West Coast Wonders
The three largest state government in-plants are all on the West Coast. Despite budget cuts and calls for privatization, they continue to thrive--but changes are afoot.
By Erik Cagle
Don't let the calendar fool you. It may not read 1849, but tremendous wealth is still being mined in the largely untapped western portion of our country. Instead of prospectors dredging local waterways for gold nuggets, though, government in-plants are reaping a fortune by producing print and communications-related products for their respective agencies.
Look at the figures. Each of the three West Coast states cracked the top 10 list on the In-Plant Graphics Top 50:
• California's Office of State Publishing (OSP) was number three, with $69.2 million in sales.
• The Washington State Department of Printing was sixth, with revenues of $33 million.
• Right behind at number seven was Oregon Publishing & Distribution, with $24.6 million in sales.
The fact that the three states with the largest in-plants are geographically aligned may be somewhat of a coincidence. But they do have a few things in common.
Each of the three has historically emphasized the role of its State Printer—a position most other states don't even have. This may have played a part in their early growth.
The job of State Printer was created during the territorial days of the Western states, notes Michael Freese, Oregon State Printer.
"That person wielded a lot of power because they were the conduit for getting legislation published and distributed," notes Freese, who also serves as deputy state information officer. "That history, I think, has driven [these] states toward having a central printing operation that typically is consolidated and typically is responsible for serving the printing needs of all the state government. I don't know that to be true for the East Coast or even Midwestern states."
It was true in California though. Back in the 1800s, the State Printer in Sacramento had difficulty getting timely material from printers in San Francisco, says retired State Printer Celeste Maia Cron. This led him to create the Office of State Printing, she says, and the operation just continued to grow.
Despite the impressive size of the three operations, budget cuts, the move to digital technologies and other factors are conspiring to downsize them. Shrinking print volumes have motivated Oregon's operation to move away from on-site offset printing and increase its procurement from commercial printers. Cutbacks at California state agencies have led to big work slowdowns at the OSP, which has been downsizing through attrition for years. Washington's operation seems to be holding its own, though like its two southern neighbors it has had to augment print work with ancillary products and services.
Like their settler ancestors who battled to survive in a growing and evolving nation, these three state in-plants have adapted to changing times.
On Top Of Technology
Perhaps the most adaptable of the three is the Washington State Department of Printing. It was one of the first in-plants to recognize the importance of online ordering capabilities, thanks in part to the vision of Interim Director Larry Weber. The 83-employee in-plant recently debuted PRTonline, which not only allows customers to create, edit and proof business cards and letterhead online, it lets them order custom-printed items like brochures and newsletters.
In its print shop, the department utilizes a two- and four-color 40˝ Heidelberg Speedmaster, along with a six-color, 28˝ Komori press. It added a Creo Lotem 800 II Quantum platesetter a year ago, a clear sign the in-plant sees a strong future in offset printing.
On the digital end, the department has 16 Xerox 6180 and 6135 units, along with a Canon IR110 and IR150 for variable data printing. It also offers mailing, fulfillment, CD replication, OCR conversion and address/data cleansing with fast forward and merge/purge capabilities.
Dan Swisher, assistant director, says the Department of Printing is obligated by state statute to provide printing and binding services for all state agencies and political subdivisions, with cities, counties and school districts having the option to use its services. The DOP is prohibited from doing any work for the private sector.
"The state enjoys a number of benefits—lower costs for materials, volume purchasing and economies of scale," Swisher explains. "One of the things we're working on is to get state agencies to funnel their work down to copy centers or our high-speed printers so that we're not printing them on desktops.
"We're a central customer provider, so we make sure that the standards for the products, quality, turnaround time and lowest cost are all met and are the same for all agencies," he adds.
The operation has to be nimble enough to handle agencies with varied levels of needs.
"Every state agency hasn't progressed along electronically and are not as technologically advanced," Swisher says. "We have to adhere to all of them. What makes us successful is the diversity of services we offer and the people we have here who work their tails off. We have to have a foot in the past and a foot in the present, with an eye for the future."
Despite more work migrating to the digital end, Swisher believes offset work is going to continue well into the foreseeable future. Many forms are printed offset, he notes, with variable data married to the product digitally.
Still, Swisher feels it's important for state in-plants to concentrate on digital printing and ancillary services over the long haul. He keeps an ear to the needs of customers and monitors the ever-changing technology climate. As for offset, he envisions a drastic reduction 10 years from now.
"I've seen the change in keeping pace with technology," he says. "We have a group here working on the POG, Priorities of Government, that's to become more like an enterprise system, so that we can centralize things, become more efficient and save taxpayer dollars. Before, everybody would have a print shop in every agency, which tends to duplicate a lot of work, and you're buying more equipment than you need. So we're working on bringing more and more to the state printer. Again, that could all go away in 10 years."
Consolidation In Oregon
A consolidation project like this was undertaken in Oregon in the late 1990s when the state consolidated its printing efforts into a centralized facility. All of Oregon's production mail operations, including mainframe and traditional print, were also brought into its publishing and distribution facility.
"We made the decision to consolidate here because it's cheaper, and that's the bottom line," says Freese.
By statute, Oregon Publishing & Distribution controls all the printing for state agencies and determines which jobs are done in-house and which are outsourced to the private sector. The decision of where to print a job is based on what makes good business sense, says Freese.
"What we look at is the stuff we have the scale to be competitive at, and if we can do it for less money—and it has to be less money—and the same or better service level, and then we'll do it. If we can't, then we outsource. We always try to get the best value for the state and the taxpayers."
Before the consolidation, he says, some agencies were doing their own printing.
"The state Department of Transportation, for example, just didn't have the scale to drive the economies the way we can," he notes.
Offset has largely given way to digital printing in Oregon, which focuses its effort on what Freese calls "print-to-post applications," integrating all the functions for high-speed digital printing, variable data printing and other material that ends up being mailed. The digital work is buoyed by CD services and Web design. The agency also partners with Corrections Enterprises for a lion's share of its fulfillment work.
The in-plant's largest press is a 40˝ Heidelberg perfecter, though a Heidelberg SORG and some other offset equipment remain in the plant. The last web press was removed about 10 years ago.
The agency saw its offset work began to dwindle in the early 1990s, due to the onset of alternative publishing means, such as CD-ROMs and the Internet. In 1996, a strategic plan was implemented that called for the phasing out of traditional print over a five-year period, and the "print-to-post applications" came to the foreground.
Freese says much of that offset work has found its way into the digital realm. State policy played a role here; past policies dictated full-color work could only be done by special request with an exemption. Though that policy was later rescinded, the mind-set took hold with Oregon state agencies that color was a discretionary, cost-conscious avenue. The by-product was a more standard document format that fed into the shop's economies of scale, and more digital work.
Oregon's future, Freese says, lies in adding the most value through the integration of printing, mailing and distribution.
"One of the areas we're exploring and will be pursuing aggressively is a distribute-and-print strategy to augment our centralized print strategy, because with some things it makes more sense to print at the location where they're actually going to be used," Freese remarks. "There's going to be a fusion...between the publishing/distribution operation and e-government program, over time."
Freese draws a distinction between his operation, where offset work is being increasingly outsourced, and Washington's Department of Printing.
"We are different operations," he insists. "I don't consider us to be just running a printing plant. That's one of many things we do. Our job is to coordinate the printing...and get the best value on behalf of our customers. The state of Washington operation...[has] more latitude than we do. They have the ability to offer services to a wider array of customers, and their job, very clearly, is to run a printing plant. The other thing is scale. They're at least twice the size of Oregon when you look at Washington's budget, population and so on. They can achieve greater economies of scale."
Golden State Printing Giant
Even larger than Washington is California, home of the largest state printing operation. But it may not remain the largest, according to Guy Blair, OSP administration manager. Like Oregon, California's OSP is moving away from offset printing, he says.
Still, the offset road will continue to be taken for the production of large quantities of voter guides, tax booklets and driver handbooks, which can number up to 12 million copies. Many of these jobs are produced on the in-plant's showpiece Heidelberg M1000 web press, with eight units and four roll stands. The sheetfed division is led by a six-color, 40˝ Heidelberg perfecting press. The OSP also operates a host of digital and analog printers, including two Xerox 6180 printers.
The OSP has branched out into ancillary services including online voter registration, online business card ordering, electronic file transfer for printing and online document publishing for various agencies. Its mailing operation can perform mail merges with customer-provided artwork and mailing lists, and a fulfillment service is available to a select number of state agencies.
"OSP operates a print procurement unit to serve all state customers, but they are not required to use our services," Blair says. "Agencies can vend out printing themselves according to guidelines of their purchasing delegations. OSP will capture work that can be done in-house meeting the customer's time requirements and will then vend the overflow to commercial printers."
California's OSP also has a long tradition that dates to 1850. The state printing office finally took up residence in the old governor's mansion in 1875 and gradually grew by documenting the activities of its state legislature. That branch remains the OSP's number one customer.
Though it has been in its current Sacramento facility for many years now, the OSP may soon have to find new digs. A proposed light rail system running through the in-plant may uproot it. This could result in a smaller operation. But Blair is optimistic about the future of the OSP and feels the state values it for its 24-hour responsiveness.
"Given the long history of serving the same customers, OSP has a specialized knowledge of the needs of each customer and a statewide perspective of the environment in which we operate," Blair remarks.
No doubt its two northern neighbors would say the same thing.
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