Here’s proof positive that you cannot grow a business by cutting back.

Here is an edited excerpt from a blog post by Andrew Bolt:

The Age newspaper is hearing the knocks of Death at its door, and Victoria will get a shock to its culture. The paper has long been Australia’s most Left-wing daily newspaper, the Bible of the global warming class, without a single conservative columnist on its staff.

But now as Fairfax is in its death throes it will cut 1900 staff and erect paywalls around the websites of its two main metropolitan newspapers as it adjusts to shrinking advertising revenue.

Less staff means less to offer, means less worth buying, means less worth advertising in, means less money for staff, means …death spiral.

The job cuts will come over three years and generate annual savings of $235 million by 2015, Greg Hywood, Fairfax’s chief executive, told staff in an announcement this morning. Of that total, $215 million will be achieved by June 2014. As in massive cuts, very soon.

Some 20 per cent on the job cuts will be in editorial, with about 150 of those losses to come from the two main newspapers over the next two or three months.

Rival News Corp is expected to reveal job cuts of its own within days, with as many as 1000 positions in Australia expected to go.

I don’t know the true figure, but, yes, all traditional newspaper companies are under terrible pressure, thanks to the Internet. That’s why the Greens’ screaming about a lack of diversity in newspaper ownership is so last century. Be grateful you’ve got any newspaper owners at all.

Today’s reorganisation will also entail the closure of the printing facilities in Chullora in NSW, and Tullamarine in Victoria by June 2014. Printing will be transferred to ‘’surrounding sites,’’ the company said.

And note the one screaming absence in the list of changes announced today: absolutely no mention at all of content. The thing they actually sell, rather than the form in which they sell it.

As I have explained in the past: cost-cutting does not grow a business. Intelligent cost-oversight is required. No organisation can afford to waste money. But to cut costs is not a strategy. Anybody can do that – you don’t have to be a genius. (Proven by Al Chainsaw Dunlap who made millions by simply cutting companies to the bone and ruining organisations for years after he had exited with his huge bonus payments cashed.) To grow a business requires business growth strategies. Where’s the growth strategy at Fairfax? There is none. Cutting costs will cut the content, which will cut the readership, which will cut the exposure, which will reduce advertising interest, which will reduce revenue….

Cutting costs is easy — developing an intelligent growth strategy that builds your business for a long-lived future is harder, but much smarter.