Volume 2
Winter 1997

In this Issue:  Snapshots in Outsourcing Outsourcing Study Update Media Asset Management Consolidation and Shakeouts The Value of Planning


BEST PRACTICES "The company with a media asset management solution in place will be vaulted into a leadership role through improved organizational readiness, an innate ability to reach markets of one and elimination of waste associated with traditional media production."  Mary Alice Lawless, President, Impact Communications


The reaction to the first issue of our newsletter was so positive that we couldn't resist doing another. The information and ideas contributed by readers helped spur us along. Right now we're looking at a quarterly publication.

A couple of weeks ago, Austin Faccone and I were feeding information and value enhancement tactics to a corporate media manager and friend. When we finished, I said I wished I could just keep doing this for free because I love it so much. My greatest satisfaction is working through a problem and a process that leads to more effective use of media, better communications with constituents and a more open and interactive corporate environment.

That, to me, is the key to what good media management is all about and is the real value we can bring to our companies.

On that note, let me use this forum to wish you a very happy holiday season and a challenging, exciting and rewarding 1998. The first two years of our management consulting practice has been a joy ride, and I'm looking forward to a terrific year.

SNAPSHOTS IN OUTSOURCING

GE Medical Systems, Milwaukee, WI, has one of the industry's most active media operations. Dave Ross, Production Manager for GEMS-TV/TiP-TV, reports producing 300 marketing, training and communications programs this year and expects even more in 1998.

GEMS-TV broadcasts training and product introductions to employees via a 45-site analog network and educational programs to their medical technology customers over a 1,700 site digital network

In addition to steady growth in traditional media, GEMS-TV has expanded into "new" media as well. They developed and maintain 5 web sites. The Global Distance Learning Instructional Technologies Team develops computer based training applications.

GE Medical Systems traditionally managed their media production operations with a small staff of key employees relying heavily on contract technical and creative personnel to produce and deliver programming in all media.

Until 1990, GE, like most other media departments, contracted with freelancers directly. However, concern over independent contractor status, the time and effort involved in recruiting and paying freelancers and rapid growth in their workload, caused GE to consider alternatives.

Ed Gogolak, a writer doing a lot of work for GE at the time, offered to become the contract labor provider for GE Medical. Now, as a Professional Employment Service, The Gogolak Communications Group manages the employment, accounting and payroll services for over 70 full and part time GE contract workers in video production, graphic design and instructional technology. GE is currently Gogolak's largest client, though they have others in the Milwaukee area. Dennis Majewski joined the firm as president in late 1996 to expand the business into other markets.

GE Medical's experience is a prime example of how strategic cosourcing works to the benefit of both partners. It also works to provide greater cross-training and career development opportunities for the contract staff.

OUTSOURCING STUDY UPDATE

Coors Brewing Company was selected as a partner for "Outsource or Insource; Making the Right Choice" because of the company's strong commitment to the outsourcing strategy as a means of revitalizing the organization. All creative services functions were among the many operations that had effectively been outsourced in 1993.

This past May, with profit growth stuck at a lackluster 1% per year in spite of intensive cost reduction measures, the company decided to see if even more outsourcing would provide a financial windfall.

Meeting planning and trade shows were the only creative services functions still managed by a Coors employee. All production work was subcontracted to commercial producers, such as Dick Clark Productions, which handled the annual distributor meetings.

The Coors purchasing department did a "yellow pages" search for a single vendor capable of handling all trade show and conference management functions, but couldn't come up with a single source. (Interesting, as we found several in a recent study for one of our clients.) One company they did find noted that since all services were already outsourced, they doubted they could achieve any significant cost reductions.

This past October, in the face of strenuous client objections to any change in the current process, and for lack of viable vendors, it was decided to maintain the status quo. Meanwhile, Barry Seidenstat, who managed the operation, has since left Coors for another opportunity.

MEDIA ASSET MANAGEMENT

If you've ever had to come up with a photo of a product that went out of production years ago, or spent hours finding video footage of an overseas factory, you can appreciate the value of media asset management.

We have always known all those videotapes, photos and graphics we produced and filed away had value. The problem was how to identify that value and how to catalog and access the library at a reasonable cost.

Several of our partners in the study "Outsource or Insource", were making progress in that area. Now, data base software, digital storage and intranet technology makes it possible to upgrade media asset management to Best Practice status.

Michael Moon, writing in "New Media" (3/3/97), pointed out that asset management demonstrated that media creation was more than a service and had "tangible economic value". His white paper is available from www.gistics.com.

Applied Graphics Technologies, a digital image management and archiving company, recently signed a $105 million contract with GM which will include building a database repository for GM's digital content.

On the other end of the scale, we've received information about "Archivist" from Vision Technology, LLC, Redwood City, CA. This software claims the ability to catalog, retrieve and display digital photos, documents and full motion video files in most formats. It can also create multimedia presentations. Advertised price is $139.99. Check out www.visiontechno.com.

An approach we think more appropriate for corporate media departments is "Dynamic Media Access" a service developed by Impact Communications of Morristown, NJ. This system offers a flexible and actionable way for companies to develop intranet-accessible archives at reasonable cost and effort. Impact will digitize, catalog and store media in all formats and then make it accessible through secure intranet connections. More information can be found at www.impactsite.com.

CONSOLIDATION & SHAKEOUTS

Over the past several months we've learned of several significant changes in the corporate media arena.

Readers of "Videography" magazine no doubt saw the feature article describing the new Microsoft video production facilities. Very impressive indeed. While there have been several facility upgrades and expansions, this is the only significant new facility we've heard of in recent years. We'll be in Seattle next Spring for CMMA - and we're looking forward to the grand tour.

Apparently the venerable Price Waterhouse video facility in New York City has finally closed. Over a year ago we heard that a major equipment order had been cancelled, presaging the final shutdown this fall. No confirmation but it would not surprise us to hear that closing the facility was a precondition of their pending merger with Coopers & Lybrand.

Southern Companies, an electric utility holding company based in Atlanta, operated a BTV network covering their Georgia, Alabama, Mississippi and Florida subsidiaries.

Austin Faccone learned that Southern's broadcast facilities and staff has been taken over by One Touch Systems which will operate the facility as a demonstration site for their interactive technology. It's not clear yet whether One Touch will continue to provide BTV services for Southern.

Speaking of venerable, The Equitable Production Group may be on the block. Started by Tom Hatcher in 1966, with (believe it or not) Norelco 1" tape decks, the operation was spun off as an Equitable subsidiary in the mid 1980s. BTV broadcasts from their auditorium on 7th Ave. in New York became their main line of business. As one of only three public auditoriums with uplink capability in the city, it was the site of a number of major corporate announcements and financial analyst presentations.

With the arrival of a new CEO, Johnson Controls of Milwaukee has closed down its corporate television studio, though the BTV receive dishes remain in place. Two years ago their network was featured in the company annual report.

A recent news item announced that Gardy McGrath International had established a digital media production alliance with Bell Atlantic. Since Convergent Media absorbed Bell Atlantic's production functions in 1995, we wondered what was going on. Turns out the alliance is with the former, and very impressive, Bell Atlantic pilot interactive cable network facility in Reston, VA.. In the face of a questionable home cable market and the need to reallocate resources, the facility had been up for sale, apparently now successfully.

THE VALUE OF PLANNING

As word of the research and advisory services Van Deusen Associates and our affiliated consultants can provide, we frequently hear: "I wish I'd called you two months ago."

The last quarter of any year is critical as companies strive to position themselves to start the new year on a positive note. (read: stock and profits ascending, expenses and staff descending.) It's an opportune time to write-off downsizing charges.

This is the time of year corporate planners start their own holiday wish lists, putting increased pressure on service support departments to prove value or find another line of work. The result is increased need for reorganization and strategic planning, financial analysis, outsourcing evaluations and benchmarking.

Every media manager's New Year's resolutions should include taking preemptive action to address these issues early in the year. As Ernie Bumatay is fond of saying: "If you have not been through a management review, don't worry, you soon will be. If you've survived a review, don't rest on your laurels, you'll be reviewed again."

 


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