Yes Virginia, You Do Need a MIS
In today’s competitive business environment, a management information system (MIS) is as necessary to survival and success as the quality of the image you output on your printing device.
Nor does the size and type of your shop give you a pass—whether your shop is a five-person wide-format operation, a 15-person digital print enterprise, or a 70-person offset-digital facility offering a cacophony of services—running MIS software is a must.
“Commercial printers, whether they're digital, litho, sign, or any other should invest in MIS software to streamline their workflow,” said Shawn Brown, business development manager, P.M.I.S, developers of E-Pro Print. “It is a tool that gives them control to better manage their operations as well as a helping hand in boosting revenue. MIS is made to reduce the workload and increase productivity in every department of the business.”
Stephen McWilliam, EVP for Avanti, agrees. “Implemented properly, it becomes the ‘system of record’ for everything: estimating, customer service, finance, and production. The key value-add of a print MIS system like Avanti Slingshot is that it will give you your true cost and profit on every single job,” he said.
"Understanding of your costs is absolutely key to competing and winning in a market that gets more competitive every day,” added McWilliam. “I am still amazed by the number of shops which don't have an intimate understanding of their costs. How can you make any decisions if you don't know your costs down to the penny?"
There are a host of different reasons a printer would value an investment in MIS, noted Lee Ward, sales director with Tharstern Ltd.
These include the ability to:
- Process more work with same or less staff
- Understand costs and profit at estimating stage
- Generate more estimates with less skilled staff
- Eradicate data duplication
- Have less touchpoints on a job within administrative and prepress functions
- Capture production costs at time of implementation
- Up to the minute business performance stats/KPI’s
- Integrate low value Web2Ppint orders for automatic job creation
- Calculate ganged efficiencies by grouping/ganging/batching similar jobs
- Make progress chasing more efficient for CSR’s with up-to-date status alerts
- Automate reporting within the business or customer report
Delivering on these capabilities, Tharstern’s line of Primo MIS solution streamline the workflow and enhance business performance, noted Ward.
Investment in MIS is fundamentally about control and visibility, remarked Nick Benkovich, director, Portfolio Product Management at EFI.
“MIS allows you to centralize control of your business, and to understand where all the costs associated with your business come from,” he said.
If you don’t have a handle where the true costs of your business are, down to a job or customer level, then you can’t accurately track or analyze the profitability of that job. Whatever the product line, you need to understand at a detail level where your profit lays, you need to have real data, said Benkovich.
“One of our customers, a $12 million operation involved in both digital and offset printing, was considering selling the digital press because it wasn’t running as much as the offset press,” explained Benkovich. “When he tracked where the costs were going to the job, it was 7 to 1 offset vs. digital in terms of the number of jobs, but the profit was split 50-50.
“At a raw level, all the labor components that went into the offset—blankets, plates, etc., were not contributing to the profit of the business but were contributing to the cost of the business,” said Benkovich. “Being able to measure it with their MIS, they found their digital customers weren’t spending a lot with them, but the work they were doing was extremely profitable and that they have to nurture those customers, that business.”
Cost of a MIS
The cost of a MIS depends on the size of system in terms of users and the functionality required. Systems can range from several thousand dollars up to a million.
Traditionally, printers spend between two to four percent of their annualized revenue, reported Benkovich. “We have $10,000 PrintSmith systems for the quick copy shop customer, up to the Monarch, for large plant production with annual revenues in the tens of millions.
A typical 10-user system with modules to manage sales, production, fulfillment, and integrations to both Web2Print, JDF, and JMF would be a $60k 1st year investment all in, including Professional Services for the implementation project, said Ward. Additional annual fees cost around $10k per year.
Print MIS like Avanti Slingshot are modular by design so the investment depends on what modules are purchased and what level of automation the print shop is looking for, McWilliam said. “However, a good rule of thumb is a print shop should expect to invest the cost of 1/2 a headcount per year into their system—and, in return, expect to save two headcount, thanks to the efficiencies that the Print MIS system drives,” he added.
Return On Investment
“The payback from a MIS varies from company to company and depends on how much the investment is, how many jobs are printed each day, what kind of profit margins are applied, along with other minor variables,” Brown commented. “Companies usually see an immediate ROI as soon as they start using the system, which eventually pays for itself.”
The ROI is also dependent on the customer’s engagement. “We can provide all the tools to do the analysis—what products, customers, pieces of equipment are profitable; compare two workers, but unless they really use it, they won’t see the ROI,” Benkovich said.
Companies investing in MIS move from older, home grown technology, using something like an Xcel document that required intensive labor to maintain, to a system where all the data is automatically generated and centralized in one place. They are able to repurpose that labor for revenue generating activities rather than administrative tasks.
“We also provide a locally deployed MIS offering; a SAS offering which we host through our site,” said Benkovich. Customers use a web browser to access the system. A rapidly increasing number of our customers are using the SAS, especially the franchise-based firms.”
The SAS allows them to get into a full-featured MIS with a monthly investment, he adds. “They don’t need to make a significant capital investment; they are just paying a couple of hundred dollars a month.”
Training Times
Again this can depend on size and complexity of the project; the range can be as diverse as three days to six months to years.
“Some business’ want the system built for them which naturally takes more of the MIS vendor’s time, while others want to be involved in the build, which takes more of their time but less of the MIS vendor,” said Ward.
Looking at a typical example of a 10-user system with modules to manage sales, production, fulfillment, and integrations to both Web2Print, JDF, and JMF, the Professional Service days required would be between 15 to 30 days, depending on the project approach, explained Ward.
Avanti, which does all of its training on site, finds training times range from six days to 30 days, spread over the two to six months that it takes to implement. “To properly implement a system, you need at least one person (and ideally two people for back-up) to be trained on everything,” said McWilliam. Other folks in the shop only need to be trained on the elements that they are accountable for (i.e. estimating, scheduling/production planning, billing).”
While training can be off or on site, P.M.I.S. also holds remote programs to keep training cost effective. The training period can vary, depending upon how many people are to be trained, what kind of presses and finishing equipment the company holds, etc. “Anyone and everyone within the company should get trained to use the system, regardless if it's an estimator, the press operators, all the way through to the delivery people and even the accountants,” said Brown.
For EFI MIS solutions, which are now in double digits, training can be accomplished in a week or may take multiple years, especially if customers expand their system and add components.
EFI is not just training customers how to use the MIS technology, it also looks to help customers understand best practices. “If you ask a lot of printers why they do things a certain way, their answer is ‘because we’ve always have done it that way,’” noted Benkovich.
“We give them the opportunity to learn, based on our experience with hundreds of MIS installations; here’s why they are saving money,” he added.
The customers that take it on board really see significant benefits.
EFI also offers fee-based consulting services with existing MIS customer to further increase their ROI with the MIS installed years before.
“We are doing more and more of these consultations,” said Benkovich.
