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Profit push saps spirits at Granada.

LONDON Something peculiar is happening at the TV division of Granada, one of Britain's preeminent broadcasters and program producers.

Perhaps the company should call in Fitz, the dissolute shrink of "Cracker" fame. Or maybe a therapist would be more appropriate as stories of low staff morale continue to surface.

The paradox is that the more successful the company becomes, the more unhappy everyone who works there seems to be. There are in fact signs that Granada's Great Leap Forward is putting strains on the creative culture. That culture was responsible over the years for critically acclaimed series ranging from "Brideshead Revisited" to "Jewel in the Crown" to "Prime Suspect."

In recent months, several high-profile programming executives have quit the company, while a number of the outfit's recent offerings, including dramas "2020," "Wokenwell" and an adaptation of Robert Louis Stevenson's "The EbbTide," starring Robbie Coltrane, have disappointed critics.

In the last year, Granada has achieved new levels of power and profitability as it has expanded its TV business, no mean achievement given the combo's illustrious past.

The outfit now dominates terrestrial private TV in the U.K., owning three regional ITV stations, Granada in the Manchester/Liverpool regions, LWT in London, and Yorkshire-Tyne-Tees based in Leeds. Its shows account for roughly 60% of ITV network production.

Meanwhile as a producer, Granada is fast making inroads in North America, with ambitious plans in the pipeline to make shows for German and Australian broadcasters.

If this isn't enough to satisfy its corporate ambitions, Granada is poised to take advantage of developments in pay TV via its stakes in Granada Sky Broadcasting, a joint initiative with Sky, and British Digital Broadcasting, due to launch 15 channels next year.

"While the rest of us are still talking about it, Granada actually goes out and does is," admits an executive from a rival ITV station.

Witness the loss of Peter Salmon, Granada's erstwhile director of programs, and Gub Neal, head of drama.

A year ago, Salmon elected to stay, despite being offered the job of running BBC2, arguably the most innovative net in Britain. This summer, however, Salmon successfully applied to run sister channel, BBC1, a more demanding and less enjoyable job.

Neal's defection is even more embarrassing for Granada, and raises a number of difficult questions for the company. He was one of the architects of the original "Cracker" series, scripted by Jimmy McGovern, and a pivotal figure in winning a direct commission from ABC for Granada to remake "Cracker" for American audiences, the first time a U.K. company has landed a deal of this kind.

Insiders predict more high level departures are imminent.

"Granada is hemorrhaging talent, and I expect this to continue for some time to come," an ex-employee says. "A sea change is taking place in Granada's corporate culture which is forcing people to ask themselves if they still want to work for the company. Among significant groups of Granada program makers there is a crisis of morale."

Drawing the best

This view may be an exaggeration. For four decades, Granada has managed to combine commercial astuteness with a commitment to high-quality programming, enabling the combo to attract the best writers, actors and directors in their fields.

"Cracker's" McGovern; Kay Mellor, creator of the taboo-breaking prostitute drama Band of Gold; Helen Mirren and Coltrane are all recent manifestations of a creative tradition that goes back to the dawn of Britain's ITV system.

What is causing anxiety within the TV division is that the present financial demands being made by the Granada Group whose activities embrace an extensive hotel, restaurant and catering business, plus a chain of hardware rental stores - for even greater financial returns could jeopardize the programming culture that has won Granada its international reputation for creative excellence.

Granada's present management, led by chairman Gerry Robinson, took over five years ago, replacing then chairman David Plowright.

Changes made

"Under Plowright the TV people were regarded as a bunch of luvvies who were left alone to get on with it," a former executive says. "They were not subjected to the same disciplines that applied to the rest of the company. That changed under Gerry, but the process has accelerated in the past two years."

Some insiders identify the new atmosphere at Granada with the ascendancy of the ambitious Steve Morrison, a company veteran who a year ago took over as CEO of Granada Media Group following the abrupt exit of Duncan Lewis. Lewis had fallen out with Robinson over disagreements "about working practices," according to a Granada source.

Lewis is said to have been unwilling to deliver the rigorous cost controls now being implemented. "Duncan told Gerry that you had to spend more money in order to make more money," says a program maker. "Eight months later, he left the company."

In many respects, the desperate need for cost reductions at Granada are mirrored throughout ITV; Neal, speaking at the Edinburgh Television Festival in August, referred to this as "the fever for money" now gripping U.K. independent TV.

However, referring specifically to Granada, Neal added: "The squeeze is on financially, and the argument is that the things that go first are the contentious pieces, because they only get seven million viewers and won't market (overseas)."

Looking off-isle

In common with Carlton and United, who, along with Granada, make up ITV's Big Three, Granada realized some years ago that with limited future growth prospects from ITV advertising revenue and production, it must look outside what had been its core business in order not to get left behind in the new multichannel era where, before long, income from subscriptions would outstrip ad revenue.

Granada was among the first to realize the opportunities that existed elsewhere in Britain for low-cost, high-volume production, making shows for BSkyB (in which it holds a 10% stake) and even the British Broadcasting Corp.

In tandem with these developments, the company has had to fund an aggressive acquisitions policy, most noticeably the hostile takeover of the huge Forte hotel chain, and soak up losses from GSB, although Granada insists these are no bigger than anticipated.

"All this has put a financial strain on the profit and loss of other divisions," explains an insider, "and increases the urgency of the search for cost reductions and profit maximization."

It would seem that the continuing squeeze is being felt most acutely in the drama departments, always the biggest spenders of any TV outfit, although even publicity, where budgets have been halved in recent years, is not immune to the accountancy culture now prevalent at Granada.

Slow to spend

"Even when a script is greenlit, we aren't allowed to spend anything on development until the contract is signed and we receive the money from the ITV network center," says a drama producer. "This means that everything has to be done at the last minute.

"The irony is that this absurd short-termism probably ends up costing the company more money in the long run," the producer adds. "Everyone is being hammered here - the crews, the script editors, everyone - and I'd be amazed if other departments are experiencing anything different."

One of Granada's most eagerly awaited new programs is an adaptation of Hardy's "Far From the Madding Crowd." To keep costs down, the telepic was filmed in the Peak District, within easy reach of Granada's Manchester studios, instead of further afield where program makers claim a more authentic vision of 19th century Dorset would have been realized.

Efficient goal

No one pretends that modern media companies can be anything but efficient if they are to thrive in today's ever-shrinking world.

The official Granada line is to play down the recent departure of senior executives like Salmon and Neal and to suggest that their going is of little relevance to the company's glorious future.

"I think it says more about Granada's skill in attracting talent than anything else," reckons Andrea Wonfor, the highly respected joint managing director of Granada Prods.

"Peter (Salmon) started off at the BBC, so I can understand why he wanted to return there," Wonfor says. "Gub (Neal) will be heading up an entire channel's drama department (he's the new drama maven at Channel 4) instead of one studio's, so it's a good career move."

This is undoubtedly true. But if in doing so Neal takes McGovern, Mellor, Mirren and Coltrane with him, Granada will begin to feel the pinch.

"Granada is a culture on the edge," says a senior producer. "There are still a lot of good people at the top, including Andrea, but things could go either way. Taking risks, particularly on shows that aren't likely to make a big return, gets harder all the time.

"It's like a boat that's been tipped off course. It could be steered back or it could hit the rocks. This emphasis on profit drove out Gub Neal. I don't know whether it will drive me out as well."
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Title Annotation:British television broadcasting firm
Author:Clarke, Steve
Date:Oct 27, 1997
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