Mark Anderson is President, Schools & Higher Education and Strategy & Business Development at Pearson International. He’s joining us at Frankfurt Book Fair for our What is a Publisher Now? event where prominent figures from the worlds of education, publishing and technology will discuss the future for the content industries.

Mark wears multiple ‘hats’ in publishing as in addition to being a senior executive for one of the world’s largest publishing organisations he’s also a critically acclaimed author. His most recent book, The Leadership Book, sets out the Top Ten challenges business leaders face on a daily basis and provides strategies for solving them.

Ahead of him joining us on the SPARKS stage at Frankfurt we caught up with Mark to ask him about how his experience of being a senior publisher and author affected his view of the industry as a whole?

PT: Does your view of how the publishing industry works change according to whether you’re looking at it as a publisher or an author?

MA: I don’t think it does. My view of publishing as a writer is heavily informed by what it’s like to be working inside the industry as an executive. In some ways it’s very handy for a writer to have or have had a job in publishing. It means you’re familiar with how it works and there’s less chance of there being any nasty surprises. The areas where I think publishers should be more skilled as a writer are exactly the same

What I am acutely conscious of as an executive and writer is that the environment for ‘single author books’ is an increasingly tough one, both for publishers and authors. Though to be clear I’m arguing from the position of being an education publisher and the challenges facing trade publishers are very different.

The ‘toughness’ I’m talking about manifests itself in multiple ways. There’s economic toughness, in that the traditional business model that has underpinned successful publishing is being challenged and disrupted. Even deeper than that, there’s also a related format toughness. We’re moving from a world where the way content was created, distributed and most significantly financed was based around the metaphor of the book. This metaphor has persisted into the digital world, where publishers’ digital offerings continue to be built around the structure of a linear chapter by chapter sequence. I believe, however, that we’re moving towards a different model for constructing content, particularly in the educational publishing sector, which is less much less linear.

As this new model gathers ground it will present challenges and opportunities for authors. If your motivation as an author is to produce a linear book it will become harder to get that published. Looking outside of educational publishing into a sector like travel publishing we’ve already seen how Trip Advisor has fundamentally disrupted the linear model established by Rough Guides and Lonely Planet. There will always be a place for ‘Bibles’ in education, business and management publishing, but this is a necessarily limited market. Instead I think authors will be asked to produce content in a different way and on a different financial relationship with publishers.

PT: In The Leadership Book, you write about the importance of leaders accepting a degree of ‘planned uncertainty’. As a sector undergoing as much rapid and fundamental change as publishing, do you think leaders need to think more flexibly, and what might a more flexible vision of publishing look like?

MA: Business plans are only ever directional and aspirational in these times – perhaps they always were. We only have to look at the swift collapse of businesses like Blackberry to see how quickly things can change.

I think that fundamentally we have to be prepared to unpick what we’re doing. It’s no good to continue with a practice or business model on the basis that the way it’s always been. Nothing in business is ever a non-negotiable. That doesn’t mean that I think people and businesses should operate without principles, but that they should be prepared to do things differently if what they do stops working. But I do think we should be iconoclasts

You have to be extremely iconoclastic to ride the tidal wave of change or it will swamp you. To go back to the example of Blackberry: scale is not a guarantor of survival. Just three or four years ago the company looked unassailable, now it’s been sold for roughly the same amount of money Apple took on one product over one weekend.

PT: Pearson is an example of a publisher that has taken the strategic decision to expand its operations beyond the production and distribution of content and into services. Do you think Pearson provides a template for other publishers or is it a special case?

MA: I think in principle you should never say an example is a template. What we have done is to look at the education value chain and decide we want to take a greater part in it than the relatively small part that’s taken up by content. I should add that this decision is related to Pearson not Penguin, which is now part of a different business.

It’s an example that may be proved right or wrong over time. Nevertheless, it is a good example of how a company can look at the market in which it operates and challenge its place within it. Our move into services as well as content isn’t a signal that we think content is unimportant, rather that we think our expertise in content can effectively underpin the development of our other offerings, such as language schools.

PT: If more publishers want to get into the service business, what will they need to change?

MA: You have to start from the very top with a clear statement of your company mission. This is so important because it sets the cultural tone of the organisation. Most publishers are steeped in working practices and terminology that have been defined by decades (sometimes centuries) of being publishers. You have to redefine the company before you can go into another business and this starts with culture. Cultural change has to precede the organisational and financial changes that involve entering another business because it has such significant bearings on your operations. Who do you employ? How do you incentivise them? Change is a good thing, but it’s also hard and deep-rooted.

Another thing to consider is that if you have taken the decision to move up the value chain, how far do you move? If you’re an education publisher you’re already providing services to educational institutions. Moving up the value chain can involve going into competition with your existing or historic customers. There are profound implications in becoming an organisation that you once described as your customers that have to be thought through before they can be put into action.

PT: And what might stay the same?

MA: The answer to this question depends on what services you’re talking about. To use the example of education publishers, I think we have a strong pedagogical sense, both internally and through the network of partners we’ve built up over time. We have a strong sense of how content should be organised to be delivered effectively. This extends to the services businesses into which we’re expanding, as these focus on the application for pedagogy.

Another thing that will stay the same is the value of our ability to manage and deliver content. Publishers are very good at creating and curating content. I don’t think the management of this process can or should be commoditised – or at least not in such a way that generates good quality, flexible content that can be deployed effectively in an educational setting. The skills associated with curating it and creating it will have a significant place in the digital, service based environment in which many publishers of the future will operate.

PT: These changes reflects a deeper shift in the perceived value among consumers away from content and towards services. Publishers talk a lot about the need to get to know the consumer/customer more deeply. But what has Pearson learned by actually putting that vision into action?

MA: I think we’ve learned the same thing as most other companies who’ve also realigned themselves effectively: the customer becomes an important part in the development and approval process. To look again at an example from the world of mobile, Apple has taken lot of flak over things that it has not done well in the past 12 months, but it has also committed itself to improving its products by taking customer feedback on board. Customer feedback is how you road test your products and services for continuous improvement. And the saying is true: the more you know about the consumer the more you can tailor your offering to their needs.

We’ve also learned a lot from modifying our perception of where the customer sits in our business. A customer is the last part of the process only in a very narrow and transactional sense. In fact they are not the recipients of products and services but co-creators. They’re creators of marketing and a marketing partner. What they say about it can impact your commercial success. The real impact of iOS7 is the 200 million people who have downloaded it and what they’ve said about it. Our customers are at the heart of, not the end of the process.

Another good example nearer to my own experience is the university sector in the UK, where I’ve worked a lot in recent years and which has been tremendously disrupted. Universities have gone from a position of having guaranteed funding to having to fight to get the students on which their finances are based. This has forced them to change their view of the learner. It also makes people who make the purchasing choices – students – much more powerful.

To return to the mobile metaphor the ability to make a choice and talk about your reasons for making it, both in day-to-day life and on social media, makes the collective power of consumers incredible. This is why a company like Blackberry can have such a precipitous change in fortunes. Their decline was driven not just by the quality of their products, but the tidal wave of positive advocacy from people using other platforms. Their support melted away, and so did their business.

PT: You’ve previously identified the value ascribed to education (and particularly English language learning) in BRIC countries as being a key driver of growth for Pearson, but in the services rather than the content sector, and with what sounds like a looser corporate structure. Does this means that the future of Pearson businesses might look more like a federation of city states rather than a nation state?

MA: I’d actually describe a federation as being what Pearson is now – if you define this as a range of businesses that are less tightly connected than they could be. What we’re going through is a creation of a new structure based around three core divisions to create greater connectivity, and with a single mission – that everything we do will put learners first, and help improve learning outcomes in some way.

It’s a project that isn’t intended to centralise control, but rather ensure we have greater connectivity across our lines of business. For example, by modifying our regional structure so that these are based not around geography by the development stage of individual markets, we can respond more effectively to the needs of those markets. All of these changes aren’t about slowing down, but speeding up.

PT: The challenges inherent in running a huge organisation made up of different business models, cultures and sizes sounds immense. Speaking as the author of The Leadership Book how would you define those challenges

MA: I’d identify four key challenges that publishers and other organisations must face:-

  • The Challenge of Scale: Specifically, across a large organisation how do you ensure consistency around key factors such as vision, strategy, values and way of working. There’s a challenge in embedding all those and other inherent challenges of working cultures that are defined by geography and business models. These cultural challenges can be answered by setting them within a clear framework, which is why it’s so important for a business to have a clear vision

  • The Challenge of Change: Change is a constant. You have to run the business today but plan for running the business tomorrow. This goes back to my point about flexibility, and how leaders need to be brave enough to be iconoclasts with their business practices

  • The Challenge of Technology: Technology underpins a great deal of what our business has to achieve, in terms of how it interacts with consumer and how our back-office operates. It’s also something that is constantly transforming itself, so developments here may lead to the future unpicking and change of working practices

  • The Challenge of People: This is the most important challenge of all. You have to have the right people to achieve the right balance between continuity and change. Having people around to keep the corporate history is important, but equally so are the challenges of people with new skills, or from different background who bring a more diverse experience.

PT: MOOCs: Are they a challenge or an opportunity?

MA: They’re both. MOOCs are a very welcome challenge to traditional models of learning. I don’t think generally they’ve yet demonstrated sustainable business models, though this doesn’t mean they won’t. At heart they represent how technology has the potential transform access and affordability to educate in several different dimensions.

Some publishers have already started using MOOCs as a way of distributing content. I do think encumbents should embrace them rather than hope they go away, because they won’t. We only have to look at the music industry’s efforts to criminalise digital music out of existence to see the danger of not being iconoclastic with your own business when there’s a competitor determined to do it anyway.

The fact Coursera has signed up so many people in its first few years, despite many issues with the service as it stands, shows the scale of pent-up demand. We have 180 million people in higher education alone, and this doesn’t take into account the many millions more in work who want access to training and education but can’t access it in traditional ways.

MOOCs have a way to go in demonstrating educational credibility but I’ve no doubt it will come.

PT: In fifteen words or fewer, what is a publisher now?

MA: A creator and distributor of flexible content.