Digital Directions: "In-sourcing" Production and Design

Publishers historically have been an inventive lot, with a broad array of skills and a can-do attitude. In the early centuries of publishing, they did whatever was required to put words on the page and into the hands of readers. Gutenberg was a goldsmith by background. This gave him the ability to create moveable metal type, the core technology behind the press. Subsequently, for generations of publishers, the smell of hot lead was in the air.

In the late 19th century, Cincinnati was a media epicenter with a robust book publishing industry to rival New York. Publishing entrepreneurs realized that Cincinnati had two critical ingredients: a transportation infrastructure (in the form of the Ohio River) to distribute print product and copious amounts of pigs' blood, an essential component of 19th century printers ink, thanks to the thriving slaughterhouses of "Porkopolis." Enterprising publishers saw the opportunity, mixed the ink, printed the books and shipped them off on river barges. They had vision, gumption and plenty of elbow grease.

Times changed. Cincinnati lost its mantle as Pork Capital to Chicago, and that of Print Capital to New York. And so it goes.

Another significant trend over the following century was the realization that publishing organizations did not in fact have to do it all themselves. As publishers refined their business models and sought higher levels of economic performance, they realized that doing everything in-house was not always the most profitable path. It was often more economical to use the services of an external vendor. To achieve greater profitability, publishers created and maintained a rich network of vendor relationships.

The most obvious example of this is printing. As the complexity and expense of printing presses increased, it became less practical for a publisher to own its own print operation. It was advantageous to use the services of a commercial printer. Publishers typically did not generate enough consistent throughput to offset the capital expense and operating costs of complex printing operations. Commercial printers represented a shared infrastructure that could aggregate demand and therefore drive down the costs of printing to the publisher.

Publishers realized that the ownership of printing presses was not core to their mission. What was core: acquiring and developing works for publication, as well as marketing and selling those works. Others could do non-core functions such as printing, shipping… and mixing ink from pigs' blood.

Other functions followed suit. While sometimes the source of heated polemics, today it is often the case (if not the expectation) that book design, composition, packaging, even manuscript editing, is performed by external service providers. The rationale is the same as outsourcing printing: Non-core functions are often more economically handled by external service providers.

With the advent of digital publishing, additional functions also became outsourced, such as the conversion of print titles into ebook formats. This conversion process is often viewed as non-core, and therefore appropriate for outsourcing, preferably taking advantage of lower offshore labor costs.

In many cases, outsourced service providers connect directly with one another to create an externalized production flow. For example, an external compositor may send the final PDF files used for print to an ebook conversion service provider. The publishing staff therefore assumes the role of an orchestrator of vendors, never actually directly performing the tasks involved in creating digital products.

And therein lies the danger. If publishing organizations remain outside the direct creative process, they have a limited ability to impact product innovation. It is oftentimes the case that vendors are learning essential skills related to digital publishing, such as the creation and management of cascading style sheets, and not the publisher. This creates a high level of dependence upon vendors.

Publishers are in the process of defining the nature of their digital offerings. Most recognize that simply offering e­books that are digital versions of print products is insufficient. If publishers are not immersed in the details of digital production and design and are dependent upon service providers and channel partners, they will lack the ability to meaningfully shape the future. The nature of their offerings, and therefore their role in the digital publishing landscape, will be defined by third parties: the Apples, the Amazons and the Inklings of the world.

There is an alternative resourcing strategy emerging, however, in which design and production are shifting back to internal publishing teams. Forward-thinking organizations, such as Hachette and Source­books, have emphasized the importance of having staff more directly involved in the production process. This "in-sourcing" is made possible by deploying strategies that leverage content standards and technologies that provide high levels of efficiency—thereby driving down costs and the dependence on low offshore labor costs. These efficiencies, which automate routine tasks, allow them to move away from external production services and bring creative tasks back in-house.

The benefits are manifold. By having creative production occur down the hall from editorial and marketing—instead of half a world away—greater collaborative development can take place within the walls of the publisher. This creative collaboration is necessary to drive the innovation needed to define and shape the emerging characteristics of their digital offerings. This innovation, which must be driven by the publisher, cannot take place with production and design functions primarily outsourced.

By bringing production and design back into the organization—and therefore enabling ongoing, iterative product innovation—publishers will not only take back control of their digital destinies, but in the process become more dynamic and energized places of work. BB

Andrew Brenneman is founder of Finitiv, which provides publishers with cloud-based services, mobile product development and digital strategy consulting.