Volume 8 — Summer 2002

In this Issue:  Best Practices — Outsourcing —  Management Moves — News

K. Michael McKenney, Manager of Rockwell Automation’s RA Studios/Avid Communications business unit in Eastlake, Ohio (and a CMMA member) is one of the commentators for a Case Study which appears in the April 2002 issue of the Harvard Business Review. This case study deals with the problems involved in converting an in house marketing services department to a profit center. Michael’s team successfully did just that at Rockwell. Their organization now has a staff of 45 operating at four sites in two states. This case study is a "must read" for any media manager considering such a move.

Mark Shelton of Roadway Express, Akron, Ohio told us he uses an investment life cycle tool available from our affiliate Imaging Futures, to measure the return on the company’s investment in marketing communications media. We’ll be looking for more information on that definite best practice a bit later on.

Procter & Gamble has reduced their in-house media services staff to 16 as they move to an outsource model for many technical and professional services. P&G’s operation was profiled in our 1996 study of outsourcing as a model of how to move specific capabilities from an outsource to an insource status.

The American Red Cross has closed down their 27-year-old video production facility in Falls Church, Va. The staff was reduced from nine to one, leaving Craig Reintertson, long-time manager and executive producer, to buy services in the Washington, DC metro market from his new downtown location in "cubicle city." The issue of relocating the studio to a new headquarters building or moving to a full outsource model had been under consideration since January, 2001. This facility typically produced some 200 projects a year, including satellite broadcasts. Their work in connection with the 9/11 tragedy was reported in the trade press.

Northwestern Memorial Hospital, Chicago, has been gradually trimming their media services organization for well over two years. The staff of 10 was down to 4 by last January, all of whom were then converted from employee to contractor status. This summer the final step will be to outsource the function to MOVCO Media Productions, Inc. MOVCO will rent 660 square feet (down from 3,400) in the main hospital building. A total of 5 staff will handle all medical illustration, electronic imaging, digital photo production, digital presentation production (posters, signs and slides) and customer service. MOVCO was formed out of the former Chicago Rehabilitation Institute in-house media services group.

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Management Moves

Kim Cloutman, formerly manager of Video Communications at SNET in New Haven, Connecticut is now Manager, Corporate Media Center at Norfolk Southern in McDonough, Georgia. Kim replaces Maynard L. Knestrick who received a "golden" early retirement opportunity in 2001. Kim's position at SBC was eliminated when the SNET operation was downsized after the company was bought out by SBC in 1999. Maynard launched Business Communication Solutions and has been providing consulative services to several clients. Maynard can be reached at 770-477-5636 or 770-853-5636 or email at BusCommSol@aol.com.

Len Magsamen left the position of Manager of The Home Depot’s extensive video production operation to become Assistant Vice President of Video and Technical Services at USAA, San Antonio, Texas. We feel both departments are truly world class. Shortly afterwards, Rob Hallam, Director of Internal Communications at The Home Depot moved to Washington Mutual Insurance in Seattle. Rob built The Home Depot satellite network (HDTV) and moved on to head up all of internal communications. At the time he left Home Depot was developing an integrated communications strategy designed to deliver consistent messages to all internal and external stakeholders.

We recently learned that Cameron Sanders, formerly Assistant VP at A.G. Edwards in St. Louis has left the company to form his own production and consulting firm. Cameron, who is also President-Elect of MCA-I is currently working on a book, Creating Digital Media, due to be published by McGraw Hill in the fall.

Marilyn Reed took the Merrill Lynch buyout this past December. We’re not sure just yet what the status will be of that venerable network. Marilyn is looking at independent production opportunities.

Clif Brewer is leaving his position as Associate Director, Video/Creative Services at Bristol-Myers Squibb to become director of multmedia services at Campbell Soup Company. We wish Clif a lot of luck in his new and challenging assignment. So far no word on whether Bristol-Myers Squibb's financial problems have had any impact on media services, but it certainly would not be unexpected.

Brad Lund has joined the staff of the Unisys Corporation to manage their BTV network and video production facility in Blue Bell, PA. Brad had been responsible for building the Square D network and then moved over to the production side of the business before landing the position at Unisys.

We regret to report that the positions of Gene Kutina, Director of Communications Media at CIGNA in Philadelphia, and his associate John Dombrowski were eliminated as of late August. In recent years the function had been scaled back as the insuror re-organized its business lines. Here are two more high quality media managers available to help add value to other corporate media departements.

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Consolidations/Shakeouts and Expansions

►New Corporate television studios are still being built, though the function now is directed more toward video streaming than conventional videotape production. Cisco Systems opened a four studio complex in Santa Clara, California this past January, which now reportedly does about 30 live video Webcasts plus another 400 video-on-demand projects a month. In Madison, Wisconsin, American Family Insurance is installing a second digital studio, which will join their primary facility in producing Webcasts aimed at their diverse sales force spread over a 17-state area. In both cases these studios have been justified based on increased demand and the comparative cost and inconvenience of using outside facilities. Sounds like a familiar story to those who build the first round of corporate studios back in the 1970s.

►According to the June 26 issue of TV Technology, NFL Films has just completed their new 200,000 square foot facility which includes film and television production and post production. This is to accomodate a huge and growing volume of material being received, edited, retransmitted and archived. NFL Films operates in every conceivable medium including Webcasting and DVD. NFL rents out their current facilities and VYVX connectivity to corporate clients on an occasional use basis.

►SPL Integrated Solutions recently bought the V-Tel videoconferencing integration business from Pierce Phelps’ of Philadelphia one of the largest media systems integrators in the country.

►Diversified Systems, Kenilworth, NJ has bought Digistar Networks, Pittsburgh-based satellite television services provider and integrator. That is definitely a move in a different direction for Diversified, primarily a media systems integrator. However, John Melillo, who formerly headed up Business Television operations at General Public Utilities (GPU), heads the Diversified Consulting and Management practice.

► AT&T had sold its Basking Ridge, NJ corporate headquarters to pharmaceutical company Pharmacia. However, since Pfizer has now bought Pharmacia the word is they will be trying to resell the AT&T building. Most if not all Pharmacia management functions will be relocated to New York. Pfizer, like Pharmacia, relies heavily on outsourced media services with no apparent centralized management of the function.

The AT&T Learning Center located on the property will be converted into a public facility to be called "The Inn at North Maple." It will continue under the management of Benchmark Hospitality. We have no information as to what resources AT&T will retain in house and what will be outsourced when they relocate their staff later this year.

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Last update: 01/02/03