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Quick Draw McGraw

Quick Draw McGrawUnder the focused leadership of Harold W. "Terry" McGraw III, McGraw-Hill has become a highly profitable publishing entity.

Medford/Somerville, Mass. [07.18.05] Harold W. "Terry" McGraw III has made his family proud. During his 12 years at the helm of McGraw-Hill, the publishing company's stock price has risen 437 percent, from $8.20 to $44 a share, according to The New York Times, solidifying its place among the country’s most respected publishing houses. Though the Tufts graduate never set out to run the company that was started by his great-grandfather, his leadership as president and CEO has proven critical in securing its future.

"I never planned to go into the family business," McGraw (A'72) told The New York Times.

McGraw-Hill – which posted a net profit of $755.8 million on revenue of $5.3 billion in 2004, according to the Times – is the parent company of Standard & Poor's, BusinessWeek and other trade and educational publishing properties. S&P, a debt-rating company, has played a large part in the company's success, with the Times reporting that it is responsible for 65 percent of the company's operating profits, a 20 percent jump over a decade ago.

After earning degrees at Tufts and the Wharton School at UPenn, McGraw began his career managing pension funds for the former telecommunications powerhouse GTE. In 1979, McGraw came to work alongside his father, Harold McGraw Jr., after the company fended off a takeover attempt by American Express, according to the Times.

"[McGraw] was extremely disciplined in the way he built the company," Stephen B. Shepard, former BusinessWeek editor and current dean of the graduate school of journalism at the City University of New York, told the Times. "He deserves great credit for not going off the deep end in the boom years when so many other media companies did stupid things."

McGraw told the Times that he pursued "consistent, sustainable earnings growth" by working to "take the volatility out of the earnings cycle," selling off unprofitable publications and consolidating its business units.

"What Terry has done very smartly is manage McGraw-Hill's portfolio, moving the company away from slower-growing low-return businesses toward faster-growing higher-return businesses, in an evolution of the asset mix," Peter Appert, a media analyst atGoldman Sachs, told the Times.

Among the company's recent moves are the purchase of research firm J.D. Power & Associates and growth initiatives for both the print and online editions of BusinessWeek.

McGraw has been lauded for his smart approach to the Internet, with McGraw-Hill emerging as a pioneer in the digital distribution of textbooks.

"He has been the least intimidated by the Internet and the most willing to embrace it as an improved customer delivery channel," Merrill Lynch analyst Lauren Rich Fine explained to the Times.

One characteristic of McGraw's no-nonsense corporate leadership has been a reluctance to attend the lavish resort conferences that attract many other media moguls.

"I am not interested in going to things to be seen and to be noisy. It doesn't solve problems. It is about egos," McGraw told the newspaper.










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