Article Paper
4/11/2012

National Geographic Explores Digital Future
National Geographic, the fascinating nature magazine, has been present with us for 124 years. As we know, it is well known for its photography, maps, and articles. Mr. Fahey had taken over as the CEO of National Geographic in 1998 and is dedicating his efforts into expanding the magazine’s reach to consumers. He understands that the digital aspect of the market is thriving today so he is going to enter in strong, considering 56% of their revenue is accumulated through television networks and other programming methods. Mr. Fahey strongly states he won’t abolish the company’s oldest asset, stories and pictures, but will deliver them in a more accessible manor. This article correlates highly on the implications for management seen in Chapter 6 of the textbook.
Chapter 6 strongly informs the reader about planning and strategies. Planning has a very important role in management with relevance to achieving goals. There are three steps within planning that firms must use in order to plan successfully. Mr. Fahey and National Geographic do this very well. This first step is to determine the organizations mission and goals. Mr. Fahey states this quite clearly by saying that the company will do much better off with digital expansion. The second step is to formulate a strategy. Mr. Fahey does this by noticing how the website and television networking succeeded. Since that division of digital sources did so well, he is now experimenting with the videogame market and handheld devices. (IPad apps/Smartphone apps, kindle, nook, etc.) Implementing this strategy is the third step. Fahey executes this quite well. They started selling a digital “Triple Play,” which is a package including the print edition, digital edition, and access to the website articles. They found out from research that it was quite effective and profitable even though the prices were raised. Digital revenues consist of just 3% of their revenue today, but he ensures that within the next decade it will comprise at least 50%.
This entire plan provided by Mr. Fahey would correspond to the corporate level of planning, stated in the textbook. Decisions concerning missions and goals, strategy, and structure are all appointed to top management employees such as the CEO (Fahey). As stated earlier, Fahey assumes that digital revenues will exceed 50% in the next ten years. This plan is relevant to the time horizon. There are different time horizons varying from long-term, intermediate-term, or short-term. Since this is a ten-year plan, it falls under the long-term category because it is over five years long. Because of Fahey’s uniqueness of the plan, it would also be considered a single-use plan. A single-use plan has a strong correlation with nonprogrammed decision making. A single-use plan is somewhat like a one-of-a-kind plan where they don’t happen all the time. Long-term plans are a lot more seldom than standing plans whereas standing plans could happen on daily bases. (Following the firms rules, written guides) With sales down since 2008(economy decline) it has been hard for National Geographic to come back up to the level they were once at. Their CEO, Fahey, had to reroute his success strategy. Fahey saw a new opportunity to create value into his company. He decided to innovate the company by expanding into the digital market, by using the vertical integration method. Fahey realized that he could generate much more revenue to the firm by using this integration approach. If he had not came up with this idea, the firm would be lagging this creative innovation with potential to raise profits significantly. With this being said, it is quite obvious that National Geographic is on the right track to being successful. Using all of theses techniques are great and effective ways to run a business.