-- abstract from Learn from Hollywood
-- Business lessons from Hollywood
Film is an eccentric business
studios have had neither the stunning returns of startups
nor the steady profits of mature firms
They are famed for blowing vast sums on high-profile turkeys
Other industries
are coming to resemble the film business in some ways
In today’s knowledge-based economy
bosses are having to spend more time managing flighty “stars”
Food and consumer-goods makers
are seeking to focus more on a narrower range of “blockbusters”
as the studios have already done
industries from electronics to carmaking,
the pace of product and brand launches is increasing
Hollywood’s ability to create a buzz rapidly about a new film
may offer valuable lessons
movie-making is one of the few remaining industries
in which the country's grip on the global market
is as strong as it has ever been
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Every company that employs creative people
must think about how to harness their strengths for commercial gain without strangling their free-spiritedness
Hollywood has a century’s experience in this
Studios recruit a fresh creative team for each film
leaving its members to work intensely together
with a minimum of interference
stepping in only when things are clearly going wrong
This gives team members a feeling of
control and pride in their project
Everyone has their contribution duly acknowledged
in the closing credits.
People work hard and collaborate well in the movie business
in part because they have little job stability
Many are freelancers
who will not get hired for the next film
unless they prove themselves on the current one
The tough lesson from Hollywood is that
job insecurity can lead to greater productivity
as long as workers believe in what they are doing
and have their achievements recognised
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Hollywood is a land of retakes
constant revisions improve the product
Mobile-app firms can also be adept at adjusting products
in response to internal and external feedback
Makers of consumer goods are learning to tweak their products
and packaging in response to reviews
While in many businesses
bosses still tend to spurn constructive criticism
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Like Hollywood
Silicon Valley has overcome the fear of failure
Films are like tech startups in that flops
are tolerated
because they are so common
even when the initial idea seemed promising
The value of failure as a learning experience
is well understood
Studio heads sometimes roll when a film flops
but executives directors and other talent can find redemption
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Hollywood’s most remarkable skill
is in launching brands that achieve global prominence
in a matter of days
Each film is a separate product
that needs its own marketing
and the stakes are incredibly high
if it has not gained sufficient momentum by its opening weekend
it may sink without trace
Studios spend vast sums on promotional campaigns
often as much as they spend on producing the film itself
Hollywood manages to come up with new brands
on a near-weekly basis
The key is to treat the marketing as a core part of the project
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The film industry’s reputation as a licence to lose money
But the media conglomerates that own the big studios nowadays
run them more professionally
and keep a closer eye on profitability.
Film companies no longer have extravagant numbers of projects
They focus more on action-packed “franchise” films
which sell well abroad and lend themselves to sequels
Learning from Silicon Valley
Hollywood is relying more on outside financing
sharing the profits from hits
but also protects against crippling losses when a film flops.
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The studios have survived the threats
from new technologies like television and the internet
and “pivoted” repeatedly to adjust their output
to audiences’ shifting tastes.
Few businesses have refreshed their product line-ups so often
And few have restructured so thoroughly
studios have evolved from being vertically integrated groups
that owned cinemas and kept actors on the payroll
become asset-light
flexible renters of talent.
Hollywood may have provided plenty of “how not to” for business
but it has plenty of positive ones too