Article prepared by C. Clint Bolte, C. Clint Bolte & Associates, Chambersburg, Pennsylvania. For additional information please call 717-263-5768, fax 717-263-8945, or e-mail to clint@clintbolte.com.

Executive Outlook Conference 2003

CIM & RFID Suggest Further Technology Enhancements

The day before Graph Expo and Converting Expo started, the sixth annual NPES’ sponsored Executive Outlook Conference drew its largest crowd ever. One hundred and fifty attendees gathered at McCormick Place in Chicago to get a review of the “Must See ems” products and technologies that would be on the show floor for the ensuing four days. Additionally a series of rapid-fire treatises on pertinent technology trends impacting the full breadth of the graphic communications industry were presented. The acknowledged growing impact of this meeting may well be the fact that eighteen international visitors, the largest proportion yet, were in attendance despite DRUPA being barely eight months off.

“Surviving After the Economic Upturn” was addressed by NAPL’s Chief Economist Andrew Paparozzi as he reiterated, “The rising tide will not lift all boats!” The recession actually ended two years ago, as measured by GDP growth, and yet the printing industry has continued to suffer as “excesses and imbalances have not been cleaned up since the boom of ‘90s” according to Paparozzi. Current business conditions seem to be breaking out into the sunlight as NAPL’s Printing Business Panel has reported a pick up (52%) in business versus those claiming a slow down (19.9%) on a three month trend. And for the second month in a row more panelists are reporting an increase in work-on-hand.

Print pricing trends continue to erode. Paparozzi acknowledges, “ Full recovery (for the printing industry) won’t be complete until some degree of pricing power is returned to the printer.” Investment priorities of this panel suggest the four corporate priorities to be (1) strengthen the core (bindery on top the list), (2) expand the core (fulfillment, digital presses, database management, and mailing capabilities), (3) digitize, integrate, & improve continuously (CTP, digital infrastructure, MIS) and (4) train and educate (clients and employees).

Luncheon Keynoter Mr. Bruce James, the United States Public Printer, said, “Half of all federal printing is being done illegally (outside the GPO venue) in the private sector.” In order to accomplish the GPO’s overriding mission of preserving government information, the GPO described a new method of print procurement to be inacted. Instead of the GPO being the sole approved print procurement source, beginning this month the Department of Labor will be allowed to buy its own printing. “By October 1, 2004 hopefully all agencies will be buying their own printing,” remarked Mr. James.

Exact electronic manuscripts of each job must be submitted to the GPO by the vendor in order to get paid. The GPO will receive a 3% commission for administering the qualification list of vendors, the digital asset warehouse, and accounts payable to vendors. GPO had a booth at Graph Expo, where their representatives solicited qualified vendors and answered questions. Interested printers should go online to contractorconnect.gpo.gov

Mr. James concluded by saying that the GPO unions are behind these changes. There are 2,700 employees with 52% age eligible to retire. He further added that of his twelve top management team members six are new to the GPO and of the remaining six GPO veterans only two are in their same job.

Steve Musselman, AGFA’s Worldwide Business Development Senior Manager, offered an interesting historical perspective and overview of AM, FM, and hybrid screening. Photolithography, the process of screening for print, has remained unchanged for 125 years until the digital revolution. The more consistent and precise dots delivered by computer-to-plate have allowed suppliers to develop software algorithms for dot sizing and placement. These screening alternatives are intended to optimize the press’ normal ability to render ever-finer halftone details. Virtually every electronic prepress vendor is offering a proprietary series of screening solutions for their clients.

The ultimate roadmap to future print production efficiencies shows the destination to be computer integrated manufacturing (CIM). The intention is to so link each manufacturing task to virtually eliminate all set up times, optimize running conditions and speeds, drive associated production spoilage to a miniscule level, and provide real time management information from beginning to end. This far-reaching goal has been achieved by other build-to-order industries, but not yet printing. Adoption of CIP4 and its job definition format (JDF) is the key to reaching this objective.

Heidelberg has its own JDF workflow solution, entitled Prinect. Other manufacturers offering critical links in the graphic production supply chain have joined the Networked Graphic Production (NGP) with a commitment to deliver the value of JDF. It is strongly recommended that no piece of equipment be purchased whose manufacturer is not an active member of NGP and therefore working diligently toward CIM by making their product compliant with the CIP4 and JDF standards. For more detailed information about JDF, go online to cip4.org or call Executive Director Jim Harvey at 410-451-5040.

One of the stumbling blocks to full CIM integration is the plethora of legacy equipment. Tim Daisy, EFI/printCafe’s CIM Product Manager, discussed their Auto-Count system, originally intended to measure web press activity, is being adapted to be applied to non-compliant and legacy equipment in both press and finishing departments.

Digital wide format had a dedicated area at Graph Expo. Tony McCarthy, Xinet’s Worldwide Technical Sales Director, described the three prominent trends in this area to be (1) better resolution, (2) larger ink reservoirs, and (3) more versatile substrates.

RIT’s Frank Cost discussed their project of printing radio frequency identification (RFID) tag antennas using inks containing metal nanoparticles. RFID has been recognized as an improvement over bar code technology for inventory management due to its larger data capacity. Additionally it can serve in theft detection due to its ability to be scanned even if visually obscured. Wal-Mart announced this summer that they expect their 100 largest suppliers to apply RFID to pallet (and case?) shipments by 2005 with all suppliers complying by the end of 2006. This is expected to create a ripple effect for further development and adoption of RFID tools.

Currently RFID tags are expensive (about a dollar) and complex to produce. There are passive and active tags with the later powered by a battery. The antenna coil being printed with conductive inks and cured produces the passive units. A microchip is then attached to the antenna to complete the RFID tag. In time the microchip could also be printed to further streamline the production.

The current inkjet and screen techniques are considered slow with limited volumes and resolution. RIT has been experimenting with a Mark Andy flexo press and patented conductive Parelec Parmod inks which contain silver nanoparticles. Mr. Cost and RIT conclude, “Printable electronics may represent a large potential new market for printing equipment manufacturers.”

MAN Roland’s Rover combines a tablet PC with camera, broadband connection, and proprietary software to provide a remote diagnostics system for the pressroom. Christian Cerfontaine, MAN Roland’s Director of Marketing, described how this portable, handheld device can “make trouble shooting and maintenance an integral part of the printer’s workflow.”

An afternoon panel discussed the “Opportunities and Dangers of Diversifying into Mailing and Fulfillment Services.” While all surveys are concluding that printers want to diversify into these value-added services, the title suggests that implementing such a strategy carries certain caveats that the hardware and software vendors may not accentuate. While there are a myriad of individual services that can be provided, some are much more sophisticated and demanding than others. Printers new to these basic services would be wise to both maintain and extend their network of larger specialty vendors with whom they can partner to meet certain needs. For example, the software vendors will provide excellent address updating, sorting and cleansing capabilities according to the USPS regulations. If a client’s mailing list contains a larger segment of Canadian names, for example, the printer had best find a specialty vendor that has software of Canada’s postal sort regulations to facilitate a hygienic pass before entering the mail stream.

This past April the USPS approved the regulations for using respositionable notes (RPN), similar to the old 3M Post it™ notes, to be placed on the outside of mailing pieces. The intent, which early case study evidence verifies, is to increase the response rate of direct mail pieces that incorporate this attention getting device. Mr. Patrick Peick, 3M Repositionable Note Product Manager, described the series of experiments done in conjunction with the Post Office to arrive at the exact specifications that would not gum up their automated sort processing equipment. The DMM guideline C810 was distributed and should be followed by all vendors when applying these to mail projects.

While the USPS has approved only two manufacturers of RPNs, any printer can purchase the notes in rolls, apply them in line, and inkjet (even personalize) messages in conjunction with the actual bar coded recipient’s name and address. ASMARC in the Mailing and Fulfillment Center at Graph Expo showed how a modular label applicator could be positioned in line with their Accufast mail inkjeting system to offer this service. The 10,000 minimum roll label purchase costs $280 or 2.8˘ a piece for the labels. Higher quantities would cost less. A single inkjet line with label attachment costs $26,000. ASMARC was demonstrating three inkjet heads running three different colors. Mailers, who own an Accufast line, can purchase the label applicator for $8,000 and position it in line.

Conference organizer and moderator Bill Lamparter, Principal of PrintCom Consulting, challenged the audience, “Our industry is one of responders with legacy equipment. We need to change and be more proactive. What are you going to do different in 2004?” This challenge very much is directed to the industry trade associations as well because telemarketing constraints are inevitable while the USPS is struggling to put together a new business model in the light of escalating costs and stagnating volumes.

Article prepared by C. Clint Bolte, C. Clint Bolte & Associates, Chambersburg, Pennsylvania. For additional information please call 717-263-5768, fax 717-263-8945, or e-mail to clint@clintbolte.com.