It seems that when world famous rock bands aren't bashing capitalism, they're busy refining its practice for the next generation of CEOs and deputy managers. Today, the Harvard Business School has labeled Irish rock outfit U2 the latest in savvy business pioneers. This "business lessons of the rock" canon is quickly becoming a crowded stage already shared by the Grateful Dead, the Beatles and the Rolling Stones. Rock music is, of course, a business: there are partnerships to consider, intellectual property to protect, market share, and brand management. Of course there's also groupies, drugs, and trashed hotel rooms that one doesn't (normally) find in a corporate boardroom. Here's how business writers have endorsed the management acumen of some of the highest grossing rock bands of all time.
This latest thesis comes from Harvard Business School professor Nancy Koehn who wrote a business case study of the band highlighting its genius in focusing on the long haul.
- Strategy: "In an industry notorious for its focus on short-term hits and for taking control of an artist's work and profits, the band members and their long-time manager Paul McGuiness always looked to build an enterprise that would have a long life."
- Tactics: "Toward this end, they obtained the rights to their own copyrights back from Island Records; they oversaw the vast majority of decisions about touring, record production, graphics, and packaging themselves; they focused on touring and a direct relationship with their audience (versus relying on radio station distribution and the roller coaster of trying to generate "Top 40" hits); and they acquired a 10 percent ownership stake in Island Records worth $30 million when the record company was acquired by PolyGram in 1989."
- Real-world application: Buy lots of company stock; micromanage.
- Possible real world drawbacks: May only work for complete egomaniacs with a messiah complex.
The Grateful Dead
In his delightful March 2010 piece, The Altantic's Josh Green honed in on the Dead's treasure trove of management secrets it unveiled when its archive of business records were made public.
- Strategy: "The band pioneered ideas and practices that were subsequently embraced by corporate America. One was to focus intensely on its most loyal fans. ... 'The Dead were masters of creating and delivering superior customer value,' Barry Barnes, a business professor at the H. Wayne Huizenga School of Business and Entrepreneurship at Nova Southeastern University, in Florida, told me."
- Tactics: "It established a telephone hotline to alert them to its touring schedule ahead of any public announcement, reserved for them some of the best seats in the house, and capped the price of tickets, which the band distributed through its own mail-order house. If you lived in New York and wanted to see a show in Seattle, you didn’t have to travel there to get tickets—and you could get really good tickets, without even camping out."
- Real world applications: Don't scrimp on customer service, offer generous loyalty programs.
- Possible real world drawbacks: Most workplaces aren't terribly tolerant of recreational drug use.
Earlier this year, The New York Times wrote a fawning review of the new business book Come Together: The Business Wisdom of The Beatles by Richard Courtney and George Cassidy. The book emphasizes the lessons of the Beatles' creative process.
- Strategy: "Another story from the Beatles’ early years highlights the importance of heeding feedback, even when it’s not what you want to hear. ... 'The most important lesson here is not simple perseverance, though that is important,' the book says. "
- Tactics: "Executives at Capitol Records, the American affiliate of EMI, took a pass on 'Love Me Do.' Even after the success of 'Please, Please Me' — a No. 1 album in Britain — Capitol refused to issue the record or any of its singles. The Beatles could have kept arguing about the album’s merits, or simply given up on conquering America. Instead, Mr. Courtney and Mr. Cassidy explain, they kept recording new material and sending it to Capitol — for one solid year. Finally, in 1964, Capitol released 'I Want to Hold Your Hand,' which became the Beatles’ first No. 1 hit in the United States."
- Real world application: Don't be afraid to take no for answer, go back to the drawing board.
- Possible real world drawbacks: Paul McCartney and John Lennon had enough good ideas for songs to sell 6 Diamond albums, as well as 24 Multi-Platinum albums, 39 Platinum albums and 45 Gold albums in the United States.
The Rolling Stones
The group's business savvy is lauded by Kristi Hedges, an executive coach, leadership development consultant and author of The Power of Presence. She gleans most of her information from guitarist Keith Richards's recent autobiography My Life focusing on the relationship between Richards and Mick Jagger.
- Strategy: "Omitting the rock star drama and observing the pure interpersonal dynamics and functionality, the Richards/Jagger partnership had reverberations of any other one I know, including the two that I’ve had in my career."
1. [Keith Richards] never lost the conviction that the partnership produced magic that the individuals could not. Richards can’t quite label it, but knows that he and Jagger have a chemistry that’s created precisely because of their differences, not in spite of them.
2. He acknowledged what his partner brought to the table that he didn’t have, and gave him credit for it. Richards celebrates Jagger as the best performer and lyricist in the business. He’s proud of him.
3. He honored the shared history. Often we quickly forget everything we’ve endured with someone and simply focus on “what has he or she done lately.” The blood, sweat and tears have deep personal resonance and deserve respect.
4. He separated the emotions from the work. Even when they were feuding, Richards and Jagger composed music in the studio together.
- Real world applications: Stay loyal to your most important colleagues at work.
- Possible real world drawbacks: Few executive teams (legally at least) have the same groupie-sharing policy as Richards described in a 2008 GQ interview:
How many chicks do you think you guys have in common? After Marianne [Faithfull], it's a stable. [laughs]
More than five? No. I don't want to mention other bitches' names, because I've stolen quite a few off of him and, uh, he's nudged his way into my lot, but not significantly. After the Anita thing, I made a point of stealing every bitch he had. [laughs]