You can't get more 'old economy' than the print industry, but Ruth
Winchester found one print firm that has opened its eyes to
e-commerce
Printing has been poetically described as "the business of
smearing ink on dead trees". It's a hands-on industrial operation
which lends itself more readily to images of dirty overalls and
filthy fingers than to a vision of super-efficient digital
business.
Yet one company has launched itself into the on-line revolution
with remarkable success. Formed through a management buyout in
1996, Astron squeezed three old-tech printing businesses together
and wrought a dynamic new e-business in the process.
The driving force behind this radical culture change has been
its chief executive, David Mitchell. In the past four years Astron
has doubled its workforce from 200 to 400, and sales of £13m have
shot up to £35m.
The firm has made the difficult transition between old- and
new-tech remarkably successfully, with traditional business still
accounting for about £15m sales.
Astron has developed a full range of e-support services,
delivered to an array of large, prestigious clients including BUPA,
British Airways, RAC, Granada Compass and Scottish Power. These
range from on-site reprographics services to sophisticated on-line
purchasing, ordering and stock query functions. The business is
divided into five vertical markets - financial services,
healthcare, communications, and airline and travel - each
identified as a growth sector, each with its own specialist team of
staff.
"There was a lot of froth, a lot of excitement around at the
time about e-working, and I wanted to apply that to traditional
business," says Mitchell.
The first step was to replace external IT contractors and
consultants with in-house software engineers - a decision he
describes as, "a leap of faith". "In trying to create value, you
still have to make a profit," he argues, "and yet we'd hired these
guys, and we weren't going to see any return on that investment for
at least 18 months."
Astron's take-off may have been aided by the fact that it got in
at the start with many of its clients. Mitchell says one of the
firm's strengths has been its willingness to work alongside clients
in developing new solutions, rather than trying to offer a
ready-made package.
He says, "We found ourselves in a very collaborative situation
with a lot of customers - it was a joint learning process, about
talking to them and understanding their vision. I guess we were
quite small, so we were never a threat to big blue-chip clients,
they just saw us as a testing ground for their ideas.
"There was a great deal of honesty - we worked with customers,
and they thought it was fantastic - they loved it. Around the same
time, lots of bigger organisations were trying to roll out the
model solution on their own, and they failed."
Mitchell is also a great believer in a re-circulating approach
to developing services. Thus, for example, a system developed with
British Airways for clearing credit cards online was subsequently
made available to other Astron customers.
Work with BUPA, the company's first full-blown online customer,
made it possible for them to interrogate stock, place orders and
track progress of an order, all over the Internet, and will make it
possible for other clients to set up similar arrangements.
Mitchell admits that the massive change the company and its
employees have been through has been tough at times. He
acknowledges that management issues were sometimes unexpected,
saying, "You have to adapt to managing knowledge, rather than
managing tangible outcomes. In terms of productivity normally it is
about faster, better, cheaper. But our outputs now are far less
tangible than if you are making widgets. You need a different
management model.
"My lack of IT understanding was another thing," he adds. "From
my point of view I couldn't understand how these guys [software
engineers], who had so much to do, could pack up and go home at 5pm
on the dot. What I didn't understand was that they could be working
from home, linked in, or that they could have been there all
weekend. It was humbling. I don't think of it as a mistake, more as
a lack of appreciation for the way someone else worked."
So was there much kicking and screaming from non-technical
staff? Mitchell says "kicking and screaming is a bit dramatic", but
admits that there were culture differences which needed careful
handling.
"Jargon dyslexia" was one of the main ones, he says, and that
was reasonably easy to deal with by making sure everyone felt able
to ask questions, and by having people who could "translate" where
necessary. Company-wide IT courses and full-time coaches helped all
staff, from warehouse to sales team, to become e-literate. "It's
about creating an environment where there is no fear," Mitchell
adds.
Given that Astron seems to be making a go of the unlikely
alliance between e-commerce and traditional printing values, what
would Mitchell say to people considering a similarly unconventional
move? "You have to be fast on your feet," he says. "Hack out the
bureaucracy. Don't have meetings you don't need, don't get bogged
down. Keep your project team small, give them the freedom to
explore, but give them clear terms of reference.
"Listen to customers - work with them. One new idea that a
customer offers you for free is worth 100 you will get from a
consultant."
"Apart from that," he adds, "keep developing the vision, keep it
simple, and if in doubt, if it doesn't add value, don't do it. Be
ruthless."
Astron's e-business solutions
Astron offers the full range of logistics based on its Astroweb
system, written in-house.
Astroweb is based on Microsoft's NT platform, with a Microsoft
SQL server. The back-end is a Unix database.
Customers access Astron's online services at its
Web site, using a password login. Astroweb is
structured so that after login every customer gets access to
their own range of products, with a corresponding list of their
delivery points.
There are a series of different levels of access, so that
different users from the same customer get different options - for
example a BUPA customer from one hospital can only see the products
relevant to that hospital.
Astron then fulfils orders from sites around the UK, including
Slough, London, Bristol, Huntingdon, Derby, Glasgow and
Warrington.
Online card validation, clearing and authorisation is done by
NatWest Bank, via software written by Retail Logic.
Astron has just set up an arrangement with British School of
Motoring to host its Web site, from which visitors will be able to
order a range of things from booklets and training manuals to
driving lessons.