- By 2013, the Washington Post had become
a shadow of its glorious past,
which included uncovering the Watergate scandal.
Like most print media, it was dying.
First, digital media such as Craigslist
killed off classified advertising.
Then the onslaught of eCommerce
led to reduced advertising from brands and retail stores.
To add insult to injury, online portals like Yahoo News,
BuzzFeed, and Politico reduced reader's willingness
to pay for news content.
The Post's response created
a classic case of downward spiral.
As the economics of the newspaper collapsed,
managers and editors looked for ways to cut costs.
They started by closing foreign bureaus
and laying off reporters.
As the digital onslaught continued,
they began reducing coverage of national news.
By the early part of this decade,
the one-time global giant had basically become
a city-based paper covering the Washington DC Metro region.
In 2013, Jeff Bezos, founder and CEO of Amazon,
purchased the Washington Post from the Graham family
using his own personal funds.
Benefiting from his very different perspective
regarding the digital era, the Post has become
the biggest digital transformation story
in the media industry.
Revenues have grown at a double digit rate
every year since 2013.
It has hired hundreds of reporters and editors,
making it a content powerhouse,
and the Post is now solidly profitable.
Bezos' single biggest contribution
was not the stability that comes from having a rich owner.
Instead, it was the insight
that the internet is not a threat but a gift.
The internet creates not just global competitors,
but also global customers.
If the Post were to go whole hog
into becoming a content superpower,
it would have the world at its feet.
This would induce people to pay for content
they could not get for free,
create economies of scale
and also boost advertising revenues.
Bezos' guidance also led the Post to view itself
as first and foremost, a mobile and internet media company,
with the print version just a channel.
The Post now publishes 1200 articles each day online.
It creates far more in-depth content
than a paper ever could.
For example, the Post developed a virtual museum
of President Obama's tenure, with five multimedia rooms,
The First Black President, Commander in Chief,
Obama and the World, Obama's America, and the First Family.
Only a small portion of this content
ever made it into the print version.
The Post is not the only company
to have made a highly successful transformation
from the analog to the digital world.
GE's CEO, Jeff Immelt, is attempting something similar.
His goal: make GE the world's leader in industrial internet.
That is the creation of hardware, software,
and internet-based tools that can enable
any industrial company to maximize
the productivity of their machines.
He has moved the company's headquarters
from Connecticut to Boston, home to Harvard and MIT,
and a much more attractive location to recruit
world-class digital natives.
GE's new tagline, the digital company
that is also an industrial company.
There are three big lessons
from the digital transformations
at the Post and GE.
First, don't ever make the mistake
of succumbing to the digital lipstick syndrome.
What gets newspapers and retailers into trouble
is the simple-minded belief that merely creating
a fancy website that allows customers to shop online
What they can get offline is enough.
Instead, what you need is a digital heart transplant.
Second, create and nurture
a Silicon Valley-like culture inside the company.
This means becoming fiendishly customer-obsessed.
In the digital era, customers face very low barriers
to switching across vendors.
Without delighting the customer every time,
you can die quickly.
It also means thinking in ecosystem terms.
Both the Post and GE now see partnerships
with other companies, sometimes even competitors,
as a core part of their strategy.
And last, experiment, experiment, experiment.
In a fast-moving technology environment,
your only lasting advantage is the speed at which you learn.