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Interview

John Nicely, WorkflowOne, Talks about Print Management and Business Process Outsourcing (BPO)

Print management and business process outsourcing (

By Gail Nickel-Kailing
Published: March 14, 2007

Print management and business process outsourcing (BPO) is very much in the news these days. InnerWorkings(NASDQ: INWK) announced year end financials showing 2006 revenues of $160.5 million and operating income of $12.8 million. I’m sure all the companies offering print management services are watching their developments closely.

More than a year after the acquisition of the Astron Group, RR Donnelley is re-branding the service line to “RR Donnelley-Global Document Solutions,” bringing the company more into the corporate “family” and extending “Multi-Service Document Business Process Outsourcing” along the full document lifecycle.

Today we begin a series of interviews with print management providers from the US and the UK who provide their insight into the market and the applications. John Nicely, Vice President of Marketing, WorkflowOne, is the first up to bat.

WTT: John, the concept of print management is a fairly new one here in the US, and it’s not always clear what the term actually means. To start us off, would you talk about how you view print management and print brokering; what’s the difference?

JN: In both cases – print brokering and print management – there is a strong relationship between the sales representative or account manager and corporate print procurement. With that said, I believe it would be difficult for the traditional print brokering relationship to move beyond that classic relationship.

Print management is not just a process that facilitates procurement of print through the purchasing function; a print management company extends its value proposition through the entire client organization. The CMO has different needs from the HR department, and the CFO may focus on an entirely different area. In consumer products companies, you can add Operations because packaging and labels are part of manufacturing. All departments are becoming part of the decision-making process.

Print brokering tends to be very transaction-oriented and print management involves a more complex programmatic relationship that often includes a service contract covering a number of years. The client is also looking for a return on investment on their overall use of print, not just the cheapest price on a print job today.

WTT: If we look at a simple definition of business process outsourcing, it is basically wrapping processes around technology and providing the staffing (people) to get the job done. Is that how you view it?

JN: Yes, implementing the technology piece really enables us to integrate functions and people into processes. It allows us to take on a mission critical role in the entire process so that we become an essential resource for our customers. It also makes the supply chain transparent because we bring the best prospects and solutions to them. That is a differentiation point for us; we’re not just implementing a bid/buy process.

WTT: Business process outsourcing (BPO) is the act of giving a third-party the responsibility of running what would otherwise be an internal system or service. BPO helps improve the processing of all forms of customer communications by speeding response and cycle times, lowering costs, bolstering security and confidentiality, and minimizing the risk associated with the flow of mail documents, and packages into, within, and out of businesses and government agencies.

JN: I would agree; that's what we focus on when we talk about print management with our clients. We look at the direct spend for print but also the indirect costs along the entire value chain. This is clearly an enterprise program. We still have a highly transactional side to our business. It's not business that we want to forget about; it fills a need. With our print management services, we focus on our clients’ brand-related spend; that is, anything that carries the customer’s brand identification whether it is a form, a high-end collateral piece, or a one-to-one marketing piece.

Furthermore, BPO typically involves intertwining your processes with your customers’ processes. The more closely intertwined those processes are, the more successful a BPO relationship usually is. It comes down to building trust with your customer; that you are truly a knowledgeable, efficient, and loyal extension of their business.

In addition, as point of differentiation, we also integrate our technology into the process. Our technology becomes the transaction enabler for procurement and online collaboration and to deliver information about the entire process.

WTT: These brand programs that you describe; do they include online media as well as offline media? How do you expand your value proposition into online media since you traditionally come from offline media or print production?

JN: Our digital solutions group has traditionally managed a lot of data on the transaction side, for statement processing, for example. We are now moving into managing marketing data. We are not boxing ourselves in; we are offering transpromotional messaging and we’ve partnered to deliver e-mail marketing campaigns and email links for special promotions.

Another thought involves building a virtual network of conversation around our customer’s brand. Through collaboration tools, we create a defined network of discussion around the brand. That social interaction helps spur creativity, develop natural continuous improvement activities, and build trust that the network is working.

WTT: Today the CMO isn’t really saying “I only want to talk about print,” he or she is looking at multi-channel marketing, and reaching across the entire spectrum of online and offline communication.
In other words, the value chain that reaches all the way from concept to delivery. How far up – and/or down – that value chain are you reaching?

JN: The full length of the value chain. We just launched WorkflowOneAccess, a web-based application that automates the marketing processes and supply chain management tasks associated with a customer’s brand-related spend. It was an internal collaboration across Marketing, IT, and others within our organization. The entire process starts with the design phase, then we find the right source for production, we warehouse the products, and fulfill the distribution.

While we have the ability to provide document design services, we do not view ourselves as an agency, but as a team to augment the creative effort. We then develop a sourcing solution and determine whether the project will be produced internally or externally sourced. We close the loop on the entire process through two services: VoiceOne and TrackOne.

VoiceOne is an outgoing call center that measures client satisfaction and account retention and provides formal reports monthly, quarterly, or annually depending on our customers’ needs. TrackOne is a sophisticated tracking and reporting system which measures activities within WorkflwoOne Access.

WTT: In 1999 and 2000, a lot of companies tried to provide some kind of online procurement tool, and a lot of them fell on their faces. I remember the industry “immune system” rejecting the intermediaries. There was one particularly vehement reaction from the late Harry Quadracci, in his Quad/Graphics President’s Message, Spring 2000; which said, “We will not do business with brokers – in the flesh or in cyberspace!” The issue was all about intermediaries, about people getting in the way of the relationship between the buyer and his/her supplier. Do you see WorkflowOne as an intermediary? Do you see WorkflowOne enhancing that relationship?

JN: We add a lot of value to the print procurement process and we filter out a lot of white noise that can come from thousands of suppliers who are established electronically. We help manage that business link on a day-to-day basis, particularly when there are multiple applications involved.

There are many companies who have had to cut staff in a lot of areas and they simply don’t have the time, the people, or the skill sets to manage these vendor relationships themselves. We have the programs and the tools to reach all their suppliers and manage the costs that wrap around the production of forms, collateral, or promotional products.

We may not always guarantee the lowest price on a single job – there are always printers who have excess capacity and can offer a price that just covers their fixed costs – but you’re not really managing your bottom line if that’s all you’re trying to do. The challenge is to manage costs along the entire value chain, and if that involves providing staffing, we can do that too.

We also aggregate demand and work with raw materials suppliers to leverage purchases on paper, ink, and other supplies. In other words, our trade partners participate fully in the value chain. By the very nature of our size, we have a lot of clout in the industry.

WTT: Before we sign off today, is there anything else you’d like to touch on?

JN: In the late 90s you had companies that developed technology where the value was one-sided; in particular, reverse auctions. It looked good for the buyer but there wasn’t any value for the printer. There were other gambles as well. For example, the benefit the buyer or end-user enjoys in functions like collaboration. The intermediaries got in the way of those relationships; they didn’t facilitate or enhance the relationships on both sides of the equation. We have an industry now that has learned how to create value not only for the print buyer but also for certified trade partners.

Seven or eight years ago people just couldn’t articulate the value of those technologies. WorkflowOne knows and understands the entire process and enhances the value chain for everyone involved; that is the big difference today.

 

 

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