At the beginning of the year, when there was so much doom and gloom in the industry after the economy had tanked and most publishers had sizable layoffs, Raccah called a meeting of all Sourcebooks employees, announcing that the company would freeze wages but not let anyone go, and she challenged them "to do something different" and not give in to the dispirited mood of the book business and the country.
"We decided to go into the year under a worst-case scenario, but we thought we could beat it," said Barbara Briel, v-p and director of administration and finance. "But to beat it, we needed every single employee enrolled in the effort."
At the meeting, the company came up with a "possibility diagram," consisting of qualities and traits that the company had or aspired to that would help it in this difficult year. Raccah was inspired, she said, by Ben Zander, conductor of the Boston Philharmonic Orchestra and co-author of The Art of Possibility, who argues that one can make one's destiny. The point, Raccah emphasized, was "in the vision, how you approach it, and what you create."
Todd Stocke, v-p and editorial director, put it this way: "We had to make a choice: either let the year happen to us or think differently. Some of the stuff is beyond our control, but we decided to be proactive and respond differently."
After that, they held meetings at which monthly goals were set for the company, departments and individuals, and updated data was shared. The goals were very specific and numerically oriented, involving sales, inventory, cash flow and more. Meeting those goals required "a lot of education," explained Peter Lynch, editorial manager, trade. "We all had to understand a lot more about how the business as a whole works, and that led to a lot of creativity and interaction."
In addition, everyone had to work together. As Chris Bauerle, director of mass market and specialty retail sales, said, "We had to trust everyone to go in the right direction and see the big picture. Here sales isn't fighting finance, for example."
At the meetings, Raccah and others made presentations and employees sometimes broke into groups. As Heather Moore, senior publicity manager, said, "We didn't feel it was left up to management or senior staff to deal with the issues." Raccah described one sign of the efficacy of the approach: "You can ask anyone in the building what we're trying to do this year and what we've gotten done, and they'll know."
The creative approach was not "limited to the building," Todd Stocke said. "The message reached customers, too, who were happy to be talking with energized people who weren't down in the dumps."
Sean Murray, director of trade sales, added, "Many of our customers will have their best year ever with us because of how we're working with them. Things that would have worked two or three years ago won't necessarily work now."
As befits a company whose head is co-chair of the Book Industry Study Group, Sourcebooks has worked hard on making the supply chain more efficient, working with retailers, educational partners and wholesalers, insuring they have the right inventory at the appropriate times, whether that means increasing or lowering stock. As a result, Raccah said proudly, inventory purchases are down 25% in a year in which sales are up significantly.
Inside, too, the company has made many changes, both streamlining and outsourcing some of the editorial and design work. "With a list that is so broad, finding the right cover on 300 books, we look for specialists," said Sarah Cardillo, managing editor. In addition, electronic workflow is much more efficient, green and lends itself to making e-book versions of books.
Sourcebooks has doubled its catalogue business and is "reaching the corporate market," Chris Bauerle said. "As the company and industry transform, it's important to put books in places that don't compete with retailers and are nonreturnable."
The results have been excellent. Overall year-to-date net revenue is up 31%, and returns are "significantly below industry averages," Sourcebooks said. At the same time, market share in some of the company's most important categories is also up. Sean Murray said that titles deep into the Sourcebooks list are doing better. "We're able to bring our retailers and partners very healthy growth and opportunities that are sustainable and not just one-book hits," he said. "We understand that in this retail environment, it's really important because they're trying to build their base business and be stable."
Raccah frequently praised Sourcebooks's employees, most of whom have been with the company for some time. "It's a solid team. The culture here has always been excellent. The energy and creativity and vibrancy of the people is so good. This year we saw it in spades."