HHS-Fighting Tough In Texas

Texas Department of Health and Human Services

Austin, Texas

After years of fighting to keep his in-plant alive, Robert McDaniel has finally been able to spend some time focusing solely on improving his shop.

Six years ago, the Texas Council on Competitive Government consolidated 31 state print shops in Travis County, in central Texas, into a mere nine shops. These in-plants, which lack right of first refusal, were also mandated to operate on a full cost recovery basis and forbidden from printing for any type of commercial operation. The result? They were left fighting each other and commercial print shops in a limited pool of government work. But thankfully, says McDaniel, "It's a mighty big pool."

McDaniel manages one of two sites that make up HHS Printing & Distribution Services, and both sites are overseen by the Texas Department of Health and the Texas Department of Human Services—the HHS in the title. The two state departments account for approximately 80 percent of the in-plant's sales, with the remainder coming from other state agencies, such as the Department of Safety, the Department of Parks and Wildlife and the governor's office. The work is split evenly between McDaniel's site and the one run by co-manager John Moses.

"They're slanted a little more towards publications, and we're slanted towards forms, but most of those difference are disappearing," says McDaniel. "When we started, 90 percent of our work was forms, and now it's down to about 60 percent"—partly due to forms now being accessible online.

The increased demand for color work and publications has naturally necessitated the purchase of new equipment. Recent acquisitions include a four-color Heidelberg Speedmaster press, which enables the in-plant to do work previously handled commercially, a Muller Martini Saddle Binder and a large MBO folder, so the 74-employee shop can produce higher-volume publications.

All this talk about improvements comes as a relief for McDaniel, who has seen three state in-plants fail since the consolidation, while he has simultaneously endured a number of profitability studies.

"Fighting privatization efforts by special interest groups in Texas has been one of my main jobs," he says. "We were the first program to participate in the Texas Competitive Cost Review where they compared actual printing job costs [among] 22 of the biggest Texas printers."

The cost review was an exercise in patience for McDaniel. "We had to do an in-depth management study and a cost analysis study of our own operation," he says. "Internal auditors examined everything we did, then state auditors came in and examined our reports. Then everything went over to our general services commission, who actually did the cost comparison."

Twenty-two months after it started, the review finally came to an end—and things looked great at HHS Printing.

"They were able to determine that we were cheaper, anywhere from 15 to 40 percent cheaper and on average 25 percent cheaper," says McDaniel.

You'd think a result like that would be conclusive, but the review was soon followed by a governor's operational audit, and then another study, and then another…. "It seems like every time the Texas legislature got together, they would come up with a new bill to promote privatization of state in-plant printing and we would have to respond to that," says McDaniel. "We're real proud that we're still here, and I think we've shown that an in-plant will save its parent organization money if it's handled efficiently."

by W. Eric Martin

Eric Martin can be contacted at: eric@twowriters.net&012;

Key Equipment:

• Agfa Avantra 30 Imagesetter

• 3M Color Match System

• Two Kodak 960 Film Processors

• Two 3M Plate Processors

• Four-color Heidelberg Speedmaster 72

• Two-color Heidelberg Speedmaster 74

• Two-color Heidelberg Speedmaster 52

• Two one-color Miehle Roland 36˝ presses

• Two-color Hamada 234CX press