Finally, after more than a decade-long march down the path of new technology (Internet commerce, digital printing, cross-media understanding, short-run, just-in-time, variable data and more) and changing values, the message is finally clear:

Print will never be the same.

Yes, we’ve said this before, but now you’ve heard it from everybody that’s anybody in the world of print. Perhaps a few thoughts about the future are worth sharing.

Some will decide to put their head in the sand. After all, it may be possible to survive via a short-term strategy of just doing what you are currently doing more efficiently. If luck is with you, you may just gain market share because your competitors are no longer among the financially fit. Still, this possibility doesn’t give you license to delude yourself into the belief that ‘nothing new’ is a long-term growth strategy. Nor does it guarantee survival. And it certainly doesn’t guarantee warding off major economic upheaval over relatively short time periods, even for companies that are currently doing okay.

Survival Skills
Survival really requires significant changes in the way business is run. It may mean tightening the belt; but how small can you become before there isn’t enough left to be successful? It may also mean investments in new business models or new product types; but how do you find them?

Last month we wrote about bosses that don’t want help even from within their own company. This month, we’d like to focus beyond doing the best possible with the internal tools, products and personnel and looking seriously at what is going on around us. One of the messages that have become very clear to us is that it is virtually impossible to learn what to do in a vacuum.

By looking around, we can learn how to achieve success, because we can see opportunity clearly through understanding the mistakes and successes of others. Yet, as we participate with client companies of every size, whether they are manufacturers, dealers or printers, we run into a very major roadblock to change called "Not Invented Here!" (NIH). Nothing seems to prevent good companies from achieving their own goals more than the old NIH mentality: "If we didn’t think of it, it can’t possibly be right."

Smart is as Smart Does
Companies always seem interested in hiring good ‘people’ from their competitors. They firmly believe that enlightened newcomers can come into the fold with the knowledge base that will allow them to succeed more quickly. Yet they rarely seem to acknowledge that it is the ideas themselves that have been developed and fine tuned by others, not just people, that can achieve the same good results for their company.

By leveraging external knowledge bases, companies can achieve spectacular results. Market leaders – from commodity-based Proctor & Gamble where the goal is for 50 percent of all new product ideas to come from outside, to technology giant Intel, where investment in startups and university research has become big business – use outside ideas to fuel their businesses. This is a rare occurrence in the print industry.

Here, we sometimes ignore reality and hope that things will get better. We hear talk of not taking orders that don’t supply sufficient margin, moving into packaging where there is reported growth and increased selling of private labels as the kinds of big ideas that are going to keep factories full and businesses profitable over the next year.

Short-Term Thinking
Yes, perhaps it is possible to survive another year through these measures. We believe, however, that they can realistically provide short-term help to only a few players. There still won’t be enough total sales volume to go around. Discounting can only get worse when we have over-capacity in all phases of the market, from manufacturing to distribution and in the pressroom/printing facility. Overwhelmingly, sales are being driven by rebates/discounts, and these are a way of enforcing only one thing: price competition. They don’t increase total sales in a declining market. In this reality, any short-term growth results from short-term ideas are also bound to be short-lived.

According to the National Science Foundation, in the 20 years between 1980 and 2000:

• Small companies accounted for only 4 percent of all R&D spending in 1980, growing in 20 years to 22 percent.

• Large companies, accounting for over 70 percent of R&D decreasing to 40 percent in 2000. The clear message here is that great technology can now be found in companies of all sizes.

To us, this data presents a dilemma as opposed to opportunity, because what we see in the marketplace is that:

• Large companies put up so many barriers to accepting innovation from smaller ones that they can rarely profit from anything done on the outside, and…

• Smaller companies don’t believe they have the resources to innovate.

We do not believe that any one company can afford to do everything themselves; you can’t do everything better than others. And we all need innovation to survive. But, as consultants, as we work to encourage creative thinking by our varied clients, we see the impact of the NIH syndrome all too often.

From the Inside-Out
What we need is a new way to define, measure and reward researching, recommending and championing new ideas. We need to find a way to recognize the talent and initiative of somebody who can discover a valuable outside technology or business idea and reward them for doing it all inside. We shouldn’t reward the existing fiefdoms that aren’t producing.

If a company’s "chief business" officer’s job (livelihood) were to depend upon creativity in fostering the best possible business and product/technical opportunities regardless of where they were initiated, we’d get out of the current NIH syndrome pretty fast.

Finding ways to prosper isn’t easy or straightforward. Looking around, we can clearly see companies that have been successfully bringing on creative new products or business opportunities. We have reported previously on such opportunities as:

• Adding capabilities to an exsisting vendor's product to make it fit for a sub-market of interest,

• Developing new products that meet the needs of shorter press runs more effectively than the older products that have always been used,

• Developing courses that teach customers how to achieve more with what they already have, in hope of crossing a threshold that will allow the customer to buy more from them, or

• Trying to integrate to provide more products to their existing customer base, reducing their cost per customer.