Thomson Watch : 2005 Annual Report

Tuesday, May 2, 2006

Besides cold hard numbers, annual reports contain business environment descriptions/imperatives, statements of intent/priorities, and comments on the competitive landscape – all from the executive management point of view.  I find these to be invaluable in understanding what would be otherwise impossible to derive from the “micro-level” operational view of the company – that most elusive of articulations : the company strategy.  The latest Thomson AR provides just such insights which I wish to record for handy reference –

VISION…..Be the leading global provider of integrated information based solutions to business & professional customers. 

GOING WHERE THE VALUE LIES…..To keep growing, we will keep moving up our customers’ value chain…..Our emphasis on workflow solutions reflects a major shift in the locus of value creation for the information industry, and it is key to our company’s sustained growth.  A simple way to think about the value chain is to imagine three sources, or levels, of value.  The first is content, which – not many years ago – was the major source of value creation in our industry.  We built our business on value-added content and, indeed, content still forms the foundation of our workflow solutions today.  Second, we add more value, and in turn increase revenues, when we deliver that content via sophisticated technology platforms that enable customers to access and apply our information at their point of decision.  The third and highest level of value consists of high-end analytics, decision support and transaction tools, services and consulting…..Our role changes from content provider to business partner as we move up the value chain from informing our customers’ decisions to enabling their actions.

THE NUMBERS…..

TC 2005 5Yp2TC 2005 5YTC 2005 MG

OF NOTE…..

  • Revenue from electronic solutions, software and services increased 12%, accounting for nearly 70% of total revenues.
  • Thomson Learning has begun leveraging KnowledgeNet’s advanced technology platform across its businesses, as it seeks to drive migration from print to digital solutions in the higher education marketplace.
  • For each year from 2003 to 2005, approximately 65% of revenues were generated from subscription/contractual arrangements (recurring revenues).
  • Approximately half of the revenue from electronic products came from workflow solutions tailored to customers’ needs.  Workflow solutions are clearly becoming the engine of long-term growth.   What was once work is now flow.

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