Volume 3
— Spring, 1998

In this Issue:  Change — Retakes — Snapshots in Outsourcing — Consolidation and Shakeouts — Management Tactics — Prototyping

BEST PRACTICES — Producing prototype programs at little or no cost for clients who might benefit from the results, creates new opportunities for media organizations. Concept presented by Ed Hermes, Manager, Photo Graphics (Now Retired), Procter & Gamble


Change seems to be THE hot topic these days - in case you hadn't noticed. It is more than just coincidence that Phil Stella asked me to contribute an article on change for the ITVA page of Video Systems at the same time the Health Sciences Communications Association invited me to deliver a keynote address on the same subject at their conference in Portland, Maine this June. You better believe it will be at the core of our ITVA Management Masters Seminar in New Orleans.

In my October 1997 ITVA News article entitled, you guessed it, "The Challenge of Change", I said that we media professionals are the first to test new technologies and then convince our clients to invest in them. Prototyping is a proactive way to meet change with change.

For more on prototyping, see the item further on in this issue.

The best way to cope with change is to anticipate it and approach it proactively. Most of our recent consulting work has been in helping media departments through the change process - developing action and strategic plans, streamlining, reengineering and, yes, even downsizing if it will help ease the transition into a newly merged organization with new clients, new products and services and new bosses.

Change management is not black magic, though its success certainly benefits from an extensive information database, a broad network of contacts and research time not always available to hard-pressed managers. An outside observer can also look at organizations impartially and with a bit of skepticism, much the way an acquiring company evaluation team will view the organization.

Based on the constant stream of merger announcements it seems change is going to be a way of life for some time to come. If it seems overwhelming at times, it might be well to think of the saying: "Plus çe change, plus çe la mem chose". Loosely translated as: "What goes around, comes around."


Last winter we reported the sale of Southern Companies' BTV operations to One Touch Systems. That was only partially correct. The distance learning facility, Southern Company Colleges, was sold. Southern continues to operate BTV communications networks serving its subsidiaries in Florida, Georgia, Mississippi and Alabama. One Touch, broadcasting through the Georgia Power uplink, continues to provide some company programming as well.

The Home Depot, Atlanta, GA, recently completed construction of a new 20,000 square foot video production facility including three linked Avid editing suites. HDTV is also in the process of upgrading their 600 site digital BTV network from CLI to PowerVu format. GE Spacenet is the network integrator. The Home Depot is widely recognized for the value placed on communicating with their growing number of retail outlets.

In early January, the Photo/Graphics department at Procter & Gamble moved into their new 19,000 square foot facility. Recent growth in their multimedia business (brought about partly through prototyping) led to some significant increases in their permanent staff as well. Randy Block was appointed manager to take the place of Ed Hermes who retired at the end of 1997. P&G continues to earn its place at the very top of our list of world class media departments.

My alma mater, The Prudential Insurance Company, is finally making good use of the video production facility we designed and built for them some ten years ago. First the 25-site analog BTV network has been expanded to a 700-site DirectTV network, installed and managed by Convergent Media Systems. This has led to more extensive and innovative uses of the network, including sales telethons, an idea pioneered in 1994 by Boston's New England Insurance Company. Even more impressive is that all Prudential broadcast television commercials are now produced entirely in-house, under the direction of an in-house ad agency that also creates those ubiquitous print ads. Pru's novel approach to overcoming corporate salary scale limitations for video professionals was to hire a video editor at vice president rank. Sam Small may be the only Avid editor around with the title "Vice President of Editorial Services".


Last December, NCR Corporation, headquartered in Dayton, Ohio, solicited outsourcing bids from several large production companies for multi-media and electronic meeting management functions. NCR was spun off from AT&T in 1997 during the "trivestiture". We understand that the RFPs were developed and administered by the NCR purchasing department, with the internal media department also encouraged to submit proposals. The contract was awarded to Curtis, Inc., of Cincinnati, whose outsourcing contract with GE's Aircraft Engine division was recently renewed for a five year term.

Curtis now operates a satellite shop on site at NCR, but will relinquish the space at some future date. They also offered full-time employment to the NCR production staff. This was a very fast track project, with potential vendors being given less than six weeks to submit an initial response.

NCR had been notably unprofitable under the AT&T banner. Obviously they are seeking every possible way to better manage expenses, or at least impress stockholders with their intentions.


Speaking of AT&T, the AT&T Video Resource production studios in Piscataway, NJ, were shuttered on April 1. The studios were built in the 1980's, when AT& T moved its headquarters from New York to Basking Ridge, NJ. While video production continued as a function of Public Relations, the Resource Center was attached to the Real Estate sector of Corporate Services. The idea was that the center could serve a large number of scattered AT&T business units and also become a major commercial production facility serving the NY Metropolitan market. For a long time that formula worked, but the trivestiture, combined with the arrival of a new CEO and the need to further cut operating costs drove the decision to consolidate all video production in corporate Public Relations. The equipment in Piscataway will be sold off through an independent broker, with no expansion planned for the relatively small Basking Ridge facility.


Ken Mundt, Video Communications Manager at Flow International in Kent, Washington, passed on his response to Karen Rogers' challenge of "inviting yourself to the party."

Flow International is a medium sized company ($160 million in annual revenues) so they don't have distance communications technology in-house. They do, however, make frequent use of the Kinko/Sprint videoconferencing network to confer with their six worldwide subsidiaries.

Ken says organizing videoconferences is a simple process, once the initial arrangements have been established. An administrative assistant could certainly handle ongoing coordination.

However, Ken chooses to stay directly involved with each conference, from making the reservations to being on hand during the meeting to make sure all goes well.

Why? Well, the attendees are his CEO, COO, CFO and a lot of other officers with "C" type titles. For a minimal amount of effort, Ken gets the skinny on operational and financial information about the company as well as high level visibility among top management. His presence enhances his importance. And, he gets information which not only helps him communicate credibly with management, it also gives him information helpful in better managing his own organization and as he says: "craft on-the-money messages in our marketing, investor and internal communications media."


The prototyping Ed Hermes talked about at the ITVA Management Masters Seminar last June, is a best practice we noted, but failed to emphasize, in our 1996 study.

In fact, prototyping warrants serious consideration. Originally a standard in manufacturing, in this instance the concept is derived from reengineering, where business processes are redesigned and tested to validate their feasibility. The Procter & Gamble practice, along with that of several other world class production organizations, is to set budget money aside specifically for the purpose of developing prototype media deliverables. As example, uncovering an unmet client need might lead to developing a CD-ROM. The media department contributes the media expertise and cost of production while the client only need provide content expertise and agree to test the CD-ROM under actual conditions.

If the deliverable proves to be successful, it then serves as a demonstration piece the media department can use in marketing services to other departments. One option is for an agreement with the client to contribute to the cost of production if the deliverable proves valuable.

In these days of tight budgets, how can a media department find the means to fund prototyping? The fact is, it's always possible to find a way to squeeze a few dollars here and there. The largest prototyping investment is time, which can always be found for the right cause. Outside suppliers or equipment manufacturers looking to demonstrate their products and services may pitch in to help cover out of pocket costs.

It must be made clear to clients that this is a one-time event and they should not expect future freebies. Clients should also be given a full report on the real cost of each prototype. The producing organization needs to treat prototypes as real projects with deadlines and quality controls, not something to be done when and if the spirit moves.



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