National Geographic Case Study: Trying to Change Culture

John Fahey, wearing khakis, a blue button-down shirt, blue tie and loafers, gets off the elevator on the 7^th floor of the National Geographic building in Washington, DC. It's been a long week, and as chairman and Chief Executive Officer of the National Geographic Society (NGS), he has some decisions to make.

The Society has been declining in receipts, in ideas, in energy. In 2009, it's trying to emerge from old-media when new-media is where the excitement is. The Society's internal organization is fractured into separate divisions which operate too independently, and decision-making is slow throughout the organization. He needs to change the culture within the NGS to improve innovation and operations. He knows he wants to encourage risk-taking, improve communications between divisions and put more emphasis on commercial operations. But how can he do that?

Background

John Fahey is from the Bronx, has an engineering degree from Manhattan College and an MBA from the University of Michigan. He has been with NGS for over 15 years, starting as the first president and CEO of National Geographic Ventures, a separate wholly owned, taxable subsidiary of the foundation. He previously was president of Time Life, where he faced some of the same publishing concerns faced by National Geographic, and has worked at HBO, Cinemax, and Time magazine.

The NGS was founded by a group of 33 explorers and scientists as a scientific society in 1888 in Washington, DC, and over the years, has supported the scientific studies of Robert Peary, Richard Byrd, Cousteau, the Leakeys, and Jane Goodall. It has the mission to "increase and diffuse geographic knowledge" and to inspire people to "care about the planet."It is best known for its magazine with the distinctive yellow border, which publishes articles on geography, archaeology, anthropology, and exploration, and counts more than 9.5 million readers, both in the US and internationally. The magazine has pioneered the use of undersea color photography, atmospheric photographs from space, photographs of animals in their natural habitat, and in-depth studies of cultures and environmental elements of different regions; the Society itself has a staff of 1,700 employees, and is the world's largest nonprofit educational society. It publishes books, atlases, produces television documentaries, operates cable television stations available in 34 languages in 168 countries, and is expanding into digital media. The NGS has significantly expanded Mission Programs to include NG Explorers-in-Residence, Fellows and Emerging Explorers programs, a Genographic Project which uses DNA data to chart the migration of humans, as well as programs to encourage indigenous film projects, international regional grant-making programs, and educational publishing and geography competitions.

In 1996, the Society corralled its diverse scientific research and educational programs into a division called Mission Programs, with the mission of increasing geographic knowledge while promoting conservation of cultural, historical and natural resources. This division operates behind the scenes of the more recognizable National Geographic symbols: the magazine, cable TV channel, website, and museum. This Mission Programs division is supported by donations.

Problem

NGS needs some updating to keep the organization profitable and relevant to its mission of encouraging appreciation of the planet and its citizens. Its print publications have seen subscription revenue decline from $284 million in 1999 to $211 million in 2009. The prestige of membership has weakened, and despite attempts to better integrate employees, divisions are still siloed. Being a legacy organization with entrenched systems and ideologies, it is poised for a transformation of culture, behavior and values.It must move further into the digital world, using its brand awareness and international presence as an asset, and encouraging divisional and functional collaboration.

John has been working at this corporate reorganization for the past twelve years. He notes that the creative culture of the organization also means that change is harder to accept. He has made organizational changes, however. He recently created a position of e-commerce Senior Vice President, in charge of working across departments to coordinate internet presence and develop a strong e-commerce strategy, leveraging subscriber relationships. Now he needs to decide how to integrate this position into the organizational chart, and to effect cultural change at this slow-moving organization.

There are several factors which must be balanced in the process of change:

• Reorganization can change the organizational structure
• Implementing a change from silos to collaboration can change the culture and values
• Personnel may need to be changed
• Incentives to change can be affected through compensation and recognition programs.

Another factor to consider is the speed of technological change. Decisions must be made understanding that the iPad has gone from nonexistence to a preferred platform in two years, and that cell phone capabilities have changed exponentially in only the past few years.

So what ideas could you give the CEO to keep his legacy organization current and profitable? Take a look at the questions below:

Questions:

• So what do we know about the National Geographic Society?

• How does it receive funding?

• What do you think the culture is like?

• Is Fahey moving too slowly?

• Is the new mission"to inspire people to care about the planet"the right one?

• He has created a new SVP of e-commerce.Within the corporate structure, to whom should this new SVP report? To Fahey, where he/she would be one of 14 direct reports, and which would undergird the importance of the position? Or to the Global Media Group, which coordinates the magazine, book publishing, TV and film, and digital ventures? Or to the Enterprise Group, which coordinates NGS merchandising businesses, brand extensions, and licensed products and services? Is this a functional or strategic position?

• How can he destroy silos and integrate the organization?