Wednesday, November 30, 2011

How AMI Cut Production Costs by 50 Percent

How AMI Cut Production Costs by 50 Percent

Automated workflows and software enhancements part of an ongoing process.

By Brian Kelly, FOLIO

American Media, Inc. (AMI) and Michael Esposito, Senior Vice President of Operations and Digital Production, think they've hit upon a recipe that could work across the magazine industry for rationalizing print publishing costs and scaling up on digital platforms.

"We've seen more than a 30 percent gain in productivity, and that has been achieved by being able to do more processing with less people," Esposito explains. "The overall view is that the savings have been absolutely significant and we've reduced production-related costs by over 50% percent." He goes on to explain that while publishers may reduce headcount slightly by examining processes and implementing technology, at some point headcount will increase as those publishers add personnel to support growing digital and mobile media operations.

AMI has not only reduced costs for their own magazines, but also for the publishers for which it provides a menu of services, from production and circulation to sales and marketing. "The AMI team has worked closely with our team at Playboy to optimize process efficiencies and deploy new technologies. Our collaborative effort has created a more streamlined production process that has generated significant annual savings," says Scott Stephen, COO Playboy Enterprises.

"Our clients can tap into our systems and take advantage of the tools we've rolled out," Esposito explains, adding that AMI any continues to investigate future technology investments that will enable further efficiencies in all areas of print and digital publishing.

How AMI Did It

When Esposito was brought on board at AMI his mandate was clear: bring production services in-house, outsource where it made sense, engage cutting-edge automated technologies such as DALIM's suite of TWIST, ES, and DIALOGUE, and ensure a crisp production workflow for print and digital operations, while laying the groundwork to deploy content across mobile media platforms. "One of the real challenges of an operation like this is discovering how to reduce costs on existing processes, while finding the correct way to channel those savings into investments on emerging platforms," says Esposito, referring to mobile publishing applications.

This is not Esposito's first rodeo, as he had previously headed a similar effort at Hachette Filipacchi Media U.S., as vice president of operations, and that company had reported a 30 percent increase in production efficiency. In fact, when Esposito came to AMI in January of 2011, he bought four key members of his Hachette team along with him, as well as sourcing other personnel that understood the changing technological and cultural needs of the publishing production world. "Publishers today need to think in terms of a global workforce," Esposito explains. "With larger publishers having partners in Europe and Asia, you need people on board who understand how to deal with a virtual, global workforce."

Esposito also used much of the same technology at AMI that he first implemented at Hachette. DALIM technology is a critical part of the restructuring, allowing AMI to streamline its production process and manage cross media content, automating repetitive tasks and file creation, replacing hard-copy proofing with remote soft proofing, and driving online file approval and delivery.

However, having the proper team in place and having a familiarity with which software applications might help is not enough. "The key to doing something like this, with these kinds of extensive changes, is having top down support," says Esposito. "It has to start with the executive management team supporting this type of effort."

Esposito has that support. ""We have seen a lot at this company; the world is changing fast and is accelerating," says Rob O'Neill, Vice President of Manufacturing & Logistics, American Media, Inc. "We were aware that there were new and better technologies, but we needed a team to come in and size it up. Mike and his team, with their experience, have added tremendous value to our company."

Senior management is pleased with Esposito's progress to date. "Every publisher today is looking to reduce their cost," adds AMI Chairman David Pecker. "And being able to provide them with the production efficiencies we developed for AMI's publishing services business unit has created a new revenue stream for our company."

Three Months of Preparation

The first step in revamping AMI required examining the existing situation-the processes, responsibilities, and skill sets. "Then you have to introduce change," says Esposito. "You have to unfreeze processes that have been in place for many years."

Esposito began a three-month journey of mapping out the existing process within the organization. "We looked at how departments interacted with one another, how many steps a particular job takes, the time necessary for each function," says Esposito. From this data, a base measurement of productivity was established.

The team scrutinized the production operation to see how resources are being spent, both internally by AMI staff and externally with outside vendors. Working on writing different scripts for the various workflows, the team simulated functionality using TWIST. "If something took 12 touch points, for example, from receiving files, inspecting files, converting files, and then proofing and sending to the vendor, we would see where and when manual intervention was required. Then we would write a script that detailed which functions within the workflow can be automated using TWIST," Esposito remembers.

Esposito continues: "When brainstorming how to do this, we had to consider that each organization is very different. Because of the weekly nature of some of our brands, timeliness is everything-the high frequency levels make it a very non-forgiving environment. There is such urgency to meet schedules, so we have to continually move toward the target but make sure risk is maintained at a manageable level for everybody."

A large part of the process included examining the spend levels from outside vendors and the labor requirements to maintain the arrangements. "We compared time and money spent using outside vendors with having more automation and autonomy in-house using TWIST," says Esposito. "We still continue to use outside sources, but in the future we will be strategic in how we use them."

Looking Ahead

By first quarter 2012, AMI expects to build on the workflow infrastructure, based on TWIST and ES, for iPads and other emerging platforms. A key part of this will be the ability to tag data via a content management system. "Setting up a viable tagging taxonomy is essential to building an effective way to access content. It is critical to be able to retrieve content, as we migrate to other media platforms," says Esposito.

The process demands creativity, transparency and continuity. "We have to be creative in our solutions; we had to figure out where we wanted to be before we knew how it would work and then build workflows to get there," says Esposito. "We needed a transparent change management plan, with full buy-in from everyone; from management, to creative, to end users. Finally, we need to create an operation that delivers continuity that is sustainable and scalable. The real challenge is to scale this operation to meet the growing need of publishing content across platforms in a way that meets our company's business objectives."

On the advertising side, AMI has moved to SendMyAd, a portal system, deploying a digital workflow. The ad portal is delivering a 30 percent increase in productivity and has also contributed a significant cost reduction-all the work is currently being done in-house.

AMI is now in the final stages of getting the DALIM Suite in place: TWIST, ES, DIALOGUE and for editorial, the K4 Cross-Media Publishing Platform. Staff is being tested and trained in using DIALOGUE soft proofing technology, learning how to look at a soft proof on a screen-a big culture change from checking hard-copy proofs. "We are setting expectations for them, and making sure that they understand that there is a support system in place, so if there are any questions they know who to turn to," says Esposito.

Tuesday, November 15, 2011

SendMyAd Case Study: Time Inc.

In the world of publishing, Time Inc. needs little introduction. One of the largest consumer publishers in the world, its portfolio reaches more than 100 million people with well-known titles such as TIME, FORTUNE, Sports Illustrated, and People.

As one of the pioneers of digital ad submission process and practice, Time Inc. probably has more experience with the online submission of advertising than any other publishing company. "Time Inc. was one of the key initiators in the creation of the ad portal concept", says Kin Wah Lam, Director of Digital Development . We implemented best practices for ourselves, and then began working with vendors so that they could develop technologies that would eventually reach the publication eco-system. We also worked with industry associations to help push the adoption of ad portals throughout the industry."

So why did Time Inc. want to move to an online-only model of advertising submission? "It's obvious!" replied Kin. "We are living in a world of internet technology that gives us the ability to perform fast, reliable and secure business-to-business transactions. We bank online and buy things online, so we can certainly send files to each other online."

Moving to an online model would clearly provide a number of benefits รข€“ not least a level of automation and QC far beyond simply sending a file (i.e. including preflighting, size checking, and so on). In addition, an online system would help eliminate the time that staff spends informing advertisers each time there is a problem with the submitted file.

"One can draw parallels with the concept of "Total Quality Management", or TQM." says Peter Meirs, VP Production Technologies at Time Inc. "TQM assumes that every segment of a process hands off perfectly to the next segment. Before we started using an ad portal to filter out problems, supplied ads were prone to fail. We no longer deal with the fact that a certain percentage of ad submissions are going to be bad."

"An ad portal would give the assurance of knowing that everything the publisher received had been subjected to a rigorous vetting and checking process. If a file failed to meet any specification, the advertiser would know immediately. The entire process becomes streamlined, saving time and money for both publisher and advertiser it's a "win-win" scenario for all concerned."

Prior to adopting SendMyAd, Time Inc. had been using another vendor's system. Ultimately, various technical and application-based restrictions from the other system hindered the speed of adoption of the ad portal by the advertisers. Time Inc. realized that a new ad portal needed to be implemented.

The new system had to be a 100% web-based model, offering stringent file testing to ensure that the ad met mechanical and technical specifications, as well as being easy for users to implement. "The changeover to SendMyAd was clean and quick," continues Peter. "Around 3,500 advertisers moved from the old system to the SendMyAd portal in around thirty days. There were no handover problems or cross-training issues. The users simply moved from one system to another."

"Advertiser feedback from our current ad portal has been very positive," says Kin. "One issue that we completely eliminated is the subjectivity of placement of the ad, relative to the trim size on the page. SendMyAd provides advertisers with full control of ad positioning on the page. We didn't have that before."

Today, every single ad comes in via the portal. "It's been like that almost since we started," continued Kin. "We don't do anything in half measures that would be too confusing for everyone. Our process requirements are strict and thorough, but we do that to protect the advertisers and this, ultimately, helps the industry. Both Time Inc. staff and management have fully embraced the ad portal because of the efficiencies that it has brought to the process."

Peter noted that "SendMyAd has significantly reduced user-error issues. Also reduced is the number of calls that our production people have to make to resolve submission problems. A key part of the successful move to SendMyAd has been in the area of technical support. "SendMyAd has continued to implement new features, as needed, and has modified the user interface to make it as intuitive as possible."

Peter continues "SendMyAd has helped to streamline the ad delivery process. One capability that they have recently provided is a way of packaging ads destined for the tablet versions of some of our titles. The content components need to be presented in a particular way for ingestion into our content publishing system. The portal has helped us simplify that process."

The popularity of mobile devices such as Apple's iPad has raised the profile of digital content delivery for many publishers from both editorial and advertising perspectives. While continued development of the portal to support Time Inc.'s digital editions is planned, Peter doesn't see an urgent need for new features. "We have to remember that, regardless of all the attention that's been given to tablets and mobile, there's still a ways to go before digital ad volumes approach the rate of print ad volumes.

Kin offers some advice for any company looking to implement an online ad submission portal of their own. "It's important to be aware that, technically, not all ad submission portal solutions are created equally. We are very strict in terms of the quality of files that our ad portal will accept. This, unfortunately, is not the case with some ad portals in the marketplace. As a result, an ad that passes verification from one portal may not get through our portal. Lowering standards will lead to problems with bad files proliferating within the industry."

So what of the future? Not surprisingly, both Kin and Peter take a keen "hands-on" interest. "We are active in the SendMyAd User Group, and we have hosted the meeting in our building the last couple of years," says Peter, "It's a forum where the industry people provide feedback and share new requirements with the principals at SendMyAd."

"Our business is changing rapidly. We've gone from receiving only print ads submitted in digital form to a process that includes new digital platforms such as tablets and mobile devices. The publishing industry is starting to work with a number of new and different formats and specifications. It's important that we all work together to address issues that affect us as an industry.

"Partnering with open and flexible companies such as SendMyAd is a key part of the process. We value their contribution in helping us develop best-of-breed practices for digital ad submission within Time Inc. We are happy to share our learning to help optimize the process of digital ad delivery across the industry."