Rodale revamps in bid for growth

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Two months after outlining an ambitious plan to expand Rodale's magazine portfolio, President Steve Murphy restructured the company's operations in a bid to increase revenue and profits.

The new structure organizes the company around content areas rather than media platforms.

"The mission the Rodale family put before us was to double" the size of the company in five years, said Mr. Murphy, a former Walt Disney Co. executive who joined Rodale in April. Part of the solution, he added, is to "organize into what I call content groups or studios."

Rodale's revenue for 2000 will be about $500 million.

CROSS PLATFORM

The groups each include at least one Rodale magazine and will work on content offerings across media platforms, from books to TV projects. The content areas include: the Women's Health Group (associated with Prevention); Men's Health Group (Men's Health and the new MH-18); Sports and Fitness Group (Backpacker, Bicycling, Mountain Bike, Runner's World) and Organic Living Group (Organic Gardening and Organic Style).

Having completed a process to "find efficiencies" in the company, Mr. Murphy said, "now we have the organizational impetus as well as some of the funding to pursue" the ambitious expansion plan he recently outlined (AA, July 17).

At the time, Mr. Murphy said the company eventually wanted to publish mass-circulation magazines aimed at both men and women within specific age groups.

Rodale veterans Barbara Newton and Ed Fones will head the Women's and Men's health groups, each with the title senior VP-managing director. Previously, each had held the title VP-publishing director -- Ms. Newton for women's health, Mr. Fones for Men's Health. Maria Rodale, the company's vice chairman, remains president for the Organic Living Group while Nancy Small, formerly VP-publishing director of the Organic Living Group, will be VP-managing director of that group. Peter Spiers, previously VP-group publisher of Rodale Active adds responsibilities for strategic planning and will serve as interim head of the Sports and Fitness Group.

Mr. Murphy also named Claudia Morf, formerly the corporate treasurer at CBS/Westinghouse, as senior VP-chief financial officer. She will succeed Kevin Senie, VP-chief financial officer, who is leaving.

Books that don't fit easily into one of the content categories will come under a division run by VP-Publisher Neil Wertheimer, who previously was VP-publisher of Rodale's Active Living Group. Mr. Murphy estimated that about 30% of Rodale's books this year would not fit into the new company structure and thus be placed under Mr. Wertheimer's purview. Rodale sold about 10 million books last year in areas such as health and wellness, according to Mr. Murphy.

The restructuring process coincided with the June exit of former Rodale Books President Pat Corpora, said Mr. Murphy.

He added that he continues to have aggressive plans to expand Rodale. He said the MH-18 brand will be extended to books "and even handhelds," or palm computing devices, within a year. He also said "a new venture, hopefully a magazine for the younger woman," will come as soon as next spring.

SLEEPY CULTURE

But one executive familiar with the company said Emmaus, Pa.-based Rodale's traditionally sleepy corporate culture might make it hard to move quickly.

"The changes he made in that culture are going to take a year to sink in. They're dramatic, they're rocking the boat," the executive said. With that kind of turmoil, "It's hard to turn around and say, `Let's start five new magazines,' " the executive added.

Rodale has been through rough times of late. The privately held company suffered a string of top-level executive defections this year, losing its magazine-group president, the publisher of its largest title, Prevention, and three Men's Health publishers, among others.

But Mr. Murphy insisted Rodale is back on track. "The family hired me to transform the company and do it within my first six months," he said. "Some have joined and some have left, but I believe firmly we have a stronger team now than before."

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