In the UK, creative industries is a concept that has at times struggled between the 'creative' and 'industry' bits. But as this Economist article demonstrates, the juxtaposition is seldom a clear cut case of either-or. 

Harder times are reminding the media industry of the critical importance of creating good content. But that means managing the tensions between the creative elements (the artists) and the management figures (the suits).

ONE by one, the men of extravagant vision and exaggerated showmanship have been toppled from the upper ranks of the world's media giants. The departure of Steve Case from AOL Time Warner, Tommy Mottola from Sony Music, Thomas Middelhoff from Bertelmann's, Jerry Levin from AOL Time Warner and and Jean-Marie Messier from Vivendi illustrates this trend. Into their places has stepped a parade of dull men in suits, such as Andrew Lack, new head of Sony Music, who has never worked in the record industry, Jean-René Fourtou, an ex-pharmaceuticals boss, at Vivendi or, at Bertelsmann, Gunter Thielen, ex-head of the group's printing and industrial operations.

This trooping of grey faces into the unruly media world marks a distinct change of mood. Talk of “vision”, “synergy” or “new paradigms” is out; the daily grind of evaluating and improving operating performance is paramount. The need to return to the basics of the business was summed up recently by Peter Chernin, Mr Murdoch's right-hand man at News Corp. “What the hell were we thinking?” he asked. “Where did [the industry] get our grandiose ideas the media business was on the way to complete and utter re-invention?” His point was that during the boom, the industry was distracted by gadgets, mergers and convergence theories; now it is time to relearn old lessons about fostering creativity and manufacturing entertainment that people are willing to pay for.

“Show business doesn't attract leaders who know how to listen properly or leave people alone,” comments Roger Fransecky, head of the Apogee Group, which advises many media bosses. “But when you manage creative people, you must intrude carefully.”

Resisting the temptation to interfere, but at the same time enforcing operational control, makes for a delicate balance. With their unpredictable, autocratic management styles, Messrs Murdoch and Redstone might look like ruthless meddlers. Yet in fact each gives his trusted division heads and right-hand men—respectively, Mr Chernin at News Corp and Mel Karmazin at Viacom—the freedom to get on with their jobs.

“What is really hard is managing the interface between the creative thinking and the corporate profit-centre,” says Peter Kreisky, a media consultant who is writing a book about the management of creatively driven industries. The two cultures—of the ponytail and the suit—are a world apart, and combustible together. Few managers combine both creative credibility and commercial discipline. But the best entertainment companies manage to impose operational control without squashing artistic freedom.

On paper, the recipe for successfully managing an entertainment company appears simple: carve out small creative units within big companies to give them their own identity; grant them creative freedom from meddling bureaucracies; but do not do either recklessly. Yet striking the right balance between the artists and the suits remains remarkably hard.

Over the years, entertainment companies have often failed, and have instead swung, alternately, from being too strongly in favour of letting creative types rule, towards being too much in hock to the bean-counters. EMI has lurched from periods when the suits were in charge, notably under Jim Fifield's stewardship from 1988 until his sacking in 1998, to times of financial excess, when the creatives went untamed, as happened with the rise of Mr Berry in the late 1990s until his eviction in 2001. If the pendulum theory of managing the creative industries is right, today's gallery of grey faces may last only as long as the downturn. Boom times tend, after all, to unleash profligacy—and not just in the entertainment business. The best companies are likely to be those that avoid swinging too wildly in favour of either ponytails or suits: both have their place.

To read the full article, visit www.economist.com