By far, the best business book I’ve read this year is Who Is Michael Ovitz?
Keep in mind that I was once an investor in a talent agency – so I have some first-hand experience of the challenges of the Hollywood biz. And yes, we viewed Michael Ovitz as a legend.
He started in the entertainment business as a part-time tour guide at Universal Studios, where he was an instant success and began to put together his network. After graduating from UCLA, he landed a job at the William Morris Agency…in the mailroom. Again, he proved to be a standout employee and quickly rose within the organization, where he would become a highly successful television agent.
But the William Morris Agency was too stifling. So he teamed up with four other employees to launch CAA (Creative Artists Agency). To disrupt the industry, they innovated the “packaging” of actors, directors and literary clients. This approach flipped the “power equation by amassing so much talent the buyers couldn’t go around [CAA].”
Yet this was not enough. Ovitz would further redefine the talent agency business, such as by taking the role as an investment banker (for example, he brokered Matsushita’s purchase of MCA). He even built a successful ad business, which started with a marque deal with Coca-Cola.
Amazing, right? Definitely.
OK then, so what are some of the lessons? Well, here are my takeaways from the book:
Research: Nothing that Ovitz did was by accident. He always had a clear-cut understanding of the end-game. He also spent quite a bit of time thinking about his firm’s strategies, which involved intensive research. Before meeting a client, he wanted to know everything about the person. Decision making was always about having complete information.
He also looked at what were the factors of success for entertainment. According to him: “I had started a private project (one that took me ten years) of watching every film that had won one of the five big-category Oscars. I discovered why Gone With the Wind had passed the test of time and How Green Was My Valley hadn’t; I learned the relationship between vision and craft.”
Image Is Everything: Ovitz definitely dressed for success. His wardrobe was impeccable, with Armani suits and Gucci loafers. He wanted to show his clients that he was very serious.
In the book, Ovitz writes: “Our focus on first impressions won us new clients before we’d uttered a word.”
Company Values: Every person in CAA had a deep understanding of what mattered for the firm. It became a part of the DNA.
Actually, Ovitz called it the Four Commandments:
- Never lie to your clients or colleagues
- Return every call by the end of the day (or at least have your assistant buy you a day’s grace)
- Follow up and don’t leave people guessing.
- Never bad-mouth the competition
Client Focus: Ovitz was obsessive with making his clients successful. He notes: “I focused intensely on you always turning the conversation away from myself.”
But he was also honest with his clients, such as mentioning the negatives in advance. He considers it like a vaccine against the flu. He writes: “The easiest way to lose a client is to make a promise you can’t fulfill; the client always remembers.”
With client relations, Ovitz also would hand write over 1,000 personal letters every year. He even had a Gifts Department, which would spend over $500,000 on clients annually. But to make this work, he had his team catalog as much as possible about the hobbies and interests of the firm’s clients. Ovitz also focused on gifts that were not disposable, like a rare edition of a book, a painting or even a car.
Team Work: This was certainly unique with CAA and allowed the firm to make quick inroads with the competition. The focus on teamwork was a force multiplier that allowed for much better outcomes for clients. Ovitz compares it to the way Magic Johnson ran the fast break with the Lakers.
In the CAA organization, there was “no hierarchy, no titles, no reporting lines, no nameplates.” Ovitz writes that it was “American team sports boosterism mixed with Spartan military tactics mixed with Asian philosophy, all overlaid by the communication spirit of the Three Musketeers.”