Leading In The Time Of Virus
"FEARLESS CREATIVE LEADERSHIP" PODCAST - TRANSCRIPT
Episode 143: Rich Bressler
Hi. I’m Charles Day. I work with creative and innovative companies. I coach and advise their leaders to help them maximize their impact and grow their business.
In today’s world, leadership means meeting the challenges of two viruses - COVID-19 and racism. In this environment, unlocking creative thinking and innovation has never been more critical.
This week’s guest is Rich Bressler, the President, Chief Operating Officer and Chief Financial Officer of iHeartMedia and iHeartCommunications.
iHeart is both a highly creative and a highly complicated business. The company has 13,000 employees in the United States, spread over 150 offices for 850 radio stations.
Add to all of that the realities of a global pandemic and a historic civil rights moment and you create a multi-layered leadership test.
In an environment crying out for certainty, how do you encourage experimentation and individuality? How do you produce original thinking and innovation?
And how do you create room for listening in a world filled with sound?
Here’s Rich Bressler.
Charles: (01:15)
Rich, welcome to Fearless. Thanks so much for joining me on the show today.
Rich Bressler: (01:18)
Well, Charles, thanks very much for having me.
Charles: (01:21)
Obviously it's been an extraordinary year. You were already going to have an extraordinary year even before the pandemic hit and Black Lives Matter. Tell me, how has your leadership adapted over the last seven months to the various challenges?
Rich Bressler: (01:34)
Well, it's an interesting question. I would say my leadership is still adapting and by the way, I think it's going to adapt and we had some conversations yesterday and I think whatever conversations you have the day before, you've got to be prepared to adopt the day after, based on the obvious, both the business conditions that are out there from an iHeart standpoint. We've got to look at our advertising partners and how they're behaving. Make sure that we listen very well and don't have a deaf ear to the environment that they're operating in. But quite frankly, most importantly, it's our employees. It's interesting from our standpoint, we've got about 13,000 employees in the United States that are spread over 150 offices for 850 radio stations. And so the challenges that ranges everything from New York, L.A., San Francisco, Chicago, Miami to Hattiesburg Laurel, Mississippi. Yes, it is one country, but in this case and I think during the pandemic, really hasn't been one country. Everybody's experienced many different things and many different, endeavored different experiences, both in business and personal.
And the virus, I was listening to something this morning that talked about the way the virus was rolling across the United States, a little bit like a wave coming in to the beach and rolling across the United States in different times. And there's obviously New York and L.A. in the early spring and the southern part of the United States were hit pretty hard. Obviously we've had a little bit resurgence now back in New York. But there are now places in the Midwest and particularly the northern part of the Midwest that are really just being hit for the first time. And so just really understanding and listening to people when they feel comfortable about going back. It's not back to work, but when they feel comfortable, physically, returning to the office space. I made a decision a number of months ago that really said I was going to decide and Bob, when we were going to open the New York office and when we were going to open the L.A. office for physical. More open and invite people back to work physically. But the rest of the office openings we're going to leave to local market presidents out there from a management style, because I can't make a judgment what it's like to live or work in each of these other locations.
Whether it's Dallas, Texas or Hattiesburg Laurel, Mississippi or different places in Nebraska, I really had to trust our local management to make it. So, I think that's the first thing. Make sure we're really listening out there. And I think the other part is this idea about really understanding what it takes. We happen to be on Microsoft Teams, what it takes to really run the company remotely from Microsoft Teams. Interesting, I often say that after two, three, four hours on Microsoft Teams during the day, I sometimes will just get out and whether we're in New York City or our country home, just get out and walk around for a half hour, just because I need a break. And Lisa, my wife, would often say to me, "Well, would you do that in the city? Would you go out and just walk around New York City after three or four hours of conference calls?" And I said, "No, I wouldn't do that." And I started questioning myself, "Well, why do I need to do that?" And then just looking at my colleagues and the breaks they need to take and then lo and behold you read some research lately and it's pretty common that people feel they need a break from their physical location, much more when they're in the office out there.
So just listening to the way people need to work. And then I'd say finally, just innovation during this period of time. We're going to innovate in different ways and be creative, I think, different than we did before. Historically we'd all have hallway conversations, or get into a room and someone ran into my office, "Oh my God, Rich, I got a great idea. I got a great idea. We should try this or what about this? What do you think about this?" And one of our core values at iHeart is curiosity. I want people to be intently curious whether it's about their areas or other areas. And very often that curiosity will lead to innovation out there. And I had been very concerned at the start of this, not so much about running the day to day company, although we had to prove to ourselves that we could do that and drive advertising revenue and drive our events to different events out there, to virtual events from live events.
But the thing I was most concerned about was can we ideate? Can we innovate during this period of time? Because I think often innovation, again, is that collaboration where people just come together and feed off each other. And I've been pleasantly surprised about some of the innovation we've done and probably too, in terms of the opportunities, when we started something called the Black Information Network in the spring, which was the first 24 hour news network in the country that's devoted to hard news with a black focus and a black voice and a black point of view. And that by the way, I think has become even more important because quite frankly, I think it's the best news network in the country when I listen and you and I have these conversations often that you have to listen to both sides.
Well, the other night when our president decided to leave the hospital and come back to the White House, I listened to both a conservative viewpoint and I listened to a more liberal viewpoint. And quite frankly to some extent, I thought they were both not listenable to for exactly the same reasons. Whatever your political beliefs are. And so I find interesting, I think the calmness of the Black Information Network, just a factual statement has really given me more faith about recording. And then the second thing we started is something called the Black Effect Network, which will be the biggest black podcasting network in the country. We're going to launch in November. It will also be the first black-owned podcasting network that will be owned, a majority owned by Charlamagne tha God who's on the Breakfast Club.
And so again being flexible, I'd say probably is the right word, about if you had said to me six months ago, we were starting an all black podcast network that'll have 19 million downloads day one, and it'll be majority owned not by iHeart, but will be majority owned by a black individual who's got the biggest voice in the country. I would have looked at you and said, "No, that's not going to happen." And we're going to have the same thing with a Latino network with Enrique Santos. So again, you and I have talked endlessly about listening either whatever your political viewpoint is or the way you should conduct business or hearing how other people want you to conduct business. I think that's probably been the biggest change in my leadership style, as flexible as I thought I was before, even being more flexible now.
Charles: (09:03)
I think that point about finding the tension point between different points of view is such an important one. And I'm struck by, as you describe iHeart and obviously I know it somewhat as well, it's a complicated business. It's a large business. It's a massively distributed business. It's a live business. It's always on literally, right? So you've got stuff coming at you all the time. Given all of that, how do you navigate the challenges, particularly now where, to your point, there is such uncertainty and change is happening so fast. How do you navigate between having to react and also the importance which I think you and Bob have demonstrated over the years, a real sensitivity to the importance of having a long-term strategic plan. You navigated yourselves out of a really complicated financial situation. You were enacting a plan earlier this year to become much more technology oriented. How do you navigate those two between long-term strategic needs and short-term reaction?
Rich Bressler: (10:00)
It's a great question and I think if you think about our business model, because we are in business and we do have people that own the company and we have a responsibility to our board of directors and our board of directors, which Bob and I are a part of, have responsibility to the people that own the company. So if you think about it in simplest terms, our business model is to rent our unaffiliated listeners to our advertisers. That's simply what we do. And I think if you keep everything through that prism, that helps you keep focus. The first part of that prism is we follow our listeners. We follow our consumers and that's really… having been in business for a long time, 30 plus years in the media business, always following the listeners, always making it one less click, making it simple, understanding what they want, I think is the key to success. And I think that always wins over time.
If you look at something like the podcast business, why did we get into the podcast business a number of years ago? By the way, before all of us ever heard of podcasting to be quite honest, including myself. And it wasn't because all of a sudden I woke up one day said, "Oh my God, iHeart should be in the podcasting business three years ago." It's because we started to see the trends, what our listeners were doing. We said, "Okay. There's something here in terms of our listeners and their level of engagement following podcasts." So I think whether it's a longer-term strategic standpoint or a short-term strategic standpoint, the first thing we do is need to follow our listeners out there.
I think secondly, we need to monetize those consumer relationships to our advertisers. And again, that's following our listeners and proving the effectiveness of the audio medium and particularly the radio medium in this case to the advertising community. And again, we could talk more about that. I'd say the third piece is how do you, and this gets back to also lessons learned during the pandemic, how do you efficiently do that? How do you take advantage of technology? Charles, you appropriately pointed out that as we emerge from the restructuring in particular, we really started to look inwardly at our investments inside the company. Our investments in technology, our investments in AI. In our 850 radio stations I think your listeners would be very, very surprised about the predictability that you can do on consumer listening. Again, it doesn't substitute for the magic of programming and I always say programming is two things. It's math and it's magic. And so there'll always be a magic. There'll always be a human element part and a judgment part there, but there is a lot of math.
I mean, you'd be surprised if you look at the number of times a top song is played, the number of times it's in rotation, the listening habits of those consumers. In terms of when they start tuning out, when you should start slowing down the number of rotations out there about listening. When you should start stepping up. It's interesting if you went into a studio today for Ryan Seacrest or Bobby Bones or Elvis Duran, compared to a studio five to 10 years ago, first of all the setting for that studio, talk about taking advantage of technology, would be a couple of Mac Pro Books out there.
And if you went back four or five years ago, you'd have a room with carts and wheelie carts out there and cassette tapes. And now you walk into a studio, it's three or four Macbooks. And if you watch what Ryan is doing or Elvis, while they're on the air is they're watching the social trends that are out there. They're watching Twitter. They're watching Facebook out there. They're watching Snapchat and, excuse me, and they're changing their conversation as they're watching them. And one of the reasons I think our medium in radio has never been hotter, never been stronger, never had more time spent on it in the history of the medium out there, is because I think our talent who is really our secret sauce and that's what makes us distinct, stays relevant. And they stay talking about what their listeners want to hear and they stay engaged.
And that's why our radio talent is really companionship. They're your best friends sitting next to you in the car. And so putting all that together in a package, again, our responsibility is taking advantage of that and technology. So I think one of the lessons learned during the pandemic is we've learned to work more efficiently. We've learned to have our talent work from home. If you listen to Elvis, which is an ensemble cast, he has not been in the studio for some period of time. Ryan has not been in the studio for some period of time. And I would suspect that your listeners and all of our listeners, them knowing that difference between being in the studio and not being in the studio, I would challenge anybody to really notice that difference out there.
So again, I think we're doing a nice job on that and I think as we emerge from the pandemic, whatever that means, and when people get back to being comfortable moving around a little more with the vaccines and returning more to the workplace, I think we're just going to have a more efficient workplace environment. And I suspect we won't return back the same way we left the workplace. And again, back to the first point, that's the flexibility that we need to have out there, is what does it mean to return? Everybody's got their own theories. Is that 25% back? 50% bad? Some people never coming back. Some jobs never coming back. I'm honestly not sure of the answers to any of that, because I think we look back two or three months, I don't think any of us would have thought we are where we are today, whatever that means. I'm sitting in New York City in the West Village in an apartment and there's a lot more activity and a lot more traffic than there was a month or two ago. But yet I was in my office yesterday in Midtown, met somebody for lunch at an outside restaurant, which was packed, but there was no traffic in Midtown. I just think we all need to have that understanding and be adaptable.
Charles: (16:08)
Yep. Every modern business I think is a combination these days of data, technology and innovation and human creativity, human creative thinking, right? We're always finding the tension point of balance between those inputs. Your background is a financial, from a financial standpoint, but you're probably one of the most innovative, creative, financial people in the business world today. How do you, when push comes to shove, make a decision? If both sides are from your standpoint balanced, if you've got data and technology on one side, you've got instinct on the other, which one do you lean on in that moment?
Rich Bressler: (16:52)
That's a great question and I'm not sure there's a simple answer to that. I think that we make 10 decisions, let's say every day, hypothetically 10 decisions every day. One's a clear winner. One's a clear loser. Those are easy. Eight are in the middle and I think the hardest thing in business is to cut those eight that are not clear winners at the end of the day.
I think one of my roles as a leader is to push people beyond their comfort zone. Sometimes people say, I think people think I'm being an asshole because I want to push them so far beyond their comfort zone to make decisions that's uncomfortable to them. That's part of my job.
The other piece, though, if you're going to do that, is that if people make bad decisions or make decisions, one is I encourage them to get me in the trenches with them, so we're making the decision together out there. But also if you make a bad decision, we make a bad decision, we need to cut it. You say, "Okay we made that decision. We tried, don't worry. We'll try and get them the next time." And the next one's bad. So I think you can't have it both ways. You can't push people beyond their comfort zone, have them take high-risk decisions and not support them when you need to cut it at the end. And when you have that operating philosophy, it's a lot easier to make the tough decisions, like you just said, because who knows, we're going to make a decision.
Y’know, the example when we went into podcasting and now, by the way, by far we’re the biggest podcaster in the world. We're now up to 255 million downloads a month for 26 million unique users. I mean, there's nobody in the for-profit world that's even close to us. But we bought a company called Stuffworks about two and a half, three years ago, which when we combine it with our podcasting business became the iHeart podcasting business.
That acquisition, while not big for iHeart, which was $55 million. $55, $60 million in cash at the time when we were in the restructuring process might as well been two billion dollars, quite frankly. We had to convince our board of directors to buy it because nobody ever heard of podcasting. We had actually convinced restructuring chords and our soon-to-be shareholders to buy it because we didn't have the authority. We were in the middle of restructuring. That was a big ask then. When you look back now, that company would probably sell for $500 million today, $600 million. And in the rear view mirror, it looks very easy. But at the time it looked very daunting. But honestly, if we had made a mistake, we would have said, "Okay, this podcasting thing wasn't what we thought it was going to be. Okay, let's go forward. Let's find out what our listeners were doing.:
So I think that mentality about cutting a clear loser when you get the evidence is the way you balance Charles, your point about making kind of tough decisions. Balancing financial and creative at the same point in time. But we're having a wonderful conversation here. I'm going to go back to what I said just about a minute ago. The hardest thing in business, I think for any leaders of company, is cutting those non-clear winners and non-clear losers those eight in between. I think it's the hardest thing to do in business.
Charles: (20:15)
You talked about being happily surprised at the amount of innovation that the company has come up with over the last few months. What do you think are the conditions in which innovation thrives? What do you think you have to put together to help people unlock their own capacity for innovation and creative thinking?
Rich Bressler: (20:30)
Well, I think a couple things transcend through whether you're in physical space or non-physical space. And I think a couple things transcend through companies that are built a little more to work remotely versus companies that are not built to work remotely. I think the aspect that transcends on both sides is the one we've just been talking about in terms of innovation is really just supporting people, as I said. People like, ‘I've got your back,’ the age old term, ‘I've got your back,’ and I'm going to push you to be innovative. I'm going to push you to take chances. And by the way, again, not easy to do. There's a reason why most, at least companies in this regard my whole life and running media companies, there's a reason why most media companies don't morph themselves because they're too afraid to take chances.
Look, the world is littered with media companies that have died. I mean, we can all name a ton of them that didn't have the ability to cannibalize themselves and we're afraid to take that risk. So I think that transcends. I do think it's a little harder... some of the big technology companies; the Facebooks, the Googles, the Amazons, that were a little bit more to innovate and thrive in an environment that works a little more remotely. Their infrastructure, their capabilities, their video capabilities, their engagement capabilities, those were set up and they were born out of a company that worked more remotely. And so they adapted easily. I think we've done a really nice job, but I do think for more traditional companies, there is no substitute for whatever getting in a room means and getting in a room and ideating and pushing each other.
I do think it's a little bit more of a challenge for I'll say the bigger, more traditional companies. So I do think as we think about working more physically back to the way we worked before, I think we'll never work exactly the same way we did before. I think some of our support people, our ad sales people, our finance people, our legal people I don't ever envision them coming back into the office a majority of their time. But at the same time, I think the creative side and the innovative people will probably lean a little more towards getting back into the same room. I think that's a bigger challenge for traditional companies out there.
Charles: (23:04)
Last two questions for you. What have you learned about yourself over the last few months?
Rich Bressler: (23:09)
There's always that last two questions in terms of, what do they always say, don't take the last two questions? The last two questions? What have I learned about myself? I've got a pretty good empathy gene that I think I had going into the pandemic. Sometimes I say, again, back to show business, is there things I could have improved upon? And I think I'm a pretty quick decision maker and pretty curious. I think great leaders have an empathy gene, but I think sometimes they know when to check that empathy gene a little bit when you've got to make tough business decisions to move forward. And sometimes you delay making those decisions a little bit because of that empathy gene. I think I've learned during this period of time, by the way, how to use that empathy gene in a way that's been to the benefit of our employees and benefit to the shareholders. Meaning the empathy gene, probably more involved understanding people's personal challenges, whether they're listening to school, listening to commuting or listening to family members with illnesses. And I think the empathy gene has served me well with coming up with creative solutions that are out there.
So, I'm proud of myself for that standpoint. I think I've also learned to be a better communicator surprised, by the way, not just on Zoom calls, but also I think in terms of written communications, in terms of rising to the occasion. Because I think written communications during this period of time when you're not in a person are also probably more important than they've ever been from a leadership standpoint.
And I would say finally my level of boundaries, I probably could have done a better job prior to the pandemic of having boundaries around... I'm not sure I believe in the words ‘work-life balance’. But when you work and when you don't work. And I think the importance of putting up some walls and boundaries during this period of time, having things like email-free weekends, which I had never done before. And now instituted periodically said, "Okay, everybody from Friday night at 6:00 to Monday morning at 9:00 AM, don't worry about checking your email. Go focus on your family, your loved ones. And if we really need you, we'll pick up the phone and call you during that period of time."
And so I think learning to establish those boundaries is absolutely critical. And then I think what we talked about before figuring out ways to find efficiencies in the business that I never thought… I thought we would, "Oh my God, we have the highest operating margins in the business. We can't possibly get better than we were before." And you know what? We've gotten significantly better. So what I'm really spending a lot of time on now is taking those learnings, whether they're the empathy learnings, putting up parameters around, again, work versus non-work efficiencies and really reflecting on those and thinking how to take those into the post-COVID operating world. I really am spending a lot of my personal time thinking about that.
Charles: (26:41)
Yeah. I think the issue of finding boundaries and helping other people find boundaries is going to be so important coming out of this for all the reasons you've described. The lines are so blurred these days.
Rich Bressler: (26:50)
Yeah.
Charles: (26:51)
Last question for you. What are you afraid of?
Rich Bressler: (26:55)
I'm afraid of probably what many people listening to this podcast, not a surprise. The number one thing that I'm the most afraid of, or two things. One you and I discuss endlessly and when we're together as couples is not listening. I think I've always been a very… I hear very well. I think the importance of that is greater than ever and whatever your beliefs are, and again, we've got the most conservative and the most liberal talk show people in the United States and platforms and the platforms we provide them. And I've shared this story with you before, often my kids will say to me, "Oh my God, Dad, how could you provide that person with their….”... they both have, my kids are all much more from much more left in terms of left leaning in terms of their thoughts.
And they'll say, "Gee, how can you provide this person with the platform, with their conservative viewpoints? How do you possibly do that?" And I say, "Because whatever you believe we can't stop listening. And whoever wins the next election, whether it's the incumbent president or the challenger, you really need to listen to that person out there. And you may not agree with one word they say, but if you stop listening, I think that's when we all get in trouble." And I think the other thing that scares me a little bit and you may have seen this. When the president went to the hospital last week, I had mentioned something to one of my daughters I was on the phone with and it's a she and she said to me, "Dad, do you really think it's true that he has the virus?" I said, "Well, of course it's true. The president of United States and other people said he has the virus.” “But many people don't believe a word he says. So why do you think it's true?" I was like I got off the phone and I was shocked because it was something I hadn't thought of. And then we get daily research in daily sentiment surveys. And our research just a couple of days ago, even when the president came back from Walter Reed Hospital was that somewhere between 33 and 37% of Americans didn't believe him, that he actually had the virus. And so that's what scares me. When you stop listening, coupled with the fact of that mistrust. That to me transcends everything else we're doing in business. That's very scary to me.
Charles: (29:26)
Yeah, I was stunned. In fact, I had probably 50% of the people around me saying exactly the same thing. “I don't think he's got it.” It was really startling as well. And we clearly need to get to a place where we can have more trust and belief in each other, right? Because we're not going to get to the other side of this with just deciding there's two sides to this, and one has to beat the other. That's not going to work.
Rich Bressler: (29:48)
No, or else we're going to wind up in a civil... I say it all the time, I never really understood how there could be dramatic civil unrest leading to an uprooting of our society in the United States. And now actually, I understand, as sad as that sounds, actually I can see the path there and understand how it can happen.
Charles: (30:07)
Yeah. Yeah. I think that's true. Rich, thank you so much for joining me today. I appreciate your openness and your insight. It's an extraordinary time, but it feels to me like you've got the company heading in the right direction at a macro level.
Rich Bressler: (30:21)
Well, thank you, Charles. Really appreciate it. And as always, thanks for your friendship and support.
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