TOC – Inventory on Demand in the Digital Age

Inventory on Demand in the Digital Age

Panelists:  Laura Baldwin, O’Reilly Media and Phil Ollila, Ingram

Laura – reality of our biz, print and retail is still the bulk of the business. Print erosion cost, shipping costs, printing expenses, safety stock, operating capital are all factors in the profit/loss of publishers.

Strategically they wanted to deplete the amount of inventory and instead, make content available anywhere/anytime in a variety of formats. People expect faster cycle times (and not only in production).

Freedom plan – determine how to spend the capital.  Offset/digital short run (much smaller print runs, focused on shelf space awareness), back it up with print-to-order, combined with great forecasting tools.

How?  With a new model – total inventory management rationale – includes short-run, POD, breaks down into three rationales.  Financial – frees up the capital and offers very short update cycles. Relevance – continuous publishing, want faster concept to consumer (6 weeks instead of 7 months). Reach – combination of a distribution network with POD capability.  Old model – 15 steps (lots of boxes and trucks) and the new model – 7 steps.  By removing 1/2 the steps, you free up the capital involved in those steps.

O’Reilly’s vision – always available, always relevant, and never out of stock.

In order to institute this model, you have to crunch the numbers, have to know cycle times, etc. etc. It was all about data and it took a long time to prepare.

What’s more important? Product specifications or product relevance?  Don’t get wrapped up in the old way and make sure to think about what the audience needs.  Allow yourself to think out-of-the-box.

Freedom = sales growth, cash flow and digital discipline (make sure your internal systems can actually do what you tell people you can do)

My notes are my interpretation of the panelists comments, my best effort was made to ensure accuracy.