Tim Armstrong Gets It Right, "Silicon Alley Insider" Gets It Wrong - Charlie Warner - MediaBizBlogger

In an interview with Advertising Age Editor Jonah Bloom at the AAAA Leadership Conference AOL39s newly appointed CEO Tim Armstrong gave some insight into his plans for the beleaguered Time Warner unit But you had to listen carefully to what he said to get a sense of what he was planning httpadagecomaboutdigitalarticlearticleid136349Many of the snarky blogs that follow Internet businesses countless online industry watchers and most current AOL employees listened poorly or with their usual confirmation bias and thus took away from Armstrong39s remarks on the Ad Age video and from his subsequent personnel moves and communications something to reinforce their own prejudices fears and shallow thinkingI39ll pick on just one blog to make my point but there are numerous examples of selective perception and confirmation bias that I could select in this current era of uninformed personalaggrandized opinionated biased reporting on blogs newspapers and especially cable news channels Dobbs Beck O39Reilly Hannity Olbermann Maddow egThe influential Silicon Alley Insider is widely read by people involved in or interested in the online industry The first word I received about Google39s Tim Armstrong replacing the inept Randy Falco as CEO of AOL was in a Twitter from Silicon Alley Insider39s Editor in Chief Henry Blodget and his blog has been on top of the story since thenThe Insider has been all over the Armstrong story like a wet blanket and has excellent inside sources The Insider has published memos to the AOL staff about moves Armstrong is making such as the memo he wrote on why he broomed AOL sales chief Greg Coleman and the memo AOL PlatformA sales chief Mark Ellis sent out May 4 about using SalesForce to track callsThe Insider39s lead writer on most of the AOLArmstrong stories is a 26yearold editor named Nicholas Carlson who according to his LinkedIn profile was an associate editor at Nick Denton39s gossip blog Valleywag before he came to Silicon Valley Insider And before that he was a client associate at Merrill Lynch Carlson wasn39t at Merrill Lynch when his boss Henry Blodget was there Blodget got banned for life from the securities business for touting Internet stocks in his analyst39s reports that he thought were quotcrapquot as revealed in private emailsCarlson lists as an accomplishment in his LinkedIn profile having won first prize in the Davidson College Vereen Bell creative writing awards for a short story quotScrambled Eggsquot Blodget was also a writer before he was an analyst amp8211 a freelance journalist after he graduated from Yale Blodget proved he was a creative writer writing stock analyses for Merrill Lynch and Carlson has shown he is a creative writer in his blogs about AOL Armstrong and Armstrong39s new head of global advertising and strategy Jeff LevikCarlson may be a good writer but he has no clue about management leadership sales or compensation theory or practice In an Insider post titled quotAOL39s Advertising Systems Overloadquot on May 4 Carlson wrotequotMemo to new AOL ad sales boss Jeff Levick We have two quick things to slot in at the top of your todo list1 Make it easier for ad sales people to sell premium inventory2 Create incentives for them to do itOne big reason AOL ad sales were down 20 during the first quarter is that AOL sales people lean too much on the company39s inhouse lowpriced advertising network Advertisingcom instead of pushing clients into higherpriced premium display advertisingBut even though this is bad for Time Warner39s TWX online subsidiary it turns out we can hardly blame the sales peoplequotOh Nicholas you mean incentives like Merrill Lynch gave Henry Blodget to lie about stock he thought clients should buy and incentives that Merrill Lynch gave its brokers to churn clients39 accounts to increase commissions line their pockets and screw their clients Or like the incentives banks gave loan officers to make stupid loans The government is now looking to regulate these incentives so that people who make loans only get incentive payments if the loans perform over a reasonably long period of timeIt was the mistaken notion that money is the only thing that motivates people that was the main cause of our current economic meltdown It was the wrong incentives that fueled the rapacious greed on Wall Street But since Nicholas Carlson39s only job before writing gossip was at Merrill Lynch he has no other reference point for knowing about incentives other than those that incentivize greedy unethical behavior on Wall StreetBefore you give advice to Tim Armstrong about incentives Nicholas I suggest you begin your education on incentives by reading Fredrick Hertzberg39s classic Harvard Business Review article quotOne More Time How Do You Motivate Employeesquot and from there move on to my paper quotCompensating Media Salespeoplequot which includes extensive references to research on the subject and unlike the HBR article it39s freeAnd before you and others inside and outside AOL poke fun at Tim Armstrong for getting AOL employees involved in writing a new mission statement read some of the most highly regarded management books of all time Collins and Porrass39 Built to Last and Collins39 Good to Great and then you might understand why Armstrong is on the right courseYou and others who have no clue what Armstrong is doing look at the Ad Age video again carefully and you might understand why he hired Jeff Levick who understands how to create value by using analyzing data read Competing on AnalyticsThe odds of Levick and Armstrong improving on what Falco Grant and their string of inept cronies screwed up are huge But you wouldn39t know that Nicholas Your job is to write gossipy disses that get headlines not to provide knowledgeable insightUntil he retired in 2002 Charlie Warner was Vice President of AOL39s Interactive Marketing division Before joining AOL he was the Goldenson Endowed Professor at the Missouri Journalism School where he taught media management and sales and he created and ran the annual Management Seminar for News Executives Charlie can be contacted at charleshwarnergmailcom

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