Outsourcing: Case Study

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Case Study 2: Why BMJ Group Decided to Outsource Specialist Journals

Background to BMJPGØ Commercial arm of the British Medical

Association (BMA)Ø Flagship journal - Weekly BMJ (bmj.com)Ø 23 specialist titles (BMJJs)Ø Evidence based products

• Clinical Evidence (CE) (>2,500pp)

Ø Significant online presence (most with Highwire)

Ø New initiatives• BMJ Learning• Best Treatments

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Ø Typesetting brought in-house mid-1996• Interleaf

Ø Interleaf contract cancelled end of 1996• In favour of Xyvision• Traditional typesetting system• Powerful batch pagination

Ø 26 staff• Pre-editing• Typesetting• File delivery / conversion / archiving• Web administrators

Ø High salaries / benefits; Central London; ‘recharges’

Background to Case Study

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The Pressures in 2002

ØHigh cost of typesetting (per page)• Backed up by comparisons with other publishers

ØCore business?ØTurnaround times erraticØXyvision wasn’t “XML aware”ØSmall development team in-house

• We could not progress quickly

ØCapital investmentØPublishers using offshore alternativesØEfficiency Review

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The Good Stuff

(What we did well in-house)ØQualityØDedicated teamØRespectedØWorkflowsØAutoproofing

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Efficiency Review

ØActivity Based Costing by another name!ØMost departmentsØConsultant ledØMapping all jobs

• Tasks• Time taken

ØActual cost of tasks derived

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Efficiency Review (continued)

ØBrainstorms (all staff)• Analysing tasks and roles• What could be done better?• Duplication of effort?• Move tasks to another team?• Outsource tasks?

ØDevelop ideas; cost solutionsØApprove and implementØStrive for 20% savings; expect 6%

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Cost review project

ØTeam set up to analyse costs and potential changesØ Included:

• typesetting team managers• typesetters• Operations Director

ØSome process analysis• Looking at handovers, workflows (galleys)• Considered technologies, systems etc

ØOverlapped with (and superceded by) Efficiency Review

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Outsourcing Review

ØStarted in 2002; formal projectØProject manager from Print ProductionØOperations Director was sponsorØTeam included Editorial staff

• Expertise and buy-in

ØConsidered all products• BMJ• BMJJs• CE

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Outsourcing Review: Objectives

ØTo reduce costØTo maintain or improve qualityØTo improve turnaround time

• Resilience

ØTo reduce time to publicationØTo refine and improve workflowsØTo replicate autoproofing facility (more later)

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Outsourcing Review: Process

Ø Formal structure:• Invitation to Tender• Request for Proposal

– Detailed Specification– Supplied pricing matrix for ease of comparison

• Review and Shortlist– Scoring system weighted objectives

– Cost; quality; proposal quality; systems; size; customer base; risk, training and development; business continuity arrangements

• Visits– UK (BMJ)– China (BMJJs)– India (BMJJs and CE)

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Process (continued)

• Financial Reports / Trade references• Further discussions with shortlisted suppliers

– Clarification of service / costs– Teasing out startup and any hidden costs

• Consideration of remaining in-house operation– Size (for resilience / cost effectiveness)– Structure– Redundancies and costs

• Decision and recommendation to the Executive– Via formal business case– Including staff redundancy costs

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The decision

ØTo retain BMJ in-house• Not comfortable with any other supplier• Weekly journal leaves no room for error• Editorial liked the close proximity

ØTo retain CE in-house• Slick in-house solution• Used Xyvision’s batch pagination to great effect

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The decision (continued)

ØTo outsource BMJ Journals• To The Charlesworth Group

– UK company with Beijing typesetting operation– UK Point of Contact deemed very important

• Looked like best ‘organisational fit’• Recommended phased handover• Loss of eight staff through redundancy• Page price reduced by at least two thirds• Savings helped some failing journals

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Implementation Phase

Ø Following Exec approval

• New project – ‘Implementation’

• Same sponsor

• New project manager (me)

Ø New team

• BMJ Journals specific

• Kept Editorial presence

- Key stakeholder

- Expertise and buy-in

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Objectives

ØNew objectives:• Implement transition of BMJ Journals

typesetting– On time– Within budget– While achieving original objectives

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Methods

ØProject management techniques• Regular (structured) meetings• Clear actions and dates• Project plan• Risk register

ØUsed Charlesworth’s implementation experienceØPhased transition over 4 months

• Avoid big bang• Sensible phasing (journal frequencies; printers)• Resource still available in-house

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Considerations

Ø Managing the fear of change• Regular communication• Use project team to disseminate news• Training; support; documentation

Ø Don’t forget third parties• Keep them informed

– New workflows– New delivery methods– Timescales– TEST!

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The detail

Ø Major tasks included:• Creating more than 30 unique templates in

Charlesworth’s system (Advent 3B2)– Helped by detailed documentation (2002 Redesign)– Enormous effort to build and test / QA

• Creating new Word templates for copy editors– With simple installation

• Migrating covers to Charlesworth’s Quark system

• Imparting knowledge to Beijing via UK office– Chinese whispers?!

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The detail (continued)

ØCharlesworth dedicated project manager and senior software developer• Very professional• Eased the transition• Helped solve the mysteries of XML• Despite all this, there were setbacks, errors,

wrong assumptions, miscommunications …

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Developing ‘The Good Stuff’

Ø Autoproofing• Copy editors create typeset pages …• … and deliver to authors within minutes• Already developed in-house

– but on a small scale• Charlesworth helped us to:

– Refine– Develop– Integrate

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What is autoproofing dealing with?

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Key Successes

ØProject was on timeØ… and on budget

• No hidden / unexpected costsØOur journals are now XML basedØOverall process more integrated and

seamlessØHave continued to develop the workflows

and systemsØAdditional revenue stream realised (Online

First)

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Lessons

Ø Visiting was the right thing to do• Helped manage people’s perceptions of

working conditions, moral implications etcØ Don’t underestimate the size of the task

• Moving work is a big deal• Ongoing management of outsourced work• Schedule (and cost) regular visits / reviews

… From both typesetting review 2002 and copy editing review 2006

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Lessons? (continued)

Ø Refer back to ObjectivesØ Lots of Quality AssuranceØ Test as much as you can

• Deliveries to third parties …Ø Consider parallel working

• Cost can be prohibitiveØ Documentation and detail essential

• Be specific about requirements• Document workflows and methods for users

Ø Relationship can drive both organisations forward

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Lessons? (continued)

Ø Local point of contact pricelessØ Budget realistically – problems happenØ Allow time for contract approvalØ Risk analysis (pros and cons at least)Ø Communicate!!Ø Sense check resources; don’t be afraid to stop

and take stockØ Schedule and cost visits (remember how much

you’re saving…)Ø Take the opportunity to review processes and

workflows

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Thank you.