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Sunday, July 20, 2003

Digital Smart Factory 2003: Moving from Vision to Reality


By Chuck Gehman
Originally appeared in High Volume Printing magazine

July 20, 2003

The Digital Smart Factory Forum 2003 was held recently in Philadelphia, PA, June 23-25th. It was the fifth annual event, and was a watershed for the Digital Smart Factory (DSF) effort, attracting a record attendance of over 90 people (that’s up over 30% from last year). Attendees and speakers included printers (web, sheetfed and digital, producing a large variety of different products, and sized both large and small), publishers (from the biggest magazines to small journal publishers), as well as equipment and software vendors.

The conference committee worked hard to incorporate content that would appeal to this wide range of constituents: in previous years, the DSF forum represented more of a “think tank” atmosphere, where hard core technical “geeks” got together and discussed leading edge technologies. This year marks the first time the event has been held since the Research and Engineering Council (R+E Council) became part of the NAPL (National Association of Printing Leadership) late last year. Yet another first was the support of corporate sponsors: Fujifilm, Heidelberg, Kodak Polychrome Graphics, Printcafe and Prinexus all supported The Digital Smart Factory 2003.

This is all strong evidence that the concepts of the DSF: a combination of business, manufacturing and customer-facing systems working together to create a sum that is greater than the individual parts, are starting to become more “mainstream”.

Background
If you haven’t heard of the Digital Smart Factory, here is some background. In a nutshell, the DSF’s goal is to converge all the systems in a printing company, as we said above: this includes business systems, including accounting and production management, manufacturing systems, including scheduling, press systems, workflow systems and more, as well as customer-facing systems, which are most often CRM (customer relationship management) and internet-based ordering systems.

The late Bob Jones, a veteran production executive at Newsweek, RR Donnelley and Sons Co, and subsequently the founder of Prograph systems (predecessor of Printcafe), saw early on the potential that computers held to revolutionize the printing industry. The DSF idea came out of an R+E Council prepress committee in which Jones was active. Frustrated with the “islands of automation” he saw everywhere he looked, Jones set about to bring change to the industry.

While the group started out addressing the needs of high-end printers and their high-end customers, its scope has broadened as the hardware and software tools to implement these ideas have become affordable to even the smallest printing company. In fact, that’s part of the interest the NAPL has in the Digital Smart Factory: applying these concepts can be a great equalizer for smaller printers to compete profitably with larger ones.

The Digital Smart Factory Committee of the Research and Engineering Council of the NAPL plans the conference, and is an open group. Many thanks go out to the committee members who put in the time (often that they didn’t really—these are very busy people) to build a great agenda for this year.

We encourage newcomers to get involved. When you read this we will be starting to plan next year’s conference, and all input is welcomed. There are programs and other involvement opportunities between now and next June’s DSF 04, too. See the contact information below if you wish to become involved.

The DSF 2003 Program
The conference opened with a keynote from Anthony M. Federico, senior vice president of the Xerox Corporation Production Systems Group. While the name of the conference has the word “Digital” in it, and presentations do cover “digital” and “toner-based” printing technologies, the Digital Smart Factory Forum is not a “digital output” conference. DSF is more focused on the automation needs of lithographers.

Having said that, though, Federico presented a fascinating look at such digital output technologies, and their business drivers, from the Xerox perspective as an industry pioneer. He compared the evolution of digital color technologies to Moore’s law (which says transistors in Microprocessor will double annually). In Federico’s version, digital color power is doubling (in speed and quality) every 18 months. He also noted that costs have declined from $0.16 per page in 1996 to less than $0.05 per page on the new iGen3 (on average), and as low as $0.023 in some cases today.

The conference went into full swing with a panel entitled “Information Technology (IT): The All-Important, Now-Understood Role”. Bill Lavelle, principal at Point Balance, moderated a lively session that included panelists Mark Evans, VP of technology applications at Prinexus, and Chris LaFontaine, product manager for system integration at Agfa.

Evans described the role of IT at Prinexus, a $100 million plus “integrated communication services company” (owners of Tukaiz in Chicago and Findlay Printing in Hartford, CT and Color by Pergament in NYC, among others). According to Evans, there is no single point of activity at the company that does not touch IT in some way, and IT is a fully respected, involved member of their team. This means leveraging technology and manufacturing to help customers execute their marketing strategy “more efficiently than has been historically possible”; speeding time to market, with no increase in spending.

LaFontaine brought another perspective—that of a system integrator, and presented a unique and well received presentation about how to plan, organize and execute successful IT projects to implement a “graphic enterprise”—Agfa’s vision of the printing company of the future. Noting that some 85% of IT projects fail, the cause is often because they are technology-driven, rather than business-driven. LaFontaine stressed that work today should be “matrix-based”, rather than linear: inefficient and self contained processes versus collaborative, and efficient processes.

On the second day, Mark Evans returned to the podium joined by Janice Reese (principal at Network PDF), co-chairing a panel on Content Management. A variety of presentations made up the session, with Leigh Kimmelman, director of emerging business for GroupInfoTech kicking off with a look at automated prepress from his company’s unique perspective:
• Documents for Factories
• Smart Documents for Digital Smart Factories
• Intelligent Documents for Smarter Digital Factories
The concept being that these new type of database-driven documents leverage XML and “zoned” content (page level geometry) to “purpose” information from/to a variety of sources and destinations. This is stuff that GroupInfoTech is implementing today in their Print Line Automation software (used by Valassis, among other prominent industry leading companies). Leigh wins the award for the use of the most unique and obscure word at DSF 2003, for “Punctum”, a word dating back to Roman battles that means “the moment in time where small actions lead to great changes”. Leigh proclaimed DSF 2003 as such a moment.

Kin Wah Lam of Time, Inc. presented a talk about using an ASP for Digital Asset Management, primarily for Ad content. Carsten Lau of Pindar, a software company whose roots are as a British printing company presented case studies of technology applications that have benefited both customers and printers, with increased savings and top line growth. David Lipsey of Artesia talked about how XML has matured in use for metadata indices, and the evolving role of DAM in both corporate use, and in general for printing applications. Stephanie Gwyther of Banta Integrated Media demonstrated an application called “Page Sprayer” that was used to populate QuarkXpress pages with tables.

A panel on Customer Facing technologies followed, led by Holly Muscolino of CAP Ventures. Presenters included Denise Miano, vice president of customer technologies at Moore Wallace (fresh from the merger of those two large printers), with a talk about the company’s diverse customer base and manufacturing platform: with 16,000 employees serving 40 countries, that’s diversity. Miano stressed the fact that they are looking to make everything they do PDF and JDF enabled. She also pointed out the high importance of building an interface to the customer’s platform—not driving the customer to the supplier’s platform. Moore uses content management, order management, market intelligence and connectivity to serve their customers. A little known fact is that the company holds 2,500 patents in more than 40 categories.

Chris Wells, the forward-looking (and young) President and CEO of LaVigne, Inc, in Boston, a successful NAPL-member sheetfed and on-demand printer in business for 104 years (and planning to remain that way). Wells very articulately described how the printing business is changing and ways that commercial printers can leverage technology to turn the challenges into opportunities. Paul Beyer, VP of product marketing at Servador, talked about how the business of online procurement is changing, and the threat that commoditization can present to printers who don’t embrace technology. Mark Jones, the always engaging and very smart senior VP with Quebecor World, talked about how the world’s largest Printer leverages off-the shelf technologies, custom solutions and best practices to serve their customers through their own branded portal, called QWikLink.

Leigh Kimmelman chaired a panel on Digital Manufacturing, which (perhaps as opposed to CIM) focused on the front-end of the manufacturing process: dealing with customer input, making pages and making money. Speakers included Xerox color guru Ann McCarthy, Tim Daisy, CIM product manager at Printcafe, Ken Brooks, president of Publishing Dimensions, and Arthur Burkhart, partner and business development director at iGility Communications. McCarthy, an ICC (International Color Consortium) Steering Committee member, gave a talk was about as technical as things got at this conference. Her well-received presentation spelled out the challenges of color, and challenged the RGB vs. CMYK line of thinking, instead telling the group that seven other elements are more important: device calibration, capture and visualization characterization, profile creation, image color encoding, profile selection and exchange, profile use and visualization.

Mills Davis, the industry’s own futurist, provided the second day keynote, in which he presented his vision of an “shared resource” architecture for the Digital Smart Factory, ala Web services and the various computer industry technology and standards initiatives that encircle it. While Mills sometimes has trouble explaining his own beautiful graphics (because they can be very complicated), his vision is one that we should all hope becomes a reality.

The last day of the conference opened with a standards session, featuring experts on all the current and emerging standards affecting the Digital Smart Factory. Volker Rendl, from Heidelberg Web Systems was the moderator. He was followed by Dr. Rainer Prosi, CTO of the CIP4 organization and a Heidelberg staffer, David Hultin, director of print initatives at Idealliance, Larry Warter, director of new business development at Fujifilm and Alan Darling, executive vice president of Vio. Prosi presented a complete overview of the activities of the CIP4 group, and gave the audience a very good picture of the complexity, and great progress embodied there. Alan Darling presented the (very thoughtful) idea that interoperability means changing system components without changing the files or output.

Darling pointed out that accredited international standards take a long time to gestate (he should know, being a longtime leader of the DDAP Association), so it is important to adopt defacto standards, in the meantime—but we must carefully monitor and control how companies make proprietary extensions to these defacto standards, and that they eventually are confirmed and approved as part of the specifications. Such is the case today with CIP4 and JDF, according to Darling, who noted that interoperability tests are underway.

The conference’s last session was, appropriately, on Computer Integrated Manufacturing, chaired by Bob Whitton, principal of Arellton Group. Joining Bob were Al Shapiro, president of LA Graphico, John Sweeney, director of color measurement systems at Graphics Microsystems, Udi Arielli, director of product management for web and CIM products at Printcafe, and Andy Featherman, manager of the Muller-Martini Digital Finishing Division. This session focused the group in on the primary challenges facing the industry, and the ways that efficient manufacturing can address many of them.

Summary
It’s hard to accurately portray a conference with the depth and breadth of content that the Digital Smart Factory Forum 2003 provided in such a short article, but I hope we came close to doing it justice here. Thanks to Dennis Mason of Mason Consulting for his excellent notes. If you’d like more information on any of the sessions described, to obtain the Powerpoint presentations, Dennis’ complete notes, or to contact any of the individuals or companies mentioned here, call or write Ron Mihills a the R+E Council (contact information provided below).

The final thing that I would like to leave with the readers of High Volume Printing is this: as great as DSF 03 was, it would have been even better if you had been there. We hope to see you next year.


Sidebar:

Upcoming Digital Smart Factory Events

GraphExpo 2003
The Research & Engineering Council of the NAPL’s Critical Trends Breakfast at GraphExpo on Monday, September 29th will highlight exhibitors at the show who feature Digital Smart Factory technologies.

On Demand 2004
On Demand, March 8-10, 2004 in New York, New York, will feature a special interest day entitled “Workflow for Efficiency and Profit”. The focus will be Digital Smart Factory technologies and best practices, featuring case studies presented by print service providers who are achieving success with the Digital Smart Factory. The day is co-chaired by Holly Muscolino of CAP Ventures, and Chuck Gehman.

Contact Information for The Digital Smart Factory
Research and Enginnering Council of the NAPL
Ron Mihills
www.recouncil.org
www.smartfactory.org
www.napl.org
804-436-9922
recouncil@rivnet.net

Saturday, July 12, 2003

The Do Not Call List: Is it the tipping point for variable data and personalization applications?

Originally appeared in: OnDemand Journal
By Chuck Gehman
July 12, 2003

It’s clear that just about everyone, with the obvious exception of telemarketers, is ecstatic about the new National Do Not Call List. Estimates are that more than 60 million people will sign up. Within those numbers are the most sought-after demographics targeted by marketing professionals today.

Graphic Communications World, in their July 7th, 2003 issue, declared the list a “boon” for print. According to GCW, telemarketers made 104 million calls daily, and capturing $80.3 Billion from companies hawking their products in this way. That money has to go somewhere-- certainly, printing industry trade associations and analysts (not to mention printing company owners, as well as publishers) are among those that are extremely happy about this development, and almost universally assume that it will benefit print. This is most likely very true, but it is important to consider just how it will provide these benefits.

The fact is, print advertising and direct mail already targets those same families and individuals who have now added their phone numbers to the Do Not Call list. It’s hard to image that increasing the volume of advertising in the same channels will compensate for the loss of telemarketing. And that money probably won’t go to TV or other media, either, for the same reason. The Do Not Call List eliminates an important weapon in the direct marketer’s arsenal: direct, personalized communication. Telemarketing has been an effective tool because, armed with specific information about you, marketers have been able to directly target you with offers that you are more likely to buy.

Author Paul McFedries, on his “The Word Spy” web site (www.wordspy.com) defines a “tipping point” in epidemiology as “the concept that small changes will have little or no effect on a system until a critical mass is reached. Then a further small change tips the system and a large effect is observed”. The Do Not Call list could well be the catalyst that helps demand for variable and personalized print applications, which have been growing over the last couple of years, to reach such critical mass.

Except for some notable successes by forward-looking marketers, variable-data applications and database-driven print campaigns have been a solution looking for a problem. This isn’t to say that “statement stuffers” from companies like American Express haven’t been highly successful—they have. The difference is, we’re likely to see a whole new range of applications of these technologies as companies look to replace the campaigns they formerly waged over the phone.

Are printers going to be the ones who bring about this revolution? Quite frankly, probably not. Not because printers who have purchased variable printing technologies don’t have “a vision”, but because the need is driven from outside printing.

This is an opportunity for creative marketers in corporations and ad agencies to apply personalization in ways that haven’t yet been conceived. It’s up to printers and technology vendors to educate these people on what is technically possible, and to help them implement their ideas.

Do printers have a great opportunity to capitalize on this situation? Absolutely. Because printers are ideally positioned to provide solutions to the technical problems that marketers now have, created by the Do Not Call List. This is truly something new and unique that printers can bring to the table for their corporate and ad agency clients. It’s the kind of application that will differentiate printers from their competition, and that can be highly profitable. To me, that sounds like just what the industry needs.