The printing industry is currently and will continue to experience many transitions in the form of `Digital Printing and Communications`. This also impacts on all businesses globally.

The printing industry will continue to evolve into new and exciting `electronic imaging driven by digital technology`. Digital technology, economic restructuring, global competition, market changes, emerging new media and other market forces are combining to `dramatically` change the operating environment of the Printing Industry. The traditional printing industry is very mature with over capacity in the established countries and also very poor training of personnel and very few people entering the industry. We are in the `emerging information society` driven by technology, where by the very nature of the role of the printer is changing rapidly, driven by `customer demands`.

The major drivers are first, technology, particularly the digitisation of data, is reshaping the communications industries. The rapid experience of the convergence of computers, telecommunications and television, plus the use of `multimedia` and the speed of change in the `information superhighway`.

The second major driver is the changing macro environment, particularly the rapid restructuring of the world economy and global competition.

The consequence of these two major drivers is the movement in print markets worldwide. The emerging `new` countries who invest into the print/communications industries with the latest equipment are global players whom will significantly drive down prices by the economies of scale.

Print companies are redefining their business (or they should be) to one of identifying `customers ‘changing communication needs brought about by the digital processing and storing of information and delivering it through the most effective distribution channel. Since printer’s are/should already well be established in `imagery`, they are well positioned to participate in new channels as they develop. If print companies do not take on board new technology, they will not survive in this rapid changing environment.

Changes to Industry Structure and Profitability

The structural changes to the industry are occurring as a result of `technology` changes and market forces on a global scale. This restructuring and the pace have quickened and the impact on profitability has been profound. Over the last 40 years industry profitability has moved in cycles roughly corresponding to industry investment cycles. With the current need to invest in `new digital technology` coinciding with a slowing of market growth world-wide, printing companies profits will be `squeezed` further in there mainder of the decade as structural change continues on a global scale.

The implications for the printing industry structure and profitability in the future are;

• The number of large printing plants is declining. (costs out way benefits of net profit)
• Large printing companies will become larger by acquisition, at the expense of less well-managed large companies and medium sized companies.
• The less innovative companies will face serious issues in a slow growth business environment.
• The rate of failure for less well managed small companies will be high. This is the majority of the industry.
• Medium size companies particularly those without well-defined speciality niches will continue to be squeezed by larger companies.
• The impact on the printing industry profitability will be a continuation of the pressure on overall industry profit margins.
• The profit leaders will continue to make attractive profits by acquisition/cost controls/economies of scale/skilled and experienced personnel in `all` areas.
• The impact of `Print Management Service` programmes on the manufacturing sector that does not participate in this customer driven environment.

Management without Vision

A lack of management commitment to change and a failure to hold a compelling vision of the future with their employees are holding back global mature print manufacturers when they attempt to make a move towards `lean manufacturing`.

But addressing the attitude and behaviour of an organisation – in addition to the operating system and management infrastructure – could boost production by at least 20%, and improve stock, lead times, quality and capacity. The organisations with skilled and experienced people of any age and training programmes with business models will be the winners.

There are at least 12 major pitfalls which companies must avoid benefiting from making the journey to lean production.

The pitfalls are;

1. Lack of management commitment
2. Lack of share division and objectives
3. Failure to lead by example
4. Initiative fatigue
5. Constant fire fighting
6. Employees` lack of understanding
7. Middle management not engaged
8. Stagnation after pilot
9. Failure in deployment
10. Lack of clarity over the future state of the organisation
11. Failure to build on a change which has been achieved
12. The understanding of Managing the `Management of Change`

All too often failure to make a lean transformation stems from a superficial, piecemeal approach. Lean manufacturing requires a holistic approach transforming not just the technical production system but also the organisations management systems and a comprehensive approach to change which addresses mindsets and behaviours as well as formal processes and structures.

Most common faults are a lack – lustre approach to change by a dividend or uncommitted senior management and unwillingness to properly consult and communicate with the workforce. This is why some European companies claim to have tried and failed to implement lean production systems. Communication, communication of the requirement and a `buy-in` programme by `all` people is necessary for change to be successful.

Lean manufacturing is now almost universally regarded as a panacea for European print manufacturers (also, all UK manufacturing) to improve productivity but, UK owned manufacturing companies are typically less productive than their UK-based, US – owned competitors.

A McKinsey & Company study showed that an average US manufacturing companies deliver a 22%annual return on capital. While UK companies return only 7.6%! (before the recession).

McKinsey & Company experience reveals that middle management and front-line staff are adept at spotting half-hearted support for production process improvements and adopt a `just-enough` attitude to tide them over until the effort is abandoned. Also, senior management (Directors) were complacent to act due to lack of knowledge of `management of change` process.

A typical scenario might be of an UK company undertaking a lean programme. But, sooner or later, after considerable diversion of company resources, they admit defeat and settle for a few small improvements here and they’re rather than a lasting and marked performance improvement. This type of company will not survive.

Having seen the `writing on the wall` for their business before being spurred into a lean transformation attempt, such businesses frequently joins the list of statistical failures.

A lack of a `shared` vision headed the list of failures.

Alignment around `shared` objectives must begin with the `top` team and cascade through the organisation. It must also be seen to go hand-in-hand with visible commitment by `all` Directors/Senior Management so those staff sees their `leaders` are serious about change and play a full part themselves. Middle management are very good at spotting lack of commitment and respond in kind by supplying just the amount of effort they judge expedient until the latest initiative withers and dies. People know what they are expected to say and duly say it. But, it is meaningless if they are just going through the motions. Again, this type of company will not survive.

Failing to lead by example resulted in middle managers and production staff failing to `get onside`.

This most often happens where senior management is `out of touch` with all the employees. Top management must get close to the reality of the `people` to understand the issues the frontline staff are living with, and then take the lead to resolve them as part of the `change process`.

At the same time, management need to be aware of initiative fatigue, the `been there, done that, did not work` attitude. Change targets must be precise and stretching, but realistic and some early successes will galvanise the rest of the effort.

The tendency to fire fight constantly must be stifled and while some managers thrive on fire fighting and build a successful career on it, this only deals with symptoms and not with `long-term solutions`.

Just telling employees what to do is not enough. They must be involved at all levels in solving issues in the change process. All staff expects to see their line managers directing change, so these middle managers must be engaged from the outset.

Even when a successful pilot implementation is over, there are still several more pitfalls to trap the unwary. One is stagnation following a successful pilot as the focus shifts away. Another is the failure to deploy lean manufacturing to the wider business. Never stop looking to improve.

Conclusion – Lean manufacturing requires a holistic approach transforming not just the technical production system but also the company’s management system and a `comprehensive` approach to change which addresses mindsets and behaviours as well as formal processes and structures. The `right` trained and skilled and experienced `People` manage companies and these will be the winners in the future.

Keys to Bridging to the Digital Future

The central message of technological change is the accelerating pace of digitisation. Besides basic matters of understanding emerging printing technology, then integrating it effectively into the business and using it to enable expansion into `new` businesses. Two broad issues stand out as follows;

1. All print companies will have to address the question of how their internal operations are interconnected digitally and how they are also connected to their customers and suppliers. The question involves connecting through data networks to customers and suppliers; the consideration here are productivity, profitability and customer demands for `rapid` service. It also concerns customer demands for fast turnaround and shared data.

2. In the long run, higher growth opportunities will be available in `new` rather than traditional media. Printers of all sizes should be serving specialised markets also have opportunities to experience with new media today; with minimal effort. The greater the penetration of multimedia personal computers, for instance, the greater the opportunities for some printers to move into this medium.

Beyond these general issues, a number of specific opportunities exist. These will become imperative as for future success as customers become more demanding;

• Participate in inter-enterprise systems that connect suppliers, printers and end users with systems for managing activities together and communications for digital data for printing.
• Participate in the development and maintenance of digital databases of text, data, images for printing and other media. Publishers have already redesigned their own front ends to send the same information to their printers and to on-line databases.
• Participate in new delivery options. These include both the use of database and mailing list technologies to enable direct mail and refined targeting capabilities and connection to the cable and telephone company with broadband information directly to end users.

Non Traditional Printing Services

Non-impact, primarily electronic, printing technologies will continue to improve in speed, process colour capability and quality and prices will continue to fall rapidly. Larger and specialised printers are already integrating such technologies into their production systems; quick printer’s basic businesses are based on such technologies. But there continue to be opportunities especially for small to medium size printers to meet growing customer’s needs for non-impact work and to offer convenience as one of their services.

Customer and Printer Alliances

Alliances with groups of customers and groups of other printers will increasingly become critical for small and medium size printers. The point is to bring together different capabilities that no one printer can afford to maintain. Larger printers on the other hand are already moving to ally themselves on a long-term basis with their customers to protect their investments and market share both in printing and emerging media. The Print Management Service organisations are a prime example of meeting customer needs.

Education and Training

The rapid pace of change in printing technology in competing media and in printers markets places a `premium` on ongoing education and training. Printers must ensure that `all` of their employees are up-to-date on the latest technologies and management skills that are required for now and the future. The degree of change expected in this and the next decades also places a premium on educating customers about emerging technologies, systems, media and distribution. We must use people of `any age` to further their education and skills to compete in a global market. Also, people of `any` age with experience and skills of `management of change` will be your main asset!

Customer Needs

The most successful printers will be those who can meet rapidly changing customer needs. Inevitably, that will mean faster turnaround and lower costs in a more competitive business environment. It also means the ability to innovate rapidly either internally or by outsourcing work, provide new services both in front end and distribution areas and as stated above participate on new media. Creating and nurturing the best possible relationships with customers remains a critical success factor. A related issue will be the ability of printers to understand their customers in order to be more proactive in meeting their needs and to focus their `bottom-line` profitability.

Other Issues

The large printers will be driven to `dominating` these they serve trying to maintain the top positions in their business. Smaller printers able to grow comfortably in general commercial printing in the past will have to focus more on `selected` product and /or service niches either alone or through alliances.

With technological and market change, competition for critically important skills will increase across the board, raising the premium on attracting, training, managing and retaining the best skilled workers and managers. Managing technology, capital and costs will continue to grow in importance. Also, age should not be a factor, but the ability to carry out the function at the highest standards, using experience and skills that are required at each sector of the business.

Above all, printers will have to strategically -oriented businesses, be aware of changing technology, markets and other external developments and able to take advantage of them profitably. Indeed, for many printers hiring or developing a `digital champion` to act as a catalyst for change within their company will be a critical step.

The future is a great challenge so please take on board these excellent publications for your success;

`Document Management – Cost Savings Solutions`
`The Hidden Overhead in the 21st Century`

“Nothing is `Impossible`, the word itself says, `I`m Possible` for success in life”
Colin Thompson

Have a vision for the future

It’s been a busy time for sourcing professionals (though, when isn’t it?) with potentially highly significant political developments in the US and Europe, the announcement from various corners of the globe of some hefty deals.

While more details emerged of how the new UK government plans to tackle its planet-sized budgetary deficit and shudders continued to ripple through the Eurozone as Spain’s credit rating took a hit and German public opinion hardened against bailing out the continent’s more spendthrift economies, across the Atlantic the House of Representatives approved HR4213, legislation aimed partly at closing tax loopholes – including those for organisations “sending jobs overseas”. The bill now goes to the Senate for final debate – we’ll be looking closely at this legislation, and its potential ramifications for outsourcing globally.

All these topics and many more were debated at length by the great and the good of sourcing at SSON’s 10th Annual European Shared Services & Outsourcing Week in Edinburgh in the last week of May 2012. Highlights of the event included the G8 “think tank” (in which IBM’s Bill Payne was a stand-out contributor); the “Thundering Hooves” of Horses for Sources Live; and The Hackett Group’s Tom Bangemann taking home Thought Leader of the Year at the event’s annual award ceremony.

One of the main bellwether’s for measuring a global economy is the Print Industry. Now let us look at the largest economy in the world, America.

A Climate for Change

It`s often assumed that the printing industry moves in the same direction as the economy. In 2009, the USA commercial printing sector was a $88 billion industry, representing 0.61% of GDP. If the relationship it had with GDP in the year 2000 was maintained the commercial printing industry would have been a $149 billion sector. The statistics from 1993 to 2009, GDP grew by +52%. If the proportion to GDP the print industry had back in 1993 was still intact, the sector would have been a $176 billion industry. There is a missing $88 billion in sales. Business has become a struggle, with downsizing, liquidations/bankruptcies and defensive merger activity by print manufacturers and industry supplies. The power of the commercial print sector has declined rapidly. This factual story is mirrored globally.

When the printing press was invented in 1450, the population of Europe was 50 million people. The literacy rate at the time has been estimated at 1% = to 500,000 people capable of reading what was printed at that time. It took over 100 years to rise the literacy rate to 50%. By then the population was about 70 million people, so it took 100 years for the number of people who could read what was printed to hit 35 million people. Therefore, it took more than 100 years for the number of `users` of print to reach 50 million people.

Useful information

• It took `radio` 38 years to reach 50 million people
• It took `television` 13 years to reach 50 million people
• It took the `Internet` 4 years to reach 50 million people
• It took the `iPod` 3 years to reach 50 million people
• It took the `iPad` ? years to reach 50 million people

Plus:

• `Facebook` added 100 million users in 9 months
• `iPhone` application downloads hit 1 billion in 9 months
• `The Twitter` followers for Ashton Kutcher and Ellen DeGeneres exceeds the entire population of Ireland, Norway and Panama

The past is a story of the way the future has been disrupted by technology and innovation. The future is to learn about technology and innovation to stay ahead!

The Relationship between Information and Knowledge

In trying to quantify the volume of information/knowledge in print and electronic form I sought some understanding of the inter-relationship of the two. At the turn of the last century our education, information, entertainment and business worlds in the developed countries were based on print. By 1998, our lives still revolved around print, but television, telecommunications and computers were usurping print’s media monopoly of information distribution. By 2025, print will play a reduced role in communication and society, but it will still play a role in some form.

The generalised volume of information in print and electronic forms between the years 1998 to 2025 will change dramatically as follows in our opinion:

The Future of Print depends on whom you ask!

If you ask people in the Printing Industry, they will say `print will be around forever`. But, you ask a school student and you get a ‘different’ opinion. Unfortunately, your view of the future is clouded by your feelings about paper and technology ‘today’. When you ask the wider global population about their opinions concerning the future of print and ask them to envision new generations in the future and not themselves in the future, then these different generations have different perceptions about reading, print and communications. Look at these figures about the future generation’s opinion on print’s role in communication:

The future prediction is based on computer use, mobile phones and the Internet, all as metaphors for ‘new’ forms of communication, the future generations have a tending more towards the screen than the page. Children routinely accept electronic substitutes for paper because we buy them more electronic items than paper items.

Therefore, this and the next generation may finally bring about the paperless office due to the change in our ‘habits’, about 100 years after it was first articulated that paper was not needed.

The Global Communication Highway

The world economy has been ‘dominated’ by networks which facilitate the movements of goods and services. But, technologies which support the communication of information are now the ‘dominant’ force in the global economy. The move in the global economy from an urban industrial base to a distribution-information base. The primary technology supporting this change is the telephone network, this is the major communication highway and it is the electronic lifeblood of developed and developing countries all over the world. The largest challenge to this change in the movement of goods is the high price of energy for now and the future. Therefore, we could see a vast change in the dominant countries of now to the new ones of the future!

The present position is that de-regulation for users of the telephone system to plug-in a large number of devices beyond the standard voice telephone with Digital lines, fiber-optics, automated switching, satellite relays and computer access ports have made the telephone network the most versatile communications network on earth.

The Future for Print

The future is to ‘print through innovation’ and ‘maximise customer interaction and support’ with flexibility. The Print Industry is re-inventing itself all the time, and as long as you get pressure from the customers, it will continue to do so.

“It is not the strongest species that survive, nor the most intelligent, but the ones most responsive to change” by Charles Darwin.

Now read on about the ‘Challenges for the Printing Industry’.

THE CHALLENGES FOR THE PRINTING INDUSTRY

The biggest challenge facing the printing industry has become what almost seems like a “war on print” by those who produce and disseminate content. The advertising and marketing industry enthuses about online and even newer media 24/7-and has even taken to referring to print as “offline media.” What the industry needs is not only to fight back and remind people of the effectiveness of print, but also to come to the same conclusion as its most successful customers: `that print walks hand-in-hand with other media.`

Summary

‘It’s a Digital Colour Future’

Today’s digital printing market as well as business, education, government and entertainment are in some way influenced by the digital highway, which is quite different than even one year ago. The long-predicted convergence of markets and equipment is now happening. The overlap between quality, performance and colour in the marketplace is occurring at a rapid pace.

Robust production presses are being introduced in smaller versions. Small-footprint printers are being more broadly accepted, even for applications like VIPS. Market penetration is growing; even small printers can now match a digital press to their volumes and customer needs. It is a growing and increasingly crowded market.

As such, it is fraught with opportunity for creative studios, manufacturers, printers and publishers alike.

The future is about offering ‘solutions’ to customers by operating a Print and Workflow Solutions Programme and methodically looking at how you manage your business with the ‘right’ people. Also, keeping a close eye on the speed of change that will affect your business. Training, business models, business guides and experienced/skilled people that are available to help your business challenge the global impact are the most important investment for your success.

Be positive, have passion to be successful and have a strategy for this rapid changing world.

When we get through the present recession (yes, there is still a recession), many printers will be in a stronger position than when they entered it. The question is who will they be, and what are they doing now that puts themselves in that position?

My guess is that right now they have a low debt to equity ratio, they have made and are implementing action plans based on the economic realities, and are adopting strategies that are aimed at making them stronger.

Four types of printers
Based on what I see in the market today, 2015 will see for following four groups of printing businesses.

Group 1   The 10% where the proprietor makes a market wage and the business achieves a 10% or greater net profit.

Group 2   The 50%, where the proprietor will just make a market wage and the business achieves less than 10% net profit.

Group 3   The 25% where the proprietor will make little or no wage, perhaps tipping equity, and the business will achieve breakeven profit.

Group 4   The 15% that will be liquidated or simply close their doors, perhaps after the proprietor has tipped in additional equity.

You may argue the percentages, but I think the groups are accurate enough for most readers to guess which group they may be in upon reflecting on their 2015 calendar year performance

The issue/problem I see now is that many within groups 2-4 are adopting a wait and see approach. They are digging in, trading on, making the best of it. No real action plans, with the market realities either not seen or not acknowledged.

For those I suggest they need to start looking a lot closer at their business, the market, and the customers they serve. And then ask themselves, or perhaps some trusted advisors, is their business capable of getting you at least to a Group 2 business? What needs to happen now to increase the chances of making it happen? And if they cannot see they can get to group 2, what is their motive for staying on in the same business structure?

The merger / alliance option

One of the facts of the Printing industry is that it is capital intensive and generally has a fairly low equipment utilisation rate, underutilised facilities and often inefficiently used labour. So doesn’t it make sense for many printers, especially in these tough economic times, to consider pooling some of their equipment, labour and facilities resources?

Does it not make sense, for at least Groups 2-4, to at least consider ways to get through this together, and perhaps entertain the thought of developing business models that will not only survive, but have a very good chance of becoming a member of Group 1? Note, Group 1 printers are not necessarily high turnover printers, they are spread throughout most categories of printers.

Below is very simplistic example of what could be achieved in a merger:

                     Printer A        Printer B        Merged entity
                    Group 2 or 3       Group 3            Group 1

Turnover             £1,500,000       £2,500,000        £4,000,000

Owner's Wage         £80,000          £25,000           £160,000

Staff                8                15                20

Staff wages          £320,000         £600,000         £800,000

Turnover per head    £187,500         £166,666         £200,000

COGS and expenses    £1,500,000       £2,500,000       £3,600,000

Profit               £0               £0               £400,000

My point here is that together Printer A and Printer B could develop a business model and structure that may make the new entity a Group 1 printer. And it could be developed with minimal, if any retrenchments – job sharing could be a real option for many employees and perhaps owners. The business could also have a lower debt to equity ratio.

So why do not people consider a merger or alliance?

1. Egos – We’re competitive beasts, we think we’re better than the other guys
2. Inability to work with others – We’ve operated a business all our lives and we cannot possibly have an equal share in a business with someone else
3. Inability to align business direction / strategy
4. They get tied up in the intricacies of how it would all work, rather than focusing on the big picture
5. Inability to overcome irrational / emotional hurdles – e.g.- “I’m a Komori man, I could never work in a Heidelberg shop”!
6. They do not know where to begin

The sad part is that many can see the benefits but are unable to get over one or more of these hurdles. And in doing so, will be forever destined to being a Group 2-4 printer. Often engaging someone external to both businesses can assist in overcoming these hurdles – most evolve around personal / emotive issues, not the financials.

Forming alliances is also a much overlooked strategy. Would it not make sense for some printers to just operate a sales and perhaps some pre press operation, and form an alliance with a trade printer or another printer to do their work? Why couldn’t that work? There are a huge amount of alliance alternatives available – why not share a trades person or a machine or a driver or a building? Get creative, the printer next door is in all likelihood is in the same Group as you

One would think a monty for an alliance / merger would be two franchisees who belong to the same chain and have adjoining territories – double the turnover, job share some staff, one set of manufacturing premises, one shop front?

Market Realities

I’m not saying merging or forming alliances is for everyone, but I do think these options should now be on a fair proportion of the printing proprietor’s radar screens. It’s about market realities – about recognising where you are now and how you are going to step up to a higher Group ranking. And if you’re not aiming at Group 1 or 2, why are you even in it?

Consider who could be a fit with you and your business and what each party could bring to the table. Think not only of what printers look like you but also what printers / other providers serve your client base or niche? Think about what could be a win-win for both of you

The stakes are high for a fair portion of the Printing industry in 2015. Those that evaluate the market realities and act according, possibly through merger or alliance, will be far better placed than those who adopt the wait and see approach and do nothing.
How many Print companies globally will survive 2015?

About the author: Colin Thompson is a former successful Managing Director of Transactional/Document Manufacturing Plants, Document Management/Workflow Solutions companies and other organisations, former Group Chairman of the Academy for Chief Executives, Non-Executive Director, Mentor – RFU Leadership Academy, Mentor – Coventry University, Mentor – The Chartered Institute of Personnel and Development, author/writer Business Advice Section for IPEX, Graphic Display World, News USA, Graphic Start, many others globally, helping companies raise their `bottom-line` and `increase cash flow`. Plus, helping individuals to be successful in business and life in general. Author of several publications, research reports, guides, business and educational models on CD-ROM/Software/PDF and over 2000 articles and 35 books published on business and educational subjects worldwide. Plus, International Speaker/Visiting University Professor.

General Management: Objective – Turnaround and Sell

The company had achieved remarkable growth in its first 10 years – on the surface it looked good, with a new large factory just opened and well equipped in the capital-intensive industry that Print is. The then institutional owners asked me in to provide them with a consultancy report based on my previous extensive Print Industry background. They had bought the company two years earlier but the company was under-performing – their overriding question was – “is the company broken or can it be fixed?” A question often asked by Institutional Investors having invested money in a business that was under-performing.

The company sales performance had been impressive, growing quickly and steadily since it’s founding just 10 years earlier. A second new larger plant had been commissioned and the Investors had backed the company with a generous capital expenditure program. However it became clear to me that the company growth had outgrown the management’s ability to turn sales growth into profits. It is often not understood by executives that the challenges of managing a large company are significantly different from managing a small or medium size one.

In the beginning of the next year a decision was made to replace the President and most of the existing management team. I was appointed Chairman and President of the Group shortly afterwards. Working closely with the Investors, we were able to recruit and replace the key management positions from the local (Polish) job market. We hired a few good young managers into the key positions of Sales, Finance and Operations. Following a quick business analysis we gained agreement with the Investors to implement our strategy and make the changes designed to move the business into sustained profit growth, through efficient production, world-class customer service and fully utilising existing assets.

We implemented new ways of leading and managing the business including improved and regular communication with employees, suppliers and customers and a more open approach to benchmarking, company performance and the sharing of financial and operational results. We installed a continuous improvement culture and ensured that employees who performed well were rewarded and recognised.

A new plant maintenance program was implemented ensuring that machines were kept to the high standard recommended by their manufacturer. Regular maintenance programs were carried out in the 24 / 7 production environment. As a result machine breakdowns improved dramatically, the press crews voices were heard and also acted upon. Working closely with Press Operators, I was able to gain an insight as to what actually worked and more importantly – did not work – in terms of systems and procedures. I learnt that often managers have great ideas, but before getting too excited, you should ask the employees what they think before adopting it as your new culture! We stopped prescribing solutions and turned instead to making the crews more responsible for their own area of expertise.

In order to take the company International we had to be able to speak several languages if we were going to be attractive to our target European customers. So we established a language-training centre, with a focus on driving the business from a multi-lingual base. Existing employees were encouraged to learn an extra language, which they embraced enthusiastically. The production people soon became respectful of the new broadly based and well-trained customer service team. A funny thing happened as we moved from being a manufacturing centred to a customer centred organisation – sales increased! Customers not only continued to place their work with us, they told everyone in the industry how good we were!

Finally our sales had grown by 15%, despite disposing of non-core assets including an office stationary business, hand paper making plant, publishing business and the company head office. EBIT had improved by 180% and Profit before Tax had improved from a (9.5m PLN) loss in two years earlier to 11.1m PLN profit.

We had refrained from spending major capital whilst the existing assets were under-utilised. However, now, the performance of the company and relationships with shareholders and our banks, suppliers and employees improved to a point where we could recommend to the supervisory board that the company could take on increased debt and enter a period of expansion.

A program of investment was approved resulting in the installation of a new Web Press. The business continued to grow profitably and further investments were approved. The increased sales enabled further investments in the latest Digital and Finishing equipment and the creation of a new Fulfillment Service business.

The company’s performance soon drew attention from the Global Print industry. Articles appeared in leading Trade Journals in Poland, Germany, USA, Asia and the UK commenting on our progress and emergence as a serious European Print competitor. Our improved financial, commercial and production performance enabled us to open up a substantial gap over companies which two years previously were seen as being at our level, and the company’s two main competitors, both supported by major international strategic corporations, were showing increased respect and co-operation towards the new kid on the block.

This was demonstrated most clearly when the process of selling the business was implemented. Six of the largest global industry players expressed interest in purchasing the company. Anyone involved in selling a business will tell you that as the process unfolds it becomes essential for the long term good of the company for the process to be concluded as quickly as possible, so that the new owners can make the longer-term strategic decisions necessary for the good of any company. The selling Investors become increasingly focused on their exit whilst the incoming Investor can’t wait to push forward their ideas for the business.

And so it was that one year later the business was sold successfully to a strategic investor, who was then able to apply their global expertise and take the business forward.

A final word about our Polish workers – without their extraordinary hard work, skills and loyalty no turnaround could have been achieved. If you are thinking about investing in Poland – stop thinking and just do it! When I left the company, the employees gave me a farewell present, a nice watch. But the best bit was engraved on the back of the watch “thank you for making us stronger” A success story it is then.

About the author: Alex Walker now lives in youthful retirement (his 3rdattempt) in Cyprus. He worked his way up through the ranks from apprentice and after only 34 years, 6 companies, 5 countries and doing just about every job in the industry, became the CEO of RR Donnelley (UK). Donnelley is the world’s largest printing company.His focus has always been on developing key people to take businesses forward. An innovator, he once successfully started a multi million pound International business – despite Corporate refusing to back him! Alex enjoys public speaking and mentoring and driving young executives to do better.