Now, ITHAKA president Kevin Guthrie interviews Elsevier chair YS Chi. #ithakatnw18 
Guthrie: How do you square revenue with purpose in a commercial setting? Chi: You have to balance the two or you cannot persist. Sometimes it is a matter of timeline. Shareholders demand short term; Leaders must ensure longer term perspective. #ithakatnw18
Chi: We are trying to ask the market to be on a journey with us. If you want only short term returns, please do not own our shares. #ithakatnw18
Chi: We have short, medium, & long term investments. For ex, we debated if to maximize market share in journal articles published. We decided to lose market share while raising the quality of our portfolio (field weighted citations). It was the right strategy. #ithakatnw18
Chi: Key q's for us: What is the source and allocation of money? We have to think about a different flow. Which technology should we embrace and let go? What is the long-term impact of poor decisions, such as not investing enough in research? How do we manage talent? #ithakatnw18
Chi: Elsevier had been farmers - we would harvest w/o an interest in how our products were used. Digital distribution let us begin to offer a supermarket for the things we farmed - relationship with cooks. Now we have a restaurant - we have recipes, cook, and serve. #ithakatnw18
Guthrie: Why is Elsevier acquiring a strategy of purchasing workflow and preprint tools. Is that about lock-in? #ithakatnw18
Chi: We don't want to become irrelevant. If the conversation moves away from journals to somewhere else, we don't want to lose engagement with the researchers having a dialogue about scholarship. #ithakatnw18
Chi: We don't want to have lock-in. There is no way to lock-in curiosity. #ithakatnw18
Guthrie: Why shouldn't we worry if you have the restaurant, the farm, and all the parts of a vertical integration? Why is that good for the sector? #ithakatnw18
Chi: We are not a platform company w/ a near monopoly like Google or Facebook. We are part of a vibrant ecosystem. In the short term there is no real threat of any of us having a large enough market share to be a concern. Elsevier only has 17% of the journals market. #ithakatnw18
Chi: Some of the things we are trying to do are very costly. We have to be prepared to invest because others are unable to do so. We are taking risks that others are unable to take. And other risks start-ups can take that we cannot; then we acquire them. #ithakatnw18
Guthrie: Transparency is incredibly important for you. Journals are not substitutable so they are mini-monopolies. You may have dominant market share in certain areas. Yi: That is true. #ithakatnw18
Guthrie: Elsever is positioning itself not as a publisher but increasingly as an analytics concern. Can you share with us lessons of driving change in an organization - what advice for those in similar positions in publishers and libraries? #ithakatnw18
Chi: Three major steps. 1. What did we want to be when we grow up? That debate was robust and "quite violent." Needed to come to strategic decision. #ithakatnw18
2. We needed to determine if we had enough money and how to allocate those resources. #ithakatnw18
3. We needed cultural change; to have people believe that taking risks was encouraged. We previously rewarded predictability. Now need ideas to come from our customers, bottom up. Can't be punished for being wrong. Fail often & early, so cost of failure very small. #ithakatnw18
Guthrie: What percentage of the business has shifted to data analytics? Is part of the strategy about protecting against loss of revenue from OA? #ithakatnw18
Chi: Our strategy is about growth. In the research domain, probably a good two digit percentage of our revenue comes from non-publishing revenue. In the health sector, it's a very large percentage. #ithakatnw18
Chi: Let me make it clear that we are not EVER going to take our hands off the content, because having the content in a structured and curated way is very important to the analytics business. #ithakatnw18
Guthrie: In the shift to analytics, how are you planning to lead in the areas of privacy and data management? #ithakatnw18
Chi: Most of the data we have are not B2C but in the B2B sector, so we are less concerned about this, although in the health sector we are very conscious of HIPPAA. [Doesn't E have TONS of usage/activity data from academics?] #ithakatnw18
(he used the "take our hands off language" a second time with respect to content, emphasizing the metaphor)
Chuck O'Bryan from SUNY Libraries Consortium: We manage collections budget from a deficit perspective. What is Elsevier's approach internally to allowing us to manage our costs? #ithakatnw18
Chi: Our ideal endpoint is that everything should be available to everyone. From there, we think about prioritization. #ithakatnw18
Chi: You [librarian] know what is most critical to your users. We make similar decisions about which ones are most important from our perspective based on your usage. But it shouldn't be a zero sum game for universities, with flat library budgets. #ithakatnw18
Chi: We are investing in so many ways. For example, bringing ML to create excerpts/snippets rather than having authors write. We want to continue to bring more value. Also will make more open - such as flat content - or if you want more for efficiency you can pay. #ithakatnw18
Chi: Our cost increases since 2004/2005 has been in the lowest decile of publishers. We will continue to commit to that. #ithakatnw18
Guthrie: I want to challenge this a little bit. Is it a profit maximizing mentality? Chi: No. It's about getting the most out of the relationship, not just from a single sale. #ithakatnw18
Guthrie: It's great to add more value, but libraries only have so much money. There is a crowding out effect, especially to the humanities and some social sciences. There is some zero-sum here. #ithakatnw18
Chi: I recognize universities are reducing the share of their funds going to these purposes. We need to convince university leaders that there is value here that they should be funding, so that researchers and research management can be more efficient. #ithakatnw18
Chi: There has been a huge reframing of libraries over the past 15 years as being about more than just collections. That means there is an opportunity for partnership in our evolution that was not there previously [when E was working around libraries]. #ithakatnw18
Guthrie: We appreciate the need to articulate the value, but I think libraries would also appreciate passing along more of the efficiencies as well. Chi: We pass along tons of savings. #ithakatnw18
Question: What would it take to have Elsevier open in the US through a national license [R&P?]? Chi: It's a question of resolve and how difficult it is to assemble so many organizations together. #ithakatnw18
Question: Elsevier's profit margin is higher than Apple or Google. Are you making too much off the deals with libraries? Chi: Elsevier's *profit* is in the teens, but we do not report profit just for Elsevier, only operating margin, which excludes many costs. #ithakatnw18
Q @JosephJEsposito: Which competitors do you focus on doing interesting things? He talks about large familiar names but also "those we don't know who are nimble and hungry and creative and will be acquired. I fear those I don't know about." #ithakatnw18
Chi: It's quite easy to start a new company to solve difficult and important problems with six people in a garage. I wish some of it happened on campuses, in libraries, and I don't know how much of that is going on. #ithakatnw18
George Fowler from ODU: Can you give examples of activities that Elsevier is doing for the public good? Chi: We were the first to support Portico, we support CLOCKSS, bought Mendeley and de-monetized it completely. SSRN acq. #ithakatnw18
Chi: We're not doing things for the bottom line only but also because it keeps us relevant in the conversations going on among researchers. Does that have a long-term benefit? Of course, but you can draw a line from here to there. #ithakatnw18
Chi: Librarians today are so ready to be a part of the research workflow tools. "Ten years ago we had to go around the librarians. That was a stated goal." #ithakatnw18
Stuart @StuDempster: Pure is reluctant to engage on automated ingest. Chi: I am surprised to hear that. It goes against our philosophy. We are trying to simplify your processes of submitting so much data to so many people. Pure should automatically ingest&distribute. #ithakatnw18
Cappy Hill @IthakaSR : To what extent is your business contingent on the tenure system? Chi: Not contingent on tenure but our business is absolutely contingent to the competition among researchers and the assessment of their research. #ithakatnw18
Chi: I am a huge anti-ranking person, that is well known. But we have to have a system that has hefty competition. And in that Elsevier can thrive. [Interesting he is anti-ranking in light of this: morningstar.co.uk/uk/news/AN_154… ] #ithakatnw18
And now we take a coffee break. /
