Replicating the Hollywood Model

Replicating the Hollywood Model

One of Australia's most successful film producers claims CIOs have a lot to learn from the successes and failures of Hollywood studios since the 1940s - a time when labour disputes, government antitrust actions and disruptive technologies like television threatened to bring the studio system to its knees.

From the beginning of the 20th century through to the mid 1940s, Hollywood was pretty much a self-contained world of mini moguls running film production "factory lines" and controlling everything, including the lives of workers, stars, directors and writers. Five major studios totally dominated the business of making movies; administering production, distribution and exhibition through their own chains of theatres, and binding actors and directors with onerous and exclusive contracts of as much as seven years' duration. Studios had their own nurseries, schools, police forces and fire stations, the moguls had the mind-set of dictators the world over, and it was wise to think like them and behave according to their dictates if you wanted to secure your film career.

Once the so-called Studio Model began unravelling in 1938 in face of antitrust and other lawsuits, the highly autocratic, not particularly well-educated or sophisticated moguls, often immigrants with little propensity for change, initially acted "slowly, stupidly and self-servingly", says Australia's most prolific producer, Hal McElroy. McElroy believes the IT industry has much to learn from Hollywood's eventual transformation into an industry in which largely outsourced production companies primarily make films on a project-by-project basis.

"For a period there in the fifties and sixties, Hollywood teetered close to extinction," McElroy says. "But of course there's tremendous resilience in Hollywood among these moguls, among their lieutenants and their children and their extended family, and tremendous intellectual capital there. So what happened was all of the studios had to reinvent themselves and they then adopted what we now call the Hollywood Model, which was to outsource most of their production."

Under the Hollywood Model the studios leave the production of films (and much of the financial risk) primarily to outside independent producers. Once financing is found for a film the producer hires a production manager and together they assemble the film crew. Each crew member is hired and his or her skills assembled for use when needed. When the production wraps, most crew are released, and post-production begins with a skeleton crew (who are also hired only when needed).

Sounds a lot like many IT projects today, doesn't it?

The new breed of production company typically has a lifespan not much longer than it takes to make a particular film, and is then dissolved. There are no stars or directors under long-term contracts to be automatically used for ongoing productions. Like an IT head pulling groups of specialists together to work on a project, only to have them disband once the project is complete before going off to work on other projects, Hollywood replaced its formerly hierarchical structures with teams assembled to tackle specific tasks. And while the model is far from perfect, it has secured the survival of the industry in the face of such extreme disruptive technologies as the advent of sound, television and colour television.

McElroy, whose credits during 30 years in the film and television industries include Blue Heelers, Picnic at Hanging Rock, The Sum of Us, The Last Wave, Razorback, Water Rats, Murder Call, Return to Eden and the US network success The Last Frontier, has raised tens of millions of dollars for projects during countless trips to Hollywood. He knows how to conquer complex logistics and budgets to create thousands of jobs for occasionally temperamental actors, writers, directors and crew, then find creative ways to sell and market, all over the world, the more than 1200 hours of film and television he has been responsible for. In doing so he has become a master of making the Hollywood Model work to maximum effect. And he sees how CIOs could make winners of themselves by adopting the best aspects of the Hollywood Model to their purposes.

Last year, research and analyst firm Gartner predicted that "the primary work unit in the enterprise will be a virtual matrixed team composed of diverse competencies, knowledge and capabilities", and that such teams will be critical to gaining greater value from IT investments. The concept of replacing the hierarchical structure of an IT organization with teams to tackle specific tasks could borrow much from the collaborative Hollywood Model. And while McElroy would not dream of telling IT leaders how to run their business, he says there is much they might learn from the successes and failures of the Hollywood experience since the 1940s.

Hollywood today is a place where anything is possible, notes McElroy. Literally anything can be bought or negotiated. It is capitalism in its purest, most market-driven form. Logically, anything Hollywood can do, IT ought to be able to do as well, or better.

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