A discussion of how print-on-demand (POD) and digital printing fit within the supply chain of a higher education publisher.

1. Digital Print Platforms / Solutions A Digital Print Primer for Book Printers, Thought Leadership Workshop August 5, 2010 Ken Brooks SVP, Global Production & Manufacturing Services ken.brooks@cengage.com

2. The supply chain is growing more complex 2 Supply Side Demand Side Make-to-Stock Supply Demand Make-to-Order (short-run, one-off) Supply Demand Configure-to-Order (Custom) CMS Demand Supply

3. There’s a Make-to-Stock / Make-to-Order breakeven 3 Make to Stock TCO per Unit Make to Order 0 Print Order Quantity

4. Manufacturing Strategy – 4c 4

5. Manufacturing Strategy – 1c 5

7. Stock-out / Lost Margin

8. Cost of Capital

9. Make Ready

10. Run Rate

11. Order Processing6

12. There are three principal cost levers… 7 Reduce Manufacturing Cost Basis Manage Planning Risk Optimize Print Strategy Lifetime Total Cost C Cost per Unit B A Mfg Risk Average Months Supply …all of which are impacted by POD.

14. Fully supporting POD requires substantial change. 9

15. There are also process capability issues to resolve…

16. Digital Print Platforms / Solutions A Digital Print Primer for Book Printers, Thought Leadership Workshop August 5, 2010 Ken Brooks SVP, Global Production & Manufacturing Services ken.brooks@cengage.com