Operational Issues in Higher Education Publishing

April 7th, 2009 - 2 Responses


Operations executives in education publishing are under intense pressure to evolve their business practices and processes in response to dramatic changes that are having a direct influence on all parts of the business. In operations and production functions, about the only certainty we have for the future is that we must continue to leverage our best practices and our best people. This allows us to deliver the content needed by our internal customers so that they can better meet the needs of their customers-professors, students, administrators and librarians-regardless of where the winds of change take this dynamic industry next.  This article will address some of the macro trends reshaping the industry and then will delve into how these shifts are affecting publishing operations, in particular. It will close with some counsel on a few key initiatives that may help publishers successfully navigate the landscape ahead.

From the ongoing impact of the Internet and other advanced technologies, to growing shareholder oversight and pricing pressures, to changes in the make-up of the student and learning community, the education publishing market as a whole is, arguably, in the midst of the most dramatic period of change in the history of the industry. For example:

Content free and increasingly devalued

Content is becoming increasingly free and devalued. While this trend has been in action since the dawn of the Internet, the growth and success of resources such as Google, MSN and Yahoo! have accelerated its effect.  Ultimately, the proliferation of free content means that publishers have to find other ways to drive value for their customers.

Changing pricing dynamics

The pricing of learning materials has been an issue in the Higher Education market for quite some time, as increasing prices have driven students to look for cheaper alternatives. This, in turn, has spurred the growth of a used-book market, which reduces the number of units over which development costs can be amortized, reducing the copies sold per edition.  For publishers, this means a profit source is eroding that will have to be made up through the introduction of innovative new products and services.

New learning styles

Demographic changes, the cost of higher education and the introduction of new technologies have evolved the base of students and learners. This has caused instructors and professors to seek out new learning materials and tools such as distance learning programs, self-study and other programs in response to the emergence of new learning and teaching needs.

Shareholder expectations

There are very few (if any) publishers left whose owners are indifferent to revenue and profitability growth, cash flow and return on investment. Pressure on financial return has never been higher to do more with less and continue to drive increasing financial performance.  Operations and production play a key role in this, controlling the major spend of the company in Plant, PP&B and Operating Expense areas along with major investment in inventory and fixed assets.

Pull versus push content selection

Although it’s tied to learning styles, we’re seeing a move toward pull-based consumption, whether custom publishing, curriculum-driven publishing or standards-based publishing, away from the more traditional method of pushing a textbook out and having professors adopt it and students purchase it.

Web first publishing

With the Web gaining favor as a low-cost, highly accessible publishing medium, publishers need to develop Web publishing models that bring additional revenue without cannibalizing traditional products-no easy feat as every newspaper in the country will attest to.

Facets of publishing operations

With those mega trends as a backdrop, what follows are more specifics about how they are affecting specific facets of the publishing and operations process.

Acquisition of Content

Acquisition of content, essentially acquisition of the rights to content, is clearly an important part of the publishing process and part of the publishing supply chain. It’s also an important part of the economics of a publishing enterprise: for trade publishers it can be the dominant balance sheet factor and a very significant P&L factor.  At present, publishers are wrestling with two dominant issues-standards rights agreements and incoming content mark-up-both of which have significant implications for the way publishing will develop in the future.

There’s massive uncertainty around how new formats are going to perform. Often this has led to publishers unwillingness to acquire all of the rights that would be necessary for either a digital future or international operations. The mandate for the future, in our view, is to push for a standard basket of rights, which would help to resolve the aforementioned issues.

In any production cycle, there’s a need to quickly process incoming content. This is best achieved if content is developed in a manner that can be easily integrated into publisher content management systems. The imperative for publishers is to put in place some templates to do that, although I have to say that STM publishers have been operating like this for years…

Development of Content

Content development starts where the completed contract leaves off and stretches from the authoring and editing of the content through page makeup. It stops at the end of prepress where reproduction masters are placed into a content management system for use either in printing or digital distribution. XML-based editing and production, PDF workflows, linkage with rights and metadata systems, collaborative authoring and Digital Asset Management systems are just some of the technologies impacting content development.

One of the key technologies in this area is the integration of XML into the early editorial process – even prior to copy editing of the manuscript.  Once the content is expressed in a sufficiently robust XML, it is then possible for it to be output as a normalized typescript, as fully composed pages, or in various digital formats for editing, indexing and further development. There are a number of interesting innovations in this area that are helping publishers get the benefits of content agility and re-use and significantly decrease composition costs.

Acquisition of customers

Acquisition of customers is the development of customers to the point at which they are ready to place an order. In the world of professional, educational, journal and magazine publishing this can look like development of long-term subscription-based relationships ranging from libraries to professors to individual readers or students. In trade publishing, acquisition of customers is primarily the concern of retailers, who are very jealous of the information about those customers. All publishers, however, are interested in generating demand for their products which is a key part of this process.  Public search engines and the trend toward personalization are among the thorniest issues impacting customer acquisition.

Most new technologies in customer acquisition are oriented around stimulating demand over the web. Enhanced search technology will increase the ease of finding material that is specifically relevant to the customer’s concerns. Personalization turns this around and allows presentation of material that is most likely to appeal to the customer or be relevant within his/her current context.

A key piece of customer acquisition is distribution of metadata to channel partners, including search engines. Customers will increasingly find you (if you let them), but once they do, it’s important to give them what they want and then see how else to add value.

Processing Customer Orders

Processing customer orders is the process by which customer orders are received, processed and instructions delivered to fulfillment and billing. Orders can range from simple cash transactions, through credit sales, to orders for custom publishing items that must have individual elements of content selected and sequenced.  In this arena it is the trends toward on-demand publishing, self-help technology and Web order processing that are having the most impact on publishing processes.

Publishing on demand, for example, is an interesting development in publishing that crosses a variety of functions. It combines the order processing with custom development of content (generally re-assembling previously developed chapters, test questions, etc.).  When you think about it, these tools should be very easy to use…and with a slight bit of enhancement, allow internal staff to develop new products, as well.

One of the biggest areas of opportunity in publishing is in integrating eCommerce engines with existing order processing systems. This allows real time processing of financial transactions, more rapid determination of in-stock position, and fewer overall customer service problems.

Fulfilling Customer Demand

This involves taking the orders that were placed in the previous process and delivering them to the customer. There are three variations:  Configure to order, found in custom publishing applications in which titles are assembled from components and then printed and delivered (or if eBooks, just delivered), make-to-order, found in true print-on-demand operations, in which the books are printed only in response to a customer order, and make-to-stock, in which books are printed ahead of time and delivered as ordered from stock.

This is one of the most rapidly changing areas within publishing, influenced by ZMR and digital printing, production planning and scheduling, XBITS and EDI and digital distribution.  We’ll look at ZMR and digital print technology as an example of the impact new technologies are having on the fulfillment process.

Zero Make Ready (ZMR) and digital print technology significantly alters the economics of printing, making it feasible to produce very small print runs of books, even down to a single unit. This allows not only low quantity replenishment of stock in publisher, distributor and retailer warehouses, but also print-on-demand in which books are printed only in response to customer demand. There is a continued arms race going on here among a number of printing equipment manufacturers and publishers can benefit immensely from if they’re not led astray by their accounting systems. I’m still waiting, however, for the cost of digital color printing to drop sufficiently for its use in textbooks of several hundred pages.

Customer financial transactions

Management of customer financial transactions starts with billing and ends with settled and reconciled accounts.  It involves billing, collection, cash application, credit generation, deduction management and account reconciliation.  Electronic cash sales and subscription processing are turning traditional transaction models on their heads.

Contributor financial transactions

Author financial transactions involve posting sales and royalties to the correct royalties sub-ledger account so that advance assets can be reduced and royalties paid as appropriate. This involves tracking the amount that is due on any particular kind of sale and generating the appropriate accounting transactions.

The key to doing this efficiently is knowing the rights and royalties structure of each asset and how it ties into the products that are being sold. This is a hugely complex area that gets much more difficult as custom products are developed.

Managing content provider relationships

Managing content provider relationships is critical when moving past transactions to provide a longer term basis for working together. The key here is to develop overall contractual relationships that lay out expectations on both sides.  This is much more extensive than a simple permissions agreement and supports both our digital in international initiatives.

Managing customer relationships

Managing customer relationships is key to identifying opportunities for revenue growth and determining how to work with downstream channel partners more effectively. CRM systems were, and still are, the big deal in systematically understanding customers and their needs, but there’s a whole lot more to it than just systems.  You need to get inside the heads of customers and understand what their wants and needs are.  You don’t really do this via systems.  You do it by following them around, looking at what they’re doing on a daily basis, what their challenges are and how they can be resolved.

Manage supplier relationships

This used to be called “purchasing” but goes farther than purchasing in determining the strategy with which suppliers are approached and then managing the relationship in terms of that strategy. Most publishers are driving pretty hard in this area to tie their composition, print and paper suppliers into the planning process, and then integrate them with operational systems, but really the idea here to make this a partnership for testing new ideas so that we’re both parties benefit.

Major Issues and Questions

Now that we’ve gone through the blow-by-blow of each process, let me summarize what I see are the major issues and questions facing publishing production and operations executives:

The big questions revolve around optimizing rights, content and physical supply chains

  • What are correct planning, control and operational mechanisms in this new world?
  • How do we prep content for an uncertain future without adding cost?
  • How do we deal with Web-first publishing?
  • How do we integrate all of the different printing technologies and alternatives into our physical supply chain?
  • How do we integrate more closely with our suppliers (physical, content and rights)?
  • How to capture rights, royalty obligations and flow them back to payables and sales restrictions?
  • How do we standardize systems, yet make them flexible enough to handle uncertain future requirements?

Others concern the correct planning, control and transactional mechanisms in this new world? Particularly as it crosses the configure-to-order, make-to-order and make-to-stock frontiers.

Major Initiatives

While there are many ways to address these issues, there are three critical initiatives that publishers should be pursuing. Each of these can represent a massive investment for the organization in terms of money, management attention, and organizational change, but it is important to have a perspective on each.

Integrated rights, asset and content repository

The first is an integrated rights, asset and content repository. All of a publisher’s assets should be captured, along with how they are used, what rights they have to the asset, and standard description of the assets using controlled vocabularies. As far as how to approach the issues, there’s value in drawing from the Bill of Materials used in manufacturing: essentially publishers should create Product “Bill of Materials” from an asset and rights perspective.

XML-first editorial production process

The second is an XML-first production process that starts preferably with a standard Schema or DTD, flows into your composition systems, whether internal or external, and maintains any changes during the composition process in the source XML. This same XML should be used to generate eBooks, course cartridges, and NIMAS-compliant files to meet accessibility requirements. Publishers get a huge number of benefits from doing things this way.  First, it’s cheaper and they get XML files for free as a by-product of composition instead of doing a post-composition conversion. Second, they always have the latest production files and third, by also using XML-based styling instructions they can get away from vendor lock-in that a pure Quark, InDesign, or 3B2 process might result in.

Integrated supply-chain planning

Finally, publishers must integrate their supply chain planning.  Standard concepts such as demand-, inventory- and capacity-planning and vendor integration are finally penetrating publishing and will save publishers a huge amount of inventory investment over current processes that look like a ‘We’re almost out! Better print some more’ policy.

There’s no doubt that the challenges facing academic publishing are pronounced and complex to address.  But, it’s heartening to know that, largely through technological advancements, viable solutions exist that will allow publishers to evolve their business models in step with market development and technological advancement and stay in the black.

While some of these solutions do require significant up-front investments, it’s more likely the fear of change, rather than the fear of the CFO’s wrath, that’s preventing many publishers from moving forward with these promising initiatives.  Publishing has always been a change-wary industry, but the stakes-and market pressures-are simply too high for publishers to let that hold them back any longer.  For those that are ready to enter the brave new world ahead, the market holds much promise.

Making the Digital Leap: Protecting the Value of Your Business in the Migration from Print to Electronic

April 7th, 2009 - Comments Off

Today’s publishing industry is in a period of tremendous change. While the great majority of revenue is still generated by traditional print products, the pressure to develop more digital offerings and—and a greater share of revenue from them—grows more pronounced each week, it seems. While the challenges of transforming age-old business models are great, the consequences of ignoring digital imperatives are far, far greater (just think back to what happened to Encyclopaedia Britannica in the mid 90s should you need any proof).

Most publishers, of course, are well aware of how critical—and increasingly urgent—it is to make the digital leap. But few are clear on how to prepare for and manage this fundamental shift while meeting and exceeding existing financial expectations. The path to change is a treacherous one, to be sure, and few companies have proven roadmaps for successfully navigating through this uncharted new business landscape.

For the last two years, Cengage Learning, the $1.8 billion publisher of educational and reference materials based in Stamford, Conn. and formerly known as Thomson Learning, has been developing its digital assets while still protecting overall business value. In this article, Ken Brooks, the senior vice president of global production and manufacturing at Cengage Learning, discusses the journey to date and shares some of the insights gleaned from both successes and missteps. For publishers focused on similar issues, this case study provides some outlines on best practice for successfully managing this complex—but critical—business transformation.

The Digital Push

Few publishers need to be reminded of the numerous market forces pushing us all to develop more electronic materials and digital offerings. While the need may be clear, the steps forward are not—particularly for an industry as mired in tradition and as risk averse as ours. Among the principal questions we’ve all been asking over the last decade, the most worrisome one has been how to expand into digital solutions and services without cannibalizing our core offerings. It’s not an easy one to answer, by any means, and it will be different, of course, for different organizations. At Cengage Learning, we decided more than two years ago to start making this shift, and we knew the transformation was going to necessitate tremendous changes in our editorial, production and sales processes and workflows, as well as our overall work culture, due to our large size, broad scope and global scale. What we didn’t know at that time was that Apax Partners, a private equity firm, was going to become our new owners 18 months into our digital leap—an event that eventually helped us to successfully implement many of the cultural changes necessary for long-term acceptance and success.

A Mandate for Organizational Change within a Changing Organization

Cengage Learning, as many readers already know, consists of three divisions. The Academic and Professional Group is the largest of these divisions. APG is the former Thomson Higher Education consisting of such imprints as Wadsworth, Heinle and Brooks-Cole, and the Career and Professional Group consisting of Delmar Learning and Course Technology. Gale is our reference publishing division that publishes databases and reference materials for libraries. Finally, International is comprised of Asia-Pacific, EMEA and English Language Training groups.

As an organization, Cengage Learning has always been focused on developing and delivering highly customized learning solutions for institutions, professors, students and libraries around the world. In addition, along with a strong editorial focus, we’ve also traditionally led the industry in terms of delivery. One of the reasons for that delivery expertise is the strength of our production and manufacturing organization, GPMS.

GPMS—Driving Change from Within

GPMS handles the production and manufacturing of both print and digital product and has supporting vendor management and technology functions. In the case of Gale, we also handle the development of editorial.

Because of the breadth of each business division’s product suites, there is tremendous variation of production responsibilities across industry sectors. For example, because textbooks have a large amount of third-party content, GPMS handles the acquisition of rights and permissions for this third-party content as well the outbound licensing of our own content. In another example, GPMS has a large indexing group that handles not only the back- of-book indexing for our textbooks and reference books, but also indexes 14 million periodical articles per year for the Gale databases. Along with this we have an operation dedicated to taxonomies and controlled vocabularies, which I believe will be a source of competitive advantage in the future. We also handle copy editing, art, design and page composition for our print titles as well as transformation of content into eBook, courseware and other digital formats. Last, but not least, we handle the archiving and content management.

On the print side of the business we have both inventory management, determining how much and when to print, along with the actual print and paper buying.

As you would expect, an operation of such breadth, depth and sophistication requires heft and scale. We have 700 people spread around the globe and our operation commands over $300 million annually in plate spend (the money spent in developing a title prior to publication), PP&B spend (money spent for paper, printing and binding) and other operating expenses.

That background on our overall business and our GPMS operation is necessary for providing the proper context for the complexity underlying our digital leap as well as for the specific process, workflow and cultural changes we initiated to support this endeavor. In addition, it helps underscore the dramatic cultural changes we had to spearhead within GPMS to support the broader objectives.

Process and Workflow

In terms of the specific process and workflow changes we implemented to support our digital goals, they are far too numerous to detail within one article. But the objectives behind the great majority of them have to do with reducing internal cost per title, external cost per title or preparing for the future. And many have focused on creating a tighter alignment with editorial and vendor operations.

Two initiatives in particular, however, warrant a little more detail. The first is our production automation program, which really encompasses many of the other activities and is the source of our greatest opportunities—as well as our greatest challenges. The production automation program is essentially a complete re-vamp of how we generate titles, starting with authoring templates and ranging through standardized—well, actually we call them “mass customized”, designs. It also includes the use of XML throughout the process for at least 80 percent of our titles. This is a major change from our previous approach, which gave each title its own design and was done in a desktop layout program such as Quark or InDesign. Not only does our revamped approach substantially reduce cost– we’re expecting composition cost to eventually drop below one dollar per page — but it also is much faster and removes a major manual step in the publishing process, which is critical as we move to electronic products.

The second major initiative is our vendor consolidation and offshoring effort. This has proven highly effective in two areas with more benefits expected. We have saved millions of dollars in prepress costs by consolidating our vendor base on the use of low-cost suppliers, mostly in India, or in a combination of India and the United States. While this has not been easy, it has certainly reduced our costs.

The outsourcing effort is interesting in that as part of it we performed analyses of various manufacturing technologies and locations to determine if it would be more effective and cost efficient to place our printing elsewhere. We learned that for four-color print jobs under 15,000 units, we could print in China and transport them to the United States far more cost effectively than if we manufactured them in North America. As a Higher Education publisher, we have a large number of these four-color titles and most of our reprints fall into this quantity range. Naturally, there is a longer lead time associated with printing in China. We have addressed this through the use of demand and inventory planning processes, which are common in other industries. At the other end of the quantity spectrum—the low end and/or black-and-white printing, we’ve also tied print on-demand technology into our distribution system so that we don’t have to stock slower moving ancillary titles at all.

The outsourcing necessitated numerous and significant changes to our production processes. Our traditional approach was focused on high quality and schedule and budget maintenance. All pages were checked internally, the schedule was developed by our production managers and we had strong relationships with our compositors. Under our outsourcing approach, we wanted to maintain the focus on quality and scheduling, while also reducing costs. We still checked most of the pages, but we specified schedules and vendor expectations contractually. This is a stage where many problems started to surface around how explicitly we could specify our expectations, and how we managed vendor workload.

In the next phase of our effort, we continued to push outsourcing, but also focused on automating the process and providing transparency for all involved. We moved to a full process management model in which we achieved, and are still achieving, process efficiencies for the vendor and for ourselves. We still have a long way to go to achieve our overall objectives, but we have already realized significant economic benefits including substantial reductions in plate and PP&B costs (despite paper cost increases of 5 percent over the past three years) as well as headcount reductions in the production department.

Change begets more change

When you change the process and workflow of an organization, you must, of course, also change the organizational culture. Within GPMS, for example, once we implemented our production automation program, our outsourcing initiative and other programs, we had to overhaul our culture accordingly. The focus on product quality on a title-by-title basis no longer worked way it used to, for example, and we knew we would have to move our culture from a craft, title-by-title, basis to one focused on process efficiency, alignment and quality.

To ensure that employees would embrace the fundamental cultural shift noted above, we needed to create an environment that would help employees understand and accept the numerous day-to-day changes. What we grew to understand was that while management was busily creating new workflows, processes and tools that we excitedly interpreted as efficient and effective, employees were taking an entirely different view and seeing the changes as little more than “additive”, or, in other words, burdensome. And management’s interest in metrics—or measuring the results of our changes—were being viewed even more negatively as our attempt to “check up” on them. These findings were learned through engagement surveys that we conducted, that unfortunately came on the heels of the announcement that the organization was being divested by Thomson Corporation and everyone was concerned about the future of the company. Ultimately, it was a classic disconnect between what employees were doing and seeing and what management wanted them to do and see.

Publishing is a traditional industry that has long shied away from even small changes. While many other industries have already shifted from a craft focus to a process focus, few publishing houses had done it when we were trying to make this fundamental shift. Longstanding practices and beliefs cannot be changed overnight and cannot be changed by a simple management mandate—it’s a long process that requires commitment from and communication between all participating parties.

Publishing employees in particular, who tend to be older, educated and loyal, were highly invested in their roles as craftspeople, highly respectful of traditional practices and highly committed to day-to-day relationship management. Getting employees of that mentality to accept automation and standardization was no easy feat, especially when publishing employees tend to invest heart and soul into individual titles. We knew that if we couldn’t get GPMS employees to embrace the shift to a process culture they would never understand leadership’s broader goals they would not only fail to execute with the precision needed, but, more critically, fail to lead the innovation, co-creation and creativity we needed t remain a market leader. So we designed a framework for change based on forging shared understanding, imparting new information and building strong communication. What follows is a list and brief description of the Culture Change Imperatives we employed to build the acceptance and buy in we needed to make our broader change initiatives a success.

Forging Change Successfully

Cultural Change Imperative—Build a Shared Understanding

Every employee needs to understand what he or she is working toward, how the work is supposed to be conducted and what his or her role is in advancing on that goal. We began achieving this aim by discussing what the company was looking for—which was critically important given our changing circumstances and the shifts in business goals that attended those changes. Under The Thomson Corporation, the focus was almost entirely on revenue and operating income – which makes it quite difficult to get anyone to focus on plate or inventory investment, I might add. Under Apax, we’re now heavily focused on a mix of operating cash flow and free cash flow with a good chunk of revenue growth thrown in. So we brought our employees up to date on this shift and then explained how current goals are tied into operational metrics, along with the implications they have for day-to-day decisioning.

In terms of results of these discussions; they were significant. As we began to talk with employees about our customers, primarily students and professors, we realized that for many of us, these were our children or slightly older versions of our children and that a significant gap existed between how they worked in educational settings, the technology they used in a learning environment, and what we—as employees and managers—were personally familiar with.

Those discussions and realizations led to a shared understanding that we had to do something differently to bridge the technology gap between our product users and our product developers. And to put a fine point on our learnings, we conducted meetings not by PowerPoint presentations but by Wikis. This turned out to be wildly successful – it started out as just a vision presentation, but all of the sub-projects ended up with their pages, and then each group needed its own Web and it’s grown like kudzu ever since. Of course, there is the downside of not being able to find anything, so tagging and search has become equally important. But the upshot is: our efforts to build a shared understanding is leading us to better understand our customers’ needs and learning styles and, ultimately, will help us create the products and services they need to make the most of their educational opportunities.

Cultural Change Imperative—Get with the Program!

Now some readers may laugh, but related to the technology gap noted above, when we embarked on our digital leap, much of the GPMS was made up of 40- and 50-somethings who, while quite competent professionals, viewed texting as something that teenagers did, had no idea what blogs were, and had little experience with the very collaborative and technology based products and services we’re focused on developing to improve learning outcomes.

Using these tools for the first time and fitting them into a long-established world view is hard. I myself, still get into discussions about whether blogging is a good thing or a bad thing and whether Wikipedia will be the death of authoritative reference works and a major misleader of youth or a genuine boon to information-seekers and learners. Providing our employees with access to technology education, and encouraging discussion about new tech developments not only forced our teams to work together, but also provided them far more insight, expertise (and even interest) in developing the tech-driven, customer-responsive digital products we’ve committed to creating.

Cultural Change Imperative—Vision & Values

Vision and values govern what we see is possible in the world and how we work together. Ensuring everyone understands and supports the organizational or divisional vision and values is critical. It’s not a matter of creating an inspirational slogan, but rather effectively and accurately articulating what everyone is working toward. We invested a significant amount of time, thought and discussion on not only identifying the vision and values driving our new processes, workflows and culture but also ensured the words (and principles underlying those words) resonated with everyone in GPMS.

Cultural Change Imperative—Organizational Structure

When organizations change so too do their internal reporting structures and hierarchies. What’s important here is not only clearly outlining every employee’s role and responsibilities, but also ensuring that there is dedicated project management for key initiatives of major scope, teams focused on the key initiatives and strong executive leadership.

Executive leadership is an interesting topic. We’ve had a long legacy of strong senior sponsorship for divisional production responsibilities. That was a hard fought battle that continues to occasionally surface to this day, but I’m absolutely convinced that we would not have seen the financial benefits from the various initiatives had we turned that model on its head and centralized. The embedded divisional cultures would have just been too strong to accept the introduction of many of the concepts we are pursuing. So, cultural imperatives shouldn’t be aimed just at employees, but also designed to ensure leadership gets on board with the organizational changes that may be required to realize broad objectives.

Cultural Change Imperative—Metrics and Feedback

Metrics are a key part of what we’ve been doing not only because they help us gauge impact and measure successes, but also because they ensure we remain objective about our decisions and overcome more emotional objections to our plans.

At Cengage Learning GPMS, we’ve begun reporting performance and compliance, and I’ve been surprised at some of the metrics proposed by the team to address their concerns (variance in length estimates, and plate expenditures due to errors, among them).

In addition, we’ve also begun to tie performance incentives for a large part of the organization directly to the things we do in controlling costs and plate investment. These initiatives not only clarify what is expected of individuals and divisions, but also help to align individual performance with broader organizational goals—which is critical to meeting those business aims.

Cultural Change Imperative—Relationships

This imperative is designed to get at the formal and informal networks of relationships that exist in the company and how we work with our internal partners, our staff, and our vendors, strengthen these relationships and devise ways to make them more mutually beneficial.

Culture Change Imperative—Communication

It was difficult deciding whether I should list this first or last in the Culture Change Imperatives. I decided to emphasize this at the end so that the point is fresh in every reader’s mind upon finishing this article—because communication is perhaps the most critical aspect of effecting significant cultural shifts. And when it comes to getting everyone on board for moving innovation forward, everyone must be involved in the ongoing communication about all of the important issues.

What we’ve learned is that it’s important for management to take the first step in communicating. We’ve also learned that communication from the top never seems to go all the way down. Since it’s important to put a personal face on the change and be prepared to engage all levels of staff on any concerns they might have, we moved from an original focus on Town Hall meetings and broadcast e-mails to roundtables, blogs and wikis. Now, on a quarterly basis I meet with everyone in GPMS in groups of 20 or less in roundtable meetings that start with a discussion of the business initiatives that are currently being pursued, and then finish with an open discussion of any concerns the staff may have. I make sure to have a separate session for managers and directors at the beginning of my visit to a particular location, but then leave these managers out of the individual roundtables with the employees.

In Summary

We’ve made remarkable achievements and progress toward change in an environment that’s not known for a great deal of innovation or risk-taking. I attribute this to the openness with which we’ve pursued the changes and our willingness to discuss it and the reasons at all levels of the organization.

That’s not to say that we aren’t facing plenty of challenges in the weeks and months ahead. The pace of change is not slowing down and there’s an increasing pressure on economic performance—which shows no signs of stopping.

Challenges continue to emerge—seemingly in proportion with every accomplishment. As an example in the Spring we were getting criticized for not doing everything we could to bring books in on time. When we went back and looked at the statistics, however we found that 60% of the titles were coming in late, and those that were late were delayed an average of 39 days. Leaving production, the statistics had improved substantially: 29% were late, and by an average of 19 days. We had improved performance on 50% of the titles by an average of 50% of the time.

Nevertheless, we remain heartened and excited by our progress to date and believe that our new processes and workflow, along with our strong culture, will ensure that we continue to deliver on our overarching goals of creating and developing the learning materials and services that support achieve and excellence in learning. And if the majority of those tools prove to be digital in the future—well we’re ahead of the curve and leading the revolution!

Accessibility of Digital Text

December 3rd, 2007 - Comments Off

I recently attended a summit on accessibility of digital text at the National Federation of the Blind in Baltimore.  Cengage Learning has been supplying files to disabled students for a long time, but there has been much recent attention to this issue in the press, in government and consequently in the AAP. 

With all of the available eBook formats that exist, and the bewildering array of formats, I realized that I needed to make sense of it all before we could come up with a decision on which way to go. The following is my attempt (with input from several colleagues) to articulate the issues.

The eBook world is complex with both commercial and accessible solutions available, but with no overlap across the two types of eBooks.  On the commercial side, there are a number of mass audience reading systems (Microsoft Reader, Adobe Digital Editions, Mobipocket Reader, Sony Reader, amazon Kindle, etc.) that don’t overlap or use the same formats as the accessible systems. These use a variety of formats and are supported by commercial channels through which consumers can purchase books.

On the accessible eBook side there are a number of accessible reading systems (18+). These generally use the DAISY format which in turn is based on the DTBook XML standard.  DAISY as a whole consists of additional optional elements to synchronize text, images and audio in a full multimedia reading experience. There are no commercial channels to supply files to these devices, only library-based solutions.

There are also various legal requirements to deposit accessible files for books used in K-12 education (NIMAS). In Higher Ed this same requirement exists, but without the specification of a particular format (so far). It should also be pointed out that if publishers have a commercial, accessible product, their requirement to deposit files are unclear. They may not have to deposit. However, the need to produce paper Braille may still make it a requirement to deposit, even though there is a commercial product.

Books in the DAISY format are not necessarily NIMAS compliant, but can be if the NIMAS requirements on markup, image resolution, etc. are followed. NIMAS files require high res images in order to support large print production. Hi res images generally make a less-than-acceptable eBook, however, due to size and rendering speed. This needs to be reconciled between the NIMAC and DAISY.

The IDPF has introduced a standards that allow these two sides to come together. This standard is the epub format (embodying the OCF standard) which can contain either XHTML or DTBook:

  • Epub with XHTML
    • While epub books that are based on XHTML can be accessible, there are no readers that read this format and XHTML does not support many of the navigation features (e.g. page numbers) that are necessary for educational use.  Note that XHTML based epub may work perfectly fine for access to trade content.
    • Content purchased can’t be moved to an accessible system because it is wrapped in a proprietary DRM.
    • These files are not (and can’t be) NIMAS compliant. NIMAS must be valid DTBook and conform to the Structure Guidelines for content.
  • Epub with DTBook
    • Epub books with DTBook are accessible, although there are no readers that support the standard yet.
    • It is only a matter of time before accessible readers exist that will process these files. 
    • Even when readers can process these files, they will need to have some sort of DRM protection for most publishers to feel confident of distributing files to them.
    • These files can be, but aren’t necessarily, NIMAS compliant. For NIMAS compliance the minimum specified markup must be included (headings, page numbers, etc.). There are also specifications on image resolution.

There are a few things that need to happen in order for the two eBook worlds to come together enough for a Higher Ed publisher to benefit:

  • NIMAS and DAISY need to come together.
  • An commercial channel for accessible eBooks needs to be developed:
    • Option 1: Full mass market accessibility
      • Mass-market reading systems need to accept epub/DTBook content
      • Mass-market reading systems need to become accessible
    • Option 2: Commercial channels for accessible reading systems
      • Publishers need to publish epub/DTBook formats
      • These should be created to be both DAISY and NIMAS compliant
      • Accessible reading systems need to accept epub/DTBook content
      • A commercial channel needs to be developed around the accessible reading system


In the meantime we can take the following actions:

  • Encourage the development of a commercial channel for accessible eBooks
  • Continue to produce NIMAS compliant files for K12 use
  • Continue to distribute files to the DSS offices of colleges and universities, potentially with the assistance of a group such as Bookshare.org.
  • Develop experience in producing accessible epub files based on DTBook.
  • Continue to work with the AAP committee to establish a common format and procedure for Higher Ed
  • Develop an overall accessibility policy for your publishing house

Why a rolling monthly demand forecast?

November 17th, 2007 - Comments Off

When implementing a new inventory management system, one question that commonly arises is that the effort to create and maintain a rolling monthly forecast at the title level can be extensive so why not just continue to forecast when we’re about to run out of inventory and are planning for the next print run?The answer to this question lies in the broader impact that demand forecasting has as a component of inventory management in the broader sense.  Effective use of demand forecasting as a management tool affects many areas:

  • Managing capacity at print vendors -  While initial print runs are easily managed to balance workload and capability across printers, reprints are more complex.  For reprints, there is some cost and effort to shift the title to another printer that must be considered.  Knowing what the future required capacity is by printer, format, paper, etc. allows shifts to be evaluated and managed before problems occur rather than as a last minute scramble.
  • Managing corrections – Corrections are generally initiated at some fixed interval before a reprint.  With an ongoing plan identifying when reprints will occur, production and editorial workload can be more effectively balanced.
  • Leveraging multiple print strategies Printers can and will offer discounts for printing in slack versus peak periods. A monthly inventory plan allows printings to be easily adjusted forward or backward to take advantage of pricing. Evaluation of explicit tradeoffs for printing in Asia versus domestically are also possible.
  • Improving cash flow forecasting and management – Reprints are a large consumer of cash. By translating projected print runs into forecasts of cash flow requirements throughout the year and across multiple titles, specific determinations can be made to adjust print runs to limit cash consumption or to balance monthly cash needs.
  • Validating and Balancing with sales and financial forecasts – The demand forecast should be kept in reasonable balance with sales plans in order to ensure that inventory purchasing supports projected sales.  This provides a valuable way to cross-check and validate separately managed customer, product line, channel and divisional sales forecasts. It also creates the ability to evaluate financial variances to determine where revenue discrepancies are coming from and adjust accordingly.
  • Planning and purchasing paper – Similar to printing capacity management, paper purchasing must be done significantly in advance of the actual print run to ensure availability and optimal pricing. A long range monthly forecast, even if it moves around, provides a useful tool for paper buyers to determe how to arrange their supplies.

A rolling month-by-month demand forecast that is updated on a monthly basis offers these and many other benefits beyond improving order quantity decision making from a more detailed and accurate forecast.

Learning objects

October 19th, 2007 - Comments Off

Learning objects are chunks of content with the purpose of teaching some designated topic.  At the most atomic level this could be a particular skill or part of a skill that is uniquely identifiable and focused on an individual, minutely-defined learning objective.  At the grandest level it could be a packaged course containing a wide range of atomic learning objects.

A learning list is a collection of learning objects.

A learning map is a sequenced list of topics leading to a particular overall learning objective or course. A course is built by filling in the map with learning objects associated with teaching each particular topic.