Letter from the Publisher, Patrick Howard - Print21 August 2013
Who would have thought that Gerold Linzbach, CEO, Heidelberg (pictured) would have such a poetic cast of mind? Brought in with a reputation for being a ‘toe cutter’, the formidable Herr Linzbach has his views on the ‘right sizing’ of the leading press manufacturer.
This ‘right sizing’ has seen Heidelberg cut more than a third of its people over the past few years as it comes to terms with the 40 per cent fall in demand for its products. Coming from outside the printing industry there is a refreshing realism from the new CEO about the relationship of the company, the industry and the marketplace.
Asked when he will know Heidelberg has finally reached the right size, he said:
Shaping a company is a careful creative process, almost like when a sculptor hews a shape out of a huge piece of raw stone. First he works to create the basic shape, and then he works and reworks until he has given the stone all the minute details that will give the finished work the unmistakable character he is striving for. Finishing touches are decisive – and sometimes are never really finished. Some detail can almost always be improved. At Heidelberg – with Focus 2012 – we have achieved the basic shape. We are working on the finishing touches. But for us, the creative process is really re-creative process. And, of course, we are not the real artist. The real artist in the shaping process is the market, with all its regional differences and details. Our job is to mirror the market, to recreate our business to fit the shape of the different markets. We don’t shape the markets we serve them.
There may be a certain Teutonic weight to the sculptor metaphor but he is right on the money in placing the market at the centre of business strategy. It is too easy to blame external factors when our customers no longer want what we are selling. It is sometimes too difficult to change a formula that has worked for many years, but as the Heidelberg CEO points out, we are in business to meet the demands of the market, not the other way about.
In the ongoing turmoil of the printing marketplace many are concerned about the ultimate fate of printing. Fashionable forecasts of the death of print are assured of a ready audience almost eager to surrender to doom and gloom. It is more taxing to take the measure of the marketplace and adjust our operations – ‘right sizing’ if necessary – to meet its demands.
There are structural as well as cyclical challenges in the printing marketplace but there is a solid foundation of demand that is not about to disappear. We are lucky that the demand for printing is so widespread that there is no likelihood of anyone, printing company or supplier, being able to ‘game’ the market. There will always be opportunities and overlooked niches ripe for exploiting for those who care.
Andrew Dunn, who looks after prepress for Currie Group, reminded me of this. While the Group may be focused on the high profile and lucrative HP Indigo franchise, Dunn is quietly refurbishing the relatively unfashionable commercial CTP market with the company’s Cron platesetters. He reckons there are a couple of hundred aging ECRM CTP engines installed by the Group in the market and, over the next few years, they’ll be ripe for upgrading. It is likely to be a very profitable market and Dunn is ready to meet the demand.
Sam Hanna of Hannapak also drew my attention to the resilience of the marketplace when he brushed off any fears about the fate of manroland when it went under last year. “Maybe for five minutes but I knew someone would pick it up. They were never going to let that customer base go.”
He is also moving to meet his market by adding to the company’s formidable battery of manroland offset presses. He makes the point that you will not be able to take advantage of opportunities if you don’t already have the capability to service the market.
Which proves that while the market may be the over riding power, we are not hapless victims. Energy and acumen are the tools by which we can shape our own destiny… provided we remember that in the long run everything must meet the market.