The Digital Smart Factory 2008: The Direction to Take NOW

A moderately edited version of this piece originally appeared in the NAPL's Special Report "Path to Progress, a Workflow Special Report", published October 2008, beginning on Page 3.

This is the original manuscript.

By Chuck Gehman

"Long gone are the days when people believed ideas such as Computer-Integrated Manufacturing were not applicable to printing."

The concept of the Digital Smart Factory has become mainstream. As we rapidly approach 2009, it is a good time to take a quick look back, take stock of where we are now, and think about where we are headed. For those not well acquainted with the DSF concept, it’s about applying computers and software in an integrated, end-to-end solution, to address problems facing the printing operation; with the specific goal of making printing companies more efficient: customer-facing web applications, business systems and manufacturing systems. There is a broad range of technology, as well as process methodology, that fall under the umbrella of the Digital Smart Factory.

Long gone, thankfully, are the days when people actually believed that ideas like Computer Integrated Manufacturing (CIM) weren’t applicable to printing. Instead, we now have venerable industry associations leading the charge for Lean manufacturing, embracing “green” concepts, and advocating high-tech solutions like VDP, ERP systems and Web-To-Print. Clearly, the R+E Council of the NAPL and its role in establishing the importance of the Digital Smart Factory, has had a major impact on the industry.

More than a handful of very successful printing companies have proven that there is a business case for making the transition from craft-oriented job shop to efficient, high tech, well-run, and scalable print manufacturing enterprise. This Digital Smart Factory idea—¬that was so foreign for so long— is¬ the direction leaders want to take their printing companies today.

As a reminder, Digital Printing is not the entire focus of the Digital Smart Factory. Adopters often employ multiple printing technologies, today including toner-based, inkjet and, of course, both sheetfed and web offset. Virtually any shape and size of printing operation can benefit from DSF concepts and the application of its technologies.

When we first began the DSF, print-on-demand was a far-out idea. Makereadies took 45 minutes. There was no E-Bay or Craig’s List. Energy costs were low. Phone companies charged by the minute for long distance. A mobile phone cost $800 and had a battery that weighed more than your laptop does now. You had to buy two Indigos for $1 million and have a technician on-site to fix them. A lot of printers still used film! Today? Print-on-demand is ubiquitous. Makereadies can take under 2 minutes! Craig’s list dominates classified advertising. Gas is $5.00 per gallon. Long distance is “free”, and so are mobile phones. You only have to buy one Indigo now, and it is reliable! Film? What’s Film?

Between then and now, those printers who are still around discovered that the way to cope with the changing business environment was to adopt new business and production processes. The industry has embraced the transformation from “Job Shop” to “Manufacturing”. Mass Customization can legitimately be used to describe the type of manufacturing being done in our industry

Today, there are many printers using manufacturing techniques, CIM (Computer Integrated Manufacturing) processes, in conjunction with automated equipment and technologies like JDF (Job Definition Format) that can deliver immediate and recognizable benefits from streamlined operation for companies that produce a wide variety of jobs.

The transition to manufacturing discipline helps printers to identify opportunities for optimization and understand which product types they can most efficiently produce. They can then focus business assets on developing sales and marketing strategies that target specific customers with more attractive offerings.

There are still many hurdles to overcome, and many challenges that still exist. Although many printers have adopted CIM techniques, there are many unique attributes that characterize print production that are absent from many other types of manufacturing operations. To a large extent, this explains the necessity of CIP4’s JDF format. But it also requires even more discipline in applying CIM techniques of any type, to maximize the benefits that can be gained.

Whither Specialization?
The idea of specialization has been a path to success for many printers, and isn’t new. But the drumbeat we hear today is more about “diversification” and adding services: becoming a “marketing communication service provider.” But whether you choose to focus on a particular market, or go “horizontal”, you can benefit from specialization in manufacturing. Specialization can remove a lot of complexity from an operation. Single-use machines require fewer changeovers and less or no wrench-turning, for example. It can decrease requirements for staff training, or even for temporary labor to fill peaks and valleys, and for unique, expensive skill sets. A great example of the benefits of specialization is that you may not need new JDF-enabled equipment and software if your company only produces a limited range of products — in other words, you operate a specialized manufacturing environment.

Specialization can help you sell more effectively. Once you’ve determined what your optimal product mix is from a manufacturing perspective, you can target specific vertical markets. You can more easily sell value-added services by creating a product portfolio across one or more client industries. Implementing this kind of product strategy will, however, require that you put other resources in place beyond an efficient manufacturing operation. These may include sales and marketing staffers, Web-To-Print systems and enhanced customer service capabilities, or adding services like fulfillment to round out the offering. This leads you into deploying programs that can be sold at higher margins than “bid to win” jobs, and may be replicated across multiple clients.

Roadmap to DSF
Automating inefficient processes simply solidifies them and makes them more difficult to improve and change. This is what happens when you drop a new piece of equipment or computer system into an existing operation without a carefully crafted strategy. Before you can benefit from equipment, computers and software, you first need take a number of steps to make your company ready for CIM:

• Identify and eliminate bottlenecks in production.
• Identify and eliminate issues that impact quality, put processes in place to achieve the highest quality possible
• Standardize all steps from job intake through delivery
• Begin to automate certain operations, move toward “global” automation

There are a number of ways you can approach this streamlining exercise, with the key thing to remember being that you don’t have to do everything at once. Look for the most obviously cumbersome process. Ask a lot of questions, and get some quick wins under your belt. Don’t try to “boil the ocean.”

Quality Systems
ISO, TQM, Six Sigma are all methodologies from which you can choose to implement the steps described above. Which one you choose is dependent on a number of factors that could be unique to your operation, so it’s important to understand the strengths and weaknesses of each.
ISO 9000 (International Standards for Quality Management Systems) is a family of standards that is acknowledged worldwide. More than 90 countries have adopted ISO 9000 as their national standards. Many printing companies, of all shapes and sizes, have adopted various “flavors” of ISO.

Total Quality Management (TQM) was pioneered by manufacturing guru W. Edwards Deming as a way of improving the production quality of goods and services. This has become less popular with printing companies today, but there are still many practitioners.

Six Sigma is a quality improvement and business strategy that began in the 1980's at Motorola and is perhaps best known for its application at General Electric, where legendary CEO Jack Welch was a key proponent. The primary goal is to improve quality to the point that “defects” occur only 3.4 times out of a million. Six Sigma is viewed by many as overwhelmingly complicated and expensive, requiring specialized staff, but it can work for printing companies.

There is also a combination of Lean manufacturing and Six Sigma that some printing companies have implemented, called Lean Six.

Each of these methodologies, in addition to having direct benefits, provides marketing benefits for printing companies that deploy them. If you have large corporate enterprise customers, your choice of which to implement may be based (in part) on what they are using, because those customers tend to gravitate toward suppliers who are “compatible” in this area.

Just in Time and Lean Manufacturing
There are several manufacturing “philosophies” that can provide improvements. Lean is arguably the most popular, and in some ways easier to implement. Lean manufacturing’s primary goal is to identify and eliminate non-value added activities in design, production, supply chain management and customer interaction. It is one of the easiest ways to see immediate benefits in a printing operation. Its application in printing can be summarized as a critical view of the following areas, and the reduction, elimination or replacement by automation, of unnecessary activities or results in those areas:

• Material Waiting
• Movement of Inventory
• Movement of Personnel
• Equipment Waiting
• Personnel Waiting
• Overproduction
• Underproduction
• Performing extra steps
• Waste or Spoilage

The term “lean” was first coined by an MIT team, to describe the principles of the Toyota Production system (TPS). There are many books that discuss all the aspects of lean manufacturing and TPS, including Value-Stream Mapping, the concept of the 5S Method, Visual Control. Pull, Equipment Changeover (setup reduction), Mistake Proofing, and Total Productive Maintenance (TPM) are also important concepts. My own book, Computer Integrated Manufacturing: Realizing the Benefits, published by the NAPL, can give you an overview of all of these topics.

If there were one reason to turn your own plant into a Digital Smart Factory and embrace CIM concepts, it might just be to eliminate mistakes that cause costly production errors. The cause of poor performance (in the view of lean), is wasteful activity. Lean is a time-based strategy and uses a narrow definition of waste activity as that which does not produce value from the perspective of the customer. An example often sited is moving work-in-progress from one side of the plant, to another (instead of situating production equipment in adjacencies that make sense for the workflow). Efficiency (and lower costs, and competitive advantage) is improved by focusing on converting raw materials into finished product as quickly as possible.

Waste, as described in the Lean view of the world is:
• Production errors
• Internal and external delays
• Unnecessary duplication of effort
• Unnecessary movement of digital information or physical materials
• Unclear and confusing internal and external communications
• Incorrect inventory of digital information or physical supplies

Customers become part of the manufacturing process
In today’s competitive environment, it isn’t enough anymore to focus solely on streamlining what happens inside the plant. Understanding that a lot of the problems in the print manufacturing process are caused by the customer participation in the process, because of customers delivering bad files in a variety of cumbersome digital file formats, Digital Smart Factory printers also focus technology efforts on reducing or eliminating these problems.
One approach to this problem is to limit customers’ selection of product types, and offer a limited selection of customizable attributes for those products. Using a Web-To-Print storefront, it is possible to provide a graphically rich, appealing set of choices that fit their specific needs and/or the vertical print-buying market that your company targets. This approach almost guarantees success, because you are completely controlling the input to manufacturing. However, it may be too rigid a structure for many customer relationships.

For relationships in which a large number of one-off projects take place, another approach to facilitating quality input from customers is to mandate the use of PDF and to provide templates and instructions for customers on how to produce a PDF file that the plant can use to drive manufacturing processes. PDF is still the best file format for printing, and provides great benefits. It lets many of the manual processes of preparing files for production be automated through software. Most printing company customers now know how to create a usable PDF file.

In the digital output world, many systems are either converting “office”-type documents into PDF at the entry to the workflow, or are helping customers to create usable PDF files with desktop print drivers or Acrobat Plug-ins. Similarly, offset workflow has moved to PDF, with native files from high-end designer applications being converted to PDF as they enter the workflow.

Deploying a Web-To-Print workflow has additional benefits for both the printing company and customers. Customers are impatient, and like the instant gratification that self-service on the web offers. They can also come back to the site to obtain job status, and shipping information once the job is completed. For printers, the obvious benefit of Web-To-Print is its ability to increase order flow, positively impacting top line revenue. But the ability to offload sales and customer service personnel to higher value activities beyond order-taking is also a key benefit. Web-based e-commerce can make getting paid easier, too, by accepting credit cards and/or by interfacing with customer e-procurement systems. Once the ready-to-print order has been paid for by the customer (another great advantage—getting paid before the job is even printed), it can be automatically scheduled for production. Like jobs can be optimized into print runs, and targeted at specific machines for the most efficient processing. In an ideal world, there’s no prepress or prep work necessary, especially for digital jobs.

Summary
The big difference between the Digital Smart Factory now, and many years ago at its inception, is that we’ve solved many of the problems that led to its ideation. But new challenges have arisen, and new solutions continue to evolve.
Join the many thousands of printing companies who have embraced the Digital Smart Factory, and you, too, can immediately start reaping the benefits. If you don’t know where to start, call the NAPL, or attending one of their many events throughout the year.

Challenges and Opportunities in Web-To-Print Workflow for Production Digital Printing

Originally published in the proceedings of the Society for Imaging Science and Technology (IS&T)

NIP24: International Conference on Digital Printing Technologies and Digital Fabrication 2008

Pittsburgh, Pennsylvania

September 2008 , Volume 24

ISBN / ISSN: 978-0-89208-279-7

936 pages

By Chuck Gehman, Mimeo.com (USA); pages 815-818.

Buy the proceedings here:

http://www.imaging.org/ist/store/physpub.cfm?seriesid=5&pubid=884

Abstract

Production workflow for digital printing is rapidly evolving, driven by the marketplace and customer demands. The need for service providers to efficiently handle an increasing volume of jobs drives adoption of automation technologies.

Applications for digital production printing continue to grow: from traditional monochrome statement printing to “offset replacement” for certain high-end commercial print jobs, to personalized print for direct mail, and to “transpromo”. Each new application, as well as the business needs of the customer from which it originates, creates the demand for a specialized workflow. To be efficient, those demands must be aggregated into standardized workflows that allow service providers to benefit from automation.

Customers represent the beginning of a workflow. Today, their jobs may come from a Web 2.0 “social network” system (i.e., photo sharing), or from a Web-To-Print application, or from a corporate CRM or ERP system. The input from these disparate sources must be “normalized” into a standard format for print manufacturing.

This paper will provide an enumeration of several good approaches, techniques and technologies for automating the production process from the desktop or network of the document owner through to the final delivered product, by employing digital printing and production workflow systems.

Mimeo Blazes A New VDP Path

Originally appeared in GATFWorld magazine, August 2008
August 2008 Edition

By Chuck Gehman

If you’ve been reading this magazine for the last several years, you may have seen an article or two that I’ve written. This piece is kind of a watershed event for me personally: it is officially the first article I’ve authored for GATFWorld Magazine as a Printer. The most exciting thing about this for me is that my new employer, Mimeo.com, embodies many of the characteristics and attributes I’ve been writing about in this magazine for all these years. So I was thrilled when I was asked to write a piece for this issue about Mimeo, and talk about some of the exciting things we’re doing.

To me, the most important trends going on in the printing industry are Web-To-Print on the front end, serving customer needs, Personalization and VDP, creating new document types and applications; and Computer Integrated Manufacturing (CIM), addressing the printer’s needs for backend efficiency and its resulting profitability. Mimeo is a great example of all of these concepts put into practice. Obviously, personalization is a very significant trend the industry has embraced wholeheartedly, and Mimeo believes in it very strongly. Before I get into some of the nuts and bolts of what we are doing with VDP (Variable Data Printing), let me explain some of the background that got Mimeo to where it is today.

Mimeo: The History

Mimeo is a 100% digital printing company. We were founded in 1998. Substantially all of our orders come in over the Internet. Our headquarters is in New York City, in close proximity to many of our largest corporate customers. We operate a very large facility in Memphis, Tennessee that is located at the airport. We’re very, very close to the big Federal Express hub there, so we can deliver finished printed products for shipping very late in the evening, and have them on the customer’s desk or at a meeting location very early the next morning. A growing number of our shipments are international, too. At the time you read this, we will be opening our second production facility, also very large, in Newark, New Jersey. All of this seems pretty simple and straightforward until you try to do it; and while it doesn’t appear to be rocket science, we do have a few rocket scientist-types on the payroll.

Mimeo.com is the innovator of online, on-demand document printing and distribution. Our mission has always been simple: To delight our customers with the fastest, easiest, and most reliable way to print, manage, and distribute documents.

Mimeo: The People

There are a number of things that make Mimeo a great company, making a contribution to our customers and to the industry. Being a technologist, my first call would have to be our technical resources: we have a large number of people employed in product management and software development. These are very creative and talented people who operate with an agile mindset. At Mimeo, nothing is impossible and in my short tenure, I’ve never heard anyone say “that’s not my job”. We live in a creative, problem-solving environment that makes it fun and exciting to work here. And these people are not just here to solve day-to-day printing issues. They are here to build better software and processes, and grow the company’s intellectual property—and that’s a key focus of our technical staff, from CTO David Uyttendaele, one of our founders, down the chain of command.

Of our key managers and directors, there is an interesting mix of individuals with printing industry experience, and experience outside the printing industry. For example, Ben Shaw, our VP of US Production, comes from an industry background, whereas Marc Hollander, our VP of Application Development has run global programming teams for major non-printing industry organizations like AOL. Another exciting thing that’s happened here is that a lot of people who come here from outside the industry quickly become experts in printing, because they are smart, and motivated and the expertise of our printing experts rubs off on them. Great examples of this include John Delbridge, my boss and our COO, as well as CEO Adam Slutsky. I’ve never met someone with as close a finger on the pulse of the business and understanding of all the nuances of running a print business as John has; Adam, on the other hand, is just a genius who would excel running any company, and yet is truly engaged in print.

We’ve done a lot of hiring lately (the author included). When you join a company that’s moving as fast as Mimeo and growing at the double-digit pace we are, it’s reassuring to see a large number of people who have been here for five, six, or even eight years. There are two big reasons why we can retain great people, besides how much fun it is to work here: we promote from within, and we have a world-class HR organization led by Chief People Officer Coleen Smith.

Ben Shaw, and his boss Skip Trevethan (another great example of someone who came from outside the industry- Kozmo.com, and FedEx, but is now a print expert) are always looking for ways to improve our shop floor technology. They went to Drupa to scout out new, innovative machines, and you’ll surely see them at GraphExpo looking for more, and meeting with peers in the industry to learn best practices (Lean is a focus.)

At the same time, Mimeo is an Internet shop. We’re on the cutting edge of customer-facing ease-of-use in our Web-To-Print applications, as well as in the development of alternative ways to access our capability: the Mimeo Platform and our MimeoConnect APIs, which will be discussed a bit later in this article.

Mimeo: the Web Applications

When you look at the products in the Web-To-Print application area today, they are generally divided into two major categories: Job Submission, and Catalog ordering. Mimeo has both. We started with Job Submission, which is the technically more difficult application to accomplish. Our Catalog product, called Mimeo Marketplace, came later as a result of customer demand.

Mimeo’s job submission, which is the core of the Mimeo experience, is focused on helping customers create files and submit them into our workflow for production. The customer starts with a document on the screen of their desktop computer, in their favorite application (Word, Powerpoint, InDesign, etc.), and then sends it to us for production. Often, customers will use our “File-Print” technology, which we call ExactPrint. This is a proprietary technology that Mimeo pioneered, and which we believe we are better at than most printing or technology companies. This fall we are releasing a major new version of our “File-Print” driver, which adds several important new features; it is in beta now. Beyond getting the file into the shop, there are two other really important considerations in job submission: helping the customer describe how they want us to produce their job, and showing them a proof so they can be confident they will receive what they want.

Mimeo has developed a world-class capability to allow customers to describe what they want us to produce, without any technical knowledge of print. This is a key to success in Web-To-Print. This fall, we will begin to roll out our next generation user interface, which has been in development for over a year. The new interface will bring about a new level of ease-of-use and expand the range of products that can be specified via a web-based interface.

Proofing has also been an intense focus for Mimeo, employing what we call our EZViewer. Mimeo never provides hardcopy proofs, we use 100% softproofing. When a large percentage of orders enter the workflow at 7pm for delivery at 8:30am the next day, there is no place for hardcopy proofing. Fortunately, Mimeo’s proofing technology (another important internally developed component) brings the user as close as possible on the screen to holding the printed product in their hand. It shows the pages; how the text will flow; any visually apparent issues with graphics or fonts. Finishing options like binding and tabs are portrayed in a realistic manner. For example, if you’re asking for three-hole punch, and you didn’t specify enough of a margin, you will see if the holes punch through text.

Catalog applications are usually more like “business to consumer” (b2c) web storefronts selling anything from books to jeans, and in designing Mimeo Marketplace we looked to those type of sites for best practices. The customer accesses the catalog web site, navigates through a storefront shopping experience, and chooses a print product they wish to purchase. This item could be a static print-on-demand document, a pull-from-inventory fulfillment product (whether print or non-print), or a template-based VDP item (which can take several forms), which the ordering user would customize online and ask us to produce. The MimeoMarketplace catalog storefront offering differs from others in that it supports a few distinct business and relationship models for our customers. We communicate Marketplace to our customers as “the web storefront for your community”, because it helps them use their documents with their own constituencies—whether customers, employees, agents, franchisees or other cases.

At the end of the day, Web-To-Print is specialized e-commerce. We strive to make our systems extremely easy to use so that impatient customers will enjoy the experience, trust us, and naturally gravitate toward us when it comes time to buy print. From an e-commerce standpoint, we understand the business models our customers have in place, and we’ll work with them to get them the reporting and billing they need from our e-commerce infrastructure. We will plug into their Intranets, and we will connect to their e-procurement systems with punch-outs or data feeds, to add value to our relationship.

Mimeo and VDP

What we’ve been doing with our Internet technologies for the last several years has effectively laid the ground work for some sophisticated new applications to be layered on top. Similarly, our investments in digital printing and fulfillment capabilities can be applied to a growing range of document, publishing and marketing applications from collateral, custom bound documents, educational materials, and posters to personalized kits and marketing materials.

The benefits to our customers from utilizing our Internet technologies and digital printing infrastructure include reducing costs, and more importantly, improving results as we help deliver higher quality, more focused and timely communications that directly address their business goals.

Anyone who has built a project or campaign with one of today’s sophisticated VDP solutions knows that they are far from easy to use. They generally require knowledge of graphic arts technology, some programming expertise, and database skills. While these applications are getting somewhat easier, and at the same time more sophisticated, it’s still asking a lot of customers to expect them to understand all these things. They may understand part of the application, for example, the databases (since marketers use databases as perhaps their most important tool), but they won’t know graphic arts technology and they won’t know how to program for VDP templates. The result is a lot of risk and cost for customers, which limits adoption of VDP.

This gives us two choices as a print service provider: we either need to take customers designs or ideas, and build the VDP templates for them, and then execute them, or make it incredibly easy for them to turn their own documents into templates and populate them into our web interface for their users to order. We see the latter as the big opportunity for Mimeo.

For all the technology we employ at Mimeo, we take the build vs. buy vs. partner analysis very seriously. We employ a ton of off-the-shelf technology, both industry specific and in the horizontal IT area. So when it came to making decisions about our VDP strategy, we took that same approach. Our team has become close friends with virtually all the major VDP vendors in the market today.

What we found is that the mainstream VDP solutions from popular vendors offered some very rich functionality, much of which we do not need right now for our applications. And they are all missing things that we DO need. Furthermore, for the most part, they would require a lot of effort to integrate with our own software, which I hope from reading you now understand is so very important to our success. The result of our analysis is that, at the moment, we are not employing mainstream VDP technology from any of the known vendors. This could easily change as we add print applications over time, but our strategy right now is to partner with some basic technology providers and leverage their capabilities with our own development to serve our customers’ immediate VDP application needs.

Customer-facing VDP is initially built into our Mimeo Marketplace catalog application, and will soon move into the core Mimeo job submission applications. Variable data content formats have generally been proprietary and different from those used in office or even graphic arts applications software. As a result, we’re focusing our efforts on addressing this inconsistency, so that our approach to VDP matches our incoming document types and our internal production workflow.

Once orders enter our platform, we employ an end-to-end PDF workflow which includes support for personalized printing. While virtually every job that goes through Mimeo’s platform is a custom, one-off product, the technology to support 1:1 VDP applications is an emerging one for Mimeo.

We’ve streamlined our print production operation utilizing a single workflow for all job types: job-submission, static, catalog-based print-on-demand digital, and VDP. This provides us with reliability and flexibility, while at the same time providing new opportunities for growth and to offer enhanced products to our customers.

MimeoConnect: The Integration Strategy

Mimeo’s platform combines the advantage of the scale of our production facilities and geographic reach (by virtue of our distribution partners) with capabilities to take advantage of digital technologies to tailor customer communications to audiences of one, in new applications, faster: through our web sites and new powerful Internet based APIs, as part of our MimeoConnect integration initiatives.

MimeoConnect is a series of solutions to common challenges faced by our customers. They provide standardized ways to connect customer systems to the Mimeo infrastructure. This allows us to support new applications, with a flexible, extensible architecture. It’s a new front door to our production environment.

The APIs came about when we realized that, because documents and content reside in a wide variety of systems at our Enterprise clients, interfacing those systems so customers can take advantage of our capabilities would streamline their operations, and result in more business for us. This is a key part of our VDP strategy, because corporate systems are generating personalized content without even thinking about it as VDP.

This is a story that business managers, procurement staff, IT people and developers at customer companies immediately embrace. In addition, we’ve begun to attract a community Internet software developers and entrepreneurs who are creating new companies with business models around content and community—Web 2.0, as this has generally become known—that are highly compatible with, and complemented by, Mimeo’s offerings.

MimeoConnect is composed of several methods for connecting to Mimeo:

· Global Standards-based Web services available for Enterprise developers to access Mimeo capabilities.

· Enterprise Integration– Integration available “off the shelf” from Mimeo to allow customer systems to access Mimeo capabilities. These include Single-Sign-On and E-Procurement Punch-outs

• Custom integration– “One-off” integration created by Mimeo to interface with a customer’s proprietary system

• Mimeo Developer program– making the APIs available on the Internet for any developer or Web 2.0 Entrepreneur to connect

MimeoConnect makes it easier to do business with Mimeo by integrating Mimeo printing and fulfillment with customer’s business document creation in a streamlined inter-company workflow. Managers like it because improves end user productivity in the Enterprise. Users also like the seamlessness and the fact that they don’t have to remember yet another username and password. At the same time, it increases their document quality and makes the specification of the documents automatic. Difficult to implement applications, like VDP, can become simple (at least from the user’s viewpoint.) Costs can be reduced in multiple ways: because of the streamlined workflow, and because end users can automatically take advantage of corporate pricing.

Summary

The VDP landscape is changing rapidly. It is inevitable in any technology adoption curve that major disruptions will occur. While VDP means many things to many people, and there are a large number of applications, it is becoming pretty clear that there is no VDP without IT and Internet technologies, and that includes the kind of applications and integration we discussed here. Mimeo is not the only company that is taking this approach—you’ll see our like-minded peers at the Converge conference.

Printing companies need to focus on their customers, and their own goals when implementing a VDP strategy. Those goals aren’t always aligned with what hardware and software vendors are explaining—not because they don’t mean well, but because they aren’t necessarily looking at the business the way printers do. Technology is moving very rapidly in the world, and it’s essential to create the ability in your company to get out in front of it. That is the key to VDP success.

Reprinted with permission from the 2008 GATFWorld. Copyright 2008 by the Printing Industries of America/Graphic Arts Technical Foundation (www.gain.net) All rights reserved.

Selling with CRM (Customer Relationship Management)

Originally appeared in GATF Tech Forecast 2008

By Chuck Gehman, EFI

Summary of Benefits of Selling with CRM

- Enables printing companies to more deeply understand exactly who customers are, and their buying habits

- Lets managers and owners robustly forecast the value of upcoming business opportunities

- Helps you identify emerging threats and competitors, and change your course of action to address them

- Prevents customers from “falling through the cracks”, resulting in missed opportunities

- Provides a collaboration platform, which your staffers can use to better serve customers

- With integration to other internal systems, can streamline many activities in the process of acquiring new business and serving existing customers

- With integration to customer systems, can provide a value-added service that creates unique lock-in for your - print products and services

Introduction
For this year’s Tech Forecast, I wanted to share some insights I’ve found from building some new products this past year, from the interactions I’ve had with clients in the process of gathering requirements for those products, and from my own company’s implementation of a new Enterprise CRM (Customer Relationship Management) system.

The basic goal of a CRM system is to understand your customers, and what they want, so you can serve them better, and as a result, sell them more. This is one of the most fundamental principles of marketing. The idea is to do this by collecting the information you learn about them on a day-to-day basis, organize it, and then use it to build stronger relationships with them.

CRM systems can help printing companies grow by providing these abilities; knowing what customers want to buy, when they want to buy it, and how much of it they will buy. A side benefit, that’s becoming more important these days, is optimizing and tracking how your customer wants to interact with your company, also known as their “channel” preferences (i.e., email, phone, direct mail, instant messaging). It is well recognized that CRM systems improve a company’s ability to market and sell.

The challenge begins with understanding what CRM is, and how to apply it to a printing business. Customers and prospects give the printing company information about themselves all the time. As a result of sales calls, Requests for Proposal or Request for Quote (RFP/RFQ) received, responses to an email blast or direct mail campaign, events like PIA (Printing Industries of America, local affiliates) open houses, transactions with existing customers, and even web site visits, customers volunteer a lot of information about themselves. With the advent of VDP and cross-media, integrated marketing campaigns, with PURLS (Personalized URLS) and microsites, CRM can collect even more valuable information about customers that can drive additional marketing activities and, as a result, sales.

Sales force automation (SFA) is understandably the place where most companies, including printing companies, start with their CRM implementation. Affordable and simple contact management, coupled with tools for keeping track of sales activities and simple forecasting have been available for a long time. However, this shrink-wrapped software (installed on the sales force’s desktop PCs) usually doesn’t connect with other systems that printers have—for example, the all important Print MIS systems that have the history of jobs won/lost, information about the volume of business that each account provides, as well as profitability insight. The Print MIS system is generally where information about what type of products and services customers buy, and how profitable that customer’s business is for the printing company; a link to a CRM system can provide powerful analytics that help Printers see and act upon this information.

Analyzing Data as the basis for Action

New CRM systems provide a higher level of value than just contact management, because with integration, they can give you visibility into the information about customers that you have in both the CRM system, and in other systems, that can be used to help make decisions about how to sell to them. This kind of integration has only been available to very large companies, who have reaped its benefits for many years, but at costs ranging from hundreds of thousands to millions of dollars to license, implement and maintain. Much of “data mining” we hear about is really application of CRM and the somewhat newer technology/concept of Business Process Management (BPM), which we will discuss later.

CRM systems should connect to your other databases (in the printing industry, an example of such a database would be a Print MIS system), and allow you to record and analyze the buying habits of your customers, so that you can offer them goods or services which are targeted to what (and when) they are most likely to buy.

Existing printing company systems, like the Print MIS systems, are loaded with data about customers. The challenge is that raw data does not have value in and of itself—it needs to be turned into useful information. That is where analytical technology comes into play. Analytics in the CRM software help you “see” patterns in the data you possess so that you can turn the raw data into valuable information and use it to gain insight. EFI’s Enterprise Information System (EIS), is an example of analytical (BPM) technology combined with Print MIS to bring higher value to data you’ve already collected from numerous activities in your business, and then present that data to the people who need to use it—production and finance managers, as well as executives and sales reps.

At EFI, we’ve built a connection between our PrinterSite Internal system (which gives sales reps and CSRs an Internet-based “view” of sales, estimating and job status activities in the Print MIS), and the Salesforce.com system, as well as combining both with our EIS system, to provide all the sales force automation and analytics applications that a CRM system needs to deliver to a printing company environment. We are also going to build additional CRM touch points, because as we discussed, the value of CRM is analyzing the data for the purpose of taking action.

Even basic CRM systems can provide a foundation on which you can manage the data coming in from your field—sales reps, CSRs and potentially other touch points of customer interaction we’ve discussed. Newer systems, many now available as SaaS (Software as a Service, hosted by the software provide), can provide a much more sophisticated level of integration than older, legacy solutions. For example, Salesforce.com, now inarguably the most popular new vendor, provides a complete development environment, called AppExchange, free to subscribers. This can be used to build integration to other printing company systems.

Managing sales activities with a CRM system

Sales force automation (SFA) is still one of the cornerstone applications for CRM for printer, and it can deliver substantial benefits. One of the key benefits to using SFA is to let companies manage people and processes more effectively, so reps can close more deals.

With a properly implemented CRM system, Sales reps spend more time selling and less time on paperwork. Unfortunately, many sales people at printing companies are (at least initially) reluctant to participate in CRM systems. They may incorrectly believe that their business relationships, contacts, and the customer’s orders, belong to them. The challenge here is to change the mindset by convincing these people that their win rate will improve through the use of CRM. Once you’ve overcome this hurdle, sales reps are well served by today’s CRM systems. CRM systems directly serve the rep’s primary goal of managing the day-to-day business flow with customers, with the desired outcome of winning each deal. Sales reps want to make sure they win all possible opportunities that present themselves from customers. With a CRM application, they can track all their opportunity-related data, including milestones, decision makers, partners, customer communications, and a host of other information unique to the particular printing company, its customers and its products.

Sales reps who are engaged with the customers garner a large volume of market intelligence from them, but rarely have the ability to analyze it. With a CRM system, they will be able to turn the information they collect into action. Why didn’t your company get the bid? How many times did you provide a quote to the same print buyer in the last six months, only to be rejected? Who is winning the bids?

Perhaps more than anything else, reps want to know where they stand in terms of their forecast and pipeline, because their income depends on this information. This is important for the reps, and helps managers even more, by allow them to set goals and expectations, as well as to know when they will need to help their reps achieve the sales plan. Managers like CRM’s ability to see what the next month, or the next quarter, looks like from a sales perspective. What is the level of confidence that the sales rep has in winning the bids you’ve quoted? With CRM, managers can see segmented, historical, and rolled-up pipeline analysis for insight to help shape your business and drive it forward.

For owners and managers of a printing company, the visibility that CRM provides is unprecedented, as well as obviously valuable. Managers need to be able to analyze their team’s sales pipeline across multiple reps, so they can quickly identify and eliminate any bottlenecks in the sales cycle or determine the cause of downgraded sales opportunities. How can I help my reps be more effective, so they can win more deals? Who is outperforming, who is lagging? It also makes life dramatically easier for these folks, by automating much of the data collection and analysis they might be doing by hand today. The time it takes to do simple tasks like determining sales rep commissions, and the amount of effort required, can be dramatically decreased.

In many small to medium-sized companies, the President of the company may also be the top sales executive. A sales manager might also be a key individual sales contributor. Because of the strong benefits, managers are more likely to embrace CRM than individual sales reps. Reasons include their need for better visibility into the activities of their reps, the total picture of the manager’s business, and the insight a CRM system will provide into where each rep stands with their pipeline versus their quota.

In addition to pipeline and forecast tracking, business managers want to manage additional variables, like the competition, and key competitive issues on each deal. What are competitive trends and emerging threats? Who are the competitors we are up against? What are they doing that we aren’t?

Enter BPM (Business Performance Management)

Company executives want to know what’s going on out in the field, and want visibility into the forecast and how the sales plan is progressing. CRM provides a lot of what senior managers want to see about the business

But they may be more interested in BPM (Business Performance Management) information, than tactical, day to day data stored in the CRM system. BPM can help understand things like the lifetime value of the customer, or how to maximize the profitability of customer’s business with the printing company. BPM extends CRM, providing a link to enterprise data sources, processes, and practices. BPM applications (like EFI’s EIS system) unify corporate data sources and give managers more control and visibility.

BPM technology enables managers to quickly change processes to respond to shifting customer demand and market conditions, often without adding any additional work to the IT department. Adding BPM into the mix enhances CRM's value proposition.

BPM involves consolidation of data from various sources, querying, and analysis of the data, and putting the results into practice. This data can be found in the information collected in the CRM system about the customer, as well as from information from transactions kept in the Print MIS system. Continuous and real-time reviews (in contrast to static reports, which show a “snapshot” of a moment in time—the time the report is run) help to identify and eliminate problems before they grow. Forecasting helps the company take corrective action in time to meet financial projections, and can even be used to conduct “what-if” analysis.

Some of the Key Performance Indicators (areas from which top management analysis could gain knowledge) available through the use of BPM:

Customer-related Metrics:

Best Customers

Delinquent Customers (average days past due)

Customer Paying Habits (average days to pay, discounts taken)

Estimates by Customer, Estimates Won

Profitability by Customer

Product-related Metrics:

Profitability by Product

Value Add by Product

Sales by Product

Enterprise-wide Metrics:

Overall Profitability

Sales Performance (for the company, and by sales person)

Value Add (by sales person, by product, by customer)

Receivables (Average days to pay)

Beyond sales reps, CSRs, managers and executives, there are certainly many other staffers in a printing company who will benefit from CRM, for example, production managers and accounting staffers: so they can plan for future production needs and make important business decisions.

Combining CRM and Web-To-Print

Once a printing company’s internal staffers are using CRM, it’s time to look at extending the CRM functionality to the web. CRM can be a valuable become part of your Internet sales and marketing strategy. This combination can be an important enhancement that can make the impact of both more powerful. And, in a novel twist, your customer’s CRM systems could also be used to actually sell products and services.

There are many touch points between CRM and Web-To-Print (W2P) that can be valuable. The information you’ve acquired that resides in your CRM system can be used to increase traffic to your web site and the W2P application, by using it to create customized offers to customers who order online. CRM can be used to track customer Opt-In to your marketing programs, generate leads from your public website (with easy, direct integration), or upsell customers via merchandising features in your W2P software. You can also use CRM to control when, and to whom, you send a newsletter (perhaps even driving variable newsletter content depending on information about the customer stored in your CRM system), enhancing customer retention.

One of the best ways to lock in a customer’s business is to have them access the printing company’s products and services from within their own enterprise systems. In other words, their employees use their own CRM system to help identify their own customer’s issues or desires, and then use a link to your Web-To-Print system to deliver the document to that person in print.

Many large companies have done this for years, with multi-million dollar enterprise software like Siebel CRM systems and Documentum document management systems. Once the realm of only the largest printers, with large IT staffs, enterprise integration is now within the reach of most printing companies, even without a room full of programmers. This is especially true with the increasing popularity of new, open architecture CRM systems, like Salesforce.com, Centric CRM and SugarCRM, to name a few.

These are new applications emerging that a tech-savvy printing company can leverage to garner new business. You will still need some tech expertise, but the playing field has been leveled to a large extent—and you can partner with vendors to make this happen, as well.

The idea is simple: your customer’s sales rep, call center staffer, or support “help desk” staffer in gets an inquiry, and needs to send a particular document to a customer or prospect. Popular include sales collateral, training materials, point-of-sale posters, kits (which often include items like pens and binders), franchise startup kits (which might include signage, business cards, and sometimes even furniture and fixtures, or other non-print business supplies).

A link between your customer’s CRM system, and your catalog-based Web-To-Print application lets them automatically find and order the appropriate document. The customer’s contact information is automatically transferred via the integration link to your system. You print it, and mail it to the customer. This can also be linked to VDP products in your W2P applications, so the rep at the customer company can order a personalized item for their own customer or prospect.

Summary

In today’s fast moving and constantly changing business environment, the insight provided by CRM and BPM systems can literally make the difference between success and failure. These essential tools are accessible and affordable. Remember that the technology is only one part of the equation—a well thought-out sales and marketing plan should be the first priority, and then the technology will be a natural supporting element.