Commentary & Analysis

Challenges for In-plant Printers

By Howie Fenton
Published: May 21, 2010

I did a presentation to an in-plant group in Oregon last week and learned from Bob Neubauer, the editor of In-Plant Graphics, that the number and rate of in-plant closings is accelerating. Bob opened his presentation by listing recent in-plant closings such as Texas Tech, the University of  California at Berkley, Michigan State University, Mississippi State, Blue Cross Blue Shield-Minnesota, the University of Waterloo and the University of Ottawa. Each in-plant had its own story. The only common thread was that a few in-plants had closed because the organization needed the space occupied by the in-plant and decided to close down operations.

I do a lot of work with in-plants and know that, like their commercial counterparts, they are facing serious issues including 20-40% declines in demand, budget cuts and complaints from customers of uncompetitive pricing. But the most important message I hear from all these closings is that in-plant printers struggle to demonstrate their value.

But before talking about value it would be naïve not to acknowledge that most in-plants are evaluated first and foremost on their financial performance. Some need to break-even or come close to break-even, others have to make sure that they are perceived as offering competitive prices and services.

In the work I do with in-plants I focus on three critical areas: measuring financial and operational performance, improving productivity and driving down manufacturing costs and listening and responding to customers’ changing needs. When I get calls from in-plant managers who feel that they are under scrutiny and need to take immediate action I recommend they focus on the measurement process.

The role of the measurement process and changes resulting from that process are essential in making in-plants less vulnerable to outsourcing. This requires the identification of the vital few metrics that will be used to measure, track and benchmark operational and financial performance as well as customer service. Today's operational focus has become one of the never-ending battles in print production today. Companies must constantly work on improving productivity to drive down the cost of manufacturing to remain competitive.

If you can survive the immediate crisis, the next step is to go beyond mastering the measurement process and focus on increasing value. The three keys to increasing your value are listening to customers’ changing needs, responding to those needs and proving to your clients that your desire is to be the best.

If you’re an in-plant and have survived the close scrutiny of your company, how did you do it?

Howard Fenton is a Senior Consultant at NAPL. Howie advises commercial printers, in-plants, and manufacturers on workflow management, operations, digital services, and customer research.