mail strategies fall 2009
TRANSCRIPT
It’s Not the Destination but the Journey
Capture Hidden Savings
Real-time Intelligence
Selecting for Success
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Together On the production floor where true productivity is achieved, sometimes you just need a hand. Overcoming production challenges and working together to cut costs are just a few of the ways Kern has been helping customers succeed.
we
www.kerncan.comBetter Technology, Products, Processes, Partnership, People
Together On the production floor where true productivity is achieved, sometimes you just need a hand. Overcoming production challenges and working together to cut costs are just a few of the ways Kern has been helping customers succeed.
we
www.kerncan.comBetter Technology, Products, Processes, Partnership, People
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understanding MPtQM
CertifiCationBy Krystal Barr
featuresissue 3 Fall 2009
CaPture hidden savings Reduce costs while increasing
postage discounts
By Hank martin
real-tiMe intelligenCe
The measure of a complete Automated Document Factory
By Pramod madala
seleCting for suCCess The dos and don’ts of
supplier evaluation
By graham Newell, CmDsm
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journeyit’s not the destination
EDITOR’S VIEWThe changing role of the USPSRyan McManus
A WORD fROm ThE PublIShER/CONTRIbuTORSPerspectives on the past, present and future of mail
SERVICE STRATEgIESBuilding relationships for successScott Moore
COmmuNICATION STRATEgIES Strengthening your message for improved response ratesTodd Russell
fINANCIAl STRATEgIESSavings from the shop floor Rick Stepp
NEW PRODuCTSProduct Innovations
IN CONCluSIONOrganizing for successThomas Brock
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bEYOND
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strategies
We started putting together the fall issue of Mail Strategies just after returning from the National Postal Forum in Washington DC, and the USPS was fresh on our minds. May was a busy postal month with new rate changes going into effect and Intelligent Mail barcode systems go-ing online. At NPF, the Postmaster General, Jack Potter, announced that 25,000 jobs had been cut so far in 2009 in an effort to curb the growing losses at the USPS. The USPS most recently made headlines when news broke that almost 10% of existing post office branches were going to be reviewed for consolidation or closure.
Cutting jobs and closing branches are just a few of the ideas that the USPS has been kicking around. The Postmaster General and other postal executives have been in the news several times during 2009 as the USPS makes plans for survival while lobbying congress for a little relief. There are no handouts or bailout requests coming from the USPS, though. The Postal Service has every intention of continuing its long-standing tradition as a self-sustaining government agency. That is something every taxpayer can appreciate.
Legislation plays a major role in the workings of the mailing industry. Recently, San Francisco passed the first piece of ‘do not mail’ legisla-tion, which most members of the mailing industry would agree is a negative. Of course, mailers have had to make accommodations in the past for insurance, financing and other regulations in regards to han-dling personal information on documents, but the issues at hand are much greater. The USPS needs Congress to pass legislation to lighten the universal service requirements and open up the possibility of five-day delivery. This seems like one of the best ways to quickly save signifi-cant amounts of money, which ultimately helps volume mailers because rising costs of doing business for the USPS will not have to be absorbed through larger postage increases or fewer available discounts.
This issue will be arriving on most desks just before Print 09, which will be in Chicago, Illinois September 11-16. As the remainder of 2009 flies by, Kern will continue to keep you updated through our digital sites at www.kerncan.com and www.mail-strategies.com.
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EDITOR’S VIEW
BY RYan mcmanUs
PUBlisHerDave Squires
editorRyan McManus
maNagiNg editorAmanda Cook Armendariz
CirCUlatioNRachel Spahr
ProdUCtioN direCtorChad Griepentrog
Creative desigNerKelli Cooke
desigNerGreg Middleton
advertisiNgKen Waddell
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MAIL STRATEGIES (ISSN 1081-4035) is
published 2 times a year by RB Publishing Inc. All
material in this magazine is copyrighted 2008 ©
by RB Publishing Inc. All rights reserved. Nothing
may be reproduced in whole or in part without
written permission from the publisher. Any
correspondence sent to MAIL STRATEGIES, RB
Publishing Inc. or its staff becomes the property of
RB Publishing, Inc. The articles in this magazine
represent the views of the authors and not those
of RB Publishing Inc. or MAIL STRATEGIES.
RB Publishing Inc. and/or MAIL STRATEGIES
expressly disclaim any liability for the products or
services sold or otherwise endorsed by advertisers
or authors included in this magazine.
tHe CHaNgiNg role oF tHe UsPs
mailP R E P A R I N G F O R S U C C E S S
strategies
mailers Have Had to make aCCommodatioNs iN tHe Past
For iNsUraNCe, FiNaNCiNg aNd otHer regUlatioNs iN regards to HaNdliNg PersoNal iNFormatioN
oN doCUmeNts, BUt tHe issUes at HaNd are mUCH greater.
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Capture Hidden Savings | BY Hank Martin
Hank Martin is the OEM Sales Director for Address Vision. Now that postage is set to increase on a yearly basis and the USPS increases their requirements on automation mailers, searching for savings is not just a goal but a requirement to remain competitive. Your organization has made an important investment in print and mail technology, and Hank has identified several areas where mailers large and small can find cost savings.
Real-time Intelligence: The Measure of a Complete Automated Document Factory | PraMod MadalaPramod Madala is the Vice President of Technology for Kern, Inc. and plays a major role in the development and implementation of Kern’s ADF solutions. He has writ-ten about the many advantages that an intelligent ADF solution that encompasses the entire mail production process provides. There will continue to be new innovations in ADF processes that will lead to even better mail production center management.
CONTRIBUTORSPersPeCtives ON the Past, PreseNt aNd FUtUre OF mail
MPTQM Certification: It’s Not the Destination but the Journey | BY krYstal Barr
Krystal Barr is the Director of Print and Mail for Sprint Mailing Services. Krys-tal led a cross-functional effort to achieve MPTQM certification for Sprint and has shared her experience and expertise in her article that outlines the process-es of achieving this valuable USPS certification. MPTQM mailers identify the value of quality in mail production and reinforce the need for quality processes.
Supplier Evaluation: Selecting for Success | BY GraHaM newell
Graham Newell is President of the Mail Systems Management Association’s The Carolinas Chapter, which is an organization for mail and distribution profession-als committed to advancing the education and integrity of those in the mail com-munications industry. Graham has written about the vendor selection process with advice on how mail and print centers can objectively make the right product or service buying decision. He is currently employed with Wells Fargo Bank.
A Word from the Publisher | BY dave squires
It’s been almost a year since we published our last issue of Mail Strategies. Last time, our focus was Quality, and we were reflecting on some fresh news regarding our financial systems. We had no idea how severe the impact would be on our industry. With USPS Q3 results still not in as of this writing, the reading of the tea leaves still points to historic losses in both mailpiece volumes and in every econom-ic measure. Though they haven’t pulled the trigger yet, a five-day delivery schedule seems all but inevitable. And just wait until the February announcements!
So it seems fitting that this issue of Mail Strategies focuses back on the art and science of making mail in great quantities with world-class systems, processes and people with optimal efficiency and effectiveness. We have an obligation to keep this medium alive and healthy, not just as a way to keep ourselves relevant but to pre-serve a critical communication channel between organizations and their customers.
As always, we hope this issue provides some insights that you can use, presented in an enjoyable way. Simply put, our goal for this medium is “edutainment” (where education meets entertainment). Come to think of it, that’s what should be going into our mail. Enjoy.
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SERVICE STRATEGIES
Relationship building is an important aspect of doing business, and very few businesses can
survive without establishing solid relationships with their customers. But the question then
arises as to how we should actually maintain those relationships.
This is where continuous communication is key. Communication between both parties is one
of the most important factors of not only developing but also maintaining a strong service
relationship. This will lead to a true valued partnership: a partnership where both sides ex-
perience and appreciate value and simultaneously push for a common goal, which results in
continuous improvement for the customers’ operations.
So how do we bring value to a customer partnership? Value can be defined differently in
every partnership; however, every customer sees and recognizes value in a collaborative effort
between vendor and customer that is working towards meeting their day-to-day operational
requirements. How can a trusted supplier demonstrate the desire to do this within their cus-
tomer base day in and day out? How can they demonstrate a genuine concern for customer
success every day? The answer lies in being very interactive on the customers’ floor, working
with operators to meet production goals by job, shift and ensure that SLAs are met every time.
It means working through outside issues with the idea that our customer still has an obliga-
tion to meet their goals, regardless of the external factors. It means proactively communicating
with operators and supervisors about what problems they might anticipate with their upcom-
ing day or week and discussing how we can be successful as a team.
But communicating with a customer does not always mean that both parties are completely
satisfied. In fact, how do we even measure the satisfaction of a customer? Is their produc-
tion level the only number that counts? At Kern, our personal mission for service is 100%
customer success, 100% of the time. In order to achieve goals of perfection, a culture must
be established within the company to seek continuous improvement. You can’t believe that
just because the customer is currently satisfied, they will stay that way. Companies are always
changing, requirements change, and employees change, making continuous communication
the only way to satisfy the ever-changing needs of your customers.
Demonstrating to your customers that you are proactively working towards improvement and
that their success is your number-one concern will build stronger relationships. Never forget
that continuing strong service relationships with your customers is one of the most important
parts of business.
By ScOTT MOORE
BUildiNg relatiONships FOr sUCCess
ValUe CaN Be deFiNed diFFereNtly iN eVery partNership; hOweVer, eVery
CUstOmer sees aNd reCOgNizes ValUe iN a COllaBOratiVe eFFOrt BetweeN
VeNdOr aNd CUstOmer.
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COMMUNICATION STRATEGIESstreNgtheNiNg yOUr message FOr imprOVed respONse rates
Business-critical documents sent through the mail are like conversations; one party sends out
a statement and awaits a reaction or response. For business mailers, these conversations have
the power to drive organizational goals, maintain a steady revenue flow and create awareness
about your company and your products and services. For these communications to be suc-
cessful, the messages must be clear and eye-catching. Much like a regular conversation, where
more than 50% of what’s being said is conveyed non-verbally, a successful mailed communica-
tion is much more than the words on the paper. Overall, a mailpiece must be eye-catching,
cohesively organized and relevant to the recipient. When all these pieces come together, then
the second half of the conversation can continue.
Mailers already have a desired reaction in mind when the documents are created. The effec-
tiveness of the mailed communication will be measured by the number of respondents who
correctly react, either by calling about an offer in a direct mail piece or by sending in payment
for a monthly bill. These correct reactions come from sending the correct communications,
either as a stand-alone direct mail piece or as part of a transactional mailing.
Companies today record an incredible amount of data about their customers. Regardless
of the company, when you call a customer service line today, you will undoubtedly hear the
person on the other end feverishly typing to input your information and take notes about
your account. These interactions with customer service, along with your patterned buying
behavior, are available data for most companies who have the forethought to integrate their
customer relationship management systems with their customers’ billing or statement data.
Data mining and the ability of a company to scrutinize their data and make intelligent deci-
sions is the future of communications. With Google’s entrance into targeted search-based
marketing, mailers who want to remain relevant will need to be targeting their customer
and prospect base with very relevant and timely messages. Once this is accomplished, true
TransPromo mailing will begin to take place.
The Internet has all but destroyed the art of letter writing, and the attention spans of people
today do not allow for the unknown return time of a mailing response. People want informa-
tion now. Mail center managers want to know today when their return mail will be arriving.
With the introduction of the Intelligent Mail barcode (IMB), this waiting game has been mini-
mized, and the answers are just a browser away. Some advanced companies are even leveraging
IMB to trigger payment or renewal notifications. For all-around mailing success today and
in the future, it is important to craft target communications that leverage valuable customer
data and provide tracking information so that mailpieces can be monitored full-circle. And
remember, initiating the conversation is half the battle.
By TOdd RUSSEll
COrreCt reaCtiONs COme FrOm seNdiNg the COrreCt
COmmUNiCatiONs, either as a staNd-alONe direCt mailpieCe Or as part OF a
traNsaCtiONal mailiNg.
By now, you’ve all learned a recession lesson. Cost savings is in, and it’s here to stay. So how
can your company turn these short-term lessons into long-term success? While saving money
now is important, the savings mindset is the real long-term solution. An organization can
draft all the cost-saving initiatives it wants, but the real savings come not from the board
room, but from the shop floor. The value of an organization lies not in its assets, but in its
employees. The culture and attitude of your employees will have more to do with your future
financial success than your current investments and size of your bank account. The key is to
instill a culture of cost savings within your employees. This attitude is not only important
for your CFO and accountants, but your administrative assistants, production operators and
receptionists can be the most important and influential members of the organizational team.
Some of you may have heard the story about the matchbox company that was presented with
a cost-saving idea from the janitor. The janitor suggested that the company start putting the
match striking surface on only one side of the matchbox. This, in turn, saved the company
millions of dollars, and the janitor was rewarded accordingly. For organizations to reach their
pinnacle of success, they need to instill a sense of empowerment regarding cost savings to each
and every employee. Create a culture of employees actively searching for cost-saving measures.
This can save your management team time and increase their flexibility while providing even
entry-level employees the power to make decisions that create savings. It is often the tempta-
tion to offer up quick-fix cost savings initiatives, but in reality, any cost-saving measure must be
a well thought out, long-term solution. Harnessing the power of a culture of savings will go a
long way toward helping you consistently reach your fiscal goals.
A major challenge in running a business is in motivating your employees to care just as much
about the company as you do. The more empowerment an organization’s employees have,
the more ownership they will take in their handling of the company. One big incentive to
offer employees is a kick-back on any cost-saving idea. This will get employees actively thinking
of ways to save money, and when it works, they earn more money. It gets hard in the busi-
ness world sometimes to get employees to think about saving money because it’s not “their”
money, but when you get employees to feel like it really is their money being spent, true long-
term savings can be realized.
While cost savings on every level should be considered, it may be unwise to consider only
cutting costs. Sometimes you have to spend money to make money. This should be done
strategically by thinking about how the expenditures will help you in the future. You and your
organization need to look at spending money as a skill, not a mindset. For every dollar you
spend, look at what that dollar will contribute back to the organization.
An organization’s employees are the most important aspect of ensuring future success. Right
now is a great opportunity to spend a little extra money and hire top-level talent. With the
current high rate of unemployment, there is some serious talent available on the job market,
and as an organization, you have the opportunity to pick the best of a crowded field. There
are great opportunities out there, if you spend your money wisely.
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By Rick STEpp
saviNgs FrOm the shOp FlOOr
a majOr ChalleNge iN rUNNiNg a bUsiNess
is iN mOtivatiNg yOUr emplOyees tO Care jUst as
mUCh abOUt the COmpaNy as yOU dO.
It’s Not the DestINatIoN
but the Journeydits are conducted every three years to ensure that you continue to meet MPTQM standards. In addition, surveillance audits are conducted each year except for the year a recertification audit is conducted.
So far, this just covers the “what.” What really matters is the “how and why”! Why would any organization want to put themselves through the pain of process change and multiple USPS audits when it is not a requirement to do business? The answer lies in both the title to this article and the first line: to be the best that you can be and because the value is more in the journey and not so much in reaching the destination.
MPTQM certification is the premier external validation for any major mailer. It says that you are the best of the best. It provides proof positive that you have internalized the principles and con-cepts of Quality throughout your organization and have put them to work to make mail better and make better mail. But beyond the “bragging rights” lies a tremendous opportunity to take your team through a remarkable journey that will transform your or-ganization into a continuously improving, constantly learning culture that drives better business results and is some of the most personally rewarding (and at times trying) that you will experience in your career.
As major mailers look to implement systems and processes to be the best that they can be, one strategy that is freely avail-able and supported by the United States Postal Service (USPS) is its MPTQM certification program. Short for Mail Prepa-ration Total Quality Management, MPTQM was created by the USPS in 1995 to improve the quality of mail production processes and drive efficiencies through the entire mail preparation value chain. Rooted in and based on international Quality manage-ment standards, including ISO 9000 and the Total Quality Man-agement principles behind the Malcolm Baldridge National Quality Award, it is earned by mailing organizations that demonstrate a pervasive commitment to quality control in the preparation of com-mercial mail.
As part of the MPTQM certification process, the USPS conducts onsite audits to verify that mailers meet MPTQM standards. It has outlined a comprehensive process where mailers first register for MPTQM Certification and the USPS provides a guidebook and checklist for each of the business process areas that need to be documented and improved to meet certain quality standards. After conducting a series of internal audits to ensure that your progress is on track for certification, a USPS team of auditors will schedule the initial audit. If everything goes according to plan, you receive your certification, and ongoing recertification au-
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It would take far longer that the space allo-cated to this article to review all of the steps to success for your journey to MPTQM, but the following stand out as a few that may prove helpful as “takeaways:”1) It’s not about the sheepskin: MPTQM is
not something that you do just so you can hang it on the wall. It will be a multi-year endeavor that requires a commitment to a culture change within your organization. The deeper you get into assessing and im-proving your processes, the more you will have to change your expectations. MPTQM, like any serious Quality initiative, is not a
“project” or a “program” and certainly not a “flavor of the month.” It is a commitment to a new way to working and thinking.
2) Everyone in the boat: You will not have the luxury of having just some on your team embrace the concepts and actions required by MPTQM. Everyone plays. As you take this journey, you will find that your reward and recognition programs will change to reward those that embrace Quality, and you may even find that some on your team may not make the trip. Pervasiveness at every level within the or-ganization is an absolute must.
3) How can you count the ways: Your metrics will change. Count on it. Measures that point to success in your pre-MPTQM world will just not be good enough anymore. In school, 90% was still an “A,” right? In our MPTQM world, we look for “defect-free” as the goal and measure accordingly. The im-pact of defects in our mail has far too great a customer and budget impact to accept the old ways of measuring things.
4) A little help here: Your people will need training, coaching and consistent feed-back followed by more training, coaching and consistent feedback. Your systems will have to be upgraded to comprehend more frequent measures and calibrations as you manage towards tighter and tighter specifications. You will want to implement internal certification steps and metrics for training effectiveness.
5) Quality doesn’t come cheap: You will need to dedicate some of your most talent-ed and critical resources to your MPTQM initiative. There are usually two ways to do this in most organizations. The easy way (less common) would be to secure senior management commitment and get their support in the form of increased resources to drive towards MPTQM. The hard way (most common) is to take a good look at your existing budget and internal team to determine how you can shift resources to self-fund your need for dedicated Quality coaches and auditors. The sacrifices and investments in Quality that you make up front will be paid back as you drive supe-rior business results in the long run.
So, what about those business results? Where will the tangible benefits come from? Besides the obvious — postage discounts — the single biggest opportunity savings area is in the elimi-nation of waste. In the production mail busi-ness, we just don’t have a full appreciation for how much rework and waste occurs in the pre-MPTQM world until we view it through the Quality filter. Every time there is an error, you could possibly be wasting the cost of labor, ma-terials, postage, customer perception and time, not to mention the additional cost to rework the mailpiece(s). Would you rather proactively invest this “cost” in a quality program such as MPTQM that will help catch or prevent these er-rors or continue to waste your budget dollars on preventable errors? Attaining MPTQM certifica-tion isn’t easy, but it’s well worth it.
Ready to take that first step on your journey? The USPS website has a wealth of informa-tion, including descriptive documents for download at www.usps.gov/mptqm. Good luck, and we’ll see you on the road.
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reduce costs while increasing postage discounts! | by Hank Martin
Capture H i d d e n SavingS
Opportunities for savings can exist in the fol-lowing ways:
Cycle 1A: 3-digit 546, 400 Pieces
Cycle 1B: 3-digit 546, 220 pieces
Cycle 1C: 3-digit 546, 271 pieces
Cycle 1D: 3-digit 546, 320 pieces
In this scenario, 3-digit 546 contains a total of 1,211 mailpieces. Further analysis shows the four 3-digit 546 trays, three of which have 5-digit ZIP opportunities:
• 54601 = 445 pieces• 54650 = 220 pieces• 54660 = 206 pieces
The remaining 340 pieces qualify for 3-digit.
the reSultS oF Merging CyCleS:
Cycles 1A, 1B, 1C and 1D now result in
Evolving the mail center requires analysis of processes to include many of the following:
1) Identify common mail streams.a. What mail streams print on the simi-
lar paper stock and can process on the same inserter?
b. How many inserts are in each unique mail stream?i. Can the inserts be accommodated
on the same inserter?c. What part of common mail streams are
being outsourced?d. Presort test combinations to show what
value can be achieved.e. Build a cost model to support findings.
2) Identify mail streams with different paper stock that could be migrated to same pa-per stock. a. Test combinations to demonstrate
what value can be achieved.b. How many inserts are in each unique
mail stream?i. Can the inserts be accommodated
on the same inserter?c. What mail streams in this mix are be-
ing outsourced?d. Build a cost model to support findings.e. Present cost model to business owners
with recommendations.
3) Identify an approach to merge common mail streams.a. Identify any changes to existing sys-
tems.b. Identify changes to paper stock to ac-
commodate merging.c. Identify changes to inserts that might
allow more merging to occur.d. Identify new systems and software that
improve success.e. Determine cost and ROI of
approach(es).f. Document key success factors, benefits
and risks of each.
IN today’s US economy, identify-ing new approaches to achieve value in Print and Mail op-erations is critical to managing
costs and improving efficiencies. Many compa-nies operate Print and Mail with methods that have been used for years. While this approach gets the mail out, it is not always the most effi-cient or cost-effective. With budget cuts affecting many areas of business and loss of mail volume an ever-increasing reality in corporate America, evaluating your Print and Mail processes is es-sential to the survival of the mail center. By discovering areas of opportunity for operational efficiency, many can reduce costs and increase postage discounts important to the longer-term survival of the corporate mail center.
Companies processing smaller individual mailings find it difficult, if not impossible, to achieve significant postage savings in their mail. Densities to the five-digit or three-digit discount levels simply do not exist. Looking at internal processes for opportunities to combine smaller mailings into larger single mailings can achieve deeper discounts and improve productivity. In many environments, identifying these opportu-nities can be met with dependencies or changes in legacy systems and applications that are dif-ficult to modify and adapt. These obstacles often prevent consideration of optimized mail streams. Use of outside consolidation services or presort bureaus can be the only option con-sidered, yet this option is not always the most optimal from a cost/value standpoint.
With every organization pushing to become more efficient while simultaneously reducing costs and improving profits, Print and Mail man-agement is now better positioned to take the lead in identifying areas of production improvement. These enhancements can then drive cost out of the system by adding savings in labor and postage as well as improvements in mail center efficiency while also creating opportunities to provide more value to the organization and its clients.
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Capture H i d d e n SavingS
5-Digit 54601
5-Digit54650
5-Digit54660
5-Digit546
cles per month and per year begins to reveal substantial cost justification factors for chang-es within Print and Mail operations that en-able successful capture and overall benefits to the organization.
When applied across all cycles being processed in an operation, savings can be dramatic while real-izing benefits that drive profit to the bottom line.
additional beneFitS:• Print and Mail departments can improve
control of managing postal costs that ben-efit the overall organization.
• Less mail is outsourced to presort bureaus, resulting in savings.
• Success breeds success.• More mail owners will approach the Print and
Mail department on how they can save money and still be successful in their message.
• Migration to a file based manifesting sys-tem provides tracking of each version or client mailpiece, providing more accuracy and auditing of the mailing processes.
• File-based manifesting provides other operational efficiencies with enhanced value.
Print and Mail is an important investment in every organization producing mail. In today’s economy, providing alternatives to estab-lished processes enables users of the system to adopt creative approaches for continued viability in the mail. Identifying these oppor-tunities and the potential contribution to sav-ings and improved efficiency create visibility and opportunities for success.
looking at internal proCeSSeS For oppor-tunitieS to CoMbine
SMaller MailingS into larger Single MailingS Can aChieve deeper diS-CountS and iMprove
produCtivity.
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three 5-digit trays and one 3-digit tray. Sav-ings on 871 pieces going to 5-digit versus 3-digit is $19.16, with a savings of $.022 cents per piece. While this is not significant for a single, 3-digit ZIP area, the savings can greatly increase when applied to regional or national mailings. In this scenario, 72% of the pieces
across four sets of 3-digit trays were upgraded to 5-digit rates. If 150,000 pieces existed in Cycles 1A, 1B, 1C and 1D, they were at a 3-digit level and 72% of that mail could be updated to 5-digit, it would reflect 108,000 pieces and an overall savings of $1,620. Spreading similar savings across multiple cy-
The measure of a complete Automated Document Factory | By Pramod madala
From the time you started school all the way through college, someone was always there to grade you and examine how you compare to others in your class, or even to your siblings. Teachers and their aides were always at your side, observing your work. Tests were created to show how much you learned and how productive you could be within the given timeframe. Your progress was then analyzed to see if you were keeping up with the rest of the class. After your grades were reported, they would
coach you to make improvements where needed. But after transitioning from learning to earning, how do you measure your productiv-ity? Managers don’t have time to hold every employee’s hand and walk them through processes to make sure they are optimizing their productivity, earnings potential and careers. Too often, the good intentions are there, but the measures are missing.M
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The measure of a complete Automated Document Factory | By Pramod madala
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Classic management philosophy says, “What gets measured, gets done.” John E. Jones took this concept a bit further by adding, “What gets measured and fed back gets done well; what gets rewarded gets repeated.” But the real magic in turning a business philosophy into practical processes is in establishing sound metrics and measures. And, in the end, you can’t measure something that you can’t cap-ture data about, and nobody wants to take the time to measure things that don’t matter. So the refined goal is choose the right things to
measure and have the systems in place to en-sure that those things are being done right (or at least continuously improving).
This business we call production mail is a com-plex, deadline-driven, quality-critical, manufac-turing process that starts with structured data from a business application and winds up as a completed, sorted, trayed and palletized finished product on a forklift being loaded into the back of a USPS truck. Completed work is the result of human resources, sophisticated IT systems and
machines all working together through predict-able, repeatable processes from “data to door.” This is the domain of the Automated Document Factory (ADF). How then do we apply the met-rics and measures to this complex web of activity? Today’s technology provides the answer, and the payback on the production floor speaks for itself.
A well-designed and implemented ADF takes you to the highest level of production and raises your efficiency beyond what you thought pos-sible. In today’s working environment, time is money. ADF can help companies avoid hidden inefficiencies and non-conformance costs that result from errors. Despite mail quality pro-grams and initiatives, USPS still reports that way too much mail is mislabeled or contains er-rors, resulting in the dreaded “UAA” (undeliv-erable as addressed) and being returned to the sender. Preventable errors on the production floor incur a host of non-conformance costs, in-cluding return fees, material waste, labor costs and the opportunity costs associated with lost capacity. And for mailers dealing with private or personal data, mistakes can mean hundreds of thousands of dollars in penalties, not to men-tion the loss of confidence in your services.
A well-designed ADF system minimizes these costs by ensuring the correct information in the right order, print quality assurance, accu-rate accumulation with no mixed mailpieces and accurate postage, based on destination and tray density. If errors do occur, ADF sys-tems notify immediately and automate the op-portunities to make corrections or recycle back through the process without slowing down or stopping their workflow. What, then, are the elements of a well-designed ADF system?
reAl-TiMe MeASureMenT AnD reporTing: I’m sure by now that most people are aware of how important real-time capabilities are when it comes to any form of information technology. Within many typical production systems, measures are manual or even anecdotal and performed by operations supervisors and quality assurance personnel. Production reports are assessed monthly or quarterly, depending on the business and deci-sions, for improvement goals are set after even more planning. Waiting that long to discover inefficiencies can cause productivity levels to be dramatically reduced. With ADF systems with real-time data collection and reporting, opera-tors and managers will see results in seconds, allowing them to respond quickly.
open AnD AcceSSible: Everyone is aware of the web and the tremendous access
to information that it supplies to our daily business and personal lives. A well-designed ADF system should take advantage of modern web technologies to make reports available to users through their web-connected worksta-tions, laptops and even their mobile phones.
Flexible AnD porTAble: Webster de-fines a report as “common talk or an account spread by common talk.” If ADF reports are to be effective in spreading that “common talk,” then it needs to be flexible in the formats that it can adhere to for both human sharing and com-prehension (e.g. PDF, HTML) and machine-to- machine sharing and data portability (e.g. CSV, XML). Reports are only as good as their ability to carry their message. This ties back to both real-time and accessibility aspects of the system.
AcTion-orienTeD: A well-designed ADF system helps decipher your data, analyz-ing and offering suggestions for improvement, which are made visible to both the operator and manager, as well as measures the efficiency of every employee and machine. This allows you to focus on areas that need improvement. Manag-ers can determine where training needs to be implemented, when and where the equipment needs attention and how to distribute the work-force based on peak performance in production.
But ADF systems are not just about machines. Your human resources and your operators rep-resent your greatest corporate assets and are worthy of your improvement efforts. Having the ability at your fingertips to see the produc-tion or idle time by employee vs. benchmarks, the number of jobs or tasks they have com-pleted and the areas where improvements can be made gives you the power to respond and to make adjustments almost immediately. As a manager, you are investing in people through compensation and benefits every time they walk in the door. But why not invest in them by helping them do their job better? Any tool that helps you analyze data and quickly make improvements to your operations will be a great improvement to your production. By obtaining the productivity of operators in real-time, you can easily discover the most efficient employees and begin a training program for new employ-ees with these mentors. This way, operators are continuously improving to a point where both they and the machines are running smoothly at their peak performance levels.
Just as no two students in a classroom function the same way and require different attention, no two production mail operations process in the same manner. Even if two shops have the same equipment, the operators are not the
same and the management is different, result-ing in the operations running in two completely different ways. ADF technology understands this and is configured to the environment in-stead of you adapting your operation to the technology. As teenagers, we all thought that we knew everything and that we could do no wrong. Then we finally realized that we should have taken advantage of some outside help. The ever-evolving advancements in ADF technology will optimize your production by speeding opti-mizing solutions right to your production floor.
In the future, ADF techniques will continuous-ly improve to ensure lower costs, higher quality, document integrity and process controls. As strategies continue to progress, new functions to support TransPromo color printing, content and campaign management driven document composition as well as response management systems will require peak performance from production systems.
ADF systems offer intelligent, real-time optimi-zation solutions — and it’s only getting smarter.
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the Objective PurchaserThe key to supplier evaluation is to develop a methodology that allows you to objectively evaluate service providers or products. An ob-jective supplier evaluation will ensure that the best supplier is selected for a given business problem. The intent is to consider all relevant factors and minimize the subjective issues that can potentially influence such a decision. The objective data is not always clear and may re-quire you to create your own system of mea-surement. A weighted matrix is just one tool that can be used to ensure objectivity while reaching the decision.
The weighted matrix method can be used for filling a specific need, such as a courier, presort service, printing operation or letter fulfillment. It can also be used for selecting equipment, software or even a complete service provider that will manage the operation for your busi-ness. In fact, the more complex the decision,
the more important it is to properly evaluate all relevant factors of the decision. Before an RFI or RFP is even produced, it is a good idea to discuss with your group the requirements and expectations that they have for the poten-tial vendors. It is also important to understand the overall goals of the business and how the selection will impact or augment those goals. This is not a like-for-like comparison of cost and product but a holistic understanding of how the supplier should affect your organiza-tion. Requirement definition will also help you convey the need to engage a third-party supplier. As you are looking at all of your business requirements, you will need to un-derstand the factors that are most important to your company. It is also recommended that, at this point, you have a conversation to un-derstand the factors that are most important to your upper management to ensure you will have stakeholder buy-in once the evaluation is complete. The requirements that you include
Over the past 18 months or so, businesses across all sectors have been pursuing one com-mon goal: sell more products
and minimize resources to reduce costs. This has placed additional pressure on the relationship between companies producing the goods and the suppliers that provide the tools to produce more effectively. We are see-ing companies go to their suppliers and re-quest better rates, services and technologies. Conversely, we are seeing suppliers utilize this economic environment to justify the impor-tance of their services and products to their clientele. Now, perhaps more than any other time in the past decade, companies need to be able to make an informed decision to select suppliers for optimum success. With every vendor putting their best foot forward and considering the purchaser’s economic re-sponsibility, how can the purchaser make an intelligent decision based on the facts?
the dos and don’ts of supplier evaluation | By Graham Newell
SuccessSelecting for
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steP twO: invOlving the suPPlierA well-written request for proposal (RFP) or request for information (RFI) should help you and your supplier understand all of the factors that will make the project a success and what obstacles will need to be conquered. The ob-jectives of an RFP/RFI are to:
• Identify critical success factors• Identify barriers to success• Integration of supplier activities with cor-
porate business strategy• Provide legal framework of an agreement• Enable ease of migration
I generally advise our business partners to keep price out of decision-making until the field is narrowed to two or three suppliers that can meet all the requirements. This prevents an un-negotiated price from kicking out a very qualified supplier. You should first see who
ance risk associated with failed supplier performance.
• Confidentiality: Supplier possession of or ac-cess to confidential or restricted information.
• Supplier connectivity to client networks: A planned network connection between you and your supplier.
• Direct customer interaction: Planned supplier interaction directly with your cus-tomers.
• Supplier mitigation of personnel changes: Moderate to significant impact related to supplier’s loss of key personnel.
The requirements process may be the most involved and lengthy part of the supplier selec-tion process but will be well worth it in the end. Strong requirements will lead to better leverage after you have begun engaging suppli-ers as you will be focusing your efforts only on those suppliers most qualified based on their RFP response.
in your matrix will be a mixture of questions that could be used in a variety of weighted ma-trices because they are requirements strongly rooted in the goals of your organization, as well as questions that are going to be specific to your product or service decision.
YOur requirementssteP One: risk assessmentRisks are often overlooked during business need and requirement development; however, they can be almost as vital a component of ven-dor selection as the final price. Some suggested areas to concentrate your risk assessment and potential mitigations include:
• Financial impact: A moderate to sig-nificant daily financial, customer or operational impact if the supplier is unable to provide services.
• Legal or regulatory compliance: Moderate to significant legal or regulatory compli-
can do the best job for your company, then negotiate the best price.
Pricing can be simple or complex, depending on the services being rendered. It is impor-tant that you comprehend all costs involved, such as hardware, software, service and main-tenance as well as facilities costs. Outside of these typical costs that most purchasers un-derstand, think about the costs associated
with establishing, maintaining and monitor-ing security and access control and the costs associated with establishing recovery capabil-ity. The costs will vary depending on your decision, but regardless, an exhaustive search for all costs will save you many headaches down the road. When including the vendor in your RFP/RFI preparation, ask them to consider all costs associated with their poten-tial proposal.
Keep in mind that most service providers you are looking at will be able to meet many, or even most, of your business needs. However, the supplier evaluation process is necessary to effectively weigh each need in order to select the supplier that meets the majority of your requirements effectively. Stick to the process to ensure success. By organizing the objective data to effectively make your supplier decision, you will have clear justification for deciding one way or the other. Providing objective data to support your supplier selection will: increase stakeholder buy-in and approval by augment-ing the decision-making process; decrease time and effort in future supplier selection cycles by creating a reusable method; gain personal cred-ibility (you and your team) through validation of the selection as well as company credibility (with suppliers — both those selected and those not) through validation of the selection
the DecisiOnOnce you get the responses back from your RFP, you can then plot each raw score into your matrix. You can then identify the com-pany that represents the “best fit” for your organization. Your scored matrix will help in complex evaluations with multiple criteria and multiple vendors to consider. Here, each requirement is weighted against the overall cost of the delivery. Using this form will help you determine where to let go of less critical or lower-rated requirements for better delivery of those factors that are most important.
Choosing the best supplier from a group of qualified service providers can be a daunt-ing task, but the benefits will outweigh the upfront efforts. Determining specific require-ments in advance and communicating factors for success with potential providers creates an equitable and decisive way to subjectively make a decision as well as increase credibility and validation of the final selection.
Finally, by using the weighted matrix meth-odology, you will be sure that all aspects of the request are covered and the ground-work for a successful comprehensive agree-ment between parties produces the desired results. The methodology can be modified and reused in a case-by-case basis to meet the needs of a particular type of service provider or product that is being evaluated. In the end, you are seeking new solutions because you want to improve your operation, and a quantifiable system puts you on the right path towards organizational improvement with your new investment.
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K2600
The Kern 2600 Inserting System sets new stan-dards when it comes to performance, modular-ity, reliability and investment protection. Consis-tent use of the latest servo technology allows for virtually maintenance-free processing that push-es the K2600 to deliver up to 16,000 envelopes per hour with either #10 or 6”x9” envelopes.
The K2600 features an ergonomic design for ease-of-operation and better access throughout the system. Standard on the K2600, Kern’s 4-plate folder makes almost any type of vertical or horizontal fold possible. The new clam-shell design of the folding unit of the K2600 allows for rapid application changeovers and offers nov-el features that serve to increase versatility and
simplify adjustment procedures. The new and in-novative unit is an integral part of both the new continuous forms cutter and the new single-sheet feeder. The K2600 can also handle up to four in-puts at the same time with the systems integrated inputs for both continuous and cut-sheet forms.
The K2600 is integrated with the most ad-vanced document safety features that include additional monitoring sensors in the docu-ment transport, as well as barcode cameras that give a real-time image of the document on the local operating panel to aid operators in lining up barcodes, allowing for quicker setup and better accuracy. Industry leading sensor density ensures every piece and packet are con-
tinuously monitored and tracked, guarantee-ing 100% mailpiece integrity.
“Kern Integrated Inputs” reduce the complexity found in current input systems and more impor-tantly, reduce setup times. The Kern Single Sheet Feed EFQR also combines three functions in a compact unit: It separates folds and collates docu-ments in a single module. The single sheet feeder is extremely reliable and is simple to adjust. When collating two pages per group, the module can process up to an impressive 32,000 documents per hour. Both input modules set new standards for reading capability. All common types of code can be read anywhere on the document. The Kern SIGR continuous forms input combines the cutting, accumulating, and folding into one compact unit. The fast SIGR processes two-page document sets at the full rated chassis speed of 16,000 envelopes per hour and three-page sets at 12,000 envelopes per hour. The K2600 is natively capable of handling either pin-fed or environmen-tally friendly pinless forms. Kern’s mailFactory Suite has also been fully integrated into the frame-work of the K2600 for unmatched ADF flexibility and reporting capabilities.
For mailers that need a flexible inserting system with integrity built-in and full integration of an automated document factory, the Kern 2600 Inserting System delivers 10 years of production- grade output when maintained under a Kern Service Maintenance agreement.
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easyMailer
Mailboxes today are filled with statements, bill notifications and a variety of mass-mailed market-ing pieces that are fighting for attention. To stand out from the typical “Dear Resident” letters that blanket a ZIP Code, wise direct marketers are leveraging the power of full color and variable data printing to create targeted messaging that will catch the recipients’ attention and deliver increased responses rates as high as 25%. This di-rect mail philosophy has become even more valu-able and effective during the last 18 months as companies tap their mailing lists to look for new opportunities and to increase business revenue
Kern’s latest innovation is the Kern 515 Easy-Mailer: a turnkey, self-mailer that turns an
11x17” form into a complete mailpiece. Now you can maximize your marketing messages by using all sides of the envelope for added graph-ics and text inside and outside the mailpiece. Personalization, along with the use of variable color graphics and text, has proven to gener-ate a much higher response rate than general letters. Marketing companies, transactional printers, copy shops and quick printers are seeing opportunities to provide more focused marketing solutions for their customers by us-ing personalization to increase response rates. The K515 EasyMailer has been improved with the addition of an optional insert feeder and the improved capability of adding up to three documents per envelope.
With the Kern 515 EasyMailer, you can easily connect more personally with your prospects and customers. The EasyMailer complements the new age of variable digital and offset print-ing to revolutionize direct mail and transac-tional mail processing. The EasyMailer allows any company to go the extra mile in commu-nicating with customers and prospects. For every personalized finished letter, the barcode tracking system guarantees integrity between envelope and contents to be finished. So from print to finished solution, the product is ready to be mailed.
Not only can the EasyMailer give you the com-petitive edge when mailing to your customers, but compared to conventional methods requir-ing separate envelopes and an insertion device, it can provide cost savings for short to medium mail runs of fully personalized mailpieces. As an added benefit, the K515 EasyMailer can process common paper stock, giving sig-nificant savings over specialized envelopes and forms. The K515 EasyMailer is an easy-to-de-ploy and cost-effective direct mail solution that will surely make your customer’s mail stand out in the mailbox.
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Why pre- and post-processing? A simple an-swer to a simple question: savings potential. Any production printer requires pre- and post- document processing. Savings comes from automating processes and minimizing manual input during the document production pro-cess. Kern’s line of Document Finishing on Demand Solutions for pre-and post processing requires little operator supervision, reduces operator handling, and increases operator productivity for better overall production ef-ficiency. Your printers can only processes as quickly and efficiently of their inputs and out-puts and Kern’s line of Document Finishing on Demand Systems maximize the efficiency of your complete production from end to end.
Kern Document Finishing on Demand (DFD) provides intelligent solutions for the pre- and post-processing of digitally printed mate-rial from roll-to-roll, roll-to-fold, roll-to-cut and
roll-to-book, thus saving you time and money. Kern offers a variety of modular products with-in the DFD category that ensures all steps in the printing, inserting and finishing of docu-ments are accomplished efficiently.
roll to roll — unwinders and rewinders
Kern’s line of Roll to Roll solutions optimize today’s high-speed printers with input and outputs that can handle up to 500 feet of continuous form web per hour. The K100 roll unwinding module feeds Kern’s high-speed in-serting systems and is also perfectly suited for use in combination with high speed printing machines or with offline cutting, folding and inserting systems. The K100-DR6 series of un-winders and rewinders are also available in a lighter version for those who do not demand as much functionality but still want advanced
electronics and performance. The K110 high- speed roll rewinder ensures perfect web re-winding so that the finished roll will process correctly during the next step of production. One advantage of the K100-DR6 series is that 90% of the parts on the K100 unwinder and K110 rewinder are interchangeable, saving you money in parts inventory.
Large shops face the challenge of ensuring every device is matched to its purpose and ready for production. When equipment configurations change on the production floor, that may mean expensive and time-consuming changes. Kern has taken the DFD concept a step further with the announcement of the K115 “Runwinder,” a fully featured system that can serve as either Un-winder or Rewinder on your high-speed print lines, giving customers the flexibility to shift production assets to different uses as produc-tion needs change.
K125 web buFFer
Printing and post-processing modules need to maintain a perfect balance of input and output so produc-tion processes can run efficiently and without delay. Post-processing devices, such as cut-sheet drop stackers like the Kern DS-29, require time to eject the finished forms. Printers, however, must continue production,
or the entire line will be stopped until the drop stacker is ready to resume. The Kern 125 Web Buffer serves as the buffer zone between two different production process-ing stages and allows for continuous web flow. The module also synchronizes print-ing systems with follow-up paper process-ing systems, a feature which allows you to connect a printer directly in line with a Kern Inserter.
With the K125 Web Buffer will maximize your printer capabilities and keep auto-mation to the max, saving you both time and money. Featuring an automated loop control to adjust variations in printer speed, the web buffer also offers an auto-load system for easy startup.
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MailFactory
Continuous technological advancement is the key to business success today, and it is even more important for the mailing industry to stay ahead of the curve. Production mail centers utilize the most advanced printing and inserting systems and these environments need the ability to moni-tor and control the entire processes, from end to end. To meet this need, Kern has developed a suite of Automated Document Factory (ADF) solutions, mailFactory. Kern’s mailFactory is a comprehensive suite of web-enabled ADF soft-ware tools designed to help clients manage docu-ment production, verify document accuracy, and easily interface with other workflow systems in an ADF. All of mailFactory’s components are based on an open structure, making it possible to network document inserting systems and to store data in a central database.
mailFactory Manager allows you to visualize pro-cesses monitored by mailFactory, giving you the ability to see all finished and processing jobs.
mailFactory Document Control ensures the in-tegrity of your mailings by controlling the infor-
mation for file-based/database driven inserting.
mailFactory Workplace provides a window into the production mail job being run at the inserter with a color-coded view of each mailpiece. It also provides the capabilities of repairing, reprinting or manually handling mailpieces within a job.
Interfacing with mailFactory Manager SQL Database, the mailFactory Reporter is capable of reporting on inserting, operator, job, mail-piece and mail recovery data.
mailFactory Media Control provides tracking of inserts via a barcode read at the time the insert is added to the packet.
mailFactory PROStream helps customers man-age their production resources by enabling print stream engineering, replacing barcodes, organizing control files and signaling auto-matic reprints.
mailFactory Postal Reporter provides integrated CASS-certified address cleansing, PAVE- certi-
fied presorting, and full manifest report writ-ing for meter elimination.
In addition to mailFactory Manager, mailFac-tory FileManager allows you to control file transfers and distribution, as well as store in-structions for production jobs.
mailFactory Validation provides input and out-put validation, diverting documents that are out of sequence.
More than just document inserting systems, the components of mailFactory cover all lev-els of mail production.
Any piece of mailFactory software will benefit mail producers and greatly increase your pro-duction integrity, speed and capabilities.
ADF Systems enable a significant increase in productivity and greatly enhance processing se-curity. Furthermore, they make production veri-fiable and retraceable, allowing you to quickly and confidently process your mailpieces.
K146 HigH stacK Folder
The Kern 146 High Stack Folder folds continuous stationery perfectly into large stacks. This module offers everything you could possibly desire: It creates fanfold stacks of one-up or two-up continuous stationary with or without pinfeed. It can automatically separate jobs at an odd or even number of sheets; the intermediate
conveyor belt makes it possible to create sep-arate stacks without interrupting print jobs.
You can choose between two delivery sys-tems: The folded forms can be transferred directly to a drop stacker, where they are set upright and then moved away on a stack trolley with stacks up to 31 ½”, or they can be stacked with the automated Forms Transfer Systems (FTS) for high stack trans-portation up to 48”.
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in conclusion
In our last Mail Strategies, I reflected on challenging times and the need to “get go-ing.” As our 2009 year unfolded, we have all felt the impact of those challenges and have taken actions in response that we deemed necessary. Sometimes those actions had a human cost and are some of the most difficult choices to make. What are the actions, taken during tough times, that will provide the best payback as we enjoy the recovery? How do we make sure that we are doing more than just doing things right, but that we are doing the right things?
I believe that any organization’s attentions and efforts are best focused on customer relationships and ensuring that every customer is successful in achieving their goals with the products and services that they receive from their supplier/partner organiza-tion. We have organized ourselves accordingly.
It’s too easy for senior managers to concentrate on cost-cutting and divesting business-es. Though we understand that this approach can be necessary in the short run, we preferred to take this “down time” to strengthen our relationships with our customers by establishing metrics for customer success and ensuring that our measures demon-strate continuous improvement. We have reorganized to put our best people closer to the customer and increased our focus on collaborating with customers regarding their challenges today and their emerging needs tomorrow. We are looking for new ways to serve our customers with new product and service offerings.
That brings us to the spread in the front of this issue. We know that many of you have experienced trying times. More than just a “get going,” we want to work side by side with you to help you meet and exceed your production expectations. And, as always, we would like to hear from you regarding the steps you have taken to organize for suc-cess, so contact us via email at [email protected].
We hope you enjoy this third edition of Mail Strategies, and we look forward to col-laborating with you towards your success.
BY Dr. thOmas J. BrOck, PrEsiDENt/cEO, kErN, iNc.
organizing For success
i believe that any organization’s attentions and eFForts are best Focused on customer
relationships and ensuring that every customer is successFul in
achieving their goals.
