Strategic Planning is the Key to Your In-plant’s Success

Why do some in-plants anticipate massive growth while others struggle to stay even? Sometimes the answer is out of their control, but it turns out that there is one thing that can be done to dramatically tip the odds in your favor: create and maintain an effective strategic plan.

I know that this might sound like some painful and pointless management exercise, and it will be if your strategic plan is filled with buzzwords and vague statements like “we will satisfy the evolving needs of our client organizations.” However, strategic plans don’t have to be lengthy tomes, which are a waste of time to create. An effective strategic plan can be as short as two to five pages — if it contains the right elements:

• Organizational Alignment: Effective strategic plans support your parent organization’s strategic objectives. Your company or organization’s strategic plan probably doesn’t mention printing, so your in-plant’s strategic plan should explain how what you are doing helps meet your parent organization’s goals. This not only helps you prioritize your efforts; it helps your management understand the value you’re bringing to the overall organization — and why they need to keep you.
• Specific Targets: You need to have targets if you want to grow your revenue, volume or client utilization at a faster rate than by just letting those things happen. We all know this, but it is surprising how many strategic plans don’t contain specific annual targets. Sales managers, coaches, teachers and others know that just asking people to do the best they can rarely leads to much more than average results. You know your budget and volumes for the past five years. Map that trend forward as a baseline and then set targets by increasing them by 5% or 10% each year to the growth you want to achieve. Now you have something to shoot for and manage toward.
• Specific Mileposts: You’ll probably need to implement programs or acquire technology if you’re going to grow your operation. Your strategic plan should detail when these investments need to be made and when they need to go live.
• Plan Reviews: A strategic plan is almost worthless if the management of your parent organization hasn’t reviewed and signed off on it. They need to know your in-plant’s objectives and how they tie into their own goals. They need to understand and agree to your growth targets. And they need to approve your investment and implementation plan. A strategic plan is somewhat like a contract: If you provide this level of funding and resources on this schedule, we will deliver these results. If they don’t agree to your required investments up front then you need to revise your targets. And these reviews should occur no less than on an annual basis.

Does it Matter?

This summer Cholmonco surveyed 140 in-plants from across the United States for a Future of the In-plant study hosted by the In-plant Printing and Mailing Association (IPMA) and sponsored by Canon. The study focused on three areas:

• How will your in-plant be different in five years?
• What challenges will you face to get there?
• What are you doing to address those challenges?

The dramatically different answers between in-plants with effective strategic plans and those without showed that having an effective strategic plan is almost mandatory for success. An effective strategic plan was defined as having four or more of the following key elements: company alignment, revenue targets, client targets, volume targets, services targets, investment targets and implementation milestones.

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While 59% of the in-plants in the study claim to have a strategic plan, only 25% include at least four of those key elements. And in-plants with strategic plans missing those elements were no more positive about business growth than those without any strategic plans at all. However, budget growth optimism is markedly higher and there are far more cases of optimism for dramatic growth when key elements are included than when they are not. (See chart.)

This shouldn’t be surprising. Consider an in-plant that has presented a five-year plan with measurable objectives and implementation plans linked to the company’s strategy to senior management and had it approved. Not only do they have measurable targets rather than just “doing the best they can,” their senior management:

• Understands and agrees to their role in supporting key corporate objectives.
• Accepts key in-plant growth targets.
• Has signed off on investment objectives.
• And tacitly agrees that the in-plant will exist in five years.

Is it any surprise that in-plants that have senior management on board like that predict greater growth than those that don’t?

The Study

The full study contains much more information, and you can contact IPMA (www.ipma.org) to learn how to get a copy of it, but here are a few data highlights of where the industry is going:

Growth: More than 80% of in-plants believe that their budgets will be the same or greater in five years. That is great news, given everything the entire industry has weathered over the past two decades.

Staffing: In-plants everywhere are facing staff retirement and replacement, which will result in new, younger, more technologically proficient staffs requiring new skill sets on modern equipment and solutions.

Services: Expect to see growth in traditional short-run and rush work, in non-traditional printing areas like large-format, variable data and packaging, and in non-print services like design, multimedia, video and fulfillment. Many respondents also expect their in-plants to be more engaged in enterprise-wide responsibilities in five years; specifically with regard to printer fleet management, mail management, insourcing and even vehicle fleet management. In short, in-plants’ businesses are changing to produce new types of work for an evolving set of customers.

Investments: Not surprisingly, in-plants are investing in digital output devices. Most plan to invest in digital color presses followed by a statistical tie between digital monochrome presses and wide-format printers. Many plan to invest in online ecommerce sites, graphic design, print MIS, production automation, color management and enterprise print management software. At the same time, the trend to remove offset presses and do less transactional printing is expected to continue.

Sales and Education: Implementing or increasing proactive sales efforts is one of the top areas where in-plants are focusing. They recognize that their commercial competition is constantly calling on departments in their organizations and that they need to be calling on these clients to gain or retain their business. Much of the planned sales efforts mentioned focus on creating awareness of capabilities, quality, responsiveness and pricing, which will need to be addressed through customer and management education.

The full report contains 45 pages of information and analysis, including interviews with thought-leading in-plant managers and recommendations on how to utilize the data. I hope this article helps you consider how a few of these key findings could be used to increase your operation’s chances for success over the next five years.