The modern MIS - not just a pretty interface: Print 21 magazine article

Information is our secret weapon in the struggle against overseas competition, but managing that information correctly, and making sure it works for your customers as well, is no easy matter. Peter Haydock investigates making the modern MIS.

As a kid growing up, my head was often buried in Boys Own-style annuals usually replete with obscure facts about far-flung parts of the world.

One 'fact' I never forgot was that if all the Chinese in the world marched by, four abreast, the line would never end. Wow! Now that was something to ponder!

I was reminded of this the other day, thinking about the number of printers that would be needed to service the developing economies of China and just-as-heavily-populated India.

What if all those printers were to march by four abreast. I wonder how long that would take?

The question is pertinent to the subject in a roundabout, idiosyncratic sort of way because, as their own economies mature, it is perfectly natural for those printers to begin marching into export markets and, with lower labour costs, they are well-placed to attract customers from Australia.

What cheek! Is there nothing we can do to stop them? Yes. We can use the advantages given to us by management information systems (MIS) – but are we ready to grasp the nettle?

Our acceptance and mastery of these digital dark arts, helping us take complete control of our businesses and print jobs, and integrate our systems with those of our customers, would give us advantages on three fronts. Firstly, it would make us better business people and that's always a good thing, building our corporate biceps to fend off attacks from without. Secondly, it could help us do more with fewer employees, thus reducing any labour cost advantage enjoyed by printers in other countries. And thirdly, it offers the promise of greater integration with our customers making them more reliant on us and more reluctant to be seduced away.

Joe Kowalewski of the Printing Industries Association of Australia worries that we are not embracing the digital age as fast as we should.

"Some time ago we set up an industry benchmarking system that our industry identified as being much needed. We invited printers to contribute information," he says. "But it soon became apparent that they didn't have the information to contribute – and we're talking here about pretty basic business management information. We were getting educated and, too often, uneducated guesses as to such things as wastage rates, machinery downtime and manufacturing costs.

"This is the sort of information that any MIS worth its salt would give you, and it told us that if they had MIS they either weren't setting them up for whole-of-business use or simply didn't understand the benefit of having detailed business management information available in addition to job handling capabilities.

"I believe this is a problem not only with MIS but the whole issue of digital assets management. Are printers keeping accurate digital archives of jobs they have done in the past? How quickly can they recall them for reprinting or repurposing for a client? This is where the value-adds sit and where profitability can be created. If they're relying on the customer to lead, then what's to stop the customer next time passing the job onto someone else? Do they realise the revenue streams that could come from being at the front of the imaging process?

"Our advice to any printer who asks us is this: begin to understand the enormous advantages and opportunities that lie ahead if we can harness the information at our disposal and learn to use it correctly. And that's where a good MIS system can help enormously."

Time to muscle up
But what is a management information system? Even a rudimentary enquiry reveals that MIS means different things to different people. It's all rather academic if you're working from seven to five to keep the presses rolling.

The range of products goes from workaday software that's a step up from Excel to powerful, muscular systems that are the King Kongs of information management.

Optimus, for instance, is at the high end of the MIS range with more than 30 different modules. It was developed three decades ago in the UK and is one of the oldest digital management tools for business. Peter Charlton, representing Optimus in Australia, describes it as modular with a very powerful core. The modular system means that although it is suited to very large printers, smaller printers can pick and choose to meet all their requirements.

"The core of most MIS packages is its estimating capacity," says Charlton. "From this can flow other tasks, such as scheduling, customer job tickets, sales analysis etc. The optimum aim of the MIS package is to provide a whole-of-business approach. I think the size at which printers should start looking at really robust MIS, like Optimus, is when they have around 15 employees. They're then becoming a large concern and an MIS system will certainly save them money if it is used correctly, particularly if used in conjunction with JDF.

"If your MIS package is also JDF-compliant - and not all are - then you potentially can make some big savings. Your MIS system can show you what a job ought to cost, based on what you believe your prepress, your makeready, your wash-up etc should cost in terms of time. If you use job messaging files (JMF) you can extend this to give you real time information as your job progresses, about whether you are meeting the guidelines you've set.

"This complete automation abolishes all paper systems. It eliminates time sheets. It takes all the guesswork out of your cost structures and releases staff from clerical tasks to other duties. In the next few years - as in the last few for that matter - cutting costs will remain the name of the game."

Leaders and challengers
Still, the initial cost of a powerful system, which can easily run into six figures and beyond, can itself be a deterrent. Chris Wood, VP sales and marketing of DiMS! Organising Software, designed for the mid level to large print and packaging companies, acknowledges that printers should look seriously at return-on-investment in the purchase of any system.

"We always do an analysis of a customer's business to identify tangible financial returns on the new system," Wood says. "Beyond that, there are many intangible benefits to which each printer must apply their own value eg customer-facing websites which may not increase sales or reduce costs, but may help client retention or reduce errors."

How important is it for printers to install an MIS system? Wood makes an important point: "The gap between what we might term profit leaders (top 25 percent) and profit challengers (bottom 75 percent) is quite marked. In the USA, PIA/GATF estimates that profit challengers are barely making a profit, while the profit leaders are making an average of 10 percent.

"Whatever the size of your company, there are a number of characteristics common to profit leaders and one of these is managing by numbers for which an MIS is essential. I guess the moral of the story is, if you want to simply survive you can probably do it without MIS but if you want to be a profit leader, then MIS is an essential tool."

All about automation
Oliver Mergen of MIS developer DaVinci says the lack of an MIS is not an absolute barrier to survival for medium and larger printers but profitability and the ability to rapidly respond to customers will not be as good for those without automated MIS.

"The modern MIS is all about automation, workflow and artificial intelligence," Mergen says. "It doesn't simply replicate 'pen and paper' business processes on a computer screen but rather brings a lot of 'brain-power' to the table. Products such as DaVinci are, more properly, business and workflow management systems. Such systems use artificial intelligence and have the ability to think and to act independently of staff within the business."

Convenience is another word that crops up all the time in discussions with MIS suppliers. Chris Wood of DiMS! points out that everyone now expects information to be available instantly.

"For many of us, it's years since we visited a bank; our relationship is maintained online. Print does have some unique barriers to this kind of relationship, although for many types of simpler print jobs it's ideally suited. I feel safe in saying that the provision of online information is going to be a universal requirement, but the precise usage will vary by market and product. In our case, the entire DiMS! system is web-enabled and this, along with other tools we provide, makes it very easy to provide customer information and transactions on the web."

Nigel Davies, developer of MIS system M-Power agrees with this: "Just think about the times a customer rings up for information about a job you're printing for them," he says. "Too often they're kept waiting till the appropriate person can be found. They're often fobbed off, told they'll be called back and then they never are.

"A good MIS system gives anyone the power to call up jobs on screen and advise the customer about the state of the play, avoiding printer-customer frustration. Instead of looking for Fred on the floor, the receptionist can immediately provide the information they're seeking. That's an enormous improvement in customer relations right there."

What the *#!@?
As viewers of Gordon Ramsay's Kitchen Nightmares would know, though, there's many an (expletive deleted) slip between recognising the need for a change and actually getting it implemented and accepted. The boss might like it but the factory foreman, for instance, may feel threatened and play a spoiler role. Davies says cultural change is the biggest direct obstacle to MIS.

"Even when you've managed to convince the owner of the business to accept your system, unless he or she is sufficiently motivated to drive it through, it may not achieve maximum efficiency. And this is on top of a sales process that might have taken up to six months from the initial demonstrations to final implementation. It's very important to get everyone who will be using it involved."

Echoing that view is Richard Rolfe, operations manager at Dynamic Graphics in Melbourne's south east. Rolfe is a mail management expert who has been running his company's powerful MIS system for the past three years.

"These systems are huge and for them to work at optimum level there are a number of things that it's essential you get right from the very beginning," he says.

"Firstly, define carefully what you want the system to achieve. If you're not sure, the developer isn't going to know either. Secondly, write down your aims and explain them with precision to whoever is implementing the system for you. These are powerful tools, they can manage huge amounts of information to give you what you want. And, thirdly, commit heart and soul to the system so that you can drive it through the company and motivate everyone who's using it.

"Adherence can be a major stumbling block. If it's set up correctly then everyone is expecting to get something out of it. If someone on the shop floor doesn't enter information then someone in accounts is left floundering. It's imperative that this connection is explained throughout the company and you accompany this with careful training.

"One more thing. Someone in the company at all times has to manage the system. It contains  a totality of information about the company so, by rights, it should be the business owner. The point is, never let the only person who knows how to manage the system walk out of the door."

And is it all worthwhile? "Absolutely," says Rolfe. "We now have access to information we could have only dreamed about three years ago. We can spot trends. Is a customer spending more with us or less? Are we using more resources to service those requirements or less? How much money are we making in the servicing of each account? The information we can pull out of the system is endless and helps us run the operation in full possession of actual facts not vague conjecture."

The system also allows companies to introduce new revenue streams too. "For instance, we now have a system that allows customers to check the stocks of pre-printed inventory we are holding for them. Customers recognise the value they're receiving and are happy to pay for it."

MIS may well be at the position that prepress software was a couple of decades ago. Those that recognise the advantage it offers will prosper. Those that don't may become the Flying Dutchmen of the print industry, forever flying the flag of profit challenger. Never becoming profit leader.