Standard Register Reports Strong 3rd Quarter
After following Standard Register for more than a decade,
By Cary Sherburne
Published: October 29, 2010
After following Standard Register for more than a decade, I find the company’s 3rd quarter results very encouraging. Joe Morgan has been in the CEO role for a couple of years. He is an extremely dynamic leader that is making big changes in the company. For those of you who attended the Print CEO Forum and had an opportunity to hear him speak on a highly-rated panel with Vistaprint President of North America, Wendy Cebula, or to network with him during the session, I am sure you will agree he has taken this challenge very personally, and that, in turn, has been an inspiration to his team to deliver against that challenge. The 3rd quarter of 2010 marks the sixth consecutive quarter of stability for the company.
Although Standard Register’s revenues are still heavily weighted toward legacy products and services such as forms, a segment which is declining and has been for some time, the company is taking a two-pronged approach to the transformation: increasing focus on specific markets to grow revenues and working hard inside the organization to bring expenses into alignment. The fascinating thing for me in these results is the dynamic cultural change one sees under Morgan’s leadership. He is a very inclusive CEO and has put a number of programs in place, including MyC3, which engages employees at every level to uncover cost savings opportunities. This MyC3 effort was targeted to generate $30-$40 million improvement in net annual earnings by 2012. To date, the company has implemented 397 ideas that have realized $19 million in savings YTD, and are projected to ultimately improve earnings by $40 million. The company has also reinvested $12 million into technology enhancements, go-to-market, employee development and incentives, and reported $7.7 million in positive cash flow for the quarter. Part of the investment was an update of Standard Register’s SmartWorks customer facing web services platform which was completed in about a quarter, as well as a complete technology refresh in the company’s 22 StanFast digital centers. Morgan took over a company that was quite distressed and is delivering on turnaround promises. This has not only helped with employee morale, but also with customer retention and customer acquisition/growth in market share in the company’s target segments. Morgan has established a new operational framework the company calls 5 Points of Change as well as an outside-in growth strategy. At the same time, Morgan and his team are reenergizing the culture to be more market- and customer-focused.
As the economy begins its slow recovery, we are hearing more positive stories from owners and managers of printing companies, many of whom are smaller firms. Sometimes turning the ship in a large company like Standard Register can be difficult—just ask the captain of the Titanic. While Morgan admits the company still has a distance to go, he and his team should be congratulated on the progress that has been made under his leadership in a very short time. Having had the opportunity to visit there a couple of times this year, I can tell you first-hand that there is a very different feeling in the building, and employees are excited and engaged. WhatTheyThink will be keeping tabs on the company’s progress, both financially and it its overall transformational efforts.