Lean Printing; the benefits of implementing an MIS/ERP solution in small to mid size print shops…

Printing has become a very complex and constantly changing industry. With the rapid advancement of digital technology, the rise in the use of the internet, globalization and the commoditization of the printed products the industry as a whole has seen compressed margins and a new level of competition.

Combined with a weak US economy and lagging consumer confidence this storm has wreaked havoc on US print shops.

Using the Business Register from the US Census Bureau the number of shops has declined from 36,024 in 2003 to 29,550 in 2008 that is a loss of 6,474 print shops in 5 years.(1) It has become a top priority of print shop leadership to find more creative ways to distinguish themselves among the crowd and to maintain profitability. Today, commercial printers have difficulty differentiating themselves from one another; this has come from the elimination of craft positions and increased reliance on automation to maintain profitability. One of the ways that companies can get the most out of their organization is through the implementation of a MIS/ERP solution to help keep inline with lean manufacturing principles.

Lean manufacturing is a combination of practices, polices and philosophies that allows an organization to shorten the time between order placement and product delivery by eliminating waste in equipment usage, labor resources, and materials to produce higher quality products and greater profit margins. (2) Even though Lean Manufacturing principles have been around for ages the printing industry has been slow to adapt them. (3) In fact, it is a common misconception that you must be a large organization to benefit from Lean.

NAICS 323 Printing - from the Business Register of the Census Bureau
Enterprise Size	2003	2004	2005	2006	2007	2008	2008 % of Total
1-4 employees	16,307	16,214	15,952	15,450	15,551	14,117	47.77%
5-9 Employees	7,661	7,464	7,214	7,067	7,069	6,109	20.67%
10-19 Employees	5,096	4,984	4,793	4,619	4,466	4,107	13.90%
20-49 Employees	3,974	3,774	3,599	3,495	3,434	3,110	10.52%	92.87%
50-99 Employees	1,669	1,636	1,589	1,551	1,531	1,052	3.56%
100+ Employees	1,317	1,249	1,238	1,251	1,230	1,055	3.57%
Total	36,024	35,321	34,385	33,433	33,281	29,550	100.00%

 In the US the Small Business Administration classifies a small business as a company with less than 100 employees. In the European Union a small business is any business with less than 50 employees. In 2008 almost 93% of all print shops in the United States had 49 or less employees. Yet when we look at these companies we find that less than 5% of small firms and less than 20% of large firms have an Enterprise Resource Planning (ERP) System. (4)

According to a 2004 Gartner, Inc. white paper entitled, "ERP Applications Help Achieve Lean Manufacturing," there are five areas in which an MIS/ERP solution can be leveraged to build a successful Lean Manufacturing operation:

1. 
   
   Product Data Management
2. 
   
   Forecasting
3. 
   
   Line Design
4. 
   
   Line Scheduling
5. 
   
   Flow Visualization

MIS/ERP solutions offer manufacturing organizations many benefits, it can help with value stream mapping of individual processes and help to increase the flow of information to the leadership to increase response time and limit buffering for problem correction. It can be helpful to human resources managers to monitor and asses the strengths and weaknesses in the organization's employees and give them and the production manager's feedback on employee's productivity and effectiveness.

MIS/ERP solutions can affect not only the pricing and estimating strategy but also can affect the days sales outstanding by making the billing/invoicing systems more efficient. Due to the high importance of cash in running a business, it is in a company's best interest to collect outstanding receivables as quickly as possible. By quickly turning sales into cash, a company has the chance to put the cash to use again. Printing is a capital intensive business and the proper use of all resources is critical.

Indentifying, assessing, and implementing a successful MIS/ERP solution can be a daunting task. Not only are the systems to be implemented important but equally important is the company doing the implementation. The analysts and sales staff must be familiar with the intimacies of print shop operations and it is even better for your salesperson to have worked for a number of years in the areas of the shop to be affected. If your salesperson has not "walked the walk" it is almost like giving someone a heart transplant after reading a book. To be successful leadership must consider the following three areas for assessment: 1) Technology 2) Human Resources 3) Systems after the assessment leadership must look for ways to implement the simplification of the identified processes and lastly place policies to safeguard performance with metrics for measurement.

Value mapping a process can help identify "cost added" activities and "value added" activities. A "cost added" activity is any activity that does not directly increase the value of the product. When looking to streamline a process the RIT Center for Excellence in Lean Enterprise has identified 7 different kinds of "cost added" activities.(5) 1) Transportation; movement of material in the plant 2) Inventory; anything of value waiting in process 3) Motion; excess movement of people 4) Waiting; idle operation of machines 5) Overproduction; producing more product at each step that is needed downstream 6)Over-Processing; performing extra processing steps that do not add value 7) Defects; materials spoiled in the process.

Until the advent of the proliferation of digital technologies the printing industry has fought against using many manufacturing techniques to save the impression that it is a "craft" done by "artisans" instead of looking at the productivity and effectiveness at its employees and processes. Until the digital age the printing industry was filled with highly skilled workers that could output the day's jobs using their "craft" to uniquely produce each job. This lag in adopting "lean manufacturing" has positioned the industry to be caught up in the "perfect storm." Michael Baker in his blog, "Lean Manufacturing Blog" (5) states,

"Lean manufacturing may be the last hope for the printing industry. Because of the promises, the forecast and expected savings companies can reap from implementing lean manufacturing principles: the printing industry is believed to be the most and primarily boosted and lifted up by the lean manufacturing approaches.

The printing industry has somehow turned into a damsel in distress. With the lean manufacturing, figuratively, its knight in shining armor."

Using Lean Manufacturing as our armor, technology then becomes our sword. Technology is one of the most valuable "keys" to unlock the door to reducing the costs of business and manufacturing processes. Having access to the proper information is critical for all areas of a printing organization from the receiving or taking of the order through every step in the process to the point that it is delivered to the customer and eventually billed and the payment received. It is estimated that there is a 60% chance that a job will get delayed somewhere in the production process. The delay ultimately will be caused by the lack of information. These delays cause jobs to have to be expedited to maintain delivery promises. This sacrifice of efficiency to maintain "service at all costs" puts an organization in jeopardy.

The effective implementation of a MIS/ERP system to allow for the critical exchange of information and the proper allocation of resources can be tantamount to the long term success of an organization. MIS/ERP systems have come a long way now integrating every area of the shop. From web submission to the ordering of inventory, efficient pre press workflow, maintaining job ticketing information and feedback to production managers of bottlenecks or potential shop problems, to the dissemination of business intelligence to the leadership and the eventual shipping and invoicing of the job to the client.

Due to the varied services and product offerings of today print shops, a solid MIS solution must be modular and offer flexibility in designing an end to end solution for your organization. It must not just automate the simple tasks in the production organization but must also provide real time feed back to production managers and shop leaders so they can monitor the key performance indicators that had been identified in the original analysis. One of the key factors in lean manufacturing is that the employees must be surrounded in a culture that promotes thought and the questioning of all processes. Leadership must have the business intelligence real time to minimize the buffers so that they can be quick to react to opportunities to impact and improve shop efficiencies.

As JDF/Cip4 technologies develop and come to the forefront you will want a MIS/ERP solution that can help you manage your equipment workflow and address challenges that come from improperly or inefficiently installed pieces of equipment. These inefficiencies can create "islands of automation" which can contribute to "cost added" activities which will undermine your lean efforts. Leveraging CIM principals can enhance the areas of 1) Improved quality 2) Increased productivity 3) Lowered costs 4) Shorter customer lead times 5)Reduced waste, labor and inventory 6) Greater flexibility and responsiveness - all are parts of a good lean strategy.

This use of lean manufacturing principles and techniques will further separate the leaders from the challengers as the competitive field narrows through attrition. Only the companies that embrace the emerging digital technologies and proven manufacturing processes and strive to continually improve those processes will survive.

Happy Sale'ing
Pirate Mike

1. Frank Romano and David Broudy, "An Investigation into Printing Industry Demographics—2009" RIT 2010
2. Chris Faust, Paper Film and Foil Converter, Apr 1, 2003 12:00 PM, "Think Lean"
3. Sandra Rothenberg PhD and Frank Cost, "Lean Manufacturing in small and mid-sized printers" RIT December 2004
4. Frank Cost and Bret Daly, "Digital Integration and the lean manufacturing processes of US printing firms" RIT October 2003
5. Frank Cost and Bret Daly, "Digital Integration and the lean manufacturing processes of US printing firms" RIT October 2003
6. Michael Baker, "Lean Manufacturing Printing Industry", Lean Manufacturing Blog, http://www.leanmanufacturingsecrets.com/

Got Coach? One pirates view on having a life coach…

Now this really could apply to many areas of your life. What is amazing to me is how many people that I talk to that are really dissatisfied with where they are in life. They are not happy with their progress at work, home etc. What is even more amazing to me is how many emails I receive that talk solely of how they are amazed at my hobbies, interests and pursuits.

I admire people that are "living their dream," as I am living mine. But I don't envy, or wonder or get amazed, I just admire that they had the courage to step out and be different. I remember a statement that has stuck with me my whole life. It went something like this, "Why watch dynasty on tv, when you could be out creating your own?" If I remember right it was a slogan that Amway used in pep rallies. But the importance of what it is saying is still true.

I think that direction, fear not having someone to use as a soundboard are all reasons for not accomplishing our goals and dreams especially as it pertains to work.

Now what do Professional Athletes, CEO's, actors, have in common? They all have coaches. Tiger Woods has a swing coach, Actors have theatrical coaches, CEO's and powerful business people use life and sales coaches. So why do so few of us have a coach? What is a coach?

Most definitions use some phraseology like this, "one that gives instruction." Now if you're not achieving what you want out of your personal, professional and spiritual life surely you can see the value of having a personal coach?

Now it is much like a counselor, except that you are really going to get somewhere; and you're going to get more than an introspective view of what has happened to you in your life and how you processed it. This is relative to what is going to happen to you in the future and how successful and fulfilled you're going to be. Now granted a psychiatrist and the many related fields are for mental illness, and there is certainly room for that. But a life coach and a counselor have their roots in the same pot, and many times will blur together in a successful individuals life. A good Life/Sales/Executive Coach will have a background in counseling, to help guide you through the tough business and personal challenges that you will face.

A good coach will be a mentor, teacher, counselor, coach, guide, friend, and will often say things to you no one would have the guts to say. (Except some of my friends, they have no shame in telling me what they think I need to hear)

Now I have been in executive level sales for 6 years, during those 6 years I have almost always had a coach. From Zack Jones at Konica Minolta to Larry Poe who was a Sales/Executive Coach that Datamax employed to work with us to Monica Huddleston or Brian Balow at IKON. It is invaluable to have someone to work in this capacity for you. You cannot afford to not have a coach, unless you just don't have any dreams or desire to get ahead. And then it is ok not to have a coach. Family and friends can help, but they typically are poor sources for this type of training. We usually need someone from the outside that can speak into our lives that we have no other feelings for or some other relationship that would interfere with our learning and listening. Sadly enough it is typically our family and friends that become dream stealers as they have no perspective or experience that can help us get to the next level.

I am a firm believer in having a mentor, counselor, trainer and coach. I have benefited greatly from having this type of relationship resource. And more than the personal benefits that come from it that go into every area of your personal life and help to make you the person that you would like to become. It also advances you professionally and directly impacts the type of success you have both financially and in your career mobility.

All I can say is Got Coach?

"Go confidently in the direction of your dreams! Live the life you've imagined. As you simplify your life, the laws of the universe will be simpler." - Henry David Thoreau

(Xerox, Konica Minolta, Danka, Ricoh, IKON, Oce, Imagistics, Lanier, Global) How good companies alienate great people – A story of bloodletting and corporate ignorance.

I have wondered how companies let such great talent walk out the door and end up at the competition to do nothing short of shut them down in a particular marketplace. I have watched so many people change hands over the last 4-5 years that it is truly amazing how fast the strength of a company can change. I have noticed that companies lose employees in 5 distinct ways.

1.Through lack of leadership.
2.Through lack of promotional opportunities, and poor positioning of their resources.
3.Through changing of the compensation plan or not insuring that the employees get paid as they should.
4.Through the changing of an established employees territory or constant switching of roles.
5.Through the lack of respect, recognition or pure disregard for the employees goals and dreams/desires.

I have survived now 2 distinctly different combining's, the merger between Konica and Minolta and the acquisition of IKON by Ricoh. Both were very different but had many of the same elements in them. I have witnessed several other acquisitions and mergers from the acquisitions of the Ricoh family companies like Lanier to the acquisition of Global by Xerox and Danka by Konica Minolta and Imagistics by Oce. One thing that they all have in common there was always a mass exodus of many great people during these troubling times. And in which affects the company's strength and positions the company for greater failures.

During Konica and Minolta's merger I witnessed many events that I wish would have ended up differently. One thing that Minolta and the later Konica Minolta were very good about is making sure that their employees got paid what was due to them and identifying what the employees dreams were and addressing their work to accomplish that dream/desire. Managers took special care to see that the sale reps got paid and that their livelihood was preserved at all costs. Although it seemed as if the sales people were spared the initial cuts, pay plans took dramatic cuts. Leadership was there to manage focus and readdress employee concerns. Konica and Minolta had their failures with processes and support structures. The companies were brought together without a good supply chain methodology. There were very few things that actually happened that made business any easier. In fact many of the processes that were solid become more flimsy as the companies came together. Research and new product lines were coming out quickly giving their people some great products to sell but there was no internal support structure to get them to where they wanted to be. The frustration had always been tolerated as salesmen knew that they were "paid the big bucks" to deal with it themselves. Now that the financial incentive had left the big hitters left also for a more fertile hunting ground.

There was very little emphasis that anyone was very important. In fact the exact opposite was quite true, we like you but we can replace you tomorrow with someone that wasn't here when we paid them properly was definitely the attitude. Promotional opportunities were available but limited to the local leadership's ability to keep you pinned down to what they needed you to do (sell if that was what you were good at). The branch I was at had probably 8-10 of the companies top 20 reps nationally and they all were gone within eighteen months of the formal merge. Territories didn't change for the Minolta employees but that isn't true of most of the Konica employees that ended up in menial jobs and eventually quit to find somewhere else to graze. Minolta had a strong culture of respect and that was only broken by raping the compensation plan to the point that one could see the writing on the wall (you are not getting paid the way you used to so just get over it). It was obvious that Konica Minolta didn't want a huge changeover but really did want to slowly change out all of their employees to new ones that would only remember Konica Minolta and not one or the other. The legacy employees were not good for morale and only brought strife and improper expectations. The original expectation was that if you don't make a six figure income we will fire you. The new expectation was be lucky to have a job and hope you make 65-80k.

IKON and Ricoh's situation was quite different. Ricoh tried to preserve the unique identity of IKONITES. They were very keen on putting value on their individuality and importance. Great steps were taken to try to keep key employees put until the changeover was complete. Leadership was lacking though as IKON had become weak and instable. How can the largest independent distributor of office products in the world get taken over? Who would let this happen? Hedge fund operators that were looking to plunder gold at any cost, that effectively were nothing but corporate pirates. These raiders and marauders slowly and methodically purchased stock and held it for ransom till they were able to manipulate the books till IKON looked like an attractive buy. Leadership had lost the desire to fight and had become fat, slow and lost the entrepreneurial spirit. IKON's growth pattern was like a dwarfed child with no way to grow into the fulfillment of the promise that it had once offered. As a result she became a victim of greatness. Her size and distribution model soon became the desire of others that didn't want to create their own but saw IKON as a cheap alternative since she had become so weak and unprofitable.

IKON was built on the conquering spirit and had become a fierce competitor to do battle with. Over time their success had created greed and sloth. (See the 7 deadly sins of a copier salesmen to fully understand this dynamic) IKON became vain and without potency. Something like 21 companies bid for IKON; Canon, HP, Samsung are some of the ones that I heard of. (If you know where I can find documentation on whom bid for IKON and how that went down please let me know) Now after the acquisition there is much restructuring being done to become the new Ricoh; the new one world leader.

One would have thought that promotional opportunities would have been wide spread as many of IKON's people did leave to places far off. But as the people left the leadership found it more attractive to place "new" talent in place that did not know of the IKON way. The compensation plan was very slowly adapted to a new way of thinking. This new "manufacturers" view of box placement and aftermarket preservation took a while to settle in and is still being implemented now as we speak. Territories have not changed that much as they really have tried to preserve IKON's identity and run it as a "wholly owned" subsidiary for the mean time. People were viewed as an asset and respect was placed on maintaining the integrity of the local branch and employees. But IKON really expects you to take care of yourself, they do not see the value in "getting you paid." If you cannot figure it out for yourself you are surely out of luck. They still believe in the "only the strong survive," and do expect that everyone that comes aboard has a sharp sword and is ready to use it. (Even if it means cutting a few throats in the initial onboarding) I almost find it funny sometimes as I have almost become accustomed to it.

Other employers love to hire IKON employees as they bring the "blood lust" to their people. We revitalize their troops in a way that we will never fully understand, but it is why we get so many phone calls. If you survive you are a "keeper." Leadership at IKON is much more methodical than Konica Minolta but the leadership at Konica Minolta was much more visionary. I can still remember seeing the President of Konica Minolta come to the local branch and taking time to meet and inspire the local people. IKON is the exact opposite they do not have time to be bothered. I have seen people I didn't know walk to the corner office and leave within an hour to only find out that it was the National VP of Sales or some other high powered title to watch them gather their things and leave as quickly as they came. They would rather do a "focus" group then actually meet the people and refocus the troops. This is the mistake that Konica Minolta did in the acquisition of Danka; they did not reach down and pull everyone up this time as they did in the merger.

But I have decided that "acquisitions" are much different that "mergers." In a merger everyone is more hey we are a team that is now stronger to take on bigger foes, in an acquisition you are more the conquered one and must be subservient. People look down but they do not reach down to pull you up. They look at their new purchase in a fish bowl and see how neat their new pet is. In a merger you look over at your new comrade in arms and hope he is carrying a big stick and extra ammunition as you go to slay goliath. Konica Minolta was a 'small' company that had 'big' dreams. Their dream was to become a tier 1 player in the game of office equipment and imaging/document services. Ricoh's dream is to be the 'one world leader.'

So in this I have seen many different approaches and cadences. I have seen good management and poor management, good leadership and poor leadership. I cannot tell you exactly what good leadership is but I know it when I see it. I can 'feel' it. It is the love – hate relationship that you have with overcoming your fears and taking new ground. It is the fear of taking the hill then rejoicing as the hill falls to your power. Good leaders empower their people to conquer and do not hold them back but send them out as berserkers. For those of you that do not understand the reference and its importance; "Berserkers (or Berserks) were Norse warriors who wore coats of wolf or bear skin and were commonly understood to have fought in an uncontrollable rage or trance of fury, hence the modern word berserk."

We now more than ever must come to grips with our fears, overcome our call reluctance and go forth with frenzy. We must take our market share by force and win friends and influence people with the sharp edge of the sword and the tactical advantage of a calculator and well worked spreadsheet. Some days I love the challenge and other days I wish I was dead. Today I was up for the challenge. I will probably reword this blog many times over so you can read it every day and it will change as the season and circumstances change. One thing that you will find out about Pirate Mike is that I am not stubborn in my knowledge. I fully bend and flow as my understanding changes. I hope to evolve my understanding of my circumstances and the events around me and hope to be a survivor and a thriver in this harsh economy and time in our industry.

So WHAT DO YOU THINK?

Pirate Mike

Here is to good hunting… May you kill everything that falls into your sights…

Leading Pirate Style...

Leaders are created and not born just like salesman. Some have more of a propensity for greatness than others. Good leaders have many traits that we can admire and adopt for ourselves. I have had some awesome examples of leaders. I feel like I am very fortunate to have had and still have some great mentors at many different levels.

I believe that leadership can come in many forms, and can be very personal. I take leadership very seriously. I have a tendency to exhibit my individuality in my leadership style. I like to let others know that I am unique and enjoy sharing my passion. I like others to see this through my lifestyle and by the way that I act and react.

I like to extend my hand to those around me to identify myself as one that embraces their humanity. I like to celebrate people’s diversity and be a guiding factor to their success in the endeavors we engage in. I like to lead in little ways. I enjoy being the odd duck and am not afraid to be counted when there is a confrontation. I encourage disagreement and discussion. I do not want anyone to give me a pat answer, when I ask for their opinion I want it as honestly as they can deliver it.

I try to play devil’s advocate in most of my thought processes so allow myself to see both sides of an issue. I am very opinionated, but open minded enough to change my opinion when new facts are evident. I try to participate in the lives of those around me; I do not want to be seen lying around and failing to act. I make decisions quickly and react to my environment as thoughtfully as I can.

I lead by doing; when those that see me respect my thoughts and actions they have given me the greatest gift. I thrive on excellence and cannot stand it when I allow myself to settle. I make plans, plot my actions, hold myself accountable, measure my progress and reassess the situation as often as I can when in a project.

I will do what others will not. This is the key to my success. I will do want YOU will not, this is my advice to you. Look around and see what the masses are doing, then turn about face and go the other direction. As a pirate I tend to be a bit aggressive in my actions at times. Sometimes I do not ask permission. There are many days that I would rather draw a sword than a pen. Not that I forsake the pen, as that would be grossly inaccurate as well. But rather I am not shy to embrace the rule of the sword and understand and comfortable with the eventuality of my fate.

I put the war pain on every day and am grateful for my time that I have to sail and fight. I work in an environment where only the strong survive and where many a want a be warrior gets sacrificed. Over the last 4-5 years I have seen many a college graduate fail do to lack of leadership and lack of passion. You must live with passion and let it fill every area of your life.

Struggle as I may, I enjoy the fight and the feeling of victory. I am no stranger to tragedy and can cope with an emergency with the best of them. I am strong when I need to be and soft as I really am. I do not see the benefit to living as a rogue with no emotions. But yet I love to hold a lady bug as she forages along my hand. I like to watch the sun rise and fall into the water. I am not a stranger to the darkness as it shields my progress toward a common goal of overtaking my enemy.

I never let my goals or enemies out of sight or mind. I keep them close to my heart. I love a good battle and encourage competition from a formidable foe. I will take my steps without looking and draw my arm with passion. I love to put a face with my battles and a name to my failures.

I allow passion to carry me like the winds of the ocean as they sweep me off to my destination. I let emotion riddle me with fleeting thoughts. I like to sit on the bank and think great thoughts. I love to discus great mysteries and allow my mind to discover new avenues of contemplation. A great debate is a treasure. To live with passion is to be an addict to the one of the most powerful drugs of all. To let adrenaline set in is to feed the monster like a junkie.

I am quick to draw a sword and just as quick to lay it aside to embrace friend or foe. I do not take advantage but yet do not allow for mistakes from my competitors. I celebrate a victory and morn a great defeat. I allow myself to make mistakes and support others in their endeavors. I believe in the team concept and am not unfamiliar with taking the bull by the horns and wrestling him to the ground.

I have starred a tiger down and out struck a viper. I have out run a lion and rode an ostrich. I have walked and talked with the animals, and have waited quietly for their responses. I commune with nature and love to teach another my secrets. I do not cast my pearls before swine but am not stingy with the truths that have been revealed to me. My mouth carries my voice loudly but my heart quietly waits the responses of others. I listen as intently as my emotions show my intensity.

I like to lead in the small things and let the large things take care of themselves. I like to be first, and charge the door of uncertainty with the vigor of a dea agent. I believe in others and only seek their respect in return. I like to be the first into battle, and will stay until it is over. I go out in the face of a storm and take off the raingear to be one with my fears. I love to lay by the shore and watch the clouds drift by in mindless shapes.

I love to lead pirate style.