Important New Research from EDSF, Gartner and University of Connecticut

By Cary Sherburne, Senior WTT Editor

October 5, 2005 -- In a press release this week, the Electronic Document Systems Foundation (EDSF) announced groundbreaking research that was conducted by consulting firm Gartner and the University of Connecticut under EDSF’s ongoing research programs. Titled “Criticality of Printed Information in the Financial Service Industry: 2005 Survey Results,” the research targeted the financial services industry and included responses from more than 350 managers. Its objective was to identify the attitudes of business managers and to examine how they relate to printing as part of their business processes. The study highlights how managers view printed information as part of their departments' business processes, and how these managers work (and don't work) with other departments to implement new technology.

WhatTheyThink spoke with Andrew (AJ) Johnson, Managing Vice President of Gartner, who managed the study process, to gain additional insight into the study and what it means for the printing industry. Kumar Mehta, Ph.D., led the study on behalf of the University of Connecticut. The study is available for downloading at no charge, and is a must-read for printing industry professionals.

WTT: AJ, thanks for taking the time to speak with us today. Perhaps you could start by giving us some background on how this study came about.

AJ:Gartner has long been a supporter of EDSF, and Joel Wecksell, a Group Vice President, Gartner Research, serves on EDSF’s Board of Directors. This year, I was asked to serve on the Research Committee, and in that role opted to contribute Gartner’s expertise to this project, which also involved a grant by EDSF to the University of Connecticut.

WTT: Tell us a bit about the objectives for this research.

AJ: Many Gartner clients on the corporate side have been frustrated with the fractures in their organizations with respect to budget and responsibility as it relates to the overall cost of print. This fragmentation inhibits their ability to optimize their overall print spend, and we believed it was a systemic, organizational issue rather than a technological issue. The research was designed to validate or debunk that theory.

WTT: Why did you choose this particular topic for your research?

AJ: We believed that this issue existed in the corporate world, but as far as we know, there has never been any quantitative research performed on the subject. Therefore it would be fresh research that could really benefit the marketplace. The numbers carry a stronger message than opinions, and this research provides actionable, fact-based recommendations for both corporations and their print service providers in dealing with this important issue.

WTT: The study focuses on the financial services industry. Does it have value for other industries as well?

AJ: The reason we picked financial services is because it is one of the more paper-intensive industries in both the customer communications and internal business process arenas. Because of that, we felt research in this industry was more likely to show the dynamics more clearly and more extremely than other industries. That being said, I would say the results reveal systemic problems for all industries and also uncover the latent opportunities for all industries.

WTT: What are the key messages from the research?

AJ: The biggest takeaway is that business managers in charge of running the business and generating revenue for the business feel that print is extremely important to the way they run their business processes. In fact, two out of three of them said it was highly important to their business processes. For managers in marketing and sales positions, eight out of ten thought print was highly important. They think it is important, but they also have indicated that they see great opportunities for improvement. And they don’t know how to fix it. In fact, most organizations are unclear on who wakes up in the morning with this task.

I also thought that the responses to the budget question were very revealing, showcasing how fractured it really is. The cost of printing often gets rolled up into a corporate budget that may or may not get charged back to the individual departments. In fact, 22% of managers involved with print decision-making reported that their departments get “free printing,” because the costs are applied to a centralized budget with no charge back. That’s not an environment that creates much motivation to change anything.

WTT : There is clearly a message here to the corporations, but is there also a message for the printing industry?

AJ: I think printing industry knows these fractures exist and it frustrates them as well, because it inhibits their ability to help companies change their print strategies. In the sales process, printers have to go to multiple departments to get the message across, and they get different types of responses. Purchasing is interested in getting the best price per piece; IT wants devices on the network that don’t cause problems; and business managers don’t have printing very high on their list of priorities. . It can all stop right there with the sales cycle because of this fragmentation.

WTT: Whose job is it to educate managers, then, on the value of well-deployed printing?

AJ: That varies, not just by industry and size of company, but by the company itself, because this whole process is steeped in politics and personalities. Providers of services trying to educate their customers on new ways of managing print don’t find a very receptive audience with the business managers because of their lack of authority and control, and the lack of time that they have to devote to the problem. In the ideal case, it is the CFO’s job to understand how much their company is spending on print and to mandate change. Gaining that understanding is best accomplished by having a well-respected person lead an enterprise-wide task force to make the change. In the research, we refer to this person as the Document Czar or the Printing Czar. Once the CFO understands how much they are hemorrhaging on print across the entire organization, things can change fairly quickly.

WTT: So what is your message to the print service provider, then, in terms of how they can more effectively educate their customers on better management of enterprise print?

AJ: Print service providers need to have one of their messages targeted to the CFO. The second entry point to making a change in this educational process would be with the security or compliance group. These groups are relatively new within organizations, and have been put in place as a result of Sarbanes-Oxley. Those professionals need to understand that there are very specific security issues around documents, whether it be protecting the company’s intellectual property or protecting customers’ privacy. To accomplish this, print within certain business processes should have their approval. These groups have budgets, they have the authority to make changes, and they are tasked with making sure that everything is buttoned up with respect to that information, including printed information going to customers. When these new compliance or security officers pause and look at the role print plays in the organization from a security and compliance standpoint, there is hope that they will question why certain print-related processes are being done that way in the first place, and they will be willing to make changes that will result in better communications and/or less expense.

WTT: How do you see this playing out relative to print versus electronic communications as awareness begins to be raised?

AJ: In the study, managers thought that electronic documents in the form of content management and document management systems were not going to displace the amount of print being produced, and that both print and electronic communications were going to increase proportionately. If there is one thing that this study provides that is comforting to the printing industry, it is that perspective from the business managers as to how things are unfolding. They are planning on investing, and are investing, in both printed and electronic communications.

WTT: How long does it take to see results once an organization decides to take action on gaining control of its print spend?

AJ: This question wasn’t part of the study, but it depends on the scope of the solution being implemented. It could be a few months if you are talking about one department that wants to make a change; it could be up to a year if it is an enterprise project. I would suggest that companies start small with a pilot project, especially if they are restructuring customer communications, to mitigate their risk. You don’t want to make a big change to a process that could result in an unexpected problem with customers. If you make a big change with internal communications and it creates problems, you can recover more easily. It also depends on the organization and what type of history and relationship they have with their workers. Some organizations have a very autocratic culture—they will just announce a change on Monday and that is that. Others are more paternalistic and want to get buy-in and encourage change over time. Changes in print-related processes should be modeled in the same way as any other type of change that is propagated throughout the organization. Ultimately you are looking to change behavior, and that can take time when you are dealing with a large number of people.

WTT: AJ, thanks very much for your time and your insight. I hope our readers will take the time to review the research. It is a valuable contribution to our industry’s knowledge base and we appreciate the efforts of Gartner, EDSF and the University of Connecticut in delivering this new information for our consideration.

This Interview was conducted by Cary Sherburne. She can be reached via email at cary@sherburneassociates.com, online at www.sherburneassociates.com and by telephone at 603-430-5463.

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