This is Not a Book

THIS

THIS

IS

NOT

A

BOOK

IS

VARIABLE

DATA

DELIVERED IN

BOOK

FORM

MICHAEL JOSEFOWICZ

Published November 2007 by Josefowicz Associates LLC web www.josefowiczassociates.com email michael.josefowicz@gmail.com Copyright © 2007 by Michael Josefowicz Cover photo ©iStockPhoto

Variable Data Delivered in Book Form What you are holding in your hand is information delivered in the form of a book. The words are somewhere between a blog and a series of published columns. They started their life as the result of many conversations. Then they migrated to a series of columns at OnDemand Journal.com. In their present incarnation, they appear in a book form produced for the PIA/GATF Variable Data and Personalization Conference held November 3-6, 2007 in Phoenix, AZ. The present digital home of these words is on the internet at http://languageofcommunicationecology.pbwiki.com. Given how often I tinker with them, they are truly variable data.

WHY A BOOK?

I want to share my story to start more conversations. Ask yourself if you would have gone to a website to get this story. My bet is probably not.

Even if you like reading on the screen, it means you have access to some kind of digital device that connects to the internet. Then you have to be interested at that moment to find them. Then you have to remember the link. Then you have to start at the beginning, and stay interested enough to keep investing the time to continue.

Not very likely.

But suppose you happen to pick up a copy or someone sends you a copy, it’s possible that it will sit in your pocket or on your desk. It might be there when you have three minutes to waste between meetings or phone calls. Or perhaps while you are on line at the bank or on a train or plane. You might flip through it and perhaps a word, a heading, a phrase might catch your attention at that moment. You decide maybe to go back to it later. Four months later, it’s still on your desk. You thumb through it again. This time, maybe one column might be interesting.

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EASY TO DO

Since assembling the words for this book is not part of my day job, the normal stresses of publishing do not apply. It’s not a job. It’s a hobby. If someone wants to buy it, so much the better.

(Available at www.josefowiczassociates.com.)

But if no one buys it, that’s okay. After seven years teaching undergraduates who want to become designers, I’ve found the best way to learn is to try to teach. Nothing separates the bs from the real stuff faster than trying to communicate it to someone else. But ten years ago, I would not have had the same attitude. This little book would have taken too much effort to produce.

Today, the effort and cost of production is acceptable. It took about 40 people-hours to transform the words – in the form of data stored at ODJ.com and other ideas still in my head – and transform them into this physical form. The 40 people-hours were spent over a two week period, in the midst of real life – between day job and being with family. I am lucky enough to have access to a skilled graphic designer who agreed to put the words into an appropriate form. The outof-pocket dollar cost was negligible. The investment in time was acceptable. The only hard3

ware/software required was a computer with web access and a document creation program, in this case Quark, to create the document. No other purchased software.

No phone calls. No meetings.

WHY DO IT? !

!

!

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First and foremost – because I can. Because it’s possible and easy to convert existing digital content into published form with the resources we all have at hand.

Because I was invited to participate on a panel about variable data printing and knew that telling the story I wanted to tell in the context of an hour and half discussion was probably going to be impossible without boring everyone to sleep. If a picture is worth a thousand words, then the actual object should be worth even more.

Because I’ve learned from the many designers I have worked with over the years, it’s always better to show than to tell.

IT IS HARD TO CHANGE A LENS THAT HAS WORKED FOR A LONG TIME

Some people call it “paving over cow paths.”

Cars, at first, were horseless carriages. Moveable type, at first, was just an easier way to do what scribes had been doing for hundreds of years. As time passes, previously unanticipated uses lead to the emergence of new activities. Sooner or later, at different times and places, the legacy lens changes to take account of these new possibilities. Entrepreneurs eventually figure out practical ways to make a living by creating new products and services that people are willing to pay for.

The potentially awesome communication functionality of data-driven printing is following this same timeworn path. Transaction printers were the leaders in data-driven printing. Their product was fed by mainframe computers and output by laser and toner-based printers, and they were making a good living printing bills, statements and other necessary paper forms for large formal organizations. Direct marketers, with their long practice of evidence-based marketing, were a great way to spend advertising dollars and get predictable results. And traditional printers have lived with “on demand” printing their whole lives. Every day, they grapple with the problems 5

of getting it delivered when the customer demands it.

It only makes sense that the first understandings of new possibilities are seen through the legacy lens. The printers have used it to meet shorter deadlines, the transaction industry has used it to get greater throughput at a lower cost, and the direct mail industry has lead the way in new ways to personalize. Step one: do the old things better, faster, cheaper.

Change comes first in the way people communicate, then new behavior, then new ways of seeing.

As long as there have been groups of people, they have communicated with each other. It’s probably the main evolutionary advantage of the human species. It is from communication that people learn. Learning how to make good decisions in the context of incomplete information is necessary for growth and survival in an everchanging world. This is a daily problem for the owner of a small company, the CEO of a global corporation and for each individual in his or her daily life.

But to the extent that the ways of looking at the 6

world do not change to take new realities into account, it is harder to learn. The words we use can make it easier or harder to see new things that are happening.

Until recently the word “book” referred both to the container and the information contained.

New behaviors of millions of people are now separating those two realities. The printing industry, with its networks of skills and technology, has developed extraordinary functionalities to create information-rich physical objects better, faster, cheaper than anyone could have imagined ten years ago. It is now almost literally true that the same variable data that lives on the internet can be delivered in physical form, as needed, when needed, and where needed to be most effective.

One of the great values of a conference such as the PIA/GATF conference on VDP is that dedicated professionals, who have to figure out what to do as part of their day jobs, can gather to share and compare what they have seen. Once you can see what’s going on, it’s much easier to make good decisions.

It is in that spirit that this “book” is offered.

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Common Sense vs Common Wisdom Common sense is the collection of the understandings of how the world works. It has evolved through the trial and error of millions of individuals throughout human history. It is written about and analyzed in the Great Classics that have “stood the test of time.� It is modeled by the behaviors of older generations as they make the decisions that guide them in creating a life for themselves and their families. The great evolutionary advantage of common sense is that it has been proved to work pretty well in everyday life.

Common wisdom starts from common sense. It has the advantage of being widely accepted. But it has the disadvantage of being one step removed from immediate consequences. It does not have to go through the rigors of a real world trial-anderror process. To make it even a little more complicated, common wisdom is often just the common sense of people and organizations with lots of time, money and power.

When everyday life is changing slowly, common wisdom works pretty well. The centers of money 8

and power don’t have a problem, since by virtue of their positions, they are doing “good enough.”

Individuals depending on common wisdom have automatic “mistake insurance.” As the old saw has it, “Nobody ever got fired for hiring IBM.” Little time or energy is required to rely on common wisdom. The risks of not using it can be pretty high. Think of Galileo or Darwin challenging the common wisdom of their time. In the more prosaic world of everyday life, most reasonable individuals decide it’s not worth the bother of swimming against the stream – especially given the potential penalties of challenging the standard model.

It’s all good as long as the things that worked yesterday are still working today.

But when the everyday world starts to change, the problems with relying on the common wisdom emerge. New players with a different common wisdom emerge to make life much riskier, especially for the big outfits. In the last ten years, AT&T disappeared, then reappeared as the new label for Cingular. Time Warner was eaten by AOL and is still figuring out what to do. Google became today’s most reliable money machine.

Amazon changed the nature of buying and sell9

ing stuff. General Motors is fighting to stay solvent. Private capital buys Chrysler. China and India are emerging as driving forces in a global economy. An Indian based company, Mittel, is one of the world’s largest steel producers. The United States has the most expensive and inefficient health care system in the world.

When life gets riskier for 800-pound gorillas, everyone in the food chain has to rethink what they are doing.

To make matters worse, using yesterday’s common wisdom to solve today’s problems just confuses things. It makes it harder to do the right things fast enough to be effective. Different people put forward their common sense as the new common wisdom. Confusion can create stress.

Stress can create fear. Fear makes it much harder to figure out the right thing to do. Meanwhile, Friday’s payroll has to be met, the kids have to go to college and quarterly profit predictions have to be met.

In times like these, the best course is to go back to common sense. Eventually a new common wisdom will reach everyone. But that could take years and who has the time to wait?

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SEPTEMBER 12, 2005

It’s the Output Business “We may not be happy about it, but it is the reality we are facing. As better functionality is built into desktop software, the reality is that we are becoming an output device for our clients and their designers.” Greg Hill, Sandy Alexander, Inc., letter to OnDemandJournal.com, May 17, 2005

In the August 11 edition of WhatTheyThink, columnists Steve Aranoff and Robert Fitzpatrick asked the central question: “What industry do we call ourselves?” They conclude, “[Whether you decide that] “Graphic Arts” is an old, obsolete and declining industry or an expanding, innovative and opportunity-filled one does not depend on your level of optimism or negativity. The answer – and business strategies that will be based on the answer – will first be determined by your definition of the business.”

My definition of the business is the Output Business – we are the hard copy output engine of the information ecosystem.

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And everywhere I look I see an “expanding, innovative and opportunity-filled” future. The internet will continue to generate the greatest explosion of accessible content in the history of mankind. Never before has there been this much content that wants to be output.

THE ENABLING TECHNOLOGY IS DIGITAL PRINTING.

In a very real sense all printing has become digital printing. Ever since offset moved to CTP, most output products start life as a digital file and involve a laser creating pixels. Whether we use toner or offset ink to complete the process is much less important than the fact that the origin of the information is in digital form. And now we are getting the standards, the RIPs, MIS systems and business processes that allow us to output a digital file on the most efficient device, based on the customer’s requirements.

Toner, whether dry or liquid, brings a new, truly revolutionary capability to our output systems.

For the first time in 500 years, we are not trapped by run length or the need to create a fixed master for reproduction. This is truly a sea change. With the advent of design-quality digital print, we can bring the powerful tools of the design craft to 14

communicate with audiences of one, ten, thirty or one hundred. At the very same time, communicators are realizing that is exactly the context in which the most effective communication takes place.

VDP and customized marketing tools are only the

very tip of the iceberg. They supply great new solutions for an important, but still relatively small part of our industry – the direct marketers serving corporate organizations. Keep an eye out for the killer apps of true database publishing. As it becomes more commonplace to output welldesigned hard copy directly from the same databases that drive the internet, much larger opportunities emerge. My own favorite so far is indicated by the use of 24 iGen3’s in Japan to produce credit card statements with full color contextual advertising messages.

Our society runs on documents. It’s been estimated that a large percentage of our education, health and government budgets are tied to the movement of documents. They have to be created, stored, accessed, and output. Adobe and Xerox, two important players in the output industry, are focused on this problem. My understanding is that it is the fastest growing part of their 15

businesses. The pressure to increase efficiency and drive cost out of these sectors will not abate.

Once we deploy the innovative output these sectors need, very large applications will emerge.

DIGITAL PUBLISHING

Educational publishing is already a well established, profitable industry sector. There are many output innovations waiting to be deployed that will significantly increase effectiveness in education. My favorite example is the work of the Grow Network, a division of McGraw Hill, that has produced totally individualized workbooks based on students’ results on standardized tests.

Each student’s book is different, providing remedial exercises specifically targeting their areas of under-performance. The first release of over 50,000 books led to a 15% increase in student performance. Grow Network is now doing the test score reporting for most of the large school districts in the nation. That’s a killer app.

ADVERTISING & MARKETING

Advertising, traditionally a mainstay for the printing industry, is going through its own sea change.

It’s clear that more advertising dollars are going to different media. But it is also evident that event marketing, word-of-mouth advertising and cus16

tomer loyalty programs are growing quickly. As the advertising industries find new ways of building communities for loyal customers, they are looking for innovative hard copy output solutions to leverage their efforts. My current favorite example of this is a program put together for the US Army that allows a local recruiter to order event related materials over a website for delivery anywhere in the country within two days - banners, posters, leaflets and brochures all customized for one event of a couple of hundred people.

And then there is the explosion of small business.

As Dr. Joe Webb is fond of pointing out, the growth of small business is constantly ignored by government statistics. In his August 12th column on WhatTheyThink he says, “And it seems that only I track this: net new businesses up yet again, now running at +72,333 net new businesses per month, an annualized rate of +868,000 annually.

That’s 12.5% higher than it was July 2004.” Parts of our output industry see the opportunity very clearly. FedEx/Kinkos, PrintingForLess.com, PSPrint.com, VistaPrint.com – all seem to be doing very well selling commodities for the SOHO market.

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TRY IT YOURSELF

Here is an exercise to prove to yourself that thinking of your business as part of the Output Industry can lead to new products that you can profitably offer to your existing clients.

Have your salespeople spend at least an hour looking at your clients’ web sites. (The communication ecosystem has now developed to the point that almost every client, large or small, has a web site – a very big change from five years ago). Look at the web site as if you were your customer’s customer. Keep asking yourself “What if....?” and fill in the blanks with possible outputs that would make your experience as a customer better.

This is an exercise that I regularly use with my design students and with clients who are focused on innovation. It’s pretty amazing what they come up with. I tell them, don’t worry about the “how” of whatever you think of, only about what would be cool to do. The good news is with all the tools for output now out there, almost any “What If...” can be delivered. And with open source software, and the abundance of software experts, it doesn’t have to be all that expensive.

The bad news is that any individual printer, no 18

matter how large, does not usually have all the skills in-house to execute these innovations.

Unless they have internalized the culture of networked business relationships, with the trust, transparency and accountability necessary, they cannot execute fast enough to reap first-mover advantage. Almost any one organization is too slow. Only the network has the resources for real speed. This is the real secret of the innovation of the internet.

The logic of the marketplace is moving inexorably. If a product can be clearly defined it will become a commodity. Innovations will succeed by exceeding customer expectations, and getting to market in Internet time. The only question is exactly when and where this logic will affect any particular business organization.

Some will look honestly at their market, and make painful adjustments before they have to, Others will continue to thrive in small protected niches. Still others will see the opportunities and courageously invest the time and attention to take advantage of emerging opportunities and become the major players in the consolidating output space.

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OCTOBER 3, 2006

Post-Tipping-Point Style Growth and the Printing Industry: Thoughts on Direction and Change Lulu.com delivers on-demand books to self-publishers who have a computer and internet access.

The company has nurtured a standards-based network of digital printers to execute delivery.

According to the Financial Times, Lulu’s sales were $1 million in 2004, $5 million in 2005, and are forecasted to be $15m for 2006.

Lulu.com was founded by Bob Young, cofounder of Red Hat, the very successful opensource software company.

It’s not a surprise that in a Post-Tipping-Point environment, Internet-style growth in print was not brought to market by anyone in the traditional media industry: not a printer, nor a global manufacturer, nor any of the publishing conglomerates. Lulu.com is particularly interesting because it is in the printing industry, but not of the 20

printing industry, and it demonstrates the importance of using common sense instead of common wisdom for decisionmaking.

WHY, WHAT, HOW

The most important old/new rule is the need to consider “why” you want to do something.

The “what to do” depends on the customer’s situation. And the “how to do it “ will probably involve taking “best of breed” and integrating it with your core strength. It’s really just another way of saying “Use what you’ve got to get your customer want they need, and make sure it’s profitable.”

These days, though, the old tradition of jealously protecting information and trying to do everything in-house doesn’t make any sense. It limits “what you’ve got” unnecessarily. Printers are probably the most natural outsourcers in business. In our industry it’s usually been called brokering, but in the new world, it’s called networking. The big difference is that the old “mark-up” is probably no longer a sustainable model.

Figuring out a new business model just means figuring out a way that everyone makes money without “marking up.”

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As we’ve see again and again, time to market, flawless execution and a service that fits your customer like a glove will win the day.

Note that “time to market” doesn’t necessarily mean first. It means finding the right time for your network to take the right solution to the market. As every printer knows, a solution that only “sort of ” fits your customer is often worse than no solution at all. The days of beta testing with your customer’s time and money are over.

And the biggest time waster of all is a solution for a problem that your customer doesn’t have. But when the right product and the timing are in place, it works pretty well. Take, for example, the personalized print piece.

The basic idea is pretty straightforward. Get the customer activity info from a database. Analyze it. Then use it to deliver customer-accurate information to up-sell, cross-sell and get responses. A great example of the power of this common sense approach is described in the ODJ.com story on the “iGen Farm” in Japan.

So, reasoned Sumitomo Mitsui, if we know a VISA cardholder drops 115,000 yen a year (about $1,000) playing golf we should make sure that customer 22

receives offers for Top-Flite balls, Ping or Callaway clubs, golf trips, and other golf-related items. Tap into any interest or passion for that matter, where customers are dropping serious yen, and cater to those yearnings....

The 24 iGens were installed in the JAIS facility in Osaka, 16 on one floor and 8 on another, creating the world’s first “iGen Farm,” a 21st century version of the DocuTech farms of the mid-to-late nineties. JAIS fired up the first production run in late July 2005 and 87 hours later 9,000,000 duplex images had filled the output stackers, on time and with no significant issues. It’s been running pretty much that way for the past year.

The article goes on to describe the software used to format the print file. The data mining software that finds the appropriate data is “behind the curtains.” But in the PTP (Post-Tipping-Point, of course) world, few technologies have a long life “behind the curtains.”

To prove it to yourself, type in “recommendation engine” into Google. Last time I did it, I got 36,000 hits. Take a look at the ads in the right hand column. If you have the time, spend an interesting half hour following the links.

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Merely knowing how to do it is no longer a longterm advantage. The very profitable days of Adobe licensing PostScript to OEMs are long gone. As information is freed from formal organizations and transparency in the marketplace continues to move forward, information itself is becoming a commodity.

But instant access to useful information coupled with flawless execution is definitely not a commodity. The hard part is getting it all to work together. Although execution and delivery are often core strengths for successful printers, access to information has always been a challenge. Meet that challenge and the future looks very bright.

The secret sauce has become figuring out the new business models that take advantage of the new conditions: What are you going to deliver, how much will the customer be willing to pay, and how are you going to produce for less than the selling price.

You’re already pretty busy running a business, so partnering might be the most realistic way to find “what to deliver.� You might keep a sharp eye out for someone outside your normal customer base who seems to be improvising a new business 24

model. Then explore the pros and cons of becoming their execution and delivery machine.

I bet that is working just fine for the printers in Lulu.com’s execution network. Remember that Bob Young is taking the risk, and the print partners print and get paid for what they deliver.

Once in a while, a long established customer can re-imagine their own business processes.

Sumitomo Mitsui Banking Corp, for instance, made a small change that turned a cost center into a profit center: Sumitomo Mitsui now sells ad space on their customer statements (and ultimately receives a transaction fee for future sales).

One VISA executive in Japan notes, “We no longer think of [statement] printing as cost per page but as revenue per page.”

So what could this mean for you? It depends on your circumstances.

First, figure out why you want to do whatever you want to do. At the beginning of the process assume that technically you’ll be able to do anything. It’s just a matter of time and money. In a PTP world, it can probably be done with a lot less money and a lot more focus than you think.

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Resist the temptation to start with what or how.

Start with why. Only after you have that pretty clear, focus on the what and the how. Keep in mind that “making money” is not a usually a good enough answer to the “why” question. To get a useful answer, you have to ask yourself why you want to make money and what else you want. The way you answer the why question is probably going to depend on your personal values and the responsibilities and constraints of your job. Personal values are personal – only you know what they are. And every job has different constraints on what you can do.

JOB: BOSS IN A GLOBAL PUBLIC ORGANIZATION

If you are responsible for a global public company you need demonstrable growth that will be rewarded in increasing share prices. Or you need investors who are satisfied with secure, sustainable organic growth that predictably delivers rewards in return for them owning your shares.

Your real constraint is the huge volume of private capital circling the globe. Every organization, no matter how big or established, is potentially under attack. Sooner or later, if some group thinks they can get more value out of your assets, they will come searching for a way to unlock it.

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And this may or may not include a major management change.

JOB: BOSS IN A GLOBAL PRIVATE ORGANIZATION

If you manage a global private company, the vagaries of the stock market are irrelevant and the owners get to decide what they want to accomplish. It could be to hold on for the long haul, or it could be to monetize the value as quickly as possible and get out. It all depends.

JOB: BOSS IN A LOCAL PRIVATE ORGANIZATION

If you are responsible for a smaller organization — which includes almost everyone in the game— you have to figure out what you want. Is it another 5 years and then retirement? Or is it building a sustainable local business, with good organic growth, that stays about the same size or grows at some percentage each year? Or is it figuring out a way to package the company for a potential exit in x years? It all depends.

If you have employees you have the additional problem of setting incentives, performance standards, or use whatever you have to get everyone doing their job correctly. It’s easier and harder, if you are a single practitioner. No one to manage or blame but yourself.

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In either case, your constraint is meeting your bills and your payrolls. There are few things that will keep you up at night as predictably as not being able to deliver on these. The good news is that if you’ve survived and grown for more than five years, the discipline of the weekly payroll makes it much more likely that you have the character and the resources to respond to your customers and not make too many dumb decisions.

JOB: INDEPENDENTLY WEALTHY ENTREPRENEUR

If you are an entrepreneur with access to lots of your own money, you can do what you want. If you want to change the world, that’s your choice.

To succeed, you have already learned that to change the world, there must be a sustainable business model. If you make tons of money, so much the better, but in any case, there have to be rewards for everyone who is in the game.

Your constraint is the global and local market.

And a second constraint is the ability to nurture a network that is suitably capable and motivated.

Aside from that, your constraint is what you decide it is. If you have a high risk profile – if you are able to withstand losing a bunch of money while you improvise your way to a successful 28

business model and no venture capitalists breathing down your back for an ROI – there are few constraints in following your passion to make it work.

Here’s how Bob Young describes what he focuses on. Why he wanted to do it is something that only he really knows. Although he has done things well outside the box, Young is no anarchist.

His hero is Adam Smith. “If the citizen and the consumer are the same thing in a free-market economy, the bigger the social problem you can solve, the bigger the business opportunity must be,” he says.

Perhaps this could turn out to be useful focus for other printers, manufacturers and media companies. Certainly the global social problems of education, health and government have the right scale to interest the big players. And the ubiquity of the problems should mean enough opportunities for the rest of us.

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OCTOBER 21, 2006

What’s Your Core Business?

Pick One “What business are you in?”

It seems so common sense. But if the answer doesn’t help you make better decisions, who can spare the time to figure it out? Instead of an essay question, or a fill in the blank question, try thinking of it as a multiple choice.

Here are your choices.

My core business is: (a) Infrastructure (b) Personal service/retail (c) Creative The infrastructure business includes General Electric, Microsoft, Starbucks, Home Depot, Wal-Mart, Google, the deli on the corner in my neighborhood (open 24 hours), and a printer I know in NY, whose head of production answers 30

email within 15 minutes, 18/6 almost 365.

Personal service business includes hairdressers, psychologists, physical therapists, nurses, yoga teachers, teachers in the classroom and some lawyers.

Creatives can be found everywhere, both inside and outside of formal organizations. The job of a creative is to produce better new ideas. The industry usually says “creatives” when what they really mean are document creators. Document creators are actually in the infrastructure business. Creatives live and produce in a world very different from the others. Sometimes the same individual does both.

New ideas can come from anywhere and everywhere. But they are usually the product of one, two or three people. It’s just the way the creative business works.

So now it’s time to pick one “Service provider” and “one-stop shopping source,” for example, are not core businesses.

They are ways to run a business. They don’t create value, they monetize it. So if you can’t pick 31

one, try again. The problem with “we do all three,” is that it’s nice to say, but in the real world, it’s almost impossible to do. The most reliable way to succeed is to be great at something. Being great at one thing is plenty hard enough. Being great at three things is pretty much impossible.

Of course, every business has elements of all three. But without a clear picture of your core business, you won’t make intelligent decisions about resource allocation. If you can’t quickly decide where to put limited time and money, you’ll miss opportunities or respond too slowly to threats. To make it even more difficult, the infrastructure, personal service and creative businesses thrive in very different cultures. And the word “cultures” is not an abstract concept. It’s just a shorthand way of defining the underlying rules, customs and incentives that govern the activities of the folks in your group. Or, for that matter, in your target audiences.

A culture is not based on what people say or a mission statement. It’s based on what people do every day. It’s reflected in how you spend your money and, even more important, how you spend your time. Culture can take a long time to grow, and an even longer time to change. It is the 32

true defensible competitive advantage. Culture will always trump technology, mission statements, and marketing campaigns. And, when you think about it, it might be why common sense printers have historically resisted the idea of marketing.

(A) INFRASTRUCTURE: THE RIGHT ANSWER FOR PRINTERS

If you chose (a) I think you are playing to the printing industry’s sweet spot. There’s been lots of talk recently about how we are in the service business. While that seems to make sense, for printers “service” always means making it easier to buy the product. That’s infrastructure.

The really good news about the infrastructure business is that it’s a very good way to make lots of money, relatively predictably. Sometimes, if you are smart, focused and lucky enough, infrastructure businesses can scale into big businesses.

In an information-rich society, delivery systems for communication are moving quickly from personal service to infrastructure. The ecology of the content delivery business is getting richer and more vibrant every minute. If you can find opportunities, and act to take advantage of them, 33

there’s no better time to be in the game. For example, some of the players in the print delivery infrastructure business include Staples, VistaPrint, FedEx/Kinko’s, Lulu.com and their print suppliers, along with hardware vendors like Canon, Epson, HP, Heidelberg MAN, Océ, Xerox and the other heavy metal manufacturers. Then there are all the software companies that develop the tools that enable the printing that takes place on the big machines. And the finishing, binding and mailing equipment. Most important are the thousands of “small” printers that routinely deliver the right product at the right price at the right time to the right people with a minimum of hassle for themselves or their customers.

What makes an infrastructure company successful?

On the most basic level, a great infrastructure company gives people easy access to stuff that people want. The hard part is that they have to keep inventing ways to do this more efficiently and more in tune with sustainable practices. The heart of an infrastructure company is lowering the cost of acceptable delivery. The trick is making sure it keeps getting easier and more pleasurable for the customer to buy the product.

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So what does this mean for you?

The bad news is there is no one-size-fits-all magic bullet. The good news is that you already have all the information you need. You just have to spend some thinking time, to get it all straight. I don’t have that much to add to how to lower the cost of timely delivery. That’s more for the experts in operations, machinery, technology, and standards-based production – listen to the people in your organization, they probably have hundreds of great, practical ideas to do just that. But I’ve been a printing customer for over 35 years, so I feel okay about talking about the customer experience.

The two questions to focus on, first 1. How many emails or phone calls does it take to complete a customer inquiry?

Anything more than one is too much.

2. How much time is spent setting up and attending meetings?

Usually anything more than 2-3 hours a week, is too much.

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What’s the quickest, easiest way you can start to fix that?

That’s up to you. But in my opinion, without fixing the customer-facing communication system first, and making it easy and even fun to deal with your company, you will probably be wasting lots of time and money. So start with communications. Talk with your customers, find out what is and is not working, what they like and don’t like; find out if they have suggestions for how you could improve. Figure out how to address the issues they point out. Then move on to finding other ways to improve the customer experience and keeping them as satisfied customers.

It’s just the way the infrastructure business works.

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ORIGINALLY PUBLISHED AT ONDEMANDJOURNAL.COM

JUNE 29, 2005

Waiting for the Tipping Point Part 1 In 2000, Malcolm Gladwell wrote The Tipping Point, a book that became quite the rage among marketing types. In it he tries to explain fads and products that have explosive acceptance rates. He extrapolates from his study of epidemics to explain massive changes that seem to happen to overnight.

In my professional life in the industry, I clearly remember at least two such events. The first was the disappearance of the typesetting industry.

With a history that stretched back to the beginning of printing itself, it seemed to disappear in a few years. Actually, typesetting didn’t go away, but most typesetters did. Not quite as drastic, but pretty close, was the disappearance of engravers and color separators. Again, color separation didn’t go away, but lots of color separators did. In both cases, technology came first, then early adopters, then business pressures and then the world turned upside down.

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Feel familiar?

The really good news is that we’ve also seen other industries appear just as rapidly. Remember when fax machines “suddenly” appeared, or digital cameras, or cell phones, or Starbucks or, of course, Amazon and eBay? It’s important to remember that while many dot.coms were dreams built without business models, this year Yahoo and Google took in more revenue than the three major TV networks.

Tipping points don’t happen everywhere, all at once. Society and business are much more complicated than that. Widespread changes, like epidemics, start small, hardly visible, and then for some not obvious reason, spread like wildfire.

The art is to watch for the wisps of evidence to try to gauge if, and how, they are developing. By the time a tipping point becomes common knowledge, it’s usually over. The “magic new thing” becomes commonplace, the extraordinary becomes routine.

The Internet boom is over, the internet economy is here. Individual businesses will inevitably adapt well, adapt poorly, or adapt not at all.

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Working with creatives in New York, I’ve seen things that make me believe that the “excitement of a revolutionary new technology stage” of digital printing is finally starting to give way to the “routine” of a new way of doing business. After hundreds of millions of dollars invested in technology by very courageous vendors and millions of dollars and people-hours spent evangelizing and educating, I’ve seen the last pieces starting to fall into place that might change the way creatives will look at digital.

What’s the enabling matrix?

In the real world of business there is only “good enough.” Digital reproduction has to be “good enough” for professional creatives to confidently use it for any client in any situation. As long as it’s for a special situation – short time-frame, low budget, or even variable data – it’s just a niche tool. To tip, a product or offering must become a general-use tool. And, critically important, a creative has to be able buy this product/service, in the open market, easily and reliably.

Recently, I’ve been able to purchase digital printing where the color is balanced, the type quality is fine, paper choice is nearly unlimited, and professional finishing is affordable.

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But, most important, it is repeatable and reliable.

From the point of view of a professional creative, who has to satisfy either an internal or external client, this is the single biggest advantage. It potentially means the end of the Great Fear of Printing: will the printed piece look like the proof that the client approved?

Take this fear out of the printing production equation and everything changes. Now a creative and a client can see a finished product, before spending large sums to buy it. Nervous discussions about setting expectations, are replaced by looking at a sample of the final product. Do you like it? No. Then let’s change it. Yes. Then buy it!

The implications of this for taking stress out of the lives of a print-based creative cannot be overestimated. It, by itself fulfills the first requirement of viral adoption, the product/service has to be better, faster, cheaper.

Once digital printing tips in the world of creatives, they will bring the brand managers and the enterprise budgets with them. And the industry will have to spend much less time “educating them” about its benefits. How much “educating” do Google, or Amazon, or Friendster, have to do, once they get to critical mass?

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Most printers still incorrectly identify document creation, either print or web, as the primary function of creatives. But that is not a creative’s unique value-added. Professional creatives are paid and trained to know the best way to get a get a message communicated. And these professionals are constantly on the lookout for practical tools that can be easily integrated into their professional practice. When digital printing works for them, in a routine way, on the ground, every day, they will gladly adopt it, and come up with uses we haven’t even dreamed of.

So. What’s next? Good news and bad news.

First, I know that achieving routine repeatability is a very serious challenge. But if you want to get tipping point adoption with professional creatives, you don’t really have a choice. I’ve had direct experience with at least one NY-based printing company that has been able to do it, so I know it can be done. It’s not easy; it’s not cheap.

The good news is that most of the tools are already in the market place, the bad news is that time, as much as money, has to be invested.

Second, digital printing has to be priced correctly.

Low enough so it that achieves wide acceptance, 41

but with sufficient margins to be sustainable for the printing company. The real cost per click is relatively low, and you can bet that with the fierce competition among vendors it’s going to continue to go down. The market is presently willing to pay a pretty good margin, although I’m betting that those margins will be under continuous pressure. The irony is that often the largest cost component of digital printing is writing up the job ticket, tracking the order, delivering it and getting paid. Printers have got to get these costs down to their absolute minimum.

The good news is that the technical systems are getting cheaper and easier to install every day.

But, at base, like most things, it’s not primarily a technical issue, it’s a matter of how you do business. That’s the good news and the bad news. It needs your company’s time and attention, not just your checkbook.

Where might this go?

The great news for creatives is that sooner or later a critical mass of companies is going to get it all together. And when enough printers combine the requisite reliability, and easy production communication with all of the following fea42

tures, we’ll all probably read about the overnight “Printing Revolution” on the business page of the Wall Street Journal.

To get ready for this sea change, you might want to ask yourself some of the following questions: !

!

!

!

How fast and easy is it for a customer to get a final, accurate, definite price – not an estimate – from your company? As easy as it is at Apple.com or Dell.com?

How easy is it for a customer to open an account and give you money? As easy as Schwab.com? or Amazon? or iTunes?

How easy is it to track the progress of production? As easy as FedEx or UPS? Do you offer a guarantee of satisfaction, backed up by a return or store credit policy? As good as Land’s End or Costco?

The companies mentioned are setting the standards for all businesses. The really successful printing businesses will not be an exception.

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ORIGINALLY PUBLISHED AT ONDEMANDJOURNAL.COM

SEPTEMBER 26, 2005

Google, Wal-Mart and Commercial Printing The models for sustainable success are pretty clear by now. They are based on the basic rule of marketplace success: get the right thing to the right person at the right price at the right time.

Google delivers the right information to the right person for free, 24/7. Wal-Mart delivers the right product to the right person at the lowest price and the item is (almost) always in stock. The idea is very simple. The execution is very hard.

Google and Wal-Mart dominate their markets because they deliver.

“Google” is my shorthand for all enterprises on the Internet, both tiny and huge. “Wal-Mart” is the shorthand for retail, again both tiny and huge.

Both create value with a computer-driven intelligence network that delivers actionable information on what people are doing in the real world.

Both have a way to use that intelligence to constantly improve their customers’ experience.

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For both, the created value is the intellectual capital created by their networks. Google monetizes that value by becoming the de facto best advertising vehicle ever invented. It enables anyone to deliver an advertising message exactly when the customer wants it. Google has built the infrastructure that allows producers to “break through the clutter” by delivering information the consumer wants to receive. If the recipient wants to read it, it’s not junk mail.

Wal-Mart invests the intellectual capital of their network by selling physical products, at very low margins in very large quantities. They have near real-time data on what is bought at every WalMart all over the world. With that information, they can tell what their consumers want and don’t want. They are conducting a 24/7 survey based not on opinion, but on the reliable indicator of consumer spending. They couple that with a business structure that allows them to restock the hot sellers and eliminate the slow ones. And they have the overriding mission to continuously drive costs out of the business transaction and the buying power to negotiate rock-bottom costs, so they can continuously improve their customers’ experience.

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The experience of Google and Wal-Mart tell us that the combination of knowing what people want and making it easy for them to buy it from you works in the real world.

What does this have to do with the printing industry?

Everything. Arguably what people want are design-rich color-printed products anywhere, anytime. The technology is now in place to give them that experience. The only thing missing are the network relationships.

First, in trying to understand what your printing customer needs, don’t focus everything on ROI. Every serious commercial organization is being pushed by the logic of the marketplace to the Wal-Mart, Target, Costco, Starbucks model: deliver the right customer experience to the right person at the right time for the right price. If you can offer a print based solution that will help your client get closer to that goal, be confident that someone in your client’s company wants to hear about it. Your job is merely to find that person.

Second, offset printing as practiced for the last 50 years, has relatively little to offer this new business 46

model. Of course there will be a continuing need for offset, but it’s pretty clear by now, that offset is a declining, or at best, stagnant market. The only road for a strictly offset print provider is better, faster, cheaper. The faster you move to “lights out,” completely automated, super efficient production and customer service, the better the chances you have of being one of the few winners.

Third, hybrid printing is the killer technology.

Hybrid is the ability to deliver the right combination of digital and offset product to the right customer at the right time for the right price. Datadriven digital printing is perfectly designed for the emerging business models. Print has again and again demonstrated its superiority in traversing the last mile to the consumer. It is also unparalleled in its ability to create a lasting customer experience that leverages word of mouth advertising and becomes a part of the consumers environment. Think about packaging, books, posters, calendars, POD and other print artifacts that live in the real, as opposed, to the virtual world.

You’ve heard this for at least five years, why believe it now?

Remember reading about the desktop revolution 47

for many, many years, and then within one twoyear period everyone switched to a Mac? Or the way it seemed that overnight the customer experience in the businesses of finance, books, used books, travel, real estate, and auto sales was completely reinvented.

If you are a print-for-pay manufacturer, ask yourself, how many new offset clients have you found in the last few years. How many new digital print customers have you found? And what are your profit margins on each kind of job?

What does it mean that FedEx purchased Kinkos?

Do you really believe it was only to get outlets to fight the UPS stores? Or might it be possible that FedEx, a world leader in logistics, sees the opportunity to capture a significant share of the printing market—both digital and offset? Have you found yourself competing with FedEx/Kinkos for substantial commercial accounts?

And what will it mean that Staples, Office Max and Office Depot are now all in the game?

Do you believe that energy prices will stop rising and U.S. Postal Service rates will stop going up?

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What effect might this have on the cost of the “print and distribute” model of manufacturing?

Do your customers really see or care about the difference between offset and digital quality?

IT MAY HAVE ALREADY TIPPED

As Malcom Gladwell argues, tipping points are a little like flu epidemics. They don’t happen everywhere at once. They start in very small places, and if all the factors are right, spread with amazing speed. I believe that all the factors are right, albeit at different speeds in different places. Look at some of the indicators.

A critical mass of quality digital manufacturers are in place and have spent a year or two going up the learning curve. My primary area of experience is watching Xerox, but I bet that Kodak, and HP-Indigo are in a similar situation. The beta versions and version 1.0 are long gone. Version 2.0 and 3.0 of digital printing systems are now in place. The printers who get it have developed the expertise to routinely produce digital printing that works. The printers who haven’t gotten it yet, are probably already too late, and will have to join the party through mergers or acquisitions.

As an educated print buyer, I can now routinely 49

purchase, or produce in my office, digital printing, without fear of failure, and with little hassle.

The cost of entry has been lowered to the point that a new class of producers have emerged.

At Print 05, I met a fellow who told me that he had 3 employees in 1000 sq ft of space in a small town in Kentucky. He has a Xerox T250, a Nuvera, and the ExactBind binding system. He spent the last 20 years not in the printing business, but when the cost of entry became low enough, he decided to make the jump. He told me that in less than 5 months from starting, he’s been able to put $60,000 in the bank, by doing between one and one hundred copies of black and white and full color paperback and hardcover books for individuals, schools and commercial organizations. He recently bid against Jostens for a yearbook and won.

Also at Print 05, I met someone from a design studio in Ohio, who was so frustrated by his inability to find a print for pay supplier that was easy to work with, that he was purchasing a T250 from Xerox. He has already developed and sold a number of innovative data-driven digital solutions to substantial clients, and wants the option to pro50

duce them himself. It’s faster than finding and negotiating with a print-for-pay manufacturer.

In New York, I recently talked to a printing broker who has been at it for more than twenty years. She has an Epson 9000, an addressing machine, and a small staff to do fulfillment. She’s been regularly getting a couple of new digital customers every month, doing small jobs in her facility, and brokering larger jobs to a trade shop that has a Xerox DocuColor 2060, and another trade shop with a NexPress 2100.

When my independent dry cleaner enters all my transaction data into a point-of-sale computer and when even the smallest enterprise has a website, it’s clear that the internet is widely accessible. Wal-Mart spent hundreds of millions building their computer systems. Now, every business can access computer functionality for a small fraction of the cost. Duplicating the logistics system, while considerably cheaper, is still daunting.

INNOVATION USUALLY COMES FROM SMALL GROUPS

Large and mid sized organizations very rarely have the time or vision to innovate disruptive solutions. Their main concern is, very correctly, 51

to manage risk. Disruptive innovation, by its very nature is very, very risky. It is usually best done in very small centers of creativity that can afford to make very big mistakes. (By the way, the industrial technology underlying digital printing has been a welcome and notable exception.)

The irony is that it is disruptive innovations that power tipping-point adoption. Once the cost of entry is low enough for failure-tolerant creatives to get in the game, the sheer volume of innovation explodes. And from that volume, the best will be identified by the market and become the killer applications of tomorrow, If your company already “gets it,” don’t worry about innovating, worry about continually improving your customer’s experience. That’s already more than a fulltime job.

But at the same time, keep scanning the horizon for the potential killer apps that you can take mainstream. Look at things like the Xerox PIXI awards, to the design schools, and to the “small” players that might not seem to be worth the investment of time or attention. The killer apps of the next few years have probably already been invented. Your job is merely to find them and sell them to your customers.

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ORIGINALLY PUBLISHED AT ONDEMANDJOURNAL.COM

JANUARY 16, 2006

iPods and Textbooks, Part 1 First comes the technology, then come lots of “wild-eyed” predictions of the revolution to come. While some of the predications may be correct, the time frames are often way off. The supporting ecosystem takes a while to develop.

But eventually it does. Then real people start changing their day-to-day behavior. And the culture starts changing. The tech gets faster, better and cheaper. Price points fall, access increases, and more people change their behavior. Then, new business models are invented and entire industries are reinvented – seemingly overnight.

With the emerging ubiquitous digital print platforms, textbooks and professional books may be the next to go. Printers and publishers can hide their heads in the sand, or they can keep a eye on this development, and prepare for the change.

A couple of years ago there was a lot of ballyhoo about e-books. The internet evangelists believed 53

that books would disappear. But the book people were right. The technologists seriously underestimated the usefulness of books. It turns out that printed output has its own unique advantages that are not going away any time soon.

But now, ten years later, with a developed digital print network, the ecosystem has changed again.

SONY has unveiled a new generation of e book readers based on e paper technology with a $200 price point. Education and professional consumers can now choose whether they want their books in digital form or in printed output form.

They can get what they want, when they want it, and how they want it. It has become a dangerous situation for the textbook industry, which is based on controlling access to content.

The last hurdle is the price point: $75 textbooks offered in electronic versions for $30 is not going to do it. It would be nice from the publishers’ point of view, but I don’t think it’s going to fly. $10 might or maybe a site license structure will.

Maybe it’s a subscription model a la netflicks.com, or the 99-cent download model of iTunes, or Google’s ad-supported model. Or perhaps textbooks will be bundled with a hardware or software purchase like Encarta. There are 54

many possibilities, but there is little question a new model will emerge.

Steve Jobs, as he did in other areas, led the way for music. The iPod is not a technological marvel.

It’s just a very well designed portable hard drive elegantly connected to the Internet. The key ingredient was the business model that showed the music industry, in spite of its own furious resistance, how it could make money from disruptive innovation.

Apple imagined a new way of doing business, so that non-consumers could be brought into the market and the music publishers could continue to make money. It’s the kind of win-win that leads to sustainable innovation and explosive growth.

Now that the stampede has begun, the game begins in earnest. The new model is becoming the common wisdom. With the common wisdom comes big budgets. With big budgets come tipping points – and the opportunity to make healthy profits. By solving it first in the music world, Apple became the de facto leader. Once a stampede begins, it’s much better to be far in front of it than someplace in the middle.

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What might this mean for the textbook business?

According the Association of American Publishers, the publishing market in 2004 was $23 billion, of which textbooks for K-12 and College were $7.8 billion. Professional books contributed another $4 billion. ( Just for perspective, the whole trade book business is only $5 billion.)

The textbook market has historically not been consumer-driven. Students do not make the purchase decision in higher ed. The classroom teacher does not make the decision in K-12.

Instead, it’s a third-party-payer system, where a school board or a professor decrees that a purchase must be made, and the student, the student’s parents or the public winds up paying for it. Usually in these kinds of situations, the cost of sales can be high, but the profit margins are relatively comfortable.

The Internet seriously undermines the value propositions that have supported the textbook value chain: control of the sales process, the ability to print and deliver huge quantities of books, and the control of content creation. Getting a critical mass of school boards to approve a textbook is a very expensive, difficult process.

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Printing, storing and delivering textbooks requires large integrated manufacturers.

Producing acceptable content has been time-consuming and expensive.

But, as the music industry has learned, control of 20th century delivery channels for information content is not a defensible advantage. Standardsbased education is making content creation much more definable. Access to content producers is no longer only – or even best – done in a large established corporate environment (consider Linux and the entire open-source software movement). And on-demand printing changes the paradigm of “print a lot, store a lot and distribute often” to a paradigm of distributing digital files and printing what you need and shipping directly to the end-user, eliminating storage completely.

Textbooks are very expensive, consume lots of resources, get out of date pretty quickly and at the end of day, don’t really work very well. This shouldn’t really be a surprise, given how far away the editorial and purchasing decisions are from the end user and how many constituencies have to approve the content.

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ORIGINALLY PUBLISHED AT ONDEMANDJOURNAL.COM

JANUARY 17, 2006

iPods and Textbooks, Part 2: A Broken Product Ripe for Disruptive Innovation I’ve spent the last couple of weeks informally asking every teacher and student I could corner whether they thought textbooks were useful. I couldn’t find anyone who liked textbooks, nor could I find anyone who thought they were an efficient or convenient – let alone elegant – way of getting the job of education done.

The students in upper middle class schools hated how heavy and quickly outdated they are.

Although they found them useful for reference, they couldn’t understand why the textbook content isn’t delivered directly to their laptops, where it could be searched, annotated, have links to the web, and most importantly, be accessible without the students having to carry 10 to 20 pounds of books from home to school and back again.

The teachers I’ve talked to in inner city schools 58

hardly used them. From a teaching point of view, it’s almost impossible to make “the one size fits all” approach of a static textbook useful for the diverse range of students in their classrooms. To complicate matters further, students aren’t allowed to take them home for study because of concerns that they wouldn’t bring them back.

And they are expensive. A friend who is on the board of a charter school of 125 students, K-4, told me they spent $22,000 for textbooks that will be outdated in 2 years. In the context of a public education system that is desperately fighting to do more with less, and college education that is getting more and more expensive, are these consumers really getting their money’s worth?

But we’ve heard all this before. What’s different now?

In addition to the expensive problem of getting a digital reading device into the hands of every student, print is, and always has been a much better content delivery mechanism in situations where you can’t pick and choose your customers. Print is still by far the best push medium for communicating with everyone. This was the essential problem that killed e-textbooks last time around. Now 59

with affordable digital printing available both on site and through networked outsourcing, this problem has been solved.

A classroom teacher or school-based educator can decide what sections of a textbook might be useful for the students that month: sometimes the electronic version, sometime the print version, or some combination of both. The teacher could download the electronic version, print out 30 copies for her students. Or a pre-assembled book, compiled by the school’s currriculum coordinator, could be made available on a website for order, printing and two-day delivery. Intellectual property is of course, an issue, but the DRM software is out there; it just has to be implemented.

Combining Internet-based content management and digital printing is the enabler. Content can now be developed, customized, and transmitted at minimal cost. Printed products can be created as-needed with no storage or shipping logistics required. At last, the implicit capability of the ecosystem exactly matches the needs of a large underserved market. The only thing left is the business model. Eventually, someone is going to do for textbooks what Steve Jobs did for music.

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Maybe it will be someone in the publishing industry. Perhaps it could even be a forward-looking book printing company. Although the latter would be nice, based on recent history, it’s not likely. It takes a lot of courage, confidence and capital to cannibalize a large and profitable business.

The more likely suspects are Google or Yahoo.

Or perhaps it will be BN.com or Amazon. Or possibly a network of nonprofits – like a consortium of the teachers colleges – or a private foundation or the big public education systems or a large University. Or maybe Sony, who has lots of $200 e-readers to sell. Or maybe Apple or Dell or Gateway will bundle it with a hardware purchase.

Or perhaps Zinio or Adobe, Xerox or HP. Or there might be two grad students at Stanford who are already doing it.

The victorious challenger can come from anywhere.

When will it tip? The game will change on the day a substantial school district, being pressured by their mayor or governor for further cuts and better results, issues an RFP for the e-delivery of textbooks, a web-based ordering system, a library 61

of standards-based teaching texts that can be combined to meet the needs of their students that month and the license and ability to print hard copy as necessary – with very aggressive pricing.

My bet is that the change will not come a day before demand happens. But probably not much more than one day later.

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ORIGINALLY PUBLISHED AT ONDEMANDJOURNAL.COM

MARCH 21, 2006

Textbooks, Digital Printing and The Dog Food Dilemma “You have to remember that the market for textbooks is like the market for dog food because purchasing decisions are not made by the ultimate consumer” Barbara Levitt, Clifford Nass; Administrative Science Quarterly, Vol. 34, 1989

Printers are usually in the dog food business.

They are often trapped someplace in the middle of a value chain where the money that comes in is from their customer’s customer’s customer.

Everything except that last link of the value chain is an expense. When you are in the expense part of the system, it’s much harder to add value without cutting margins.

Being so far away from the customer might help explain why digital and variable is still moving slower than it soon will. It’s really not that different from the first 50 years after printing was invented. Gutenberg and company spent most of those years working feverishly to be as good as 63

handwritten manuscripts. That was the standard for those already buying output in the 1460s. But eventually small editions of portable books brought a whole new population of consumers into the picture. When print found its new authentic voice, it changed the world.

Isolated inventions don’t lead to great changes unless they are part of a system that empowers people to do things that were previously impossible. Computers did the work of adding machines, typewriters and huge filing cabinets for many years. They were better ways of doing what was already being done. But when VisiCalc gave people the power of the spreadsheet, and PostScript allowed the printing of well-formatted documents in the office, the desktop revolution began in earnest. And affordable portable computing went on to change the world.

In the world of 2005 digital printing, large-scale 1to-1 marketing is generating lots of movement of dollars from one part of the value chain to another. It’s 20th century marketing being done much more efficiently.

But, based on revenue generated, does large-scale personalized marketing really make sense?

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Getting 10 times better results is a legitimately great success story for the marketer or marketing department. But 10 times 2 percent is still only 20 percent. And the kicker is that response is not revenue. When money spent on advertising is measured against actual revenue generated, will it continue to make sense?

Successful businesses, no matter how large or small, are using data-informed decision making that demonstrably drives value to the top line.

Will direct mail and advertising stand up to this scrutiny? As a printer, how much money do you spend on advertising or direct mail marketing?

Do you think it’s the smartest way to spend your money? As a consumer, how much time do you spend with advertising and direct mail? Is it the best way to spend your time?

Everyone in the textbook value chain knows the system is suboptimal. But they all are trapped by the “dog food” problem. It’s a great example of “it’s the process, not the people” insight that comes from Six Sigma process controls.

Specifiers and buyers are in the educational bureaucracy. Their incentives and rewards are not directly tied to producing the “optimal customer 65

experience� for students in the classroom. Yet, they make the million dollar purchasing decisions. Students (the real customers) or teachers (those closest to the customer) are given little choice in the purchase of textbooks.

There is general agreement that the textbook as an educational content delivery system is either broken or much too expensive. On top of that, the legacy systems for specifying, writing, printing, distributing and purchasing textbooks are inefficient. Their very complexity makes the potential risk of making a radical change very high for everyone. At this scale, only a demonstrably better system, one that is tested and proven in the real world of day-to-day practice will lead to real change, But when it does, it could happen fast.

For a while, technology enthusiasts were sure that e-delivery and e-learning were the answer.

Store all the educational content in an XML database, slice, dice and package as necessary, control digital rights, of course, and send to laptop computers or e-book readers. At the time, any opposition was ascribed to organizational inertia and lack of vision.

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But, the educational community understands something that the advertising and technology communities don’t. Advertisers can identify their best customers and figure out the best way to talk to them. Public education and government don’t have that luxury. They are mandated to serve everyone.

When you have to serve everyone, if the content delivery system doesn’t include print, it just doesn’t work. This is not because educators are backward, but because when you spend time on the ground, you truly understand the value of print.

Until just recently, there was no practical way for the content delivery system to include design quality printed output.

But now, it is starting to change.

UDPP: PRINT OUTPUT IS THE ENABLING TECHNOLOGY.

UDPP is my acronym for the Ubiquitous Digital

Print Platform. As of this writing, it’s probably best represented by the line of Xerox output devices from the desktop to digital production press. But as Canon, HP, KonicaMinolta, NexPress, Océ, and Ricoh continue to deliver 67

devices at various price points and functionalities, it will evolve into a standards-based network output platform.

A recent article in ODJ describes a major investment by the Lincoln, Nebraska school district.

They have purchased an integrated input/output system spread over 53 schools. It’s a good example of what a UBPP might look like. Once it is connected to a standard-based network of “print for pay� providers, the platform is complete.

Probably only the most forward-looking school districts in the nation will be able to make the investment made by the Lincoln, Nebraska. But many more could use a hybrid system, integrating some in-house printing and print-for-pay work with local commercial partners.

On the commercial side, the islands of innovation are emerging. But for the most part, they are trapped in individual companies. FedEx/Kinko is probably the leading player in enterprise-wide collateral pulled from the network and output where appropriate. But the potential reach of a standards-based output platform will dwarf the capabilities of any one company.

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THE NEW PRINT EXPERIENCE IN K-12 EDUCATION

A classroom teacher, a curriculum coordinator, department head or school principal will be able to select exactly the right combination and presentation of content for a specific classroom situation. Given the time constraints, it’s probable that many will prefer to choose from an edited selection of appropriate material for different situations.

That content will then be delivered as appropriate. It might be to a $100 laptop, or maybe to an inexpensive e-book reader. It might be to a teacher’s computer to use for a class presentation.

But in any case, it will also be available in print.

Whether it’s printed in the building, in the district, or in the commercial world will be irrelevant to the user – as long as it’s the right product, at the right time, for the right person, at the right price.

The new authentic voice of print is emerging.

And it’s not merely to do what we’ve already done better, faster and cheaper. The UDPP enables a completely different experience of Print. Embedded in the other digital information systems, it makes possible what every customer has always wanted, but is only now available: “I 69

want what I want, when I want it, in a form that I want, at a price that I think is fair.�

And the world will change again.

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