‘The reason you get into digital print is because you love it’
Monday, August 10, 2015
There aren’t many things that worry ProCo managing director Jon Bailey, after all he’s made a career out of embracing change.
But there is one change that terrifies even this honorary Yorkshireman – the change from 39 to 40. However, despite middle-age looming, his passion for print, especially the digital kind, remains undiminished. In fact if anything, it’s stronger today than it’s ever been as the technology has finally got to the stage where the reality has superseded the promise.
And much like the digital technology he adores, Bailey too has matured over the past couple of decades. While he’s still got a good few years before he needs to ditch the skinny jeans for a pipe and slippers, his slowly advancing years have made him realise that the industry needs to do more to attract its next generation of leaders and look at ways of giving a stronger voice to those it already boasts.
Darryl Danielli How did you get into print?
Jon Bailey I started at an Alphagra-phics franchise; that was my introduction into the world of print. I helped set up the branch in Oxford. It was a fantastic foundation and a great organisation from a training perspective.
But you weren’t the owner?
No, I just did the work [laughs]. I then went down to Magnet Harlequin. It was a really exciting business. It was pushing the boundaries at the time, because it was transitioning from a repro house and was doing things like packaging, 3D modelling and digital photography. So I helped run the digital department down there for [then chairman] Gerry Bett, and he was a legend. We installed the first Xerox-badged Xeikon DC100. We did all the testing for the DC engine and then the original iGen, which was called FutureColor at the time. I suppose we were one of the first Xerox Premier Partners at the time.
And I guess this was around the late 1990s and digital was still in its infancy to a degree, so your lack of experience didn’t matter – because it was new to everyone.
Exactly, the first variable jobs were being produced. It was very early days though; things used to catch fire, bits were held on by tape to get the jobs out... The technology was very unreliable and the quality was terrible – but the concept of digital was incredible. It was really cool and exciting talking to people about the possibilities. That was where I really got into digital.
How long were you there?
Not long, maybe four years. Long enough to know I loved digital, and I loved working with Gerry. I’d had some bosses by then who, let’s say, left a little to be desired on the management skills – but Gerry was the one who laid my foundations on how to get people to work with you, not just for you. He taught me about giving people clarity, on rewarding performance, being fair and just.
And you came to ProCo afterwards?
Yes, in 2001. I’m a Cornish boy, but my wife’s family is from Middles-brough and we were starting a family ourselves, it was no more scientific than that. So we decided to make the move north. But like most of you Southerners, I didn’t know anyone north of the Watford Gap.
You Southerners? You’re from Cornwall.
But I’m an honorary Northerner now. Anyway, so I didn’t really know where to go job wise, but I knew I loved digital and the idea of using variable data to add value. It was so new, so cool. I remember when I did my first ever variable data job, it was for a car manufacturer, it was terrible, it looked awful, but the speedo moved for every customer – on that level it was brilliant.
Back then though there were probably a lot of people that got swept up in the possibilities of digital, but couldn’t make it work because they tried to make digital fit a litho model.
That’s true. You needed to change your mind set to make it work. A lot of people were getting into digital because they felt they had to, and that’s still happening today. But that was the wrong reason and it still is now; the reason you get into digital is because you love it, because you know what it can add. When we brought it in here [ProCo] it didn’t replace litho, it complemented it. And since adding it our litho business has grown every year. Digital really levelled the playing field, especially for someone like me. Suddenly I knew as much, and had the ability to know more, than people who had been in the industry a long time.
And you ended up in Sheffield how?
Ah, yes. So I told Magnet Harlequin I was leaving, but before I left there was a pre-arranged visit from a company in Sheffield that was looking to get into digital, we were a centre of excellence so it was fairly common. So to cut a long story short, my now business partner Mark Schofield and his team came to have a look around, so I gave them the tour...
…and turned on the charm?
And turned on the charm. I contacted Mark a couple of days later, and asked him who he would like to set up the digital print division of his business, The Production Company, and he said ‘you, if you’re up for it’.
So the charm offensive worked?
What can I say, I was in sales. So we sorted a three-month contract for me to come to Sheffield, get him up running, get the press in, get the team sorted and everyone understanding what digital was about and, most importantly, get it making money.
Making money in three months?
That was always the agreement – and then I would move on.
So it was only ever temporary?
Supposedly. I didn’t know the area, it was small, local business that had a traditional litho business and a direct mail arm around the corner, Production Direct. Then when I got here and started to appreciate what a solid foundation the business had, and saw its strong commitment to customer service on the litho side and data on the DM side. I quickly realised that there was a need to get the data guys understanding the importance of service, colour and quality; and for the guys who understood the colour and quality to understand the modern-day world of tech, digital and data. And I loved it.
And the digital arm was profitable in three months?
It was, otherwise I would have been sacked.
How big was the business back then?
Around £4m across both divisions, all local customers. I ended up staying though and after six months I joined the board, and then the big jump was moving here [to the current site]. At the time  we had two options: stay a local business doing all the great things we were known for or move and get into something a bit special to drive the business forward. I wanted to go forwards and Mark backed me, so we merged the litho, digital and DM businesses into one, moved to this 5,000m2 unit, a derelict Dixons warehouse that we had to completely kit out. But we made the move, got it up and running and made a few management changes.
Was that because not everyone on the management team bought into the changes?
I guess. They were probably just at different stages in their journey – one of the challenges of changing any business is that sometimes, if people have been living and breathing that business for a long time, they might not always buy into changing that basic model – which you can understand. So not every one decided they wanted to come on the next stage of our journey. That was a shame, but if there’s a fundamental difference in what is the right strategy for the business, then sometimes people have to make difficult decisions. But I believe they were the right decisions for both the business and the individuals.
Was it at that stage that you bought into the business?
Yes, and then over the years I’ve increased my stake. Now me and Mark jointly own the business, and since I became MD two years ago we now have a completely new board – all of whom have come up through the ranks.
Is that because everyone has to buy into the vision?
Exactly, but not as in agreeing with everything I say – the vision has to be something that we all have a stake in, not just the directors, everyone. Clarity is key. Everyone in the business from the top down has to be able to talk about how we deliver net profits and how their role benefits our bottom line – because every single person has an impact.
Does that openness spread to you telling everyone exactly how the business is doing?
Absolutely. 10% of all profits are distributed to the staff equally, irrelevant of whether they’re full-time or part-time or basic salary – everyone gets the same at the end of the year. The only people that don’t get anything are the directors.
How long have you been doing that?
We’ve just done it for the first time.
Where did the idea come from?
The HR team, I think. I’m dead keen on the integrity of the business, on being straight with people. I don’t want anyone here to be in any doubt about whether they’re doing a good job, or it’s not right for them. I don’t mean we’re soft, I just insist on clarity of expectations because that delivers performance. One of the first things I did as MD was make HR a positive function, too often HR is a negative function to clean up the mess of bad management.
Is turning negatives into positives key to maintaining growth?
I think things like profit-related-pay (PRP) and bonus-related incentives for all staff are really important for businesses like ours, because we want to invest in growth and keep going forward. But to do that we need to maintain the expertise in the business – so we need to make sure that we reward people in a sustainable, uniform, transparent way. That way everyone understands that we deliver together, we perform together, we get rewarded together. I want solid, steady, long-term growth – we’re not going to set the world on fire, some say that’s boring, but we’re not going to burn our house down in the process either.
And I guess focusing on not just growing sales, but also profitability is key?
You have to grow both. Sustainable growth is critical, month-by-month growth can go either way, but the overall trend has got to be upwards. That gives you investment potential, business growth potential and people growth potential, because you’ve got to keep your team going forward.
And PRP is central to that?
You’ve got to keep people interested. PRP is new, but we’ve also introduced other things in the past two or three years.
We’ve done a lot of work on departmental 90-day plans and individual 90-day plans, reading clubs for people and ProCo University, where the team can self-learn or sign up for training. We don’t force people to take training any more either, we allow people to sign up for any training, even if it’s not directly relevant to their current role. At the moment we’ve got two people about to sign up for an MA.
And everyone has a 90-day plan?
Every single one of our 127-strong team. We all have a 90-day plan, including me.
Who reviews yours?
The board. But every individual comes up with their own 90-day plan, and then their line manager reviews them every 30 days. Then every 90 days I go through everyone’s with their line manager.
But doesn’t that suck up a lot of management time?
It does, but the value it delivers back is tenfold. Because once you’ve done that period’s review there’s no interim management required because everyone is very clear on what they need to do. If someone told you that you needed to spend a week with a customer, but that after that they would give you £1m in business over the next three months, I guarantee that every single one of us would be able to clear our diary. But my 127 people are expected to give me £12m this year, a million more the year after and so on – so it’s time well spent as far as I’m concerned.
It’s still a big time commitment though, if you multiply it through the business.
I’m not pretending it was easy; it was a challenge in the beginning, of course. The first 90-day plans probably weren’t the greatest, but we’re two years in now and everyone sees the value.
And the benefits have been..?
The big one is that the whole team is so open to change now; they just take it in their stride and actually get excited about it. That’s massive.
Didn’t you make a lot of changes to the business’s sales approach a few years ago too?
That’s how the whole 90-day plans came about. I worked with Nick Devine [The Print Coach] and he helped me translate my vision into a format that everyone understood. He gave me a fresh perspective and that was the catalyst to rolling out the 90-day plans across the whole business. In fact it probably had a bigger impact on me than the sales team in some respects.
How do you mean?
Well, I’m really into my Braveheart speeches. I’m a hearts and minds kind of guy, but he made me realise there’s no point leading from the front if you might end up slowing some people down, because they just follow you rather than run with a concept themselves.
And I guess it helps you to maintain focus too, rather than just dropping random ‘ideas grenades’ and leaving the team to pick up the pieces?
[Laughs] Absolutely. It’s easy for a business leader to come up with an idea and then just throw it to the team and expect them to deliver. What I try to do is work with the team, give them clarity, give them feedback, and break an idea down to deliverables and make them specific.
Did you get some training to develop your management approach, then?
I’m a great believer in learning, because you can never know everything.
You don’t follow any specific business methodologies though?
I take lots of little snippets from different sources. One thing I realised fairly early on is that it’s easy to read a business book and then immediately drop ‘ideas grenades’ as you put it, but it does more harm than good and just confuses people. I do still read lots of business books though, audio books in the car especially, but as I get older I get less carried away. But anything that helps you look at your business from a different perspective can only be good. That’s part of the reason why I proactively encourage staff to read business books. We will pay for any business book they read provided they write me a summary of how it might impact their job. I like to find out what other people in the industry are doing too; I always try and visit people I think I can learn from.
Does that have to go both ways?
Absolutely. One thing I’ve always done is be very open about what we’ve achieved here and how we did it. I’ve always tried to share with the industry – we’ve never been a closed shop. People outside the business have sometimes questioned the wisdom of that. But I’m a massive fan of helping drive the industry forward. I’m not saying we’re perfect, but I really believe that being open has benefitted the business and also me.
Is that why you’re heavily involved with Dscoop?
Exactly. Specifically, I’m really focused on bringing in the next generation to the industry and that’s why I’m really excited by Dscoop’s young entrepreneurs programme. We’ve got a group of really keen youngsters who want to be heard and we’re going to do some exciting stuff to channel that enthusiasm.
Are you leading that because you’re the only Dscoop board member on the right side of 40?
[Laughs.] More than likely, but only for the next few weeks. It’s fantastic though. Industry-wide we need to do more to attract young people. You mentioned before we started this interview that one of the reasons behind the series is because so many people are down on the industry, when the truth is that it’s fantastic and represents a great opportunity that we’ve done well out of over the years. So we have a duty to bring some new blood in. We’re also now in a position, as an industry, where most of us have explored digital comms to support print, and now its about everything, not digital or print, but both. People are recognising that print technology can deliver what digital can’t, because it benefits from longevity and cut-through.
You’re obviously still proud to be part of the print sector then?
We’re still very committed. People thought we were crazy to take ‘print’ out of our name, because we initially rebranded as ProCo Print and then it just became ProCo. That caused a lot of teeth sucking, but what people failed to realise was that we love print, it pays the bills. What the change was about, though, was getting people to understand that print had to become part of the new world to survive and thrive. Everyone mistakenly thought we were falling out of love with print, but it was simply to make staff and customers understand that by embracing it all, it helps frame the right discussions – and print is a key part of them.
Does not having print in the name also help attract young people to the business, though?
It can be a struggle, simply because we’re not London – and there’s a massive talent pool down there. But wherever you are, it’s about having a virtual bench.
A virtual bench?
What I mean that we need to try and get into the mind set of always recruiting, rather than just doing it on a per-job vacancy basis.
So you mean sort of passively recruiting, so if you come across someone that you think is a good fit, you would take them on regardless?
Or just know where they are when we do need them. We don’t necessarily know what skills we’re going to need in two years’ time. All I know is that it can be hard to find people with the right cultural fit, have the ability to get on and do it and the right brainpower to understand where we’re trying to get to. Finding all of those things can be tricky if you go to market to look for them at a specific point in time – but if you’re always looking, then you might.
And then spend some time subtly selling the ProCo dream to keep them warm until you have a role?
Possibly. Although we’re now getting to a size and profile when people approach us to join, which can cause its own problems.
Well I guess we portray a certain casualness. But we’re never casual. It’s tough here and everyone has to be really focused, but we also work hard to make it look effortless. But trust me, it isn’t. We expect a lot from our people, but we make sure we give them the tools and support to deliver, but there’s nowhere to hide if they don’t. One of my biggest challenges as the business grows is to make sure I recruit responsibly – I owe it the people here that have helped create this business.
On that, how does the dynamic between you and Mark work?
Well, he’s chairman and I’m the managing director. He spends a little less time in the business nowadays, but it works really well. He has this unique ability to get right to the point very quickly, we have a great relationship.
It almost sounds like, even though he is a joint owner, he is more a very involved non-exec?
That’s exactly what he does. He’s very focused on production and detail, which clearly aren’t my strongest points – so our skills are very complementary. We work in very different ways, but we’re very aligned in core values and what we want to achieve.
And what are your ambitions for the business?
They’re constantly evolving. We’re nowhere near the finished article as a business though, we’ve got a long way to go. I’m very proud of what we’ve achieved as a team to get this far – but I’m under no illusions that there’s a lot more work ahead. But that’s really exciting. I think we’re on the edge of greatness, it’s just that we’ve been on the edge of greatness for 15 years.
You guys acquired a 50% stake in Concept Communications last October, are you looking at any other acquisitions?
It’s a bit like recruitment, it’s always ‘on’ - but nothing specific at the moment.
What was the reason behind just buying a stake in Concept though and not buying the business outright?
Running it as a partnership just made sense and it’s working well, better than we could have hoped. I’ve really benefitted from Giles [Bowes, Concept managing director] and his team’s input too. Besides, it’s really nice to have another managing director to discuss things with – and he’s just turned 50, so you have to look after the older generation [laughs].
Obviously you’re an equal partner in ProCo, but have you never wanted to do your own thing?
I always said that I wanted to run my own business by the time I was 30. But by the time I was 30 I had been a director here for a while, so that kind of satisfied that itch. And to be honest, since the changes here with Mark and my roles, I sort of feel that I am doing my own thing – but either way, if I had built a business from scratch, this is exactly what I would want it to look like.
What are the industry challenges?
Margin, obviously. But as customers see that print adds value and printers realise they add value, then in theory we should see the value proposition go up – and I think we are starting to see that. But we as printers should be driving that. The sector talks about active account management, coming up with ideas, but do we really do that enough or could we do more? It’s no coincidence that the businesses that are most active in going to customers with ideas are the ones that are thriving.
I can see that, but if you’re stuck in a commodity market, it’s not quite that easy.
That’s true. We’ve worked hard not to be in that space, but I can’t get cocky and pretend it might never happen. The market changes very quickly and it’s easy to get caught out. Any market in any industry has the potential to very quickly become a commodity sector. We don’t get anywhere near the same price for a digital sheet now that we used to get 10 years ago – despite the fact that the quality is a million miles away now. You could install the latest technology that can do something that no other machine can and I can guarantee that before you’ve finished paying for it that market will be commoditised.
So what the answer?
The one thing that is hard to commoditise is your people: how could you commoditise mind sets, creativity or an outcome?
Last question. I remember you once described yourself as a reluctant sales person, is that still true?
I am a reluctant sales person, but I love selling. Nothing generates more of a buzz for me than when you’re talking to a customer and you see in their eyes that they suddenly get it. I’m a reluctant sales person from a volume point of view, but when it comes to talking to customers, understanding their needs and developing solutions – I love that. That’s why I spend 50% of my time in front of customers, even though I’m not in charge of sales. And that’s why we have cardboard cut-outs of customers in the boardroom, so that we’re always thinking about what our customers would want us to do.
Do you really cardboard cut-outs in the boardroom?
Do they know?
They do now.