Mar 25, 2008
HVTO Q&A:
Vincent De Palma
Executive Vice President, Pitney Bowes
President, Pitney Bowes Management Services
Part One: Talent and Experience---Owning the Mailstream
By Andy Plata, OutputLinks Publisher
For Pitney Bowes’ Vincent De Palma, Pitney Bowes Management Services (PBMS) is an exciting business in the midst of transforming itself from primarily a provider of labor-based solutions to a provider of high-value technology-enabled solutions.
De Palma is president of PBMS and an executive vice president at Pitney Bowes. He leads the PBMS organization, delivering leading-edge mail and print services and document management solutions, including document creation, statement processing, electronic printing, scanning, storage and on-line retrieval to government agencies, the American Legal 200 and many of the Fortune 1000.
At PBMS, De Palma directs the development and implementation of strategies that deliver high levels of customer satisfaction and retention, and identifies creative and profitable new solutions and services for PBMS.
With Pitney Bowes’ announcement in Q4 2007 that it was taking strategic actions aimed at enhancing shareholder value, OutputLinks spoke with De Palma to learn more. At the time, Pitney Bowes announced that it was taking a comprehensive review of the company’s business portfolio and that it decided to explore strategic alternatives to determine the best course of action for its U.S. management services business.
Today, the PBMS organization continues as a strong leader in the industry, poised for new levels of growth and an additional range of solutions for the high volume transaction output industry.
Question:
Vince thanks for your time today. Tell us a little bit about yourself and your position within Pitney Bowes Management Services.
Answer:
I joined in June of 2005 as president of PBMS and, prior to that, I was with ADP as president of Benefit Services, which encompassed all the “beyond payroll” products that ADP had to offer. Before that, I was with a Connecticut and New York-based firm called Petroleum Power Company, where I was a general manager. And prior to that, I spent 12 years at McKinsey & Company, where I led consulting projects for Fortune 500 companies in the industrial sector.
Question:
You have quite the background. Tell me how your past experience has led you to your current position at PBMS.
Answer:
One of the first things we focused on, Andy, was putting in place a high-value solution for our customers to help them control their costs, optimize their business processes and grow. Over the last two and a half years that I have been here, we have launched five bundled solutions to the marketplace---Pitney Bowes MailWorks™, Pitney Bowes PrintWorks™, Critical Communications Solutions, Document Processing Solutions and, Litigation and Document Services.. So, I think that leveraging some of my work experience and some of my previous opportunities have helped me put in place bundled solutions that integrate our hardware, software and other services. These solutions help address our customer's most critical pain points and play into their mailstream processes. Changing our strategy from being a provider of labor-based services to a provider of high-value, technology-enabled solutions is probably the most significant accomplishment we’ve made at PBMS over the last couple of years.
Question:
I assume that your background at ADP and at some of these other firms has led you to understand the needs of these kinds of services.
Answer:
Yes, I would agree. My background with ADP is in the outsourcing business, and that’s what we do at PBMS. We are the outsourcing arm of Pitney Bowes, and if you went way back in time, a large part of what we did was run the mail centers for large corporations -large law firms - federal and state agencies. But we’ve really migrated over time to a much broader portfolio of mail, print and document management solutions that solve our customer’s needs, whether it be the inbound or outbound processing of mail or the internal handling of mission critical documents. We have a much broader portfolio of offerings today than we did a few years ago.
Question:
Vince, when I talk with people in the marketplace, PBMS is often considered the provider of choice for some of the most critical and sensitive government documents. Why is this?
Answer:
A very specific example of what we do at the federal government level is connected to the anthrax problems that impacted the mailing industry in 2001. We had to immediately provide training to our employees on how to detect and handle suspicious mail. We worked very closely with the federal government in developing mail screening solutions and processes to detect and deal with chemical and bio-hazard contaminants. In the case of one of the agencies, the initial processes mandated by our customer caused delays in mail delivery, mostly because they were new and untried. To address this issue, we installed a digital mail solution that can actually do the screening and digitizing of the mail without causing delays in getting it to the intended recipient. Then, once the test results verify that the mail is safe, we can release the physical mail to its intended recipients. That's an example of the type of solutions we are providing in the federal government space that have earned us the high reputation you referenced.
Question:
There has been news about possible ownership changes at PBMS. Can you tell us about what you have experienced over the last few months as people ask you about a possible sale?
Answer:
Back on Nov. 15, 2007, Pitney Bowes President and CEO, Murray Martin, announced that the company had retained outside financial advisors to consider strategic alternatives for the U.S. management services business. We think this is an important step in our evolution as a mailstream and document processing solutions provider. The PBMS business is a strong business and Murray Martin is looking to see where the greatest value can be created for shareholders - whether that's continued ownership by Pitney Bowes or perhaps PBMS being sold to another entity.
I have had many conversations directly with clients, and certainly with employees, and I would tell you that the clients we’ve talked to have, first of all, appreciated how proactive we have been to explain the process we are going through and our commitment to them, and to delivering the solutions and services that we do on a constant basis. We have reassured them that nothing has changed with respect to our day-to-day operations. Our employees are still delivering the high quality service to our customers that is consistent with the PBMS culture of putting customers first.
Customers have reaffirmed their commitment to working with us and have basically said, “Look, what you provide us are very talented employees, great processes around the mailstream and great mailstream technology.” If there is a transaction or a name change, what's in a name change? We are still going to be the leading providers of business process outsourcing, a leader in e-discovery and litigation support, and a leader in providing secure mail solutions. I think everyone realizes we could emerge from this process even stronger than today.
Question:
So it looks like you are actually looking at options both within and outside the company. Is that correct?
Answer:
That is correct. One of three things could emerge from this process: We could possibly be sold to another company, we could be spun off into our own separate entity or we could remain part of Pitney Bowes. Our intention, regardless of the outcome, is to continue our investment in this business, to accelerate our growth and to continue to create advanced solutions for our customers.
Watch for part two of this discussion and learn how Pitney Bowes Management Services strives for excellence as the No. 1 provider of outsourced services in the mail, print and document management arena.
To learn more about Pitney Bowes >>>>.
Watch for Part Two --- “Striving for Excellence as the No. 1 Provider of Outsource Services in the Mail and Print Arena.”
HVTO Q&A:
Vincent De Palma
Executive Vice President, Pitney Bowes
President, Pitney Bowes Management Services
Part Two: Striving for Excellence as the No. 1 Provider of Outsource Services in the Mail and Print Arena
By Andy Plata, OutputLinks Publisher
In part one of this two part series (scroll up for part one), Vincent De Palma spoke about Pitney Bowes Management Services (PBMS) and how it’s in the midst of transforming itself from primarily a provider of labor-based solutions to a provider of high-value technology-enabled solutions. DePalma is president of PBMS and an executive vice president at Pitney Bowes.
Part two continues the discussion and looks at PBMS’ strong future in the high volume transaction output industry.
Question:
Vince, where do the core strengths of PBMS align best with the core strengths of Pitney Bowes at this time?
Answer:
Andy, PBMS’ core strengths align with Pitney Bowes in four areas: First is our talent. Our employees are our greatest asset, and we pride ourselves on the training we provide them. That is certainly something Pitney Bowes believes in and PBMS believes in as well. Second, is our technology-enabled services and solutions. Third would be our extensive experience and expertise in the mailstream. That’s Pitney Bowes’ heritage and that's where PBMS got its start. And, last but not least, our commitment to our customers. We truly believe in being customer centric, in putting our customers first. That's a Pitney Bowes value and that's a PBMS value as well.
I would say that Pitney Bowes’ and PBMS' core focus is in owning the mailstream, but we both focus on different parts or different ends of the mailstream. Pitney Bowes’ core strength continues to lie primarily in outbound mail, with a focus on products, software, hardware and services to create and distribute mail in the most efficient and effective way possible. On the other hand, PBMS' core strength focuses on managing both outbound and inbound mail. For many of PBMS' 19-plus years, that focus initially was on helping customers manage their mail centers and handling mail that comes into and out of their mail centers. But with the growth of our technology-enabled solutions, the focus is moving away from just managing inbound correspondence. Today, there is a much greater focus on the management of the content contained in transactional and business critical mail. That way, it's easier for our customers to respond to business critical communications faster and better manage their physical and digital documents.
Question:
Share with us what you see as the critical strengths and the real dream of PBMS over the next five years.
Answer:
Andy, we are a leading player in the mailstream and we are a leading provider of outsourced services in the mail and print arena. We have developed a much greater focus on document management and document process outsourcing, two areas that are becoming a much greater focus of our business. Let me give you a couple of examples. One high growth area for us and one that is becoming a bigger part of our solutions portfolio is inbound content management. Let's use an insurance company as an example. In an insurance company, one of the mission critical documents they handle is a claims form. Those forms often come in the mail or via fax. Handling that inbound content, digitizing that content, quality checking it to make sure that the form is complete and filled out accurately before it's entered into the workflow to adjudicate a claim is a very important process. And that is something we do today for various companies. I see this becoming a bigger part of what we do in the future.
A second example would be in the management of both physical and digital records, for active documents as well as inactive documents. Records management is actually a board and C-suite level discussion topic because corporations have to worry about their records retention policies to stay in compliance with various laws like Sarbanes-Oxley.
We have seen many companies that have gotten into trouble and severely fined for non-compliance in their records retention. Today, we are one of the leading providers of onsite physical records management for companies in many different industries. I see that broadening in both physical and digital records over time and becoming a much stronger records consulting practice that helps companies create and execute their records management retention policies. My vision for PBMS is to continue to grow our core business around the mailstream, with Pitney Bowes MailWorks and Pitney Bowes PrintWorks, while growing stronger in the document process outsourcing space through some of our newer solutions such as Document Processing Solutions and Litigation and Document Services.
Question:
What do you see happening in the outsourcing and print industry over the next few years that you are positioned and ready to take advantage of?
Answer:
Our customers want greater flexibility from their management services partner to handle the broad array of print equipment that's available, the different print environments they have to deal with and the wide variety of brands and models. Another big trend is a much greater use of color, which will continue to grow. Companies who are trying to get a much better handle on their print costs are looking at their entire fleet of assets, including desktop printers, their convenience copier fleet and multifunctional devices.
At the same time, there are many companies with an environmental stewardship focus. They want to make sure they are doing the right thing to reduce their carbon footprint. I think those are probably the biggest things we are seeing in the whole print outsourcing arena.
Question:
As we wrap up, what are you most excited about right now regarding PBMS?
Answer:
What gets me excited is, regardless of the ownership outcome, our intent is to invest in this business, to accelerate growth and to continue developing and creating new solutions for our customers. We have a unique expertise in the mailstream and in document processing for government agencies, large law firms and large corporations. We are confident that PBMS will emerge from this process even stronger than today with the technology, the resources and strategic focus to be very successful.
I am also very proud of this organization and the 12,000 people we have in the United States who are doing a great job of delighting our customers by delivering superior service every day.
Question:
Vince, I appreciate your comments. We look forward to following up with you in the near future to see how things are coming along.
Answer:
That's great, Andy. Thank you. I appreciate our time together today.
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