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Sunday, Jul 21, 2024

Sage Knows Success Formula in Arcane Business

Education and scholarly journal publisher Sage Publications is doing things in ways other than by the book. The No. 2 company on the Business Journal’s Family Owned Businesses list gives wide latitude to its non-family management team, led by Chief Executive Blaise Simqu. It’s also generous with employee perks that include no-cost medical benefits and tuition and book reimbursement for continuing education. And company founder and Executive Chairwoman Sara Miller McCune wants the company culture to stay just the way it is. After she passes away her majority stake in the company will go into a trust with the expressed intent that Sage will never be sold or divested. “It will continue its educational mission for many decades to come,” Simqu said. Sage, which reaches its 50-year anniversary in business in 2015, is headquartered in Thousand Oaks with global offices in London, New Delhi and Singapore. It employs more than 1,200 people. McCune is majority owner, with shares also held by her step-son, David McCune, and grandson. The company is on track this year for revenue of up to $400 million from the sales of its journals, textbooks, and reference materials in the social sciences, medicine, engineering and business management, among topics. Most sales are to college and university libraries and students. Sage also has two subsidiaries: Corwin, a publisher of professional development material for grade- and high-school teachers, and its CQ Press imprint that publishes books and other materials on American government and politics. Changing industry But like other publishers, in recent years, it has faced challenges with the advent of digital publication. Libraries are asking for more digital product while teachers request more e-books that can be viewed on the iPad, Kindle and other tablet computers. “That is all expensive,” Simqu said. “Every single day we are confronted by a market that is changing fast.” However, Sage has managed to turn that challenge into an opportunity. Digitization of content and creating more sophisticated databases has helped drive the company’s growth, which has a compound annual rate of 14 percent over the past decade. To accomplish that, Sage invests in product innovation such as e-books, online courses and databases, as well as hiring people with experience in creating that content. “There is an incredible skill set needed when transitioning to a digital environment,” Simqu said. Sarah Miller McCune was not made available for an interview but her founding of the company is well documented. It goes back to 1965 when a still single Sarah Miler, after working for English and U.S. publishers, started the firm in New York City with her life savings of $500. Miller held a day job as a consultant while working on Sage in the evenings. Its first publication was Urban Affairs Quarterly. The Sage name combined the first two letters of her name with the first two of George McCune, whom she married in 1966 after relocating to California. The company was based in Beverly Hills until moving to Thousand Oaks in 1986. The company published primarily social science journals and books until the mid-1990s when it added scientific, engineering and medical publications. A milestone event came in 1971, when Sage opened its London office and a year later purchased five journals publishing works by social scientists from the United Kingdom and Europe. Expansion to India occurred in 1981 and Singapore in 2006. “It is one thing to have offices in different countries and another to be a global company acting in unison to achieve the same goals,” Simqu said. Simqu is only the second non-family member to be chief executive at Sage. David McCune, George’s son, held that position starting in the late 1980s until 1999. Simqu took it over in 2004 from prior Chief Executive Mike Melody. While the McCune family has not been involved in the day-to-day operations at Sage since the late 1990s, their vision and goals for the company are in plain view. Covering the cost of continuing education, no-cost medical coverage, health club reimbursement, and free lunches every Friday are just some of the benefits employees receive. For each five years of service, employees and one guest receive a trip to one of the international cities where Sage has an office. Barry Cohn, chief executive of RGEB Inc., a Canoga Park employee benefits consultancy, said paying the full cost of health insurance premiums makes Sage an outlier in the benefits category. The tuition and textbook reimbursements that Sage offers are common, Cohn said, but the free anniversary trips are “unusual” and give the impression that it is a good company to work at. “Compared to other large companies, they offer a top-of-the-line benefits package,” Cohn said. Private ownership, too, brings benefits when it comes to growth strategy. Decisions are made based on what is good for the company in the long term and not what Wall Street investors want to see in the short term. “The Sage investment strategy can be summarized as buy and hold forever,” Simqu said.

Mark Madler
Mark Madler
Mark R. Madler covers aviation & aerospace, manufacturing, technology, automotive & transportation, media & entertainment and the Antelope Valley. He joined the company in February 2006. Madler previously worked as a reporter for the Burbank Leader. Before that, he was a reporter for the City News Bureau of Chicago and several daily newspapers in the suburban Chicago area. He has a bachelor’s of science degree in journalism from the University of Illinois, Urbana-Champaign.

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