Consolidated Graphics : The Dukes of Digital

Recruitment Efforts

Likewise, the Leadership Development Program has grown by leaps and bounds, from recruiting a handful of college graduates in the Texas area to hundreds of recruits now coming aboard to learn about printing the CGX way. According to Michael Barton, executive vice president and chief administrative officer, "If anything, our expectations have increased because we realize that, as CGX grows, we'll need a large pool of talented people ready to assume the leadership roles that will become available.

"Going forward, the program will grow in size and importance because leadership in every professional role is critical. Someday, it would not surprise me if every CGX plant president position is held by a graduate of this program."

CGX is a company that shares best practices and technological platforms. Its sales force is constantly raising the bar in terms of cross-selling opportunities, with more than $100 million per year in such sales. Being able to sell the full capabilities of CGX—like its legendary stout balance sheet—is a given for its sales force.

While sheetfed and web offset printing are both on the CGX customer menu, it's safe to note that today's special is digital printing. Davis points out that the 220 machines which grace the CGX network make it the largest fleet of digital presses in the United States. The company isn't beholden to one manufacturer, either, as it embraces HP, Kodak, Xerox and Konica Minolta models.

CGX has plunked down upwards of $50 million for digital equipment over the last five years, and another $25 million in software the past 12 years to develop the technology. And, that doesn't include the 100 hires—programmers, developers, customer service and helpdesk folks—brought aboard to raise CGX's game to a higher level.

Rumors of the conventional printing phaseout may be premature. The beauty of personalized printed material is that it often features an offset printing component.

Case in point is an automotive brochure program reached with Ford Motor Co. CGX's Cincinnati facility, The Hennegan Co., signed a deal with the venerable auto giant to produce custom vehicle brochures for more than 3,300 Ford dealers nationwide. The integrated marketing solution entails offset and on-demand digital printing, personalization and fulfillment. The more integrated the challenge, it seems, the more likely CGX is to win the contract.

Don't cry for offset...last year Wetzel Bros., of Cudahy, WI, installed a 73˝, six-color manroland UV sheetfed press. "We continue to invest in offset printing where we have the demand for it," Davis notes.

Personal Touch

Not that all digital printing at CGX is confined to direct marketing campaigns. Personalization is huge, with products ranging from photo books, calendars, postcards, cookbooks, insurance books and financial services products getting attention. Wide-format digital printing—signage, billboards, bus/van wraps—is also drawing interest from clients and, hence, targeted capex investments from CGX.

Jon Biro, executive vice president, chief financial and accounting officer, notes that investments over the past two years have enabled the company to nurture what he calls the "world's largest digital platform." CGX has digital super centers in St. Louis; Minneapolis; Memphis, TN; and Medford, OR. Internationally, CGX has a digital center in Prague, the Czech Republic, as well as one in Yokohama, Japan.

"We have developed a technology backbone that our customers appreciate because we have (equipment) redundancy, handle their data securely and offer 24/7 uptime to support their business," Biro states. "Additionally, we have made investments in custom software applications such as our Web-to-print storefront that enable us to offer added value by creating solutions for our customers. We also have made investments to ensure that the facilities and equipment we utilize to serve clients are in top-notch condition."

Cross-media communication is a key for the future of CGX's marketing initiatives, though keep in mind that the cradle-to-grave campaign is the key to increasing the customer's response rate, and at the heart of what they're trying to accomplish.

"Many printers can provide clients with a PURL and a basic personalized campaign," Grohs adds. "But you need to offer the whole ball of wax, and that's where we're seeing the most opportunities."

Grohs is particularly proud of the company's online storefront technology, which was developed internally 12 years ago and has since been modified. "Our online storefront provides immediate benefits, allowing customers to manage their inventories better, giving them reporting, as well as the ability for all stakeholders to order, customize and distribute product," he says. "It reduces obsolescence and inventories."

CGX prides itself on home-spun innovations. Its most recent example is a flex mailer, a cost-effective, automated way to send certain items, such as samples and promotional products, through the mail. It was introduced to clients and CGX's 650-member sales force during the emerge conference in April.

Of course, the company is perhaps most noted for its exploits in the transactional arena. Cohen, CGX's executive vice president of mergers and acquisitions, notes that several companies have expressed an interest in joining his organization, and a good many of these candidates find themselves in some level of financial distress. This has enabled CGX to become skilled in the art of creative deal structuring, which can entail negotiating terms with banks and creditors. Its most recent deal was the asset acquisition of The Hickory Printing Group in Hickory, NC, in May, which will add about 3 percent to CGX's revenues.

"Our acquisition strategy isn't directly tied to geography or acquiring new capabilities," Cohen notes. "We look for the best companies, with the best leadership and the best customers, no matter where they happen to be. We generally don't look at acquisitions as a way to bolster our technological offerings. But, if a company has a product offering that we find desirable, of course it is a factor in our evaluation of that opportunity."

Forward Thinking

Joe Davis loves the prospects that the future holds. He has no plans to retire, and is proud of the fact that his Leadership Development Program is churning out executive-level professionals year in and year out. CGX's M&A platform is as robust as any, buoyed by ready access to capital and ready to stretch into a 27th state, though geography is not a requisite. Most importantly, CGX has a committed and educated sales force able to sell across different platforms and to bring innovative ideas into the fold.

For a major printing conglomerate, it boasts many of the traits shown by companies a mere fraction of CGX's size. But don't let that fool you.

"It doesn't matter how big we get," Davis remarks. "The day we start thinking like a big company is the day we're going to die. We've got to stay nimble, stay flexible. We can't get caught up in big company bureaucracy. If we do that, we're going to lose what makes us so special."PI

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