north of neural dialog

06/01/2010

by anne lueneburger

Richard Sarnoff, Co-Chairman, Bertelsmann Inc., New York

The first thing that strikes me as I enter the lobby of Random House, a subsidiary of Bertelsmann on 1745 Broadway, is that I am surrounded by books: everywhere I look. They are stacked in floor-to-ceiling shelves, and many I instantly recognize – including my favorite Dr. Seuss: Oh, the places you go. Its words of wisdom about the big, bountiful future, the ups and downs of life, and the message that all of us can fulfill our wildest dreams offers inspiration to children and adults alike:

You’ll be on your way up!

You’ll be seeing great sights!

You’ll join the high fliers

who soar to high heights.

You can get all hung up

in a prickle-ly perch.

And your gang will fly on.

You’ll be left in a Lurch.

Too bad the books were safely stored behind glass as I was early for my appointment with Richard Sarnoff and would have loved to browse through a few…

The role

Richard Sarnoff holds several senior leadership roles. He is Co-Chairman of the U.S. holding company of Europe’s largest media company, Bertelsmann AG (with $25 billion in revenues) which includes Random House Inc, the leading global consumer publisher with revenues over $2 billion and operations in 12 countries, and he is also President of the company’s worldwide digital media investing arm, BDMI, which has a portfolio of more than 15 companies.

The journey

Richard Sarnoff is a descendant of the legendary David Sarnoff, founder of RCA and NBC (also known as the ‘Father of American television’), who was his great uncle. Richard Sarnoff’s father was a senior executive with Warner (later Time Warner), and much of his family are involved in the media.

He began studying Art and Archaeology at Princeton, and worked as a freelance writer and software marketer prior to entering Harvard to undertake his MBA. “A big part of me going back to business school was that I was curious to learn more about different career paths.” He told me. Being in a class with so many people with varying backgrounds was like ‘test-driving’ a number of careers for Sarnoff.

Upon graduation, rather than joining the ranks of many of his peers who went into consulting and finance, Sarnoff joined the publisher Bantam Doubleday Dell (predecessor to Random House) in 1987.  Starting his career in media meshed well with his love for books, appreciation of culture, and his belief that promoting literacy and education is a central plank of a healthy society.

He quickly moved through the ranks, and held a number of positions in sales, marketing and general management. One of his roles involved managing the portfolio of publishing companies, and he was intricately involved in M&A activities, and restructuring and selling these firms. “We made good profits, but there came the day that our portfolio was so small that I literally had worked myself out of my job. So for a year I found myself in a ‘holding tank’, I did some strategic planning work, but wasn’t quite sure what to do next.” Unsurprisingly for a star performer who finds himself in a ‘lull’, the thought of leaving crossed his mind.

But when the then CFO left the firm, Sarnoff, then only 37, was offered the role. “While I had gone through the rigor of business school and financial modeling, I had never anticipated to go into finance. This was quite a stretch assignment.” When I ask why he accepted it, he smiles and for the first time mentions the single word that seems to characterize his entire journey:”Serendipity. I had the trust and the confidence of senior management and saw this as a unique opportunity.” He describes how, after a steep learning curve, he did well and enjoyed his new role and, two years later, he was leading Bertelmann’s billion dollar acquisition deal of the US ‘crown jewel’ of publishing, Random House. It was a surprise deal, Sarnoff tackled both the role of CFO and Investment banker and, as a result, no information on the secret negotiations leaked to the public. Merging its Bantam Doubleday Dell division with Random House, Bertelsmann became the leading consumer publisher in both the US and the UK.

Sarnoff’s career continued to flourish.  In 2000 he became President of both the Ventures and the Corporate Development Group of Random House, and in 2002 he was the first American to serve on the Bertelsmann AG Supervisory Board.

In addition to his Bertelsmann responsibilities, in 2007 Sarnoff was appointed as Chairman of the Association of American Publishers, AAP.  In this role he served as the key architect of the Google class action settlement between authors and publishers, striving to make books more readily available to the public. Sarnoff, as a result of his efforts, was named the publishing industry’s ”Person of the Year” by Publishers Weekly in 2009.

‘Lassoing’ serendipity to create positive change

In addition to his smart and sound decision-making abilities, Richard Sarnoff’s success is characterized by his readiness to embrace ‘serendipity’. We generally understand serendipity as the habit of making fortuitous discoveries by accident – often whilst looking for something unrelated. Many scientific innovations over the past centuries were the result of serendipity, such as the chance discovery of Penicillin, X-rays, Teflon and the microwave oven, but it is equally relevant to individuals and the choices that they make.

Serendipitous quality of innovation is highly valued by organizations.  An example of its successful use is that of Japanese firms who create intellectual property and competitive advantage not by processing information but rather through “tapping the tacit and often highly subjective insights, intuitions, and hunches of individual employees and making those insights available for testing and use by the company as a whole.”[1]

Be open to it

As the French scientist Louis Pasteur said: “Chance favors the prepared mind.”  Serendipity extends beyond the concept of ‘accidental discovery’ or luck. It involves overcoming preconceived notions that might prevent us from seeing opportunities in the first place. Throughout our careers and life we are confronted with situations and opportunities that come to us unexpectedly. And every time we have the choice to ignore what is right in front of us, or to explore it.

Richard Sarnoff seems to naturally possess the readiness to pause and explore unforeseen developments and opportunities. When I ask him about what his ‘Chapter 2’ plans after Bertelsmann are, he laughs:” I am pondering whether to write a book or some poetry – but I am also open to seeing what comes my way.”

Create it

“Unlucky people are stuck in routines. When they see something new, they want no part of it. Lucky people always want something new. They’re prepared to take risks, and are relaxed enough to see the opportunities in the first place.”

Richard Wiseman, Psychologist

Richard travels extensively for both work and pleasure, and tries to participate in, even to set up, new experiences with friends and family whenever he can. It seems as if he deliberately seeks out experiences that push him out of his comfort zone. Like creating a mosaic, Sarnoff adds new perspectives to his life and strives to create an enriching perspective out of these contrasting pieces.

We are the captains of our success and well-being. Here are some examples of challenges that I have seen executives take on to get out of their comfort zone: a week on a dude ranch in Wyoming, taking the stairs rather than the elevator for a month, learning how to make crème brulée with a professional chef, or taking acting classes and performing on stage. While these particular examples may not resonate with all of us, it is clear that taking us out of our comfort zone brings about new experiences that may offer fresh insights. To get started, consider expanding your social network. Social networks are prime platforms for serendipity to play out as you get to know acquaintances or total strangers who might turn out to be helpful on your path.

Ask yourself: in what ways have I encountered serendipity in my professional and personal life? How can I shape serendipity to increase the scope and impact of unexpected encounters?

And… If you think you might prefer opera to NASCAR, why not flip for a day and experience life on the other side: you never know what you might find… That’s serendipity.


[1] Ikujiro Nonaka (1991,p. 94 November-December, Harvard Business Review)

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