• by Dave Morgan , Featured Contributor, December 4, 2008

We're going to see a significant number of leadership changes in our industry over the next twelve months. Like it or not, it should be expected. Not only will the overall ad economy shrink this coming year, but so too will our online ad sector. Online ad companies that were budgeting double-digit growth, start-ups that were depending on robust financing environments and traditional companies that were hoping to fund digital growth with analog profits will all have to reset their businesses in one way or another. For many, this will mean management shake-ups, and it won't be pretty.

We will see start-up founder/CEOs giving way to more seasoned managers with experience in dealing with difficult times. We will see sales leaders taking the fall for missing numbers that would have been hard to hit even in good times. We will see entire management teams removed as companies are merged together with competitions by investors hoping consolidation will ameliorate their downside risks in markets that are now slower to develop. We will see online media managers now finding themselves managing, or being managed by, analog media managers in related businesses into which they have been newly "integrated."

Many of these changes won't seem fair, and many probably won't be. When revenues and profits fall and costs increase and the future become less certain, owners make changes. That's life in business. What is most important, however, is that the right leaders survive, or emerge, in this process.

Just as different stages of corporate development call for different kinds of leadership, so too do different market conditions. Quite frankly, it's pretty easy to look like a great leader when your market is consistently growing by double digits year-over-year and growth capital can be picked off the sidewalk, with a 14-page PowerPoint presentation and screen shots of projected P&L and balance sheet attesting to success. It's a whole lot harder to manage when conditions turn the opposite.

Who will survive and thrive in this environment? Let's look at the attributes of some of our industry's most successful leaders the last time we had a major downturn, when the Internet bubble burst. Here is a part of my list:

Tough Love: Dick Parsons of TWX stopped the complaining, with the line "You can't put the toothpaste back in the tube."

Brian McAndrews, CEO of aQuantive (now senior vice president, Microsoft). Brian had just taken Avenue A public when the stock market imploded. He stayed focused, conserved his cash and eventually embarked on a string of very successful acquisitions that helped propel the company into market leadership and a $5 billion exit.

David Rosenblatt, CEO of DoubleClick. David turned around a slumbering market leader. He cut business lines, products and costs, all the while growing both the top line and the bottom line. He too delivered a multibillion-dollar exit.

Dave Moore and Jon Hsu, chairman and CEO of 24/7 Real Media. Dave never gave up. He showed a tenaciousness, persistence and relentlessness that was and is unmatched in our industry. He and Jon put the company on their backs and carried it through the downturn and to an extraordinary exit as well.

J Moses, CEO of UGO. J took on his role just as the bottom fell out of the online ad market. He rallied his troops, refocused his business, and quietly and calmly assumed an industry leadership position evangelizing the long-term branding power of online. His use of Gary Coleman and his team's cries of "Where is Chuck Fruit?" will certainly go down in online ad history.

Matt Blumberg, CEO of ReturnPath, the email company. Matt has been at his post for the better part of 10 years, through a lot of ups, downs and integrations. He is consistent, focused and measured. A real star.

Martin Nisenholtz, digital head of New York Times Company, Sarah Chubb, CEO of CondeNet and Peter Weinberger, president of Advance Internet. These executives have all been in place for 10+ years and have never wavered in their belief in the value of quality online content, their focus on the step-by-step building of digital businesses, and their patience, even in the face of changing market moods. To a person, they each have built what are arguably the strongest sites and brands in their respective markets.

This list is by no means comprehensive -- there are dozens of great leaders in our industry -- but it is certainly instructive. If there is one thing that the last big downturn taught us relative to corporate leadership, it is the value of consistency, commitment and focus. Those three terms certainly define the folks listed above, and always win out in the long term. What do you think?