Once upon a time the CMS print division division was “the jewel in the crown” in the overall scheme of things. How did the balance sheet get battered so badly? One thing is clear, they lost a couple of marquee clients in the VDP sector and it was dark days ahead.

Trinity Academy for Corporate Training (TACT) took over the print division of CMS towards the end of 2018 with declining turnover and profits (or rather mounting losses).  A learning and development firm TACT that had stopped its operations more than a decade ago was well capitalised. Hence the top management decided to turn it into an investment arm. And that’s how the print division at CMS was rechristened as Tact Print.

Suresh Ramakrishnan, who is executive director at Tact Print headquartered in Mumbai says, “We had a few marquee clients, especially banks, who had strict SLAs. We could not stop printing statements that were crucial for them.” And so, Tact Print followed government norms and ensured a set of employees could stay in the print factories by providing them with all the comforts. This ensured 24/7 service to the clients. Ramakrishnan adds, “We requested for better payment terms (wherever we could) to keep the cash rolling. Also, senior management co-operated well to take a cut in their take-home salaries. We ensured the bottom two layers remained unaffected.”

These were tumultuous times. Tact Print depended on the VDP segment. It catered to 85-90% of their revenue stream. The situation looked grim. And so, top management took stock of the situation. They realised, the VDP operations were spread across nine locations. Ramakrishnan says, “Most of the smaller locations weren’t profitable. We had a bloated team as well, with productivity levels much lower than industry standards. We undertook the painful process of getting rid of several locations which did not make sense primarily considering the quantum of jobs they handled. While we were halfway there, the pandemic struck. We had to shut all our plants for three months in 2020.”

 

Chennai –  VK Dhananjeyan (plant in-charge) and his team

On resumption, Tact decided to give the non-VDP business a hard push (primarily, short-run book printing). I asked Suresh Ramakrishnan how they decided to take a punt on book publishing? He says, “We had one key client who ensured we received repeat orders over the years. Based on feedback from them, we decided to approach several biggies in the space and promised to adhere to delivery parameters. It was a hard test – one at a time but we came out winners.”

What were the tricky bits while transitioning from VDP to pBooks? Ramakrishnan says, “There was a mix of difficult payment terms, delivery timelines, quality parameters to adhere to.”
Ultimately, the Tact Print team takes the credit for working round the clock and weeks and months at a stretch to make this happen.

And Books are here to stay
Suresh Ramakrishnan is a book man, He has brainstormed at Repro India as they metamorphosed into one of the biggest providers of print, content and fulfilment solutions in India. He knows more than most about how to deploy print to best effect to produce p-books. Did that experience help? Ramakrishnan says, “The understanding helped for sure. In a short span of time at Repro I was involved or rather witnessed ways and means of running the operations and producing quality products. We would discuss ways of bringing in efficiencies at the production level. I guess, this learning stayed on.”

Today, Tact Prints has digital devices which cater to short run printing. The firm has not yet set foot in the book-of-one segment, but “are actively considering getting in the offset space – we are not there yet.”
Many publishing pundits say that the advent of the eBook in the early noughties led to a steep decline in printed book sales. The Tact Print experience has been different. How so, I asked Suresh Ramakrishnan. He says, “We had hit rock bottom – the only way was up.”

In what way, I ask him? He says, “I guess, eBooks have dented the physical books market but there are other categories we should be aware of. There is a digital overload and is intrusive. There is a huge section of people who prefer time away from their electronic devices. He adds, “Schools are making their way back to pBooks rather than have their students depend on digital devices. Yes, digital devices help solve mock tests with instant results but reading out of it for long can be tiring. Besides not all schools and there are sections of societies that cannot afford a device.”

Warming to the topic, he says, “The writing culture is gaining traction. Budding authors have access to better prospects through short-run printing cycles and self-publishing methods too.”

The team at Tact Print seems to love machines that manufacture books. But as Ramakrishnan says, “Big investments do not necessarily and automatically result in big orders. There are other components or rather a need to spruce up the value chain that should be focused upon. A big task is to have the right team and people who believe in the company.

Today, a team of 120 in plants across Pune, Delhi, Chennai, and Bengaluru serve clients across India. Ramakrishnan says, “We have clients in every region.” The target for 2028 is a sizable player with a Rs 100+ crore turnover and capabilities across the spectrum.

 
Mumbai –Brijnand Sharma (head of sales) and Rahul Nisal
(vice president – operations)

The revival process
This is today.

But what transpired five years ago?

Ramakrishnan says, “The broad consensus was that closing the operations across the board was the best thing to do till such time Tact mustered the courage and sought time from the investment committee to give us 12 months”. In 12 months,  the Tact Print team thought it would do what it takes to turn this company around else we just shut shop. The condition was that we must fight hard to pay our own salaries and capital investment will only come provided we could demonstrate that we knew how to grow the business – which meant we had to fight hard to manage our cash flows, take vendors into confidence and grow the business by tapping into alternate segments.”

What was the mantra to survival? Tact Print had two mantras. “Not to spread too thin in anticipation of orders. And to take a call to right-size at the right time.”

I asked Ramakrishnan that many firms are “unofficially in administration mode” and what is the best option? Down the shutters or sell the business? His reply is quite candid, he says, “If there is a way to revive, do so. Else think of selling the business – at least jobs can be saved (some of them at least).”

He adds, “Print has not gone out of fashion in fact there could be growth opportunities. I think as business heads and company CEOs one must delve hard, assess the market, and build extended capabilities (not necessarily capital intensive) without burning a hole in the pocket.”

Sounds easy. But what is the next best option, the plan-b as the like to say in the MBA circles? Protect the business from action by creditors during the process. Or downsize? What does his experience at Tact Print suggest? Suresh Ramakrishnan says, “If you have a concrete plan to revive the business which should be robust enough to be believable, speak to the creditors to give you time. You will be surprised to see them concede.”

He illustrates this with an example. “We had a case when one of our key clients fell on tough times during the pandemic. While we were struggling to remain afloat, not getting paid was hurting us hard. The client spoke earnestly to us that he would make payments in small chunks, and he would make good when things normalise. We took a stand to help the client. Happy to state he is back in business and in good measure. Our relationship only improved in strength.”

That’s one more box ticked. But what about the information gap with the employees during the volatile period? he says, “Always be transparent. We ensured every message of progress, client acquisition and situation (to the extent we could) reached the last layer. We requested only for one thing – whatever we delivered should surpass all quality tests and expectations. We promised to reward their hard work when situations improved.”

Bengaluru – Ramesh Sundar (plant in-charge) and his team

And so, Tact Print set milestones and broke them into small achievable parts. Each employee witnessed that they were scaling each one of them slowly but steadily. And Tact Print kept their word and ensured the staff received their due as promised. One key aspect of the people strategy was to empower every person to take appropriate calls. Decision-making was decentralised. Even the junior-most person could take a call on key aspects without waiting for permissions to trickle in.

I asked what was the Tact method to dilute its workforce? Which employees to retain? Suresh Ramakrishnan says, “Your HR practices must be robust. Measuring productivity and watching out for redundancies is key. We took stock of roles and responsibilities and mapped our requirements. There was a merit rank too where the best of them were retained. Here too, keeping senior and middle management in the loop on deciding productivity matrix helps a great deal. They help you in identifying redundancies.”

And finally the emotional decision to let go of some of the iconic locations? Ramakrishnan says, “It is important to take a hard call at times. Let go of those that are low on profitability and arrest the cash drain. Yes, we are emotional about people. We made an offer to the best performers to relocate to the ones we planned to retain. If for a valid reason they were unwilling to leave their current city, we compensated them well so that they could sustain till they found an alternative employment. We went a step further to recommend their names to prospective employers.

The tipping point was being under the umbrella of an investment firm. Tact Print had to ensure it followed crucial parameters to show progress. “There was a point when we had to work hard to fulfil certain key matrices and that mandated hard measures,” says Ramakrishnan.

The Power of Print
Tact Print’s revamp has been a huge hedge on digital print production. In real terms what boosted their fortunes? Was it driven by demand?

Suresh Ramakrishnan says, “Yes, print has considerable promise. We have seen order quantities for individual titles rise over the last two years. We managed to double over turnover from where we were in 2021.”

Delhi – Manoj Kedia (plant in-charge) and his team

What does he attribute the revival to? Ramakrishnan says, “Market bouncing back. Yes, but more than that I would attribute the revival to prudent fiscal policy and making investments in procuring new machines across the board (but based strictly on milestones).. Ramakrishnan speaks about the mentoring and guidance of

TACT’s chairman, Suresh Hegde (he heads all the investment arms).

Among all the backroom calculations, the team focus was “Create a finished product that is worth more than the price you quote. Respect time, because the faster you deliver the more you will be sought. Respect the client, because if you help the client grow, the client will take you along with him.”

What about the price quotient? Ramakrishnan says, “The strange and strong belief is that the print industry is only price driven.”
Is it not, I cross-question.

He says, “Well, we have appraised our clients of current market situations and negotiated appropriate price increases too. Yes, this comes only when the quality of delivery exceeds expectations. Our clients need print plants that can help them solve their problem and give them quality products. They do not mind paying for it. It is a hard game as you need strong watch dogs at the plant level to keep a check on what is being shipped out. You also need a tight control on your supply chain both downstream and upstream. We carry regular audits across plants to ensure we do not carry stocks more than what we need and avoid dead stocks as much as we can.”

When the number of clients started growing, Tact Print decided to seek investments to revamp four core plants (they had shut five of them post the acquisition), with each turnover milestone, the committee opened its purses to allow us to buy critical equipment to bring a turnaround time from 20 days to just four days.

Pune - Pravin Wagh (plant in-charge) and his team

Five-fold growth
The momentum hasn’t abated since then. Several rounds of investment later, Tact Print acquired new printing and processing equipment across plants, a lean team, great quality, and a competitive TAT as well. Suresh Ramakrsihnan signs off, “We turned profitable last year. We have multiplied our clientele five-fold.”

Tough five years, I ask Suresh Ramakrishnan. he nods and says yes. In all this what was the Tact motto. Suresh Ramakrishnan says, “Learn from every step you take. The world is changing faster than we can imagine so we need to keep re-inventing every passing day.” He wishes me adieu, takes a quick look at the production spreadsheet for the day, picks up his guitar and strums his favourite Kishore Kumar melody.