Monday, May 31, 2010

Message to Fairfax Shareholders


The Fairfax Board has called in Bain & Co to advise on strategy. Mark Day has written an informative piece on the challenge facing the Fairfax Board in not having the media savvy to deal with conflicting recommendations between old media management (Brian McCarthy) and new media management (Jack Matthews).

Actually, I'm not sure I agree with Day. No amount of media experience will help the Board resolve the conflict between new and old. The experience will likely be in just one, as Day observed applied to the only external Board member with any media experience.

Perhaps the Board however needs to focus on finding other external members who are able to facilitate the strategic conversation within the company between the competing models. That would mean directors who had faced this challenge elsewhere and who had a track record as directors of helping management through issues.

Unfortunately they've gone for "option B" - call in the consultants. The last major corporation in Australia that outsourced strategy to Bain was Telstra under Sol. Anyone looked at the share price lately?

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