Why tapping a non-business journalist to edit a financial publication just might make sense.

When a 37-year-old editor, no matter how preternaturally talented, gets a job running a major media outlet, it is a sign of a generational shift. The announcement last week that Josh Tyrangiel will be the new editor of BusinessWeek as the publication completes the transition in ownership from McGraw-Hill (MHP), the company that had operated it for 70 years, to Bloomberg, the financial-information juggernaut. His appointment represents the passing of financial media from the relatively comfortable stewardship of one generation to the complicated headache of another.

Indeed, Tyrangiel’s hiring is tantamount to having his elders hand him a knotty problem and saying, “You figure it out!” Consider: Earlier in this decade, there was a group of editors at the Wall Street Journal who were eager to grab the wheel. Norman Pearlstine and John Huey, both Journal vets who eventually rose to the top at Time Inc., exemplified the path other Journal stars hoped to emulate.

Around 2004, it became apparent that the career cycle of the Journal’s editor, Paul Steiger, would not offer any of the three editors in this group the hope of succeeding to the WSJ’s helm. (And the way things played out at the Journal, they’re all probably lucky that they did.) So each of the three editors—Lawrence Ingrassia, Joanne Lipman, and Stephen Adler—had to find other venues in order to make their marks.

Ingrassia, the oldest of the three, was the first to move on. He became the business editor of the New York Times. Joanne Lipman was the last to go, to edit Condé Nast Portfolio until it folded. In between, Stephen J. Adler was recruited by McGraw-Hill to become the editor of BusinessWeek.

Like Tyrangiel, Adler was meant to preside over a dramatic transformation in BusinessWeek’s business. At the time, the enterprise rested on two pillars: the magazine and a robust conference business. Part of Adler’s mission was to add a third: the Internet.

BusinessWeek had some strengths. More newsy than the long-form, CEO-obsessed Forbes and Fortune, and more thematic (it ran the famous “The Death of Equities” cover story in 1979) than daily journalism, BusinessWeek was the queen of the magazine business for decades. With a million-reader rate base multiplied by the frequency of a weekly, it was powerful and profitable, if often overlooked. With few other outlets, business-to-business advertising made BusinessWeek the ad-page leader among all American magazines from the 1970s on.

For 20-odd years before Adler arrived, BusinessWeek had been something of the CNBC of its day, a haven for middle managers looking for any information edge that might give them a career boost. That’s what made the conference business such a profit center. With great distribution and visibility, the magazine’s powerful and frequent covers could set the tone of the week with a strong cover line or clever illustration.

But while BusinessWeek.com grew on Adler’s watch, it never became a major player online, compared with the financial sections of the big portals and sites like CNN Money and Forbes.com. Part of the problem is endemic to weeklies; it’s hard to adapt the work force, workflow, and readers’ expectations to the 24/7 cycle necessary for a successful Web site. But the site also had a complacent streak, often settling for columnists who just filled a slot instead of writers who hewed a path through their field of expertise. BusinessWeek.com was acting like BusinessWeek of the 1970s.

Last year, Adler also launched Business Exchange, an ambitious $20 million social network. BX, as they call it, was meant to make the magazine all Web 2.0; participants are supposed to link to content, comment on one another’s posts, and, presumably, network online. But LinkedIn was already the dominant player in the space—and struggling itself. According to the publication’s own reporting, BX has not met its traffic and revenue goals, yet still accounted for 16 percent of BusinessWeek’s digital revenues in 2009 (which probably says something about how difficult it has been to get the other 84 percent).

As the news cycle compressed under pressure from the Internet, BW’s magazine became less relevant and more vulnerable to a severe recession. For all intents and purposes, BusinessWeek died in 2009. Its failure left the WSJ stars one for three.

The one standout success has been Ingrassia. Who would have guessed even two years ago that the newspaper guy would be the last one standing?

Handed the business story of a lifetime, the New York Times has been going at it hammer and tongs in print and on the Web. Flooding the zone, the paper reminds us again and again what value a deep bench of editorial talent provides. And even though the economics are still a work in progress, the daily newspaper’s adaptability to the Web is indisputable editorially. The Wall Street Journal, Financial Times, and New York Times—along with a number of other newspapers—have all increased their readerships through the Internet.

Which brings us back to Bloomberg and Tyrangiel. For years, Bloomberg has tried to repurpose its wire terminal content for its Web site and magazine. But the Bloomberg style doesn’t scale. If what Bloomberg wants in buying BusinessWeek is a larger megaphone beyond its market-obsessed core constituency, BusinessWeek was not an obvious choice.

In buying BW, Bloomberg has acquired the infrastructure of a magazine, but little in the way of editorial assets to exploit. In hiring Tyrangiel, it still hasn’t cracked the editorial conundrum. A fluid writer, a no-nonsense manager, and an editor with a broad range of interests, Tyrangiel’s greatest success at Time was his ability to coax the editorial staff onto the Web by using what Tyrangiel often calls “medium recognition.” That’s the awareness of what kind of content works best in print or on the Web—and having the ability to execute against that awareness. Medium recognition isn’t the whole solution to the editorial riddle, but it is a big start.

On the execution side lies Tyrangiel’s ease at dealing with difficult personalities. With a complex mix of editors—Pearlstine, Winkler, and former Time managing editor Jim Kelly—all floating around in the new BusinessWeek stew, Tyrangiel’s positive energy and lack of pretension may be one of his biggest assets.

Where BusinesWeek goes from here will be a litmus test for magazines and media. The Bloomberg team swears by the magazine and says they plan to invest in it heavily. The imperatives of the 21^st century surely mean they will take another run at figuring out BusinessWeek.com. And despite Tyrangiel’s lack of formal credentials as a business journalist, he had tremendous success in building Time.com’s Web traffic over a few years. (Of course, he had corporate access to the CNN.com juggernaut for help.)

Time’s great limitation was its cultural baggage as a weekly magazine. No matter how much Time.com changed the organization’s metabolism, it would always be thought of by readers as a weekly. BusinessWeek, on the other hand, gets a new lease on life if it can fuse Bloomberg’s reputation as an instant-information service with BusinessWeek’s reputation as a trend-watching guide.

To paraphrase the old candy bar commercial, they’re going to take two great tastes and make them taste great together—like peanut butter and chocolate.

Easier said than done. Much has been made of last week’s round of layoffs that hit a quarter of the staff. Some observers noticed they had cut many of the columnists, prompting speculation that the Bloomberg Borg is trying follow the path of the Economist—the supposed model for a number of magazines these days—and create a monotone editorial voice.

But doesn’t fit with the combined talents of the former Time team, among whom packaging, graphics, and fluid, timely writing have always been the foot forward. Magazines are better for graphics—charts and photo spreads and charticles—and writing that holds the reader's attention as it unfolds an A-to-B-to-C story or lays out a complex argument or analysis. The Web works better for trial balloons, opinions, and flat-out news.

And Tyrangiel doesn’t have to reinvent the wheel here. There’s at least one successful model out there that the Bloombergers can retool for business news: New York magazine. When you think about it, the model ports over very well. New York magazine has deep-pocketed ownership willing to invest in a great product. It takes a wise, witty, and knowing voice and applies that to some crucial constituencies. New York uses the Web to stay in constant contact with those subgroups and takes the most successful items from there and adapts them to print.

On top of that, New York has some signature franchises and commissions long-form stories to have the last word on who’s who and what’s what. Finally, it wraps that all up in a graphically innovative print package that subscribers feel gives them an inside edge on the place they want to be.

Having that sensibility—and Tyrangiel, who is equally comfortable talking pop music and politics, has it—is far more important to reviving BusinessWeek than having a specific background in business. Which may be another way of saying that medium recognition is the best hope of Tyrangiel’s generation.