MY MISTAKE was in trying to run a specialist reference-book publishing business within a mass-market paperback division.
It was soon after I had joined what was then Century Hutchinson to run its paperback division. A reorganisation resulted in the reference list being added to my portfolio - I think because I was the only one in the building who knew anything about managing reference publishing. My primary responsibility was to double the market share of Arrow and launch a number of new imprints - brands such as Vintage and Red Fox. This was a key period for taking the Arrow list several notches up the ranks of paperback publishers and diversifying into new areas, so we were extraordinarily busy.
Meanwhile, The Hutchinson Encyclopedia, which had been a market leader since it was first published in 1948, had fallen into my lap. The problem, although I didn't see it at the time, was that the reference list didn't fit the mass-market culture of the paperback division I was working on. I was so preoccupied with launching brands - and celebrating their successes - that I wasn't aware of my mistake until we were three months late in publishing the ninth edition of the encyclopedia.
It was supposed to be the flagship product of the reference range, and this was the first time it was being published in full colour. But instead of coming out in August, it didn't appear until November, which was far too late for back-to-school and Christmas sales. By that time, two new competitors already had their rival versions in the shops, and it took us about nine months to re-establish our market leadership.
At first, I felt angry and frustrated that we hadn't achieved what we set out to, but then I realised why. It was because I had been spending 95 per cent of my time on the paperback business. With hindsight, I can see that the reference list was under-marketed and under-managed, despite an excellent product and a terrific editorial team.
The moral is that I realised that it needed to be a division in its own right, which is what I then proposed to Random House. That idea rapidly turned into a proposal for a management buyout.
I could see the potential of the reference list, both in print and in electronic form. We had already released the first British electronic encyclopedia and the world's first television-based multi-media encyclopedia.
So we went through the usual courtship for a management buyout, which lasted about 15 months, and finally cut loose on St Patrick's Day last year.
Now, instead of treating the reference list almost as a hobby, we are able to give it the care it deserves with proper marketing, promotion and so on.
Random House still maintains strong connections with us, partly because it decided to buy 20 per cent of our new company, and partly because we use its UK sales force.
Originally the turnover was just over pounds 1m; in our first year that grew by 50 per cent. This year it will be pounds 2.7m, so all worked out well in the end.
What I learned was that you can't ride two horses at once. Different businesses have their own organic cultures.
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