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ING Conference Presentation October 6, 2012. GANNETT PUBLISHING SERVICES. Who are we How did we get here 1 st Year success/challenges Moving Forward. GANNETT PUBLISHING SERVICES. GPS is a one year old business that manages: Production operations. GANNETT PUBLISHING SERVICES.
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GANNETT PUBLISHING SERVICES • Who are we • How did we get here • 1st Year success/challenges • Moving Forward
GANNETT PUBLISHING SERVICES GPS is a one year old business that manages: • Production operations
GANNETT PUBLISHING SERVICES GPS is a one year old business that manages: • Production operations • Product distribution
GANNETT PUBLISHING SERVICES GPS is a one year old business that manages: • Production operations • Product distribution • Consumer sales and services (CSS, CSC, OCC, CIDC, and DRC)
GANNETT PUBLISHING SERVICES GPS is a one year old business that manages: • Production operations • Product distribution • Consumer sales and services (CSS, CSC, OCC, CIDC, and DRC) • Contractual outsourcing of printing for all of Gannett’s printed products
GANNETT PUBLISHING SERVICES GPS is a one year old business that manages: • Production operations • Product distribution • Consumer sales and services (CSS, CSC, OCC, CIDC, and DRC) • Contractual outsourcing of printing for all of Gannett’s printed products • Building business for imaging, ad production, printing, packaging, distribution of third-party products and consumer services
Gannett Publishing Services Senior Management President Evan Ray SVPOperations Austin Ryan SVP Circulation Jerry Hill VP Finance Kelly Provant VP Technology John Palmisano VP HR Mellisa Alford
Operations Printing & Packaging Structure SVP Operations Austin Ryan VP National Printing & Packaging Dale Carpenter East Regional VP Jack Roth Midwest Regional VP Greg Fiorito West Regional VP Open Mideast Regional VP Bill Bolger
Gannett Publishing ServicesNational Commercial Sales Sandy Andrews VP National Commercial Sales Atlanta, GA Regional Sales Executive West (1) Regional Sales Executive East (4) Regional Sales Executive Mideast (3) Regional Sales Executive Midwest (4)
Gannett Publishing ServicesImaging and Ad Production Toni Humphreys Director Imaging & Ad Production Connie Gallagher Customer Support Development/ RTC Operations Manager Amy Cox Senior Financial Analyst Monty VanEmmerik IT Manager Stephanie Lengtat Operations Manager (DM)
GANNETT PUBLISHING SERVICES • 41 Gannett owned print sites • 29 Contract print facilities • 18 of these print USA Today • 5 of these print USA Today and a Gannett daily newspaper • 70 sites in 4 regions
GANNETT PUBLISHING SERVICES • Product distribution • Home delivery • Single copy • Consumer sales and services • Customer support • Sales and marketing efforts
GPS - Distribution Management Structure President, GPS Evan Ray Sr. VP of Circulation Jerry Hill VP Distribution & SC Sales Jack Saunders VP National Distribution Tom Kelly Single CopyOps Kevin Cooper Sales Services(Load Network) Chris Hansen Home Delivery Ops Rosie Cassidy USPS Tom Salvo Reg. VP, East John McGee Reg. VP, South Bob Sutherland Reg. VP, Midwest Open Reg. VP, Upper MW Mike Quinn Reg. VP, West Steve Reed
GANNETT PUBLISHING SERVICES • How did we get here
Prior to GPS: • U.S. Community Publishing (USCP) • 80 local newspapers • USA Today • National newspaper • Gannett Offset • Commercial printer, USA Today and regional commercial accounts
GPS More Fully Leverages the Company’s Existing Assets, Including: • Industry-recognized employee talent and experience • Investment in physical plants, equipment and real estate • Unique national and local distribution network
Consolidate Operations: Executive Summary Consolidate and centralize management and eliminate duplicative activities across all GPS divisions, implement a cost efficient model across all markets, and build sales capability to fully load the network. Description 1 Business implications Objectives 3 2 • Realignment of organizational structure • Major culture change • Shift in financial responsibility • Change in accounting processes • Greater focus on loading • Improved opportunities for across print site business units • Reduce annual operating cost • Allow unit management (publishers) to focus solely on content, audience engagement & advertising sales • Maximize productivity & efficiency • Eliminate duplication • Leverage existing expertise across business units • Loading the network by building sales services organization
GANNETT PUBLISHING SERVICES • Allow unit management (publishers) to focus solely on content, audience engagement & advertising sales
GANNETT PUBLISHING SERVICES What is our commitment to our newspapers?
Responsibilities • Print and deliver all publishers’ products within current schedules and deadlines. • Print all work consistently at or above Gannett Optimum Quality guidelines. • Inserting will be at a 98% accuracy level or better for FSI’s and 100% for editorial products. • Maintain publication position in the marketplace and make adjustments to draw when breaking news or events present the opportunity. • Jointly discuss and agree to sales strategies and goals to maximize volumes and profitability objectives. • Meet consumer volume expectations on key days in key zip codes outlined in strategies and initiatives. • Achieve quantitative metrics and key performance indicators (KPI’s) for consumer service, sales and retention. • Participate in annual budgeting and operational planning process, and conduct periodic performance reviews. • Communicate and work with the publisher/general manager in the event of a hard down or force majeure to minimize delays in the delivery of the paper.
The Publisher Responsibilities • Provide GPS with page and editorial close in a timely manner and reasonable flow. • Make reasonable efforts to ensure incoming materials meet specifications and are readily identifiable • Maintain or improve editorial quality standards. • Provide input on publisher’s market strategy, and collaborate with GPS to develop operational and expense plan to meet market goals. • Both Publisher and GPS will: • Communicate any quality or service issues to the other party • Quickly address any reasonable concerns from the other party • Keep parties apprised of any potential legal, regulatory or operational risks. • Work together on budgeted and projected volumes
GANNETT PUBLISHING SERVICES 1st Year Successes
Objectives Accomplished to Date: • Formed business unit and restructured a 132 member management team and realigned 8,400 employees into new single business unit • Finance – accounting, purchasing, payroll, inventories, etc. • Human Resources – restructures, job descriptions, pay grades, benefits, workers comp, hiring/firing, employee development, etc. • Reporting – begin standardize, GPS database
Objectives Accomplished to Date: • Merged USA TODAY and USCP distribution and single copy sales management teams and realigned along five new national regions • USCP strength of local home delivery • USA Today strength of single copy • Consumer services – evolution • Consumer sales and marketing – leveraging expertise
Objectives Accomplished to Date: • Merged USA TODAY, USCP and Gannett Offset Production Operations management teams and realigned along four new national regions. • Regional VP’s • Local GM’s – press and packaging management with more complexity of multiple publications and commercial work • Commercial work • Regional sales force • Leverage commercial expertise
Objectives Accomplished to Date: • delivered significant improvement to the bottom line of the Gannett company
GPS successes: • new launches - bringing on daily newspapers to our own print sites • new launches – USA Today strategic print locations • new launches – out sourcing our newspapers to non Gannett print sites • PRINT OR BE PRINTED - do the work where it makes the most sense
GPS successes: • better understanding of commercial sales process • building relationships with potential customers or printing partners • developed a quoting tool for commercial pricing • developed a publishers check list for things to consider when outsourcing • quality standards, customer support, estimating, fulfillment and billing
GPS successes: • Improving reporting of statistics – GPS database • applying best practices • scheduling, training, equipment, maintenance, etc. • sending employee “experts” to help sites • more aggressive use of company equipment • RVP’s know what is out there – equipment inventories • employee reviews • Common review date for all • most management levels on company wide review system • common consumables for better price and standardization
GANNETT PUBLISHING SERVICES 1st Year challenges
GPS challenges: • Revenue and growing the business • churn • the bigger the project, the longer the selling process • relationship building • building a sales force • sales material, quotes, specs, samples, deadlines, production capabilities, work flows, billing, etc • compensation plan
GPS challenges: • Changes in a large organization • communication • culture/history • Employee items • workers doing more with less • furloughs • benefits – moving toward standards • change and uncertainty it brings • motivation, retention and succession planning
GPS challenges: • lack of equipment flexibility • web width, quarter fold, trimming, etc • equipment maintenance • recovering from past maintenance reductions • scheduling maintenance as business grows • systems and standards • vendor community • upgrades to drives, controls and systems • concern for vendor support
GPS is Significantly Reducing Operating Costs by: • Standardizing best practices across our printing and distribution networks • Eliminating work process and management redundancies
GPS is Growing Revenue by Increasing Third-Party Sales of: • Pre-media services • Commercial printing • Product delivery • Customer services capabilities
Strategic Objectives for GPS are: • To allow our local media unit management teams to focus more fully on growing audience, improving content and developing revenue • And, for Gannett Publishing Services management to: • concentrate on optimizing and leveraging our centralized production and circulation assets and operations • and focus our centralized consumer acquisition, retention and engagement services to accelerate the company’s recently announced transition from the print subscriber model to the multi-media paid content subscription model