Idealliance Capital Investment Study Findings

At Print 17, I had the chance to sit down with Andy Paparozzi, chief economist at Idealliance, and talked about the latest research on investment priorities. I had worked with Andy on the last Capital Investment study and was interested in learning about the latest study entitled “Capital Investment: Where Companies are Planning to Invest and Why.”

Year after year, the study uncovers the changes occurring in the industry. For example, the 2016 report identified more than 20 products, 20 services, and 10 processes that executives believe will have the most growth potential over the next two or three years—vital information for those planning their company’s course of action in the years ahead. In the latest research, when senior management were asked what they wanted to accomplish with their investments over the next three years, slightly more than half of the participants (55%) plan to invest the same percentage of sales dollars in new equipment and technology as they did in the previous three years.

Investment percentages ranged from 1% to 12% of sales, with most in the 3% to 8% range. When participants were asked what their main objectives were for their capital investments, the top three answers were items that were about increasing operational productivity. Ninety five percent said their investment objectives included one or more of the following:

  • 67% say they want to achieve a more efficient workflow.
  • 66% report the need to automate processes and reduce labor costs.
  • 61% want to work faster to shrink turnaround times.

More specifically, companies cited workflow software; bindery finishing equipment and systems; digital infrastructure solutions; management information systems; and web-to-print software. Asked what they would most like to improve in their decision making, the survey base put “more unbiased, agenda-free input” at the top of the list for evaluating investment options.

Investments Only Go So Far

At Print 17, Mark Michelson, the Editor-in-Chief at Printing Impressions, interviewed many industry subject matter experts. I was fortunate enough to sit down with Mark and discuss productivity. During the interview, Mark asked about the current state of productivity improvement in commercial and in-plant printers.

Among other things, we talked about declining efforts by many companies and misconceptions in many companies that consider themselves as leaders. While it’s true that many companies make investments in hardware and software, that alone is not the definition of a leader. Leaders measure and benchmark performance to confirm the improvement.

Whenever I talk to a company that considers themselves a leader, I ask them about their metrics and improvements in those measurements. A few of the questions include: “What are your metrics and KPIs (Key Performance Indicators)?” and “Has your labor as a percentage of sales, equipment utilization, NPI (Net Promoter Index), SPE (sales per employee) or cost of goods sold improved?” The puzzled look on some faces tells the story.

For more about this, watch the full five-minute video interview.

By | 2017-10-19T17:51:29+00:00 October 19th, 2017|Categories: In-Plant, RSA, Video|Tags: , , |0 Comments

About the Author:

Howie Fenton is an independent consultant and trusted advisor to in-plant printers. He recommends equipment, best practices and workflow automation tools to streamline operations. To learn more about measuring performance, benchmarking to leaders, and improving your value e-mail Howie@howiefentonconsulting.com.

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