The Reader’s Digest Association, publisher of the iconic magazine that for decades has owned much of the “wire” at supermarket front ends, announced yesterday that it will file for Chapter 11 bankruptcy protection.
CEO Mary Berner said that despite the filing, it would be “business as usual,” with no layoffs, no salary cuts and virtually no impact on day-to-day operations. She said that the move was strictly a “balance sheet issue.”
CEO Mary Berner said that despite the filing, it would be “business as usual,” with no layoffs, no salary cuts and virtually no impact on day-to-day operations. She said that the move was strictly a “balance sheet issue.”
- KC's View:
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The idea that Reader’s Digest thinks it can do business as usual and survive in the long term strikes me as a joke at best, and delusional at worst. My guess is that you would have to hunt very hard to find anyone under the age of 30 who reads Reader’s Digest on a regular basis or find it relevant to their daily lives – and it is almost impossible to imagine that they don't need to make major changes to their business model in order to have an extended and healthy life span.
They may have convinced themselves at Digest headquarters that this is just a balance sheet issue, but anyone with a computer knows that the world has passed Reader’s Digest by.
“Business as usual?” In 2009, any executive who utters those words ought to be shown the door. Because those words are a recipe for complacency, disaster and irrelevance.
