Mail Keeps Omaha In-plant Strong

Combining internal print and mail operations can place an in-plant in a much more secure position, since mail is often viewed as more mission critical to an organization. Nationally, 60 percent of in-plants have gotten this message and are providing mailing services to their parent organizations, according to IPG research.

One great example is the 42-employee print and mail operation at Physicians Mutual, in Omaha, Neb. Equipped with an arsenal of digital printing and high-tech inserting gear, the operation processes between 30 and 35 million mail pieces a year for the health and life insurance company.

With direct mail playing such an important part in the company's success, the in-plant's expertise is highly valued by upper management. This has fostered some very dedicated in-plant employees.

"Nobody cares more about our work than we do," remarks Sherry Monico, assistant vice president of the Mail Processing Center, which is located in a 92,000-square-foot facility in the northeastern part of the city, near the airport. With an annual operating budget of $3.6 million, the in-plant produces more than 45,000 jobs a year.

To handle this volume, the operation uses an array of Xerox equipment, including two DocuColor 8000s, two Xerox 495 continuous feed printers, two DocuPrint 135 MICR printers and two DocuTech 180 HighLight Color printers, supplemented by a pair of Konica Minolta bizhub PRO 1200s. About a quarter of the work is full color, Monico says, and 95 percent of it contains variable data.

'First Stop' for Marketing

The in-plant works closely with the company's marketing department to produce promotional and direct mail pieces. In fact, marketing approaches the operation very early in the process for each new project.

"We are the first stop," Monico says. "We have the right of first refusal in everything that they do."

This close relationship has developed over the past couple years, she says, after the in-plant worked hard to prove its value. Now the in-plant is able to offer suggestions early in the design process.

"Having insight into the front end concept and design process, we've been able to provide input," she affirms—to ensure pieces are printed and mailed efficiently and cost effectively.

It wasn't always this way, though. A little over a decade ago, mail volume had dropped to about 25 million pieces a year, from a high of 100 million in the early 1980s, when the facility opened. The department's aging equipment and slow productivity forced most direct mail projects to be outsourced.

In 2005, Physicians Mutual overhauled its mailing equipment, replacing 10 older Bell & Howell inserters with a fleet of four Pitney Bowes FlowMaster systems. The difference was amazing.

Huge Productivity Gains

"In an eight-hour shift, we were producing three or four times more with one machine than we were with three or four machines," says Monico.

Staff went from running 70,000 mail pieces a shift to as many as 300,000. In the end, 26 million pieces of mail were brought back in-house, cutting costs tremendously, and allowing the in-plant to monitor and control every step in the process.

As the in-plant worked increasingly close with the direct marketing group, jobs became more customized and specialized, to the point that outsourcing them was less of an option.

Though the operation has a print-on-demand area for producing business cards, stationery, flyers, booklets, posters, newsletters and brochures, most of what it prints ends up in the mail stream. This includes billing statements, payment books, claim payments, refund checks and customer correspondence. The operation also handles fulfillment of policies.

Innovative Solutions

One of Physicians Mutual's most successful promotional programs is a kit that includes a personalized letter with an attached ID card printed with the recipient's name. Recipients are pre-selected. All they have to do is respond to apply for insurance.

To attach this card, the in-plant uses an MCS Perfect Match read-and-print system. It reads a two-dimensional bar code that is printed on the letter, then prints a corresponding name and account number on the card. The system can also read the bar code, bypass the attacher and just spray images or addresses on envelopes or self-mailers. This maintains mail piece integrity while reducing the longer turnaround times associated with outsourcing the card attachment.

After the ID card is affixed to the letter with a Sure-Feed attacher, the letter and card are inserted into a window envelope. The system can handle 16,000 such pieces an hour. Adding this equipment, Monico says, has saved the company hundreds of thousands of dollars since it was installed in 2005.

More recently, the in-plant added a trimming and folding unit to the front end of the MCS system so jobs can flow right from the printer into the card attacher, without being trimmed and folded offline.

"We've eliminated a mid-stream process," Monico says.

Quality Control

To ensure integrity of the inserting process, the in-plant relies on a quality control team, which receives a copy of the job ticket showing all forms and pieces to be inserted in a mailing, the order they are to be inserted and the direction they should face in the envelope. After the FlowMaster's operator puts all the pieces in the correct bins, the quality control team runs test jobs to ensure accuracy.

Monico says the company is exploring the idea of transpromo printing—putting promotional messages on monthly statements. It is moving from the coupon book format to providing monthly statements.

"Now we have the opportunity to touch the customer 12 times, versus once," notes Monico.

To fill gaps in its workload, the in-plant insources work from outside the company—providing both printing and mail list cleansing services.

"We have the facility, we have the equipment, we have the people, and there's lots of peaks and valleys," she explains.

This started as a way to help non-profit groups cut their printing costs and thus enhance community relations, but it has benefited the in-plant as well by showing that it is not just an expense to the company.

"We are not just a cost center any more," Monico says. "We do generate revenue."

The company values the in-plant and shows its support by continuing to invest in it. Exhaust fans were recently installed in its warehouse, and the plant was painted. The two Konica Minolta bizhub PRO 1200s were recent additions, and Monico says she is looking into adding a Web-to-print system.

Looking ahead, Monico anticipates continued growth of the internal and external business by enhancing the service offerings and refreshing the equipment fleet in response to customer feedback. Possible additions include large-format printing and read/match/print capabilities.

"We are excited about the future," she concludes, "and we have an incredible group of people on our staff who deliver bend-over-backward service every day." IPG