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9/24/2004
10:40 AM
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It's Never Business As Usual

229-year-old Bowne, not content to rest on past successes, has changed itself repeatedly to meet customer demands for new services

At Bowne & Co., a financial-printing and services company, a disproportionate amount of business volume takes place during a few busy months of the year, as the company's high-speed presses crank out annual reports and mutual-fund statements for customers to meet Securities and Exchange Commission deadlines. Now that cycle could be compressed even further, as the SEC weighs a change in filing dates that would squeeze even more of that ink-on-paper activity into fewer days.

For years, Bowne's core financial-printing business unit has been at its busiest during the months of February, when mutual-fund companies typically send annual statements to shareholders, and March, when publicly traded companies file to the SEC 10-Ks and other documentation that are the basis of their annual reports. Now the SEC has signaled that, as part of its Sarbanes-Oxley mandate, it's going to require that companies file 10-Ks by Feb. 28 instead of March 31, essentially squeezing both waves of paperwork into one month.

Even with modern business technology, paper hasn't gone away, says senior VP and CIO Ruth Harenchar.

Even with modern business technology, paper hasn't gone away, senior VP and CIO Harenchar says.

Photo by Sacha Lecca
"It's a complete and total overlap," says senior VP and CIO Ruth Harenchar, who joined Bowne two years ago from Ernst & Young. "It's chopping the month of March out."

The pinch will be even worse than that, since finance chiefs tend to hold onto their reports as long as possible while double- and triple-checking their numbers. As a result, the bulk of all that reporting could take place in the last two weeks of February. "We expect the crunch to be enormous," Harenchar says. "We would assume the last week of February will send the meters to places they've never been before."

It seems like a lot to ask of a company that, at 229 years old, claims to be the longest-running public company in the United States. But Bowne has a long track record of adapting. Founded in 1775, Bowne started out as a stationer's store at 39 Queen St. in New York, when the town's population was about 25,000. An 18th century map in Bowne's headquarters shows exactly where the company's office was located at the time, not far from the fresh-water pond that supplied the growing town's needs and a short walk from the East River, small farms, and marshland.

As New York grew into a bustling seaport, Bowne's founder, Robert Bowne, saw an opportunity to help ship captains cope with the paperwork and transactions unique to maritime commerce, and that became Bowne's primary business. The company then morphed into a printer specializing in financial documents and, when the SEC was founded in the 1930s, Bowne focused on helping public companies, commercial banks, insurers, investment banks, and other organizations that file documents to comply with SEC requirements. In addition to juggling 10-Ks, 8-Ks, annual reports, and mutual-fund statements, Bowne produces the documentation used in mergers and acquisitions and initial public offerings.

It's cyclical work, with spikes in activity at the end of each quarter, and it's heavily influenced by broader economic trends. When mergers and IPOs are popular, Bowne's offices are buzzing with activity, as lawyers and business executives pour over the fine print of documents detailing their agreements. At the company's current headquarters at 345 Hudson St. in New York's former "printers' row," 21 conference rooms--each well equipped with sharpened pencils--serve clients who sometimes pull all-nighters hashing out last-minute minutia. "Even in this day and age of technology, paper has definitely not gone away," Harenchar says.

But all that paperwork has an electronic component: Documents arrive and are returned in a variety of digital formats, and Bowne's typesetting operations are networked together. The challenge for Harenchar and her team of 160 IT professionals is to accelerate processes involved in high-speed, high-volume printing while maintaining the accuracy and quality that are expected in financial documents. "Speed is always a competitive factor in our business, but it's speed with quality," Harenchar says.

In her five years at Ernst & Young, Harenchar initially worked on planning and managing that firm's IT infrastructure and then on those of its clients. It was good preparation for what needed to be done at Bowne, where her priority is to create an IT infrastructure that's better suited to the ebbs and flows of the financial-printing business. For years, Bowne's systems were designed to handle peak loads, so there were obvious efficiencies and savings to be gained in a utility approach that would allow the company to dial up capacity as needed.

Last fall, Bowne became one of the first companies to test IBM's grid-computing services for an application it uses to deliver financial statements to customers. In addition, some of the company's new servers have CPUs that are paid for only when needed. And Bowne has begun outsourcing some software development to offshore companies when its own staff can't turn the work around in the time frame needed.

"Anything they can do to install more variability in their cost structure is unquestionably a good thing," says James Clement, an analyst with equity research firm Sidoti & Co., who follows Bowne. (Sidoti neither owns Bowne shares nor does investment banking with the company.)

The work so far is "not the full-scale dream of true on-demand computing; we're still quite a ways from that," Harenchar admits. But she adds, "Anything that comes on the market, we're taking a look at."

That's pretty progressive for a company that was founded before the Declaration of Independence was signed. Bowne executives and employees recognize the need to change with the times, Harenchar says, even as they cling to some of the corporate values--teamwork and a long-term view among them--instilled by years of private ownership. Board member Lisa Stanley is a descendant of the company's founder.

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