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Connecting with Quebecor World in Vegas
July 30, 2008

It's going to hit 107 degrees in Vegas, but the refrigerated world of the Wynn Hotel insulates Las Vegas visitors from that reality. But real business is going on just a few yards from the baccarat and blackjack tables in the favored convention spot--notably for the printing industry at EFI's ninth annual users's group meeting, Connect08.
EFI made a major announcement yesterday with the acquisition of rival Pace Systems Group, and the realignment of its existing management systems (Hagen, Prograph, Auto-Count, Logic, etc.) offerings into a package dubbed Monarch. It's been a long trek from Printcafe to these industry dominant print management applications, and from the presentations given here it is evident that EFI is rapidly moving ahead on integration of workflow, color management, JDF and digital and inkjet printing.
During the opening session of Connect08 yesterday, EFI CEO Guy Gecht interviewed another top industry exec, Jacques Mallette, president and CEO of Montreal-based Quebecor World, posing a  series of questions to Mallette in a casual onstage chat. THe conversation ranged from from the future of the printing industry and its competitive role with other media, to Quebecor World's efforts to meet its current business challenges.
Mallette was promoted from CFO to his current post at the end of last year, just before Quebecor World faced bankruptcy in the face of a credit market meltdown. Gecht's questions elicited insights into Mallette's perspective on his company's efforts to regain profitability and overcome obstacles faced over the past year.
Quebecor World began in 1954 with one printing press, and in 2007 earned revenues of $5.7 billion. Mr. Mallette joined the company in 2003 as executive vice president and chief financial officer before being appointed CEO at the end of 2007.
Gecht began with what may have been the toughest question: "What's the plan for exiting Chapter 11?" Mallette replied that Quebecor World first began by establishing a credit facility, a move that served to reassure customers and calm employee fears.
 "That way we can make an orderly exit from protection," said Mallette. "Our problems have mostly been in Europe," he noted, and the company has moved to divest underperforming operations there. "Our target is to exit protection by the end of the year," he said. The complex steps for the global firm have so far required, "eighty motions, all of which have been approved by the courts uncontested."
Gecht next asked, "What's your toughest job as CEO?" Mallette had a ready answer: "Operating as the financial markets crashed in August 2007," he said, "then making sure we had a plan in place."
When Gecht posed, "What are you doing on the customer front?" Mallette noted that Quebecor World was pursuing lowering costs and speeding delivery. As Gecht asked how they were going about that, Mallette spoke at length about Quebecor World's strategy: quality programs, and restructuring to both simplify and optimize the customer interface, and efforts to listen more intently to what customers want.
"Six Sigma programs are in place," noted Mallette. "But what is important is how you mind your customers," he said, noting that Quebecor World engages and communicates with clients at all levels, from CEOs and purchasing management, "meeting with them on a regular basis." But other stakeholders in the supply chain also affect the print giant's relationships and business engagement. "They will not always tell you everything face to face," he noted, so Quebecor World surveys other buying influences among its customers. And, he said, "You need to understand your customers' customers," who are the end users of print. "More than half of our direct customers are publishers of magazines and books," Mallette said.
As a result of its customer engagement, Quebecor World has reorganized its U.S. operations from six units into three. "Premedia is at one end, and logsitics at the other, with all printing in between." This allows the company and its clients to capitalize on marketing communications synergies between retail inserts, catalogs, magazines and mailings.
Gecht concluded his queries with a big question: what about the future of print.
"I'm convinced print is a great product," Mallette said. "Print is a powerful tool; it still is close to 50% of the ad spend." He cited a study done by Kinzie for the Magazine Publishers Assn. that showed that publication advertising, when done well with good paper stocks and added sensory components, was the most effective medium.
"We shouldn't be shy about printing," Mallette said. "Instead of always cutting, we need to go with the right production values that will have the most impact."

Posted by Bill Esler on July 30, 2008 | Comments (0)