A Case Study By Kelly Woodward
In researching this subject, I came upon two passages that helped to structure my thoughts. One was from the September 2004 issue of In-Plant Graphics that said, “Higher education is facing reduced funding, assessment and accountability, changing demographics, and changes in student characteristics. To successfully draft and implement a campus-wide document strategy, the print and mail manager must be mindful of these issues.” Certainly this is true for our campus, and why as good stewards of the services we offer, we are researching the possibility of merging our Printing and Mailing departments. I was also struck by a quote from Ray Chambers, Vice President of Juniata College in Huntingdon, PA. He said, “An in-plant facility is a business, and it should be run like one. However, in-plants are unique in that they have dual responsibilities: the core competencies of the profession, and the mission and culture of the institution.” As managers and directors of the communications services for the University of Illinois Urbana-Champaign (UIUC) campus, we must vigilantly keep abreast of changing trends in our profession, and the technologies that address those changes. The combining of the print and mail centers is one of those trends. To capitalize on technology, you have to address the entire value chain, from document creation to actual finished output.
In an age of automation and streamlined workflows, vendors are offering efficient ways for printers to adopt mailing systems and services to broaden their suite of services. TrendWatch Graphic Arts (TWGA) suggests that taking on these value-added services can make a competitive difference in a tough market. In 2003, TWGA reported that 25% of commercial printers see broadening fulfillment, shipping, and mail capabilities as a sales opportunity. In a similar study by the National Association of Printing Leadership (NAPL), 70% of printers affirmed that they were investigating adding mailing and fulfillment services to their business.
The November 2004 issue of In-Plant Graphics magazine indicates that 50% of all in-plant printing and mailing centers across the country have now merged into one department. Within the Big 10 universities, 6 schools have the two disciplines under 1 direction, 2 have printing and bulk mail services integrated with inter-campus mail distribution as a separate unit, and 3 schools still have the two centers reporting as separate units. Within the state of Illinois, NIU, WIU, SIU, and UIS have print and mail as 1 unit. They are separate at ISU, and oddly enough, our sister campus at UIC had them together, but just recently split them apart into 2 units reporting to two different vice chancelleries (my sources indicate that the split is more politically motivated than economically justified).
For the purposes of this report and the productivity savings indicated therein, it is assumed that the merging of the Printing and Mailing departments will include physically relocating the Mailing Center to the Printing & Photographic Services building. The synergies outlined within would not be as effective if the two centers were kept in separate buildings.
So… can we improve the core competencies of our printing and mailing services, become solvent, and serve the mission and culture of the University of Illinois at Urbana-Champaign by merging these two units? Based on my research, I think the answer is an unequivocal “yes” and here’s why.
Cost Savings
Cost savings come from several avenues with this merge: streamlining workflow, preliminary planning of design to maximize bulk mail discounts, combined administration, integrating technologies to reduce steps, and a reduction in errors. The cost benefits to customers using a one-stop source for direct marketing from concept to distribution are significant. A single direct mail campaign consisting of an envelope, letter, 4CP insert, and a business reply envelope traditionally involves 3-4 suppliers. A vertical approach integrating these services can reduce administrative hours associated with procurement and production. Printers and their customers can derive postal savings from automating as much of the mailing process as possible. The United States Postal Service (USPS) says that the more work you do in preparing the mail, the lower your postage rate is going to be.
With regards to workflow, process mapping can best illustrate how merging these two departments can improve service offerings to the campus. Currently, when a customer has an idea for a bulk mail piece, the process generally flows like this:
1. Customer gets an idea for a mail piece
2. Customer goes to Publications department for design and lay-up
3. Publications returns proof to customer
4. Customer gives approved art to Printing
5. Printing creates printing proof and gives to customer for proofing
6. Customer approves proof and returns to Printing to produce mail piece
7. Mail receives printed piece and finds errors and returns to customer
8. Printing discusses options with customer
a. re-design piece: increases design and production costs, time delay
b. mail as-is: increases postage costs and postage time
Repeat steps 2-6
9. Mail receives printed piece, addresses and mails
RESULT: The mail piece is produced at an inflated cost and is not on time, causing the customer to loose money both in production and in their intended customer’s response.
If Mailing were a part of the printing process, here’s how this same scenario would look:
1. Customer gets an idea for a mail piece
2. Customer consults with Mail to discuss parameters
3. Customer decides on parameters that meet their needs
4. Publications designs mail piece based on chosen parameters
5. Mail approves design proof from Publications
6. Customer approves design proof
7. Customer gives approved art to Printing
8. Printing creates a printing proof and gives to customer for proofing
9. Customer approves proof and returns to Printing to produce mail piece
10. Mail receives the printed mail piece, and addresses and mails the piece
RESULT: The mail piece is produced and mailed with a minimum of production and postage cost, and it is on time.
Obviously, this doesn’t happen all of the time. However, Clancy Bradley, Manager of UIUC Mailing Services feels that at least 25% to 35% of the time greater cost savings could be realized had the mail piece been designed differently. Clancy indicated that in these cases the postage savings is anywhere from $800 to $1200. Brochures go through that are inserted into envelopes that could have been designed with mailing panels and saved the customer the cost of printing the envelope and the insertion charge. Often, customers don’t leave enough space for addresses and bar codes, or they print on a color of paper that bar code readers can’t read (orange), causing the customer to lose the precious bulk mailing discounts afforded to non-profit organizations.
With regard to the latest technology, the variable print strategies offered by the new iGen3 printer recently acquired for the Printing Department allows mail to be addressed during the imaging process. This capability cuts the separate addressing process completely out of the picture, reducing the production cost and spoilage.
Finally, costs are reduced when staff and management can be combined. The Printing Department is already working on a restructure that focuses on the production process rather than the various disciplines within the Printing Department. Without anything etched in stone at this time, I think that it is safe to say that we are looking at some form of delineation between Pre-Production, Production, and Distribution, with management for each section. Should this likelihood occur, their would be one less manager’s salary in the scheme of things for Print and Mail, support staff could be merged with the possibility of an additional customer service representative available to go out and hold hands among the customer base, and some jobs could be merged where the disciplines cross over, particularly in the area of bindery functions. Cost savings will also be realized through a reduction in administrative costs such as telephones and telephone calls, time savings in single source job management, eliminating redundancy in billing processes, and the reduction in overtime and temp staffing through cross-training.
Integrated Processes
Across the industry, printers are involved with mailing services at various levels. Some printers assist customers on the front end, while others have fully integrated solutions. As technology continues to bring print and mail together, the processes become more seamless. The results of the market research by Excel for the Printing Department indicates that at least 95% of our customers on campus just want to bring us the job and feel confident that it is going to go out on time and on target. They want a One-Stop Shop. Having a single point of contact for the customer for a job from creation through distribution is a true value-added service and one of the distinguishing characteristics that the campus needs to justify using the campus service over an outside service. The advantages for the customer as well as Print/Mail are:
· Work order requests are communicated to a single person
· Single database for job management
· Immediate input on design and cost issues
· Clearer internal communication through the project completion
· Reduction in errors
· Saves customer and customer service representative time
· Greater control over process quality and timeline
· More addressing options – font, format, and color
I make some assumptions with the above list. An all important one for us is the billing solution. There are business management systems available that are thoroughly integrated and robust enough for all print and mail processes. The Avanti system is one such system that is used in our UIC Printing Department that has tackled all of the Banner issues and can be set up with modules for all forms of print and mail production. A fully integrated business management system sets us up for the next assumption which is work order requests to a single contact person or team. In a typical shop where you make choices about what goes to digital and what to offset, to be able to have a workflow path that is fully automated is a huge productivity saver. Workflow is determined by the page path. Peak performance is realized with a system that allows for a member of the pre-production team to do order entry, estimating, scheduling, and the purchase of materials and outside resources prior to the job actually hitting production, so that production can commence immediately. Again, this saves time and reduces errors. For this to work well, all of our Production Coordinators and CSR’s need to be on the front line. And all of the front line folks should be fully cross-trained in all services offered by this department. Customers should not have to guess where to go when they come in the front door. One database solution internally would consolidate purchase requisitions, estimating, job status, job tracking, delivery, and print and postage billings. There would be clear and concise data available for management to review for every possible report needed to manage well. The same data would be available for customers within minutes instead of days.
When talking about integrated processes, we have to once again touch on variable data printing. Variable printing allows us to use CASS-certified postal sorting software along with the variable data application, print management software, and a digital output device to produce campus and bulk mailings that are ready for distribution right off the printer. Variable data printing is a unique opportunity to partner with our clients in achieving their marketing goals. In most cases, that entails improved results from their mail campaigns. The June 2004 issue of American Printer magazine indicates that variable data printed products have shown that mailing results increased 5 fold over the traditional mailing at 1 ½ % to 3%. Fully customized direct mailings have a success rate of nearly 3 times higher than standard monographic mailings.
Finally, we can cross-train for depth. Implementing efficient processes will free up hours to work on larger or more projects. Synergies occur particularly in the areas of mail metering and bulk mail with the printing bindery staffs. Cross training in these areas provides depth when absences dictate the need for back-up personnel, or large projects need extra hands. Our Mailing Services already provide for printing deliveries across campus, but smaller deliveries could be done through campus mail distribution.
Better Service
All of the cost saving and integrated processes add up to one very important reason for joining the two departments…better customer service. In today’s business world, information is increasingly trumping technology as the critical element. Our relationships with customers begin as services-led discussions that have an integrated solution associated with it. Today’s cutting edge printer has now become a true printing consultant, working with clients to help identify their goals and providing a full spectrum solution that gets the results clients expect. This involves understanding direct mail trends, interpreting the client’s customer data, and educating customers about existing opportunities. However, again, in order for this to work well, we need to put our production coordinators on the front line and cross train them in all printing and mailing processes. We could hold internal training workshops where the offset experts are training one day, the paper expert the next, the mailing expert the next and so on. There would need to be a total commitment to provide quality services in both print and mail. And a total commitment on managements part to continuing education for these folks, including industry work groups, forums, association memberships, and conference/seminars. In addition, we should have a continuous stream of feedback to our print/mail customers to assist them in continuing to create cost effective print media. We should have at least 2 reps out in the field helping our customers directly, and meeting with potential new customers to let them know the myriad services we have to offer. The combined units should stand to gain substantial rewards from the increased revenues from a combined customer base and strengthening long-term loyalty from customers who see their services unit responding to their needs.
A Word of Caution
The Printing and Mailing industries are two very complex industries. Personnel from each industry need to respect that they are all specialists in their respective areas, get beyond old industry stereotypes, and accept/embrace the differences. Print allows for creativity, where mail is strictly regulated. To really get behind our professions and the mission of the university, we need to help our customers find the balance between creativity and functional compliance. Industry language, jargon, and acronyms are confusing to customers. We need to avoid potential miscommunication with customers, focus on their objective and meet it. We need to know our audience and limit the use of advanced print and mail vocabulary, while at the same time commit to educating our customers so that they are better prepared to help us help them.
Recommendation
I would strongly recommend that the campus consider having all University of Illinois mail run through the mailing department to realize all mailing discounts that the USPS has extended to non-profit entities. From my experience at MAILCOM, I’ve come to learn that those discounts are a moveable target and very complex. There are action groups in Washington, D.C. that lobby for non-profit organizations, but it takes someone dedicated to keeping on top of the mailing issues to continue serving the interests of the University of Illinois. An outside agency is not going to be so dedicated to just our needs and special discounts. There is also the issue of securing customer databases and mailing lists. We need to be conscious of protecting the privacy of our client’s customers.
What’s in a Name?
There are many reasons for a name change, but primarily they occur when companies diversify and merge with other firms or departments, and as a result, find that their current appellations are outdated or are no longer relevant to their activities. I suggest that we make it easy for our customers to find us by calling ourselves what we do. My own little unscientific poll of customers indicates that no matter what we call ourselves, the folks out there are still going to call us Printing and Mailing Services. We should also consider changing the name of the building to more accurately reflect the services contained within.
Physical Considerations
The appropriate space is key to setting up a mail center. Space planners generally don’t have the training or background to prepare them for this type of environment. We must be careful of using space planning software as well. The program will ask for the number of employees and then try to put everyone in a cubicle space. Determine the footprint of the equipment and position them according to the workflow plan. Don’t forget to allow space for staging materials in and out, and swing space for those materials.
Our mailing services operation is a hub and spoke system, where by all mailing materials are brought to one central processing center for distribution. Consequently, it is important that the mailing center have its own loading dock area so that big trucks aren’t blocking the way in and out. Timeliness is crucial to a mailing center. Swing space is also crucial for vehicle turnaround in the loading dock entrance/exit area. Also, when designing the loading dock, you need to be able to see the dock from the shipping office for security reasons. Mail often contains checks and other QT documents.
This is also a good time to hook up with ergonomics folks to capitalize on the new ergonomic furniture which can aid in productivity efficiencies (less bending, etc.).
To Do Lists
According to Michael Lathrop, CMDSM (certified mail and distribution services manager) from Hewitt Associates in Chicago, when relocating a mail center, the following steps are essential:
For USPS:
- keep the postal rep in the game
- notify USPS of the address change
- check out zip code changes/opportunities
- determine inbound mail availability
- establish USPS interactions with staff/vendor representatives for pickups, deliveries, and signature authorizations
- determine new discount opportunities
Internal:
- determine manager’s role
- establish manager’s back up
- control the vacation plan (don’t let key people off)
- get all of the staff involved (this is an opportunity to grow your employees – give them an opportunity to show leadership potential through this change)
- develop a project list
- look for opportunities: mail codes, security, consolidation – all processes
- communicate, communicate, communicate, and then communicate some more
And celebrate! This is a stressful transition. Celebrate the little and the big victories in the process.
The Cost to Make the Move
When the Mailing Center moved to its present location, the cost was $150,000. If the Mailing Center were to relocate again, it is reasonable to assume that the cost for this portion of the move would be equal to their last move. However, in addition, the Printing Department equipment would have to be reorganized internally to accommodate the Mailing Center. And, the building itself would need to be altered structurally to allow for more loading dock bays and truck turnaround. I think it is reasonable to assume that the total cost of the move would be in the neighborhood of $500,000.
This would also be a good time to replace old and inefficient equipment. For example, the saddle binder in the bindery is better than 35 years old. Our money would be better spent on purchasing a new saddle binder with double the productivity of our current binder, rather than spend the money to move it to a different location within the building. We aim to become the communications center for the UIUC campus. To serve the campus well, we should have up to date equipment and technology. This is the perfect opportunity to improve our equipment in both Print and Mail and aggressively progress toward that goal.
The Final Analysis
The combined units must share a common goal driven by a shared purpose and mission to be successful. A merger on paper does not make us a single unit. It takes proper leadership to communicate and guide the vision of a new and improved service.
