Outsourcing helps to meet user needs

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There is a trend towards sub-contracting to save money. But Elsevier's chief information officer, Tony Coorey, believes that outsourcing can help publishers offer more to their customers

The original view of a disruptive technology, as coined at Harvard Business School, was that it spelt doom to big, mature companies. Because they didn't understand the potential of the new technology, they risked being blindsided by smaller players who got the message and were prepared to take on the challenge, whether it brought success or failure.

The problem is not that older organisations don't innovate but that their innovation efforts are, by instinct, incremental. They are reined back by financial caution and, sometimes, structures and cultures that are averse to innovation and reward prudence.

Publishing has been exposed to disruptive technologies more brutally than many other industries because the web has overturned the way we use and pay for information. Our daily internet experience constantly sets new benchmarks for speed, shareability and richness of content and features.

But the solution is not simply to throw the problem to the IT engineers and expect a solution in five weeks. All publishers face the same challenge of addressing what the customer actually needs and wants, not what we and the engineers think they want. It sounds simple but it has taken some hard lessons to move from the idea to the practice.

From opinion wars to user centred design

The first step for Elsevier was to get away from what we call our 'opinion wars', where different people had different ideas about what customers want. Our products are used by a broad spectrum of people: undergraduates, post-doctoral researchers, medical practitioners and information specialists. They all have different needs and competencies. To really serve them, we need evidence, not opinions.

So what's the answer? The traditional way to check whether you're on target with customers is to buy some market research. This throws up plenty of information, some of it even useful! But it tells you what people say, and maybe what they think. It rarely shows how they actually behave.

And it is behaviour that is important in considering the user interface of an information product. In real-life tests, we have sometimes had to stop our product managers berating users for their failure to understand a product! If customers don't understand how to use something then it isn't designed properly, so knowing how our customers will engage with a new product is precious information.

In fact, this information is so precious that we re-organised our company's internal structure to help unearth it. The result was our User Centred Design Group, which has around 25 people. This team has worked out how to give us some robust insights into the nature of our customers' tasks, how they undertake them, and how we can optimise that process and make their behaviour more efficient.

Field studies, diaries and observation are key for this task. They answer questions such as: How long do people log in for? What time of the day? What sort of visualisations work best? How much information can the eye absorb on one screen? For all the different professions using our sites, what are the common features that we can engineer for?

Beyond these observations, we get feedback from actual customers. To make this feedback come alive, we turn it into 'stories' that give short descriptions of something a user wants to get from the system. This enables the engineers and designers to work towards people, not abstract 'requirements'.

Delivering the goods

All this user insight is very valuable in deciding what developments are needed. However, the technology changes actually need to be implemented before the users can feel the benefits of the research. And this is an area of major disruption in the industry. All publishers struggle to contain costs. Most books are probably now printed in Asia, for example. But the changes in book publishing are simple compared to the challenge facing publishers of learned journals.

At Elsevier, each year we get over 500,000 article submissions, and issue 250,000 new refereed articles and 2.5m journal pages, embedded in 1,852 journals. We handle 6.5m author/publisher communications. We maintain 180 years' worth of back issues, scanned, processed and tagged. Although Elsevier is larger than most, the challenges it faces are probably representative of the industry as a whole: output is growing, journals get bigger, demand for rapid delivery escalates, yet all content must be checked, securely archived and searchable for eternity. There are few other publishing ventures on this scale.

A major element of the workflow is typesetting. Of course, no-one is now retyping handwritten manuscripts and converting them into lines of hot metal to be inked and applied to paper. Authors' manuscripts are born digital, and see the light of day (if accepted) as digital products too.

But there is still ink and paper. A mere 10 years ago, like all in our industry, the vast majority of our products were exclusively on paper. Now, although the incoming files are electronic, the output is both on paper and digital. This doubles the production and distribution challenge. And, although our subscription rates do rise, the price per article downloaded has declined five-fold, journals are bigger, articles are packed with searchability features and production times are shorter.

The rise in outsourcing

So how are all these costs kept in check while still endeavouring to meet user-needs? The answer is outsourcing. Just 10 years ago, we did half our typesetting in house, and over three-quarters of the rest in Europe. Now, we do none in house, almost none in Europe and over three-quarters in India and South East Asia. We're doing all this with only 10 suppliers, compared with over 70 in 1995.

It is obvious that this reduces - but does not eliminate - the cost of supplier management, risk control and quality control. But our outsourcing is not a simple unloading of repetitive human skills activity to a low-wage economy. If that's how it started out, it certainly didn't stay that way.

The growing partnership with our suppliers means that we now involve them in much more than keyboard work (see box). Like many other journal publishers, we are now taking full advantage of their growing IT, software and process-management skills, to the point where they are doing things not just cheaper but often better.

At first we developed the process tools and quality control tools ourselves. Now, we are asking our partners to develop these tools for us. In fact, it is a condition of their staying on our roster that they commit themselves to a process of constant innovation and long-term partnership with us. In return, they share with us the benefits of economies of scale that this progress generates.

The technology continues to be 'disruptive'. It throws challenges at this industry without a break. And although most of our customers, sitting at their screens in lab, library, study or clinic, will not see how it works behind the scenes, they can be reassured that the learned publishing industry is probably leading the world in exploiting technology as it presses forward.

Off-shoring - SPi's experience of providing support services to Elsevier

One of Elsevier's leading off-shore partners is SPi (www.spi-bpo.com), a company that delivers business process outsourcing (BPO) services for many university and learned society journal publishers from its offices in India and the Philippines.

SPi's relationship with Elsevier started with entry-level hard copy data entry work in 1982 and Elsevier was one of SPi's first customers. The relationship has evolved today to include multi-year, multi-million dollar, IT-enabled global outsourcing solutions.

With Elsevier's training, mentoring and knowledge sharing, SPi was able to build its capabilities and move up the value chain. This enabled SPi to work on processes and perform services that were never offshored before. And, in 1997, SPi actually purchased NorthPrint - the Dutch pre-press operations of Elsevier - and migrated the typesetting work offshore.

The landmark in the development of a true partnership between the companies was a multi-year contract to digitise the legacy content of STM journals for delivery via Elsevier's online database ScienceDirect. This involved converting over 30 million pages of hardcopy, microfilm and non-standard format e-files.

Now on a regular basis, SPi is integral to Elsevier's journal production process, offering services such as pre-editing, copy editing, generating master copy, language polishing, composition, creating covers and graphics, operating the peer review help desk services, and running back-office electronic submission support communications.

So how does the partnership work? Although most dealings between the two companies are done via email and conference calls, face-to-face discussion still plays a crucial role - especially in the start-up phases of new projects, and in new service incubation and transition.

SPi sends key teams to various Elsevier locations in the USA and Europe to learn processes, undergo training and establish communication protocols. These onshore programmes usually range from one week to a few months. Ernest Cu, SPi's chief executive officer (pictured), said: 'It is our experience that putting a face to a name helps smooth our day-to-day communication and deepens relationship with Elsevier staff. I would categorise our relationship with Elsevier as a true partnership.'

In the other direction, Elsevier sends trainers to the Philippines and India to train SPi staff on processes and workflows. They also deliver training, mentoring and coaching to the SPi team that would be undertaking the project.