Rudi Gassner and the Executive Committee of BMG International
BMG International is a subsidiary of Bertelsmann AG, a German media conglomerate that became the second largest media enterprise with 1992 sales of $9.7 billion. At that time Bertelsmann was comprised of over 200 companies and 50,000 employees in 37 countries whose business interests included music, radio, television, film, book, magazine and newspaper publishing and distribution, printing and manufacturing operations. Headquarted in a small rural German town called Guetersloh, the company did not enter the US market until 1986 through the purchase of several companies, one of which was RCA Records, a label that had put its name on the map in the 1950's through one artist: Elvis Presley. The acquisition of RCA elevated Bertelsmann Music Group (BMG) into the ranks of the "Big Six" record companies. The other five companies CBS, Warner, PolyGram, MCA, Capitol-EMI and BMG were responsible for supplying 80% of worldwide music sales at that time.
Rudi Gassner became CEO of BMG International in 1987. At that time the company operated in 17 countries with headquarters in New York. Gassner described the organization as "a patchwork of companies around the world. It had no mission, no goals, and in total, it didn't make any money..." (p 369) Due to the lack of structure, Gassner was able to build his idea of what a global company should look like, and he wasted no time in getting started. The structure he created for BMG was a centralized corporate structure and decentralized local management structure emphasizing a flat hierarchal form. He established this in creating five regional divisions led by regional directors (RD's) who were responsible for the strategic development of the region in conjunction with the whole company, in addition to managing the managing directors (MD's). This structure tackled two crucial business issues: globalization and domestic repertoire. After he created the regional structure, Gassner established an executive committee consisting of the regional directors and four members that were corporate staff. At the end of the case, the executive committee was having trouble reaching a consensus about some major issues.
Rudi Gassner is credited with expanding BMG's overseas presence from 17 countries to 37 in his first six years. He accomplished this by forming joint ventures, purchasing small labels, and launching new satellite companies. With Gassner leading the company, annual sales increased at an average of 20%, hitting $2 billion in 1993, accounting for two-thirds of BMG's overall revenue that year.
With all the fame and fortune now, Drake now owns his own record label titled October’s Very Own(OVO). According to Theculturetrip.com It was started back in 2012 when he wanted to craft a definitive Toronto sound. Under the direction of Warner Brothers Production, October’s Very Own is set for world domination, encompassing all types of music.
Island Records is one of the most influential pop music record labels of all time.
external and focus on moneymaking. The responsibilities and decisions of a chief executive officer may seem daunting, how...
One important strategic decision that Besier, the CEO (who believed that his products should be sold heavily on American market that that of Europe), took was to move away from the German model in several aspects. One of the aggressive decision he took was to put the entire sales force team under commission sales plan as a result of which, Chevron, the first multimillion dollar sale of R/3, evidenced to be a turning point for SAP. As an outcome, SAP outperformed all of its competitors by 300-800%, the success opened up other large accounts to company.
The three major record labels are Sony Music Entertainment, Universal Music Group, and Warner Music Group; these majors have sub-labels such Atlantic Records (Warner) and Columbia Records (Sony). There are thousands of indie labels (300 Entertainment, Mad Decent, etc.) yet they only represented about a third of the total US album market share in 2015. Majors have substantial amounts of capital at their disposal and key divisions in-house (distribution, publishing), often putting them at an advantage over their smaller competitors. The below graph shows just how large a share of the US recorded music market the major labels controlled in 2015 compared to their many independent
consisted of CEO ( Kathy Kulder) ,Vice-president, and Corporate or group head of the company. Top
Using this data as well as their reported numbers, we can make a reasonable estimation on the size of each of their global regions. We know that there was a net increase of $2M between 2013 and 2014 based on their revenue report. We also know that their Asian/Pacific market had 5% growth, their North American market had 6.3% growth and their Latin America market had 3.3% growth. Their EMEA region suffered a .8% loss.
Wireless with a 2003 annual revenue of $22.5 Billion and a base of 40.4 Million customers.
At the beginning of XXI century leading Japanese electronics manufacturer Sony Corporation faced operational and financial stagnation. Reported losses were huge even for such a big conglomerate as Sony, net income in 1999 fell to 121.83$ billion from 179$ billion in 1998 and following decrease continued till record 16.75$ billion in 2001. Shareholders worried as the stock price was falling down even though top management made some structural changes: assets were sold, work force was reduced by 17,000. Sony had the only choice to do some reformations in structure, strategy and innovative products because it was losing the war to its competitors in the market. Therefore, “Transformation 60” was launched as a restructuring plan for further 3 years. However, issues were bigger than Sony predicted, neither of goals were achieved. Moreover, restructure planned to create divisionalized companies but instead just cut the connection inside. Planned convergence seemed to be leading to divergence while competitors were further developing power in the market. All the considered efforts to achieve 10% operational margin were ruined, while investors became impatient and pressured CEO. This dissatisfaction and fail of reformation led to resign of current CEO who was replaced by Welsh-born Howard Stringer, whose fame came from Hollywood where his restructuring plan resurrected movie market of Sony. Stringer stuck to its well-known policy of job cutting and replacement of executives along with integrating new management structure of centralized-decision making to avoid further progress of “silo” problem and reestablish lost connection between divisions. Furthermore, Stringer had to create further path for the company as it was no...
The heart of the music publishing business lies in the rights to the original music. After the music is successful enough to financially support itself the music is printed in mass quantities in a variety of ways. This could be everything from guitar tabs to choral arrangements for a junior high choir. The publisher's main source of income is through record royalties, performance royalties received from companies like the American Society of Composers, Authors and Publishers (ASCAP), Broadcast Music Incorporated (BMI), and the Society of European Stage Authors and Composers (SESAC) for performances of music copyrighted by the publisher. These royalties could be from many different types of performances but most are though radio and songs on television. The success of a songwriter lies in the greatly in the hands of his/her publisher. Normally we ...
At this stage when the domestic economy of japan was progressing, Sony announced Howard Stringer as the first non-Japanese Chief Executive Officer of the company. This step of opting for a western style management from the usual Japanese style management could strengthen the business environment in the company in terms of external and internal factors that stimulate the company’s operations. Announcing Stringer as the CEO was a sign of change in the 50 year old company that has been noticeable by everyone in the world. The five main challenges that Stringer identified for Sony were the once which has been taken into consideration in reorganization since 1994 which failed in achieving the desired results and trying to improve the financial performance and competitiveness of the company. Expert analysts blamed that the ...
Remember the days when a person would have to wait in line for two days just to purchase U2 tickets? Remember the days of tapes and videos? Hey, let’s get with the program, it’s now the 21st century, the information, technology age. All one has to do is flick on the computer, get on-line, type in www.knitmedia.com and one has opened the doors to the “Entertainment Company of the 21st century.” In the convenience of a person’s home, one is able to download music, purchase a compact disc, and even download a performance. Michael Dorf, founder and CEO of the Knitting Factory had this dream, and what almost seemed impossible has finally come too pass. This dream needed a group of managers to put it into action. According to Management Leading People and Organizations in the 21st Century by Gary Dessler, “21st century managing, is a management approach to the rapidly changing business world that emphasizes responsiveness and effective leadership”, (pp. 24-25). The Entertainment Industry is Infamous for the dynamic nature in the way business is conducted. The way a company reacts to trends in the Music Industry affect whether a company sinks or swims. Through expansion both here in the United States and abroad, Michael Dorf faces both challenges met and to be addressed. From examination of his management style, we can observe that this company, KnitMedia is swimming.
The Cadbury Committee (1992) defined CG as a system, by which companies are managed, controlled and power exercised by executive elites in the management of resources for sustainable development (OECD, 2004). It also involves a set of relationships in an organization between its management, board, shareholders and other stakeholders (OECD, 2004). The CEO as the ring leader define the goals the organization pursues develop control systems that guide and monitor the organization's destiny. They construct an organizational structure and rules that appropriately govern the tasks to be undertaken and motivate their subordinates to complete these tasks (Kehinde, et al. 2012). The CEO as the ring leader is the one who designs and implement by way of instructing the subordinates, enthusiastically, motivating, encouraging and guiding them towards the achievement of the set goals. The CEO as the ring leaders sits at the apex of Governance structure and is the ultimate decision maker on how best the future state of affairs can be attained through the governance structure (Pettigrew, 1992). Corporate governance structure provides an opportunity through which different leadership styles could be explicitly exhibited by the executive as he seeks to promote efficiency, effectiveness, transparency,
Diverse business and industrial houses that originally had interests limited in oil and financial services only, had now started investing more into the media industries. These industries primarily had private ownership. In the late 1980s a new form of cooperation emerged whereby there was cross –promotion and cross-selling between the different corporations so that there would an increase in the overall sales. With the developments in technologies new sources of cultural production emerged making the ownership more complex. In many of these industries such as radio, television and films, there was the emergence of oligopolistic ownership emerging which was leading to the creation of huge conglomerates. (pg195) In the USA, for instance, large corporations such as the RCA (Radio Corporation of America) became one of the leading companies overtaking the various media forms like publishing and newspaper companies and Hollywood studies emerged as an oligopoly which was integrated vertically. This vertical integration led to the development of certain new technologies such as recording and playback. There was also cross media ownership which made the system very complex. Film studios like MGM (Metro-Goldwyn-Mayer) also held considerable interest in music industry. In the 1980s media houses began to invest more into consumer electronics companies. For instance,
Woywode, M. (2002). y global management concepts and local adaptations: Working groups in the frenchand german car manufacturing industry.Organization Studies, 23(4), Retrieved from http://oss.sagepub.com.ezproxy.csusm.edu/content/23/4/497.full.pdf html