Magazine article Information Today

Which Way's the Backdoor? an Interview with Former Dialog CEO Dan Wagner Pushed a Lot of Buttons. (Quint's Online)

Magazine article Information Today

Which Way's the Backdoor? an Interview with Former Dialog CEO Dan Wagner Pushed a Lot of Buttons. (Quint's Online)

Article excerpt

Last month's Information Today carried an interview with Dan Wagner ("The Shooting of Dan Wagner," p. 1 and Mr. Wagner bought Dialog in 1997 when it was known as Knight-Ridder Information, Inc. (KRII), and quickly re-branded it as The Dialog Corporation. Within a few days after the Wagner interview appeared, I received a series of calls and e-mails from a number of former and current employees and Dialog customers who--to put it mildly--disagreed somewhat with Mr. Wagner's historical memory.

Over and over, two themes emerged as alternative explanations for Mr. Wagner's failure at Dialog: a lack of integrity and a lack of management skills. Rebutters of his interpretation of his time at Dialog allege that he lacked the talent to recognize the differences between running a major, established, broad-based information service and running a small, offshore, niche market boutique. He still seems to confuse the phrase "public trust," as applied to Dialog at the time, as indicating some sort of status with the SEC, instead of as a term expressing the reliance that hundreds of thousands of customers placed in Dialog to supply essential information for their operations. Even a privately owned utility holds a public trust when people depend on it for water or electricity--survivor commodities.

The Hard Sell

However, Mr. Wagner's niche market experience at M.A.I.D. focused on sales, sales, and sales, rather than on delivering service to sold customers. One former employee pointed out that M.A.I.D. had a reputation for hard-sell sales tactics. It also had a very high failure-to-renew rate among subscribers--well over 50 percent. Rather than trying to fix problems by improving service to customers, M.A.I.D. just sent in more sales personnel. This kind of approach might work with a niche market boutique that has a small number of subscribers who don't communicate their concerns with each other, but Dialog's customers were information professionals who had established channels of communication and a vital interest in Dialog's performance.

Mr. Wagner seemed shocked when his introduction of DialUnit pricing caused such a furor, even though a lengthy interview with him in the April/May 1998 issue of Database magazine appeared at the same time with a pull quote reading, "I will tell you now and you can put it in great big 78-point font--NO, WE WILL NOT BE RAISING PRICES!" Apparently, he was making the same promise in meetings with customers around the world.

To deceive successfully requires several qualities: an excellent memory for the tales you have told and to whom you have told them, the discipline to keep your mouth shut when silence would serve you better, and the insight to anticipate what your audience will hear when you speak and how they will react. And there's one other essential: the close proximity of a backdoor, because sooner or later the truth will come out.

Mr. Wagner had a habit of telling the wrong un-truths to the wrong people. Early in his reign, he spoke before a select company of library directors for some of the largest manufacturing corporations in the U.S. At this meeting he castigated the abilities, loyalty, and integrity of Dialog staff. Most of the people in the room had dealt with that staff for years and knew them well, but hardly knew Mr. Wagner at all. In any case, experienced managers knew that no wise executive ever trashes his staff in front of major customers. ("Buy from me and the bums who work for me?!")

Even the sales staff, the employees whose jobs Mr. Wagner didn't eliminate, were deceived. At a meeting in Florida, he drove up in a Jaguar convertible bearing the Dialog logo and walked into a sales conference dangling the keys. "These keys are for the first one of you to bring in a million-dollar contract," he proclaimed. Well, someone in the room did bring in a million-dollar contract. …

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