Thomson Reuters: Content Slicing and Dicing Chops People
December 6, 2018
A certain database company raked in the dough by pitching XML slicing and dicing as the way to piles of cash, happy customers, and reduced editorial costs. Thomson Reuters was “into” XML inspired slicing and dicing. Now the chopping up has moved from disparate content to staff.
According to a real news organization, the article “Thomson Reuters to cut 3,200 jobs by 2020, offer fewer products” states:
Thomson Reuters said it plans to cut its workforce by 12 percent, or 3,200 positions, by 2020 as part of a push to reduce spending.
Capital outlays as a share of revenue will be down about 30 percent by 2020, Thomson Reuters said Tuesday in a presentation for investors. By that year, Thomson Reuters expects to have about 11 percent fewer products and pare its number of locations by 30 percent. The pullback underscores efforts to exert cost discipline after third-quarter revenue came in 2.3 percent less than analysts had expected.
TR revenues have been less than exciting. Despite management’s heroic efforts, the company has not been able to shake the money tree with the vigor some stakeholders expect.
Thus, slicing and dicing of staff and products is underway. Nothing like a hefty reduction in force or RIF to brighten the individuals who can now look forward to finding their future elsewhere.
The larger question is, “What will TR do if the staff reductions and new points of focus do not generate revenue?” The account, lawyer, and MBA infused senior management may have to look for different sources of inspiration; for example:
- Seeking to pull the company into new markets with must have products and services. Not easy, I know, but TR will have to do more than follow the well worn grooves in the business models which are like the streets of Pompeii
- Selling itself to another large professional publishing outfit. What about a Thomson Elsevier or (perish the thought) an Ebsco Thomson?
- Selling the bits and pieces to investment banks or small companies eager to capitalize on TR’s missed penalty kicks. What would Bloomberg pay for the terminal business and maybe the Palantir inspired services? Perhaps Factset would toss a soccer boot on the pitch?
- Modifying its executive compensation methods so that TR unit managers actually cooperate on certain opportunities and initiatives.
There are, of course, other options, but many of these have been tried before; for instance, new units, new senior managers, new acquisitions, and new technologies.
Net net: TR may have to start thinking about life as a smaller, leaner, less profitable operation. Lord Thomson of Fleet may not be able to return and infuse the company. He’s needed in my opinion.
Stephen E Arnold, December 6, 2018
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