Media General Measures Nonfinancial Performance

By: Lucia Moses With newspaper executives' pay increasingly tied to bottom-line results, Media General Inc. believes financial criteria shouldn't be the only measure of performance. As a result, the Richmond, Va.-based publisher and broadcaster is implementing the "Balanced Scorecard," a management evaluation tool that captures nonfinancial criteria.

Vice Chairman and Chief Financial Officer Marshall N. Morton said the Balanced Scorecard method provides a solution to the company's pure financial-based performance measure, which he considered too limited in scope.

"The qualitative aspect has always been a problem in the service business," Morton said. He asked, "Is the better customer-service representative the one who handles the most calls in 24 hours or the one who handled them more effectively in 24 hours?"

In one use of the Scorecard, the newsroom of Media General's flagship, the Richmond Times-Dispatch, set a goal of closing 70% of first-edition pages on time to improve home-delivery times. Performance is measured monthly, and making closing times a Scorecard goal has sharpened the focus on deadlines, Senior Vice President and Executive Editor William H. Millsaps Jr. said. "Before, it was a priority, but it was not out in front of us every single day," he added.

Eventually, top executives' compensation will be tied to meeting Scorecard objectives at Media General.

Millsaps and other news executives said they hope the method will shift the conversation from quarterly profit margins toward quality journalism. At the same time, they note that measuring performance by nonfinancial criteria has its pitfalls.

The Times-Dispatch is wrestling with how to use the Scorecard to expand its use of sources in stories without watering down the quality of reporting, for instance. Tying Scorecard goals to compensation also can be problematic, Millsaps observed: "You want to make sure the ones that affect your relationships with readers and advertisers are the ones you ought to meet."