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As the man in charge of Playboy enterprises, Hugh Hefner owns 69.5 per cent of the magazine’s Class A shares and 27.7 of its Class B shares. He is the founder of Playboy and though he isn’t currently on its board of directors, he presents the image of the company that has been branded since 1953. The image of Playboy is what has carried it into being one of the most recognized brands of all time. Like any company, the demographic it targets is of the utmost importance to finding and attaining customers. This makes the image of the company vital for the realization of revenue. Hugh Hefner has been marketed since day one as being the calm guy in the housecoat who is sipping brandy and smoking a cigar. But the real attraction for this demographic of consumers is the naked women that surround him. Add to that the Playboy Mansion and you have a product that has many guys imagining themselves as living like Hefner, the dream life of many men.
Hefner and his colleagues certainly did a good job when they crafted their product – and it seems like they targeted nearly every stereotypical desire of stereotypical American men. The only thing left out is the car. Playboy has an organizational structure that is built around the indulgences of American men: naked women, cigars, liquor and a mansion. This demographical marketing plan, which is also based on the location of Playboy in the hills of Los Angeles, is the foundation on which Playboy is built, but throw in the odd luxury car and a lavish pool in a couple of advertisements, and what member of the targeted demographic wouldn’t want turn the glossy pages. So it can be asserted with great solidarity that the organization is structured around its image to the public. While there is a board of directors, which this paper will later discuss, it is the women and Hefner who are the rock that the organization is built around.
Now that I have established who calls the shots at Playboy, let’s compare and contrast Playboy’s organizational structure to that of NASA. While Playboy is known for its physical appearance, NASA is better known for the brainpower of each member it staffs. As the administrator since 2009, Charles Bolden leads the NASA team and manages resources in an effort to advance the agency’s goals, (NASA, 2012). The agency has three administrators, and unlike Playboy, it isn’t cutting back staff in an effort to save money. As we will see, Playboy has a decentralized organizational structure, and NASA is the similar, with various advisory groups consisting of multiple people waiting to advise on NASA’s next move. The agency is funded by taxpayers and, therefore, needs to report its budget to the federal government. Playboy, however, has a duty to its shareholders and must report its finances on a quarterly basis.
Now that we have compared Playboy (a public corporation) to NASA (a government agency), let’s take a look at how Playboy matches up with the World Wildlife Fund (a charity). The president of the WWF is the Duke of Edinburgh, Yolanda Kakabadse. The group is based around the fundraising efforts for animals and relies on canvassers and other fundraising initiatives to provide for the bulk of the Fund’s money. But unlike Playboy, the WWF uses that money to fund efforts to save animals. While there are paid workers and volunteers at the WWF, the vast majority of the money goes towards animal conservation efforts, (How is, 2007). Unlike Playboy, the Fund branches into two categories, the offices that can work without the direction of independent WWF offices and those that need the assistance of the officer. The offices are where the conservation work is carried out. With the primary target being conservation at the WWF, Playboy differs greatly, as the goal there is to create as much revenue as possible, which is evidenced in comments that are made later in this paper from the company’s CEO.
Let’s now take a look at how playboy is structured: The organizational structure is decentralized. A board makes decisions about what the company will pursue. Playboy is now branching into other fields, such as television, with the series “The Girls Next Door” reality show, and an international upscale merchandising company, (Gutierrez, 2010). There are only four directors and a chairman of the board currently at Playboy. This is a reflection of cuts to the organization to attempt to manage the decrease in revenue that Playboy has been experiencing since 2005 (Gutierrez, 2010). The decrease in revenue is due to fewer sales of the organization’s magazines. In 2010, Playboy announced it would cut from the top; however, the company did not say how many would be laid off, only saying they “eliminated some positions,” (Stableford, 2010). According to an article in Media Alley, an unidentified source said the cuts consist of only high-ranking, highly-paid corporate executives. Others, such as the content creators and editorial staff kept their jobs. This could be a reflection on the values of the company. The magazine has been considered to be high quality over its many years, and that’s a standard the company won’t jeopardize. Its faithful customers have grown to expect a high standard of writing and photography.
However, in 2009, the company decided to outsource its editorial staff to American Media Inc., which publishes the National Enquirer. That was another major structural change, as the company continued to downsize in an effort to save money. But the move was extremely damaging, as shortly after, advertising revenue dropped by about $22 million, or 30 per cent, in the same year. In just one year, Playboy had decreased its number of staffers by 12 percent. That left 573 full-time staff at the company in 2010.
The organization clearly allows CEO Scott Flanders to do the talking. This is what he had to say about the downsizing: “Our goal is to transition Playboy to a brand management company and, in so doing, to more cost-effectively monetize our powerful brand and assets. As we proceed through this transformation, we are aggressively looking for opportunities to streamline our operations, consolidate functions and reduce overhead expense,” (Stableford, 2010). The human resources move marked a change in the company’s organizational structure, cutting overhead costs and conducting operations in a more efficient manner. Flanders went on to say that the move is a change in the strategic direction, (Stobleford, 2010).
This move better caters to the company’s organizational needs. The company creating a hybrid of activities (television, Internet and merchandising) since the sales of their magazine decreased, likely due to the onslaught of free Internet pornography. Playboy needs to adapt to survive in a world where print media is becoming obsolete, as it is replaced by the Internet. This is exactly what the organization is doing, as its structure is undergoing a facelift.
Playboy’s Organizational Structure:
· Scott Flanders, CEO
· David Chemeroww, Chairman of the Board
· Charles Hirschhorn, Director
· Sol Rosenthal, Director
· Dennis Bookshester, Director
· Kai-Shing Tao, Director
Source: Playboy Enterprises
Gutierrez, C. (2010, July 12). Hef`s Private Plan for Playboy. Forbes.com.
How is WWF Run? (2007, Oct. 15). WWF Global.
NASA Organizational Structure. (2012, July 17). NASA.
Playboy Enterprises. (2011, Oct. 5). TheOfficialBoard.com.
Stableford, Dylan. (2010, June 29). Playboy Downsizes, Cutting Top Corporate Staff.