Ouch, That Hurts!

Printing – it’s a capital-intensive industry where pricing wars produce razor-thin margins. Customer pressure for ever more rapid turnaround has forced cost-cutting and consolidation, while smaller, more agile companies are sneaking in with more flexible ways to meet customer demands. Since printers can’t raise prices, they must do more with less.
These were just a few of the issues facing the printing industry outlined by Patricia Nagle, president of solutions provider and SAP Business Partner Syskoplan, during an SAP-sponsored webinar on “The Next Generation of Information Technology for the Graphic Arts Industry.”
What they indicate, she explained, is that printers must develop greater overall efficiency and flexibility. They must become more sophisticated in the use of technology, in communicating with their vendors, and in their approach to how material is printed, packaged, and delivered. In sum, they must change their focus from equipment to customer issues such as timeliness, quality, real-time print-job information, and new methods of delivery.
Today, she said, the industry trend is toward full-spectrum service providers where traditional print and packaging functionality is converging with direct mail and direct marketing, as the need for personalization and service differentiation increases. And technology can be the vehicle for doing this, helping a company differentiate itself and provide additional value to customers. New services, Nagle explained, require new tools to manage inventory, sales, finances, and costing. They need applications that are integrated across organizational boundaries to embrace production, delivery, and real-time collaboration both internally and with clients and suppliers.
Yet, she cautioned, these functions must also reflect the unique needs of the printing industry, where each item is made to order and no two products are alike. Estimating must be flexible and integrated with sales to turn the estimate into an order quickly. Similarly, scheduling and planning must address customer needs across multiple orders and runs. Additionally, the ability to rapidly address change orders, manage the cost implications in real-time and prevent erosion of job margins also adds further system complexity. What is required is full visibility of all aspects of the business operation – “visibility everywhere” and the ability to manage the business in a flexible yet controlled manner.
Beyond all else, printers require a long-term solution that can continually adapt to the dynamic business climate of a low-margin business and provide the means to remain competitive through information management as well as production and manufacturing efficiencies. She believes SAP is the ideal solution source for this and says, “SAP will be there.” She went on to note that Syskoplan has been an SAP Business Partner since starting up 20 years ago and is now a qualified vertical solutions reseller (VSR) of mySAP All-in-One solutions. The firm’s U.S. division has been in operation since 1996 and serves as consultant, implementer, and development partner.

Print.IT and Pack.IT

Relying on its years of experience in the print and packaging industries, Syskoplan recently introduced Print.IT and Pack.IT, two qualified mySAP All-in-One solutions. Previously, Nagle said, these industries only had access to point solutions that created isolated “islands of automation”, such as production, order management or payroll, that could not readily communicate.
For Print.IT and Pack.IT, Syskoplan extended the basic capabilities of their mySAP All-in-One solution with further industry-specific configuration. The company also provides consulting, implementation, and front-line support, with full backup support from SAP. Either solution can be implemented with only minor tailoring to the individual client, she added, leading to lower costs and accelerated implementation. Syskoplan has picked up several clients in Europe and the U.S. and negotiations are taking place with several more.
Among their preconfigured content, the Print.IT and Pack.IT solutions provide a standards-based workflow to move processes faster with fewer people, design and printing services and definitions, preloaded product types and materials, and specifics for estimating, job costing, scheduling, shop-floor control and direct machine interfacing. The mySAP All-in-One solution’s project management component ties in with planning and scheduling to provide a 360-degree view of where a job stands in the overall production process.
Describing the Print.IT solution in greater detail, Nagle noted that it is designed for such outfits as commercial printers, business-form and label makers, newspapers, magazines, direct mailers, and direct marketers. Based on best practices for the printing industry, it provides enterprise management, reports, and profitability analysis.
The solution brings with it the open-architecture SAP Web Application Server and SAP Enterprise Portal. Available SAP components include financials, supplier relationship management, supply chain management, product lifecycle management, customer relationship management, and human resources. Any of these components can be added later to meet the organization’s organic growth or to support items such as wireless and handheld devices.

“The last solution”

Nagle then handed the baton to Brad Masters, Syskoplan’s director of industry solutions, who used his 16 years’ experience – including implementation of SAP while at Vertis – to expound on the role of IT as a strategic as well as an automating tool. He first of all noted the warning signs of failure in ancient legacy systems or off-the-shelf solutions, “Do you know the real numbers in your company? Is IT holding the company in place rather than helping it go forward? Are your people spending their time cleaning, scrubbing, and fixing the data and the technology? Do your systems talk to each other?”
Non-communicating systems, he said, generate overstaffing, inefficiency, and process fragmentation – in short, expense without benefit. He listed the three ways that a company can deal with this deterioration – point solutions, an in-house, custom-built system or a single, integrated solution like SAP. Basically, he explained, it is nearly impossible to build an in-house system as completely as SAP has done. In-house is also very costly, and the costs tend to skyrocket later, something that’s not true with SAP, he added.
Printers must offer a full solution to customers and vendors, he said, and only SAP can support that by providing tailored, flexible estimating, better plant efficiency, sorting and inventory control and a complete understanding of pricing. “We could quickly see the difference after putting in SAP at Vertis, how much wasted effort there was that wasn’t visible.” As for adaptability, nothing beats SAP at preparing for any kind of growth, internal, vertical or horizontal. He went on to ask, “Is SAP too expensive?” Not over the long term since a company doesn’t have to add, replace or integrate later, “Every dollar spent brings benefits. SAP is the last business application package you’ll ever have to buy.”

More than a printer

For the third segment of the webinar, David Spinelli, CFO of Syskoplan customer ANRO, a full-service commercial printer in suburban Philadelphia, weighed in with observations on his company’s selection of the Print.ITsolution.
What sent him looking for a new solution at ANRO? Lack of IT integration, he said, peripheral applications that didn’t talk to each other and a provider that did not deliver the integration promised. ANRO had put its money into technology for production, but the financial and customer-faced systems were left out of the loop, and the ability to manage the operation from an information-driven view was not possible.
“We needed something that would meet today’s technology challenges – yet not limit or hinder future growth of the company,” Spinelli explained. In fact, ANRO was already growing rapidly and becoming more than just a printer. “You can’t compete today by just being a traditional printer .” The company is adding services continually and is looking at online customer self-service for quotations, real-time job status, and collaborative design for the future.
The future of the printing industry, all three presenters agree, may be written in its IT solutions.
To view a replay of the webinar on “The Next Generation of Information Technology for the Graphic Arts Industry,” see www.sap.com/solutions/smb/allinone/newsevents/partnerwebconferences.asp.
An overview of Syskoplan’s Print.IT solution is available at www.sap.com/solutions/smb/allinone/prepackagedsolutions/print_it.asp.
For an interview with Patricia Nagle and David Spinelli, go to http://smbnews.sap.info/public/en/search.php4/start/t/Gutenberg/cat/0/1/2/3/4/page/0/article/Article-290593f97c3c09eb20/en.

Derek Davis
Derek Davis