The reasons why publishers initiate a fulfillment conversion are varied: Cost savings by outsourcing a wheezing in-house system or renegotiating a contract with a vendor, converting a recent acquisition, or consolidating services under a single vendor. But no matter the reason, those who don’t compile a complete operational and financial picture of their fulfillment process for a prospective service bureau will likely suffer a painful conversion during what some fulfillment directors have called their single biggest career challenge.

Why Change?

Holly Panfilio, director, worldwide customer service and fulfillment for BusinessWeek, oversaw two conversions in five years. "We shut down in-house and moved to a fulfillment bureau and then three years later, we switched to another one," she says, adding that the moves helped her realize a significant savings for her fulfillment operation. But generally, moving fulfillment services out of house reduces overhead significantly. "That’s the beauty of being at a service bureau," Panfilio adds. "They handle all the overhead. By being in-house you obviously have employees, but you also have all the programs, the database;everything that has to be supported. You’re constantly having to upgrade that."

Devil’s in the Details

Preparing the RFP for fulfillment bureau prospects is not an easy task, and the more information you’re able to provide up front, the better off you’ll be later in the game. "My recommendation is to be as detailed as possible because you want to be able to give the vendors an opportunity to really understand your business," says Panfilio.

Shelley Shames, operations director at Working Mother, adds that these details are helpful in more ways than one. "That serves not only to get proposals that address what you need to address, but it also helps you walk through all the details of your file. That can also serve as a guide when you’re trying to actually do the conversion because all these things have to be addressed and you have all this information already."

Panfilio notes that important details include all the statistics that describe the business. "How many actives do you have on file? How many expires? How many calls do you get annually? How many e-mails do you get?" she says. "These are the basic things a vendor can look at and determine how large your needs are, how it might fit into their organization and whether they have the capability to take it on."

This is also your opportunity to note any unique aspects of your business: Special editions, label requirements, edition splits, incoming and outgoing mail processing. Also, pay attention to a vendor’s online order capabilities. "It’s evolving," says Panfilio. "Two years ago, PayPal wasn’t very big, now it is. Google is launching something similar. So look at where the bureau is with their online fulfillment."

During due diligence, form a conversion team that includes managers from your company’s various product divisions. Include anyone that has a stake in the data: Print, Web, events, marketing, and, especially, finance, which plays an important role in determining whether receivables and deferred income are in line. When you’ve made your selection, the various team members will be vital in helping to map your file’s various datapoints to the vendor’s database.

During this period, make sure you’re on good terms;payments and otherwise;with your current bureau. Your new vendor will need sample files from your old provider to initiate the conversion process. "You’ll want to be paid up so they’ll release the test file," says Shames. "And with smaller, less traditional services, the new incoming house may need to go directly to where you’re leaving to discuss data and you want everybody to be able to deal with that."

The Match Game

The conversion process begins after the vendor has run through the sample file, mapped the various data points and run test reports. This is where the details provided during the RFP stage pay off. The better the vendor understands your fulfillment systems, the better able they are to map the files and generate reports that make sense to you. However, pay close attention to those new reports. These include items such as deferred value, general ledger and order activity. "You want to make sure you understand the new reporting," says Carrie Landman, fulfillment director for Advanstar’s Superior Fulfillment division. "You’re going to get all these reports that don’t look familiar to you. Be sure to ask questions and understand how your data is reported in them."

Don’t Be Hasty

There are a variety of reasons a publisher might decide to speed through their conversion process. "I’ve seen huge files converted in two months," says BusinessWeek’s Holly Panfilio. "But I wouldn’t want to be on the outgoing end of that."

To plan your fulfillment conversion the right way, consider this timeline provided by Working Mother’s Shelley Shames:

  • Create RFP and receive proposals – 1.5 months
  • Review proposals, visit facilities, make decision – 1.5 months
  • Conversion (document and review of your business and operational requirements; complete programming testing and final conversion) – 2 months
  • Resolve post-conversion operational, processing and reporting issues – 3-6 months


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