Leading change and serving the public interest

January 6, 2017, Toronto

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Hubert T. Lacroix, President and CEO of CBC/Radio-Canada, spoke at the Association of Professional Executives of the Public Service of Canada (APEX) conference for business students. The conference was hosted by a team of students from York University’s Schulich School of Business.

Thank you for joining me today. And many thanks to APEX and to the students from Schulich for this invitation.

I have a great job. I lead an institution that touches the lives of Canadians, most often in ways that are deep, very personal and long-lasting.

For me, my first “adult” connection to the public broadcaster goes back 33 years, 1984, when I was hired by Radio-Canada to cover basketball at the Olympic Games in Los Angeles. I had two lives at that time: one was being a mergers and acquisitions partner in a law firm, the other one was heavily invested into coaching basketball.

So, they gave me this blue jacket, an awful blue jacket, with our logo extremely evident on the breast pocket. This jacket still hangs in my closet. When I look at it, it brings back memories of the pride I felt in being part of that broadcasting team.

I feel the same pride today, as I lead our organization through some of the most challenging years of its history.

Our industry has been through major disruption since I started my term as President and CEO, nine years ago. Digital has disrupted the way we work, communicate, do business, and, obviously, how you get news and entertainment.

Can anybody tell me what this is? Well, it’s a Gutenberg printing press. This was a revolutionary way to communicate with many.

Now, with barely a swipe on your phone, you can instantly be better informed about your world than at any time in history. And we are just beginning to understand the “internet of things” and how that connectivity will transform our lives.

In my career, I have worked for both private and public organizations, and while many of the challenges are the same, the way you manage these organizations is completely different.

Private companies measure success in market share, revenue multiples, earnings per share and share price. At CBC/Radio-Canada, we talk about “return on citizen” and “accountability to Canadians”; our measures are all focused on you and whether we are relevant and compelling in the delivery of our services.

Our industry has had to adapt to “digital and mobile”. Some businesses are failing, others are being created. And some, like print news, are still struggling to adapt.

Disruptive innovation is also a source of opportunity. All the management textbooks include these kinds of statements. I can tell you that’s true. At CBC/Radio-Canada, we saw digital as an opportunity to deepen our connection with Canadians.

That is the vision behind our five-year strategic plan, Strategy 2020. It is all about us becoming more digital, more local and more ambitious in our Canadian programming and, in doing so, increasing our value to Canadians. It’s all about strengthening our personal connection with each of you.

If we had been starting over, the smart money would have been to invest EVERYTHING into digital.

But we were not starting with a blank canvass. We are an institution rooted in this country’s history, with powerful legacy assets, and a feeling of fierce pride and ownership by Canadians.

Public institutions like ours are expected to be at the forefront of change. We have to be connected and relevant to a digital generation. And, at the same time, we have to ensure that we don’t leave other Canadians behind.

The facts are that Canadians still watch about 27 hours of live television each week and really enjoy our traditional radio services, and that our English and French television and radio services reach 76% and 41% of Canadians each month. So, we need to nurture these connections as we move to digital, all in an environment of limited financial resources.

It’s been two and a half years since we launched Strategy 2020. At that time, a lot of it seemed like too much change. And it didn’t help that, as we were launching this plan, our government appropriation was substantially reduced. We had to scale back, and we lost a lot of talented people. The initial public response wasn’t much better: many feared that we were dressing up cost-cutting.

Where are we today?

We now reach over 16 million Canadian users each month through our desktop, mobile and native apps. This is 4 million more than in 2014, when we launched Strategy 2020. We are closing in on our goal of 18 million monthly Canadian users by 2020.

We are reaching 60 per cent of online millennials each month, and CBC.ca is also the top digital news and information source for Canadians.

During last summer’s Rio 2016 Olympics, more than 32 million Canadians followed their athletes on our platforms. In terms of digital audiences, CBC/Radio-Canada’s English- and French-language websites and apps generated more than 229 million total page views and nearly 37 million video views over the course of the Games.

Because of our work and our partnership with other broadcasters, Canadians had access to every event a live feed was available. And that’s on top of the work we do all year round to showcase Canadian athletes in the competitions leading up to the Olympics. So that by the time they compete with the best of the world, Canada’s athletes are household names.

So, what have we learned about the challenges of transforming a large public institution? Three lessons:

  1. Transformation is relentless. There is no finish line. Every decision, every conversation, has to have this direction as a filter and a focus, every day. But change and constant movement can undermine your employees sense of stability. Some will embrace change, some will fear it. Too much change, too fast, can paralyse an organization. Your employees need to see, as quickly as possible, how their job will be affected by the corporate vision.

  2. Your organization has to be ready for change. So, we invested heavily to retrain our employees for new digital skills, and for new business skills to support our digital direction at all levels. We need to do more.

  3. Momentum is key. Ask employees to accelerate your pace of change.

Our Idea Accelerator does just that. It’s a fun communal prototyping to help employees develop leading-edge tech and digital ideas.

In September 2016, we also launched a lab called Next Generation. It’s an experimental space, created and managed by millennials, to develop ways of enriching and sharing news and current affairs content.

People need to see that our transformation is allowing us to do things we simply couldn’t do before. Because when people don’t see what they are gaining, they will tend to focus on what they are losing.

Earlier this year, CBC Radio’s The Current launched a series of town halls on the issue of missing and murdered Indigenous women. When people arrived at the town halls, they experienced this story in virtual reality. Using VR viewers, they were transported to the side of Highway 16, the “Highway of Tears” in Northern British Columbia.

The reaction to this presentation has been nothing short of incredible. It changes the way people understand an important Canadian issue. Our original six-month investigation and the website which we created actually brought the RCMP to reopen two cold cases, and to successfully close another. More work on these tragic cases in the weeks to come.

This is our transformation in action.

And while you are doing all this, we need to help our employees look beyond the immediate issues and see where our world is headed; to identify the blue sky ideas that can change everything.

Last summer, the Minister of Canadian Heritage launched a national public consultation on how to ensure Canadian content will thrive in the digital world. The Minister said that “everything was on the table.” It was an opportunity to think big. And we seized it!

Over the course of several months, we developed a vision of how a cohesive Canadian cultural investment strategy and a national public broadcaster at the centre of a creative hub could make Canada a cultural powerhouse, with benefits for Canadians and for the Canadian economy.

We suggested that this country needed a coherent policy framework to regulate all conventional broadcasters and new media entrants evenly.

And we suggested that, in order for CBC/Radio-Canada to be a strong anchor for our Canadian cultural ecosystem, we needed to move away from advertising as a source of revenue on all platforms.

An ad-free CBC could focus on cultural rather than commercial priorities. We could partner more closely with Canada’s creators, industry partners and cultural institutions without being limited by the need to monetize every initiative.

We developed our position paper by bringing together the best thinkers from CBC/Radio-Canada and asked them what it would take to best serve the next generations of Canadians.

We looked at the experience of other public broadcasters in the world, particularly in the UK and Australia.

Yes, there is a cost to our vision. To exit advertising, and invest in additional Canadian content, requires an increase of $12 per Canadian, from $34 to $46, the equivalent of $1 more per Canadian per month.

Many have focused on the additional money. I suggest that is wrong: the ambition is the focus, the dollars follow the ambition. And by going ad-free, we release about $253 million of ad revenues per year, of which $158 million would flow to the privates and help them through their transition to their next business model.

It’s really a question about how we see ourselves and our future. If Canadian culture (the things we believe, the values we share) is important to us, let’s develop a plan and a focus to ensure Canadian culture thrives both here and around the world.

It’s a bold proposal but one we are confident is the right one because of the work we did to develop it.

I encourage you to have a look at our submission for the consultation at future.cbc.ca, if you haven’t seen it yet.

I encourage you to think big, to embrace change, and if the opportunity presents itself, consider spending at least part of your career in a public service organization. I know you won’t regret it. I have not!

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