How in-plant businesses can use industry change to their advantage
As the printing and graphic communications industry evolves, embracing change is critical to business success—especially for in-plants. The PRINT 18 team caught up with veteran PRINT speaker and regarded industry consultant Howie Fenton for his observations on the biggest changes in the world of printing and how in-plants can embrace these changes and leverage them for their own success.
PRINT 18 team: You began your career in the 1980s and you’ve seen major changes in the industry over the years. What are some of the trends you’re seeing today?
HF: As I see it, there are three critical changes in the industry that everyone must address. It doesn’t matter if it is a commercial printer or an in-plant facility—every organization must make these changes, or it simply cannot survive.
First, every organization must include more value-added services to the traditional product mix. Second, every company must constantly improve operational efficiencies. And third, companies must constantly innovate. If you’re not always in innovation mode, you might survive, but you won’t thrive.
PRINT 18 team: You’ll be talking about the kinds of value-added services in-plants can provide in your seminar at PRINT 18. Right now, let’s focus on your second point, that constantly improving operational efficiency is no longer optional. You're an operations guy and have always talked about increasing operational performance. How is this new?
HF: It’s true that I have been focusing on workflow, measuring and benchmarking performance for decades. But working with in-plants has created a different perspective about the importance of manufacturing costs and prices. The greatest threat to in-plants is from outsourcing companies or facilities management (FM) companies who are interested in taking over or outsourcing the in-plant’s work.
The sales pitch by these outsourcing companies goes something like this, “Why are you managing a printing service? It is not your core competency, you don't have the volume or resources to be cost competitive and it is not strategically aligned with the mission the company.” In other words, you are not experts, you charge too much and it is not something you should be doing. While all three can resonate with upper management, the one that resonates most is the notion that the organization can save money because the in-plant’s prices are too high.
For that reason, reducing prices has been a big focal point with in-plants for years, but this has also become a critical issue for local commercial printers along with the rise of online printers. For years the bread and butter work for local printers was business cards, letter head, stationary and envelopes. Small local print shops are losing a great deal of that business to the online printers that can offer low prices because of their operational efficiency. The truth is that if you must cut prices, you can curb expenses by improving your own operational efficiency. It is simply not that onerous today to install a web-to-print ordering system, a digital press and automatic finishing equipment.
PRINT 18 team: You say companies must innovate if they want to shift from simply surviving to thriving. What are some examples of innovation?
HF: I think of innovation and improvement as the same—or at least closely aligned. What I mean is that successful companies are constantly trying to increase sales, improve financial results and increase productivity. The only way to do that is to try something new and see if there is an improvement. It is that “trying something new” which is at the core of innovation, along with monitoring key performance indicators to show if you were successful.
I don’t want to sound corny, but I believe that success in business is not much different then success in American football. First, you must master the basics, which is called “blocking in tackling” in football. Once you master the basics, it becomes a game of “inches and seconds.” In business, the inches and seconds are small and constant improvements.
What I find ironic in my consulting work is that helping companies master the basics is easy, but getting them to innovate is hard. Many find it intimidating to test something new. Really, all it takes is a good idea, communication to staff, a culture of support and measurements to determine success. Here are three simple examples of easy ways to test innovation in a printing facility:
- “Let’s try changing the humidity in paper storage for three weeks and see if it reduces jams in digital printing and finishing.”
- “Let’s offer 2% off invoices paid within two weeks and see if that improves our cash flow.”
- “Let’s reduce prices on products we are losing bids on by 10% and increase prices 5% on those we are winning for three months and then analyze our equipment utilization and profitability.”
You see, simple ideas can be innovative, and they’re not at all intimidating.
Howie Fenton will present “Only the Best In-Plants Will Survive: How Leading In-Plants Add Value,” at PRINT 18, as well as leading the In-Plant Show Floor Tour. Hear him and other speakers touch on topics specific to in-plant operations, including “In-Plant Panel: Workflow Processing,” the IPMA luncheon, “Be a Front Runner,” featuring a panel of in-plant leaders, and “State of the Industry: Growing and Securing the In-Plant.”
Howie Fenton is an independent consultant focusing on measuring and benchmarking performance. A trusted advisor, he helps companies use best practices and workflow strategies to streamline operations. In addition, he is an international presenter and teaches at the Rochester Institute of Technology (RIT). For more information, email: firstname.lastname@example.org.