to use your best judgement. Running an organization is a constant optimization exercise with dozens of constraints.

Life itself will always throw you curveballs – say an economic crisis or a global pandemic. The important thing is not to become fazed by a given event. Instead, pick yourself up, dust yourself off, and move forward.

Download the full report here.

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