Part 1: Leadership Dynamics and Strategic Decisions
In mid-2024, Paramount Global and Skydance Media announced an USD8 Billion merger, forming a new entity, “New Paramount.” This bold move aimed to address Paramount’s financial challenges, reduce debt, and secure a future in a fiercely competitive media landscape. Yet, if you have been following the story, the journey has been anything but smooth. At its core, this story is not just about strategy and structure—it’s about the people who drive the heart of the organisation and the shifting tides of an industry in flux.
Facing a Changing Industry
The entertainment industry is no stranger to disruption. Consumer preferences evolve faster than ever, with streaming giants redefining the rules of engagement. Paramount, a legacy brand with a storied history, found itself grappling with these changes. The merger with Skydance was not just a bid for survival but for relevance in a market dominated by innovation and agility.
Amid the focus on financial restructuring and competitive positioning, however, the human element—the employees, their creativity, and their trust—was overshadowed. This oversight reveals the cost of prioritising short-term metrics over long-term resilience and alignment.
The Leadership Shake-Up
In early 2024, Paramount’s CEO, Bob Bakish, exited the organisation, leaving a leadership vacuum at a critical juncture. To address this, Paramount implemented an “Office of the CEO” with three executives: George Cheeks, Chris McCarthy, and Brian Robbins. This bold experiment in collaborative leadership was intended to navigate a tumultuous period but instead introduced complexities that challenged decision-making and organisational cohesion,
A Lens on Leadership Dynamics
The Challenges of the “Three-e-os” Model
Leadership in challenging times requires more than expertise; it demands alignment on vision and consistent accountability. Paramount’s triad leadership faced predictable hurdles:
- Compromised Vision: Divergent perspectives among the leaders diluted strategic focus, leaving employees and stakeholders searching for direction.
- Employee Disillusionment: For employees, the lack of cohesive leadership compounded anxieties, particularly amid layoffs and restructuring.
- Blame and Fragmentation: Shared accountability often blurred lines of responsibility, leading to delays and inefficiencies.
The idea of shared leadership may have been conceived as a way to distribute expertise and manage complexity, but it lacked critical foundational elements. Leaders are custodians of an organisation’s identity. For shared leadership to succeed, it requires more than good intentions. It demands clear rules of engagement, alignment on purpose, and a unified approach to messaging and execution.
Picture three captains steering one ship in a storm, each with their own navigation chart and compass. The result? Inevitable confusion, with the ship—and its crew—caught in the chaos. Without demonstrated alignment among leaders, employees cannot trust the organisation’s direction. Leadership requires more than shared titles; it demands unified purpose, a clear vision, and mutual accountability, particularly during times of uncertainty.
The Human Cost of Restructuring
Paramount’s decision to lay off approximately 2,800 employees aimed to achieve $500 million in annual cost savings, making the merger with Skydance more appealing to stakeholders. However, these cost-cutting measures often come at a steep price beyond the balance sheet. While financially urgent, the approach lacked the foresight to balance fiscal responsibility with preserving employee trust and creativity.
The announcement of a 15% workforce reduction hit departments central to innovation—marketing, technology, and communications—particularly hard. The closure of Paramount Television Studios further underscored a perception of retreat rather than reinvention. For the employees who remained, uncertainty became the norm. Creativity thrives on stability, trust, and alignment—conditions that seemed in short supply.
The restructuring sent a clear message: short-term cost-cutting outweighed the potential for long-term growth through empowered teams. Gallup research (State of the Global Workplace) highlights that engaged teams are 23% more profitable than disengaged ones. Paramount’s layoffs, compounded by fragmented leadership, squandered opportunities to harness the innovation and resilience of its people.
A Risk Rebel Perspective: Prioritising People
At Unearth, we challenge organisations to rethink their approach to leadership, moving beyond outdated systems-first approaches, and prioritise people as the driving force of success. Paramount’s leadership appeared to miss this opportunity, leaning heavily on cost-cutting strategies that disconnected their workforce and stifled creativity.
Imagine an alternative: a culture where employees are empowered to bring their perspectives to the table, exploring how challenges and perceived risks could become opportunities for a rethink and innovation. To truly get the best from your people, including innovation, you can’t ignore psychological safety—a ‘safe zone’ where employees feel secure to contribute without fear. This is the foundation of true resilience. As Albert Einstein famously said, “We cannot solve our problems with the same thinking we used when we created them.“
There is power in people, and organisations thrive when they truly invest in them. Paramount’s leadership appears to have missed a foundational truth: employees are not line items but partners in shaping the company’s future. A people-centred approach could have fostered trust and collaboration, aligning with the rapidly changing media landscape.
The Way Forward
The impending leadership transition under David Ellison offers a pivotal moment to reimagine Paramount’s culture. Ellison has the chance to discard the fragmented leadership approach and establish a unified vision that places people at the centre. By embedding clarity, accountability, and building confidence and trust into every layer of the organisation, Ellison can create a culture where risks are embraced as opportunities for growth, and employees feel empowered to lead transformation from within.
The ship can find its true course when every crew member, from the bridge to the deck, aligns with the same compass and course. A cultural awakening that values people as the driving force of success is not just desirable—it is essential for New Paramount’s future.
Key Insights
- Leaders are custodians of organisational identity and must embody its values and purpose.
- Leadership isn’t just about making decisions; it’s about creating an environment where people thrive.
- The mindset, decisions, and actions of leaders profoundly impact the organisation’s identity, brand, and stakeholders.
- Clarity, consistency, and accountability are critical to effective leadership, especially in complex structures.
- Resilience and innovation stem from a people-centred approach, where employees are engaged, trusted, and empowered.
- Paramount’s fragmented leadership model underscores the risks of diluted focus and disconnection.
- The future of New Paramount hinges on rebuilding confidence, aligning with purpose, and embracing a unified vision.
This concludes Part 1 of the case study. In Part 2, we will delve into the evolving landscape of the merger, focusing on emerging regulatory, political, and investor-driven challenges. With the merger still pending amid heightened scrutiny and a shifting political environment, we will analyse and reflect on lessons, examining how these variables are compounding risks or paving the way for a sustainable, strategic transformation. This case offers a valuable opportunity to understand how leadership, governance, and stakeholder engagement are shaping long-term success—or failure. What happens next matters.
