Publishing Industry
Publishing Industry
Problem Analysis        Richards’ cryptic directive to Ash it to “fix it but don’t break it” conveys the sense that change must occur while at the same time preserving the core of Printzhof’s culture and legacy strengths.  A closer examination of the opportunities and threats in the external environment along with an assessment of Printzhoff’s internal strengths and weakness will provide a clearer understanding of strategic change challenges facing Ash.        Like the rest of the publishing industry, the college textbook publishing industry has undergone tremendous changes as a result of a rapidly changing environment.  Many of these changes present dual threats and opportunities for industry competitors.  The digital revolution and the growth of ebooks poses a significant threat to publishers who do not have the technological savvy or marketing capability of moving directly into ebooks.  Ebooks can be published more quickly and at lower cost than traditional print books.  They can also be rapidly distributed directly from the publisher or via third parties such as Amazon.  They pose challenges, however, in terms of copyright protection and distribution.  End-users (students) may prefer etextbooks because of their somewhat lower cover price, zero shipping costs, and immediate accessibility.  At the same time, surveys suggest that 75% of college students prefer using print textbooks over etextbooks, a finding which suggests that there are still opportunities in publishing printed college textbooks.  The digital transformation has also affected the traditional author-publisher relationship by giving author’s more opportunities for publishing their work, including self-publishing.  The digitization of book publishing has also attracted the attention of high tech firms outside of the traditional publishing field (e.g., Apple) as well as e-savvy firms with existing ties to publishing and these firms may emerge as direct competitors to traditional publishers.        Although Printzhof emerged as a top academic publisher in conjunction with one of the first big waves of higher education expansion in the mid-20th century, in more recent years, there has been a further proliferation of higher education venues and modalities and an exponential expansion of the college-attending population.  Associated with this has been the rise of the “student as customer” and the trend among institutions of higher learning to cater to the needs and demands of students, rather than simply presenting curriculum for students to absorb.  This has increased pressures on publishers to constantly update their materials, as well as to publish a broad range of ancillary materials in a broad range of multi-media format.  The expansion of higher education also calls into question the supportability of Printzhof’s “publishing rep” sales model, given the difficulty and expense of funding multiple specialized publishing reps across such a broad expanse of schools.
The changing environment has also expanded demand for custom textbooks which take advantage of new digital technologies and offer the potential for institution, program, and course-based “customization”.  From the publisher’s standpoint, this may pose some initial logical and development challenges, but it also offers the potential to expand sales while delivering a customized product to satisfied customers.        For many years, Printzhof and the other elite academic publishers were relatively insulated from economic downturns.  Most of the individuals pursuing higher education at the sort of elite schools where Printzhof sold its books were either wealthy or had no hesitation about investments in education, including investments in expensive textbooks.  In recent years, however, economic factors have been a major concern for all college textbook publishers, especially as the basic costs for attending college (in terms of tuition and living expenses) continued to spiral upwards.  Over the past few years, growth in sales has stalled among the major college textbook publishers, and profits have shrank slightly (Economy to keep market challenging for publishers, 2009).        For many years, Printzhof’s key strengths have been its strong relationships with authors, its strong relationships with key customers built through its “publishing reps” sales model, and its good employee relations and strong corporate culture which have kept turnover very low and employee satisfaction high.  As long as the market stayed the same or didn’t change too much, these strengths served the company quite well.  Printzhof has been extremely slow to adapt to the changing market environment, revealing an inflexible corporate structure.  Printzhof’s traditionalist corporate culture seems to reinforce “groupthink” and advance the mantra “if it isn’t broke, don’t fix it” coupled with the mantra, “it’s not broke, everything is fine”.  Another major weakness at Printzhoff which has been exacerbated in recent years is the cost structure.  The “publishing reps” system has proven to be quite expensive.  Moreover, there is a general lack of employee accountability that appears to spread from the top level down through the ranks.  HR is not oriented strategically, but rather focused purely on old-fashion personnel transactions.  The system of “performance appraisal” is little more than a system of meaningless rubber-stamping.