Print/mail finishing is a demanding and dynamic industry. Managers face the daily and unrelenting challenge of getting the mail out, managing staff, utilizing resources efficiently and assuring the integrity and effectiveness of thousands of individualized customer messages.
At the same time, they must stay abreast of an array of innovations and new solutions as well as key trends such as digital distribution that are rapidly changing the world of customer messaging. Selecting the "right" innovation from among the many alternatives can make a tough job easier or simply add needless complexity.
Layered on top of all this is the prospect of an increasing work load, which can result from a number of factors, including growth in the business, an escalation in mergers and acquisitions, the emergence of new or evolving applications or the "in-sourcing" of work to help lower costs.
All of which can make the task of selecting the right mail-finishing processes and equipment very challenging. After all, just acquiring equipment can be a lengthy process due to complex acquisition procedures that must be adhered to in many organizations. Businesses also expect essential equipment like inserting systems and printers to have a useful life of many years. Yet the volumes and applications that must be processed can change virtually overnight.
So managers of print/mail finishing centers should ask several key questions and remain cognizant of emerging trends as they set out to acquire new processing equipment.
Anticipated Volume
The first step in matching processing needs with inserting system capabilities is to consider the anticipated volume requirements. This volume capability can also be expressed as the net throughput of perfect mailpieces per hour.
There are three basic volume categories low, medium and high as well as a choice of equipment within the medium category, which is the largest segment in terms of number of installed systems.
The low-volume segment is usually served by equipment operating at speeds under 6,000 cycles per hour. The mid-volume segment is comprised of equipment cycling at approximately 8,000 to 12,000 mailpieces per hour, and the high-volume segment is comprised of equipment operating at 18,000 cycles per hour and above.
Transaction vs. Direct Mail
Direct mail and transaction-based mail were once entirely different processes serving entirely different needs. Not any more. Today, direct-mail applications are increasingly custom-tailored to individual preferences. They are often based on and even make direct reference to previous transactions.
Transaction-based mailings are evolving as well. Of course, they still record past business dealings. But now they are just as likely to incorporate one-to-one marketing and messaging techniques to cross-sell, up-sell and otherwise create a tighter relationship with each individual customer.
In fact, both transactional and direct marketing mail are now relationship building tools, and innovative companies are using them in an overall customer relationship strategy to maximize impact and reduce cost.
Organizations that handle direct mail primarily, or process a mix of direct and transaction-based mail, can benefit from a new generation of high-speed, high-integrity inserting systems.
Specialization
Mailers should consider their specific applications and their unique needs within their broad volume categories. For example, financial institutions such as banks and credit unions, often need specialized capabilities (i.e., the high-speed feeding of checks) to achieve performance targets for Demand Deposit Account statement processing.
Similarly, insurance companies have unique requirements for complex applications such as policy assembly. And many firms are implementing hybrid processing capabilities as a way to meet the growing consumer demand for the electronic distribution of EOBs, bills and statements.
Plus, there can be specialized needs even within an application. For example, many telecommunications firms utilize a six-inch by nine-inch envelope with a half-folded statement format for monthly bills and typically include a larger number of pages per statement than many other applications. But there appears to be a shift toward the use of standard business envelopes with a tri-folded statement format.
There is also a trend toward larger collations and higher-page-count applications as the monthly statements contain more detail and incorporate additional messages and material related to cross-selling and relationship building.
Much of the flexibility that organizations need to accommodate these evolving requirements can be achieved via customized features and configurations as well as input devices that are modular and easily interchangeable.
Breadth of Applications
Another important consideration is the variety and complexity of applications that must be processed. Service bureaus will clearly need the maximum amount of flexibility to continue growing. Industry observers estimate that the shift to outsourced print/mail finishing is advancing at a rate of about five percent a year, and the most complex or difficult applications are the ones most frequently outsourced.
But self-sufficient facilities also need flexibility to handle the inevitable volume surges, the emergence of new applications and the growing trend to in-source work to help lower operating and per unit costs.
Mailers who want to operate just a single piece of equipment but still need the myriad and essential benefits of impeccable integrity, fast processing, unrivaled dependability and prompt turnarounds are turning to highly versatile inserting systems. These systems can handle a vast array of applications.
Dependability
Faster cycling speeds can boost performance and productivity for virtually any inserting operation. But higher speeds alone are not enough. The real key to superior throughput is uptime. After all, what is the point of having faster equipment if you can never achieve the rated speeds?
Consistent Performance
This, not just raw speed, yields the best productivity. As a result, print/mail finishing managers should focus less on squeezing out a few hundred more cycles of speed per hour. Instead, they should look for the combination of speed, uptime and quality, which will assure a consistent operation and a flawless product. Inserting systems that feature smooth paper-handling processes, reliable mechanics and easy serviceability with fast setups and switchovers will yield the best quality and throughput.
Integrity
A mailpiece that is misassembled or misdelivered is not just worthless. It is worse that worthless. That's because the organization preparing the flawed message has lost time and money and must incur added costs to replace the message with an accurate one. Plus, each flawed mailpiece has damaged a very valuable customer relationship, perhaps even irreparably.
Privacy
Just as important as assured integrity is the increasingly critical concept of confidentiality or privacy, particularly for firms in the financial services and health care industries concerned about complying with the regulations related to the Gramm-Leach-Bliley Act and Health Information Portability and Accountability Act (HIPAA). HIPAA is a new Federal regulation meant to assure that, among other requirements, an individual's private health care data remains fully confidential. Much of HIPAA will take effect in April of 2003.
For mailers, the impact of HIPAA centers on the need to implement technology and procedures to assure that confidential health care data contained in paper and electronic EOBs, statements and other documents is secure.
Key areas of concern center on controlling and minimizing access to the data, recording who has accessed the data and why and assuring that the data and documents cannot be misassembled or misdelivered.
Some firms are responding to the HIPAA requirements by implementing file-based processing control systems for assured mailpiece integrity. Others are considering the use of multiple levels of integrity such as:
(1) adding a capability to weigh mailpieces during processing to assure that no extra pages are enclosed;
(2) utilizing an enhanced outsorting capability to automatically outsort both flawed and suspected collations whenever automated processing is interrupted; and
(3) enclosing all health care-related messages in closed-faced envelopes to further prevent unauthorized persons from obtaining confidential data.
Although HIPAA does not mandate any specific solution, technologies that become widely adopted, such as file-based processing, could evolve into de facto industry standards.
Enterprise Integration
With whatever inserting system is ultimately selected, make sure the equipment is part of and compatible with a "total solution" approach to customer messaging.
This approach includes full coordination of the 'closed-loop' message model that is needed to assure efficient and effective customer communications and encompasses the key functions of: creating the message, producing the mailpiece, distributing the mailpiece, receiving the response generated by the mailpiece and updating the customer data base.
Every print/mail finishing center is unique, and no one can predict the future with 100% accuracy. But print/mail finishing managers who evaluate equipment requirements against the criteria listed above are likely to meet today's needs cost-effectively while retaining sufficient flexibility to respond to future requirements as well.
Ajay Ghia is the vice president of Marketing and Product Development with Pitney Bowes Document Factory Solutions. For more information, visit www.pb.com.
