We have concluded a 10-month long transformation project, aimed at preparing SPH to face the challenges ahead.
As SPH chief executive officer Alan Chan said in his staff memo, the changes in the media landscape have been gathering speed. They are structural in nature, driven by evolving advertising and readership trends.
I'm happy to say we are starting this transformation from a position of strength. We are still making good revenues in the newspaper business, we have healthy margins and have built up strong reserves for SPH. We also have commanding brands and strong customer relationships.
SPH's aspiration is to grow and be the leading media company in this region. To achieve this, we must continue to expand both our core and non-core operations, and constantly look for new areas of growth. But we must adapt to changing industry realities, and need to make trade-offs in order to grow.
We have completed a comprehensive review of all divisions in SPH. The CEO spoke of how we have reduced management layers and reviewed supervisory spans of control. Overall, we now have a leaner, more agile and more efficient SPH, better aligned with our business aspirations.
As part of this review, we have redesigned our English and Malay Newspapers Division (EMND) newsrooms, and also redefined processes and job targets for our journalists. We have strengthened our digital capabilities and want to be better able to deliver our content across print and digital platforms.
The CEO also announced the creation of two new divisions: a digital division and a media strategy and analytics division. SPH has added more than 70 new staff positions, mainly in the digital area.
For EMND (of which The Straits Times is a part), our aim is to build high-performing multi-platform newsrooms that will serve the evolving needs of readers and advertisers in the years ahead.
We have also taken a hard look at the current work we do and trimmed manning levels across SPH. After much deliberation, we decided to reduce headcount in the following ways:
By removing some existing vacancies;
By allowing natural attrition (that is, not replacing some staff who leave);
Through retirement and expiry of some re-employment contracts; and
By redeploying some employees to new roles.
SPH reduced overall positions by about 300. Adding the 70 new positions created, the net reduction is 230, or 8 per cent. Only 10 SPH staff were given retrenchment packages.
For EMND, the figures are as follows: 92 positions were removed and 20 new ones created resulting in a net reduction of 72 staff. Because we achieved the reductions through the various ways listed above, only six staff were given retrenchment packages.
We reviewed each individual case and did not take any blunt, across-the-board approach. But some hard decisions had to be taken.
SPH remains fully committed to providing fulfilling careers. But even so, given the rapidly changing industry trends, we must be adaptable, versatile and willing to embrace change.
For EMND, aside from the right structure and processes, we must build collaboration and teamwork. We need both the yin and yang of organisational effectiveness. Leaders in the newsrooms must truly add value, and also ensure that staff are fully engaged: this is the key to good performance.
At the heart of employee engagement is good people management.
I would urge everyone to read Daniel H. Pink's new book, Drive, which is subtitled - The Surprising Truth About What Motivates Us. He cites three elements of true motivation - autonomy, mastery and purpose. It's not just about rewards alone.
Let me summarise what this restructuring means for us in EMND, and what it doesn't mean.
First, is this the end of restructuring? Yes, for now, but we can't be sure about the future. We have to stay nimble and flexible.
Second, we must strike the right balance between print and digital. Print will still pay our wages, but digital must generate more of our future revenues.
Third, yes, the cuts will be felt, but each newsroom must focus on what's important to its readers. We must keep reviewing how our resources are allocated, and also be prepared to cut unnecessary work.
Fourth, quality content is still key. We must give readers and users value for money, and we must maintain high journalistic standards. For digital, user experience matters most.
Finally, we must continue to attract and retain talent. This is also our job, not that of Human Resources alone. We must grasp the true elements of motivation, and be serious about improving employee engagement.
A key future challenge is growing our core media business. In September 2011, we launched The Straits Times' print plus digital pricing strategy, followed by that of The Business Times in January last year. The results have been heartening. Digital growth has more than offset our print circulation decline. Our multi-platform readership is now growing.
The relentless flow of newsbreaks in the last year has shown once again that the appetite for news is undiminished. Each time there is a big breaking story, whether it's the Little India riot or the Kovan murder, our sales spike. Some of our critics say that's all we are after - selling more newspapers.
But there's no need for us to be apologetic: Our job is to serve our readers, by giving them news and views they want to read, that they can't do without.
To do all of this and achieve our EMND transformation, we must get four things right: strategy, structure, culture and execution.
You'll hear more of this in the coming year. We're just starting on our transformation journey and we still have much to do.
I should end with this quote from the Indian mystic philosopher J. Krishnamurti: "What you are, the world is. And without your transformation, there can be no transformation of the world."
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