M&E Daily

M&E Journal: The Move Toward Digitizing Back-Office Processes

By Darren Ehlers, Entertainment Partners

In terms of utilizing technology, production office progress has been painfully slow. Paper scripts, paper timecards, paper purchase orders, the need for handwritten signatures. Until recently, the only real innovations behind the camera were the move from regular mail to email, the adoption of cell phones and the use of consumer technology in the production office. Fortunately, accounting software was created—pulling the entertainment industry and its reliance on paper ledgers out of the Stone Age.

Systems were developed that tracked millions of dollars in costs. Still, ironically, as digital effects evolved beyond our wildest dreams, there simply wasn’t a wholesale rethinking of the back-office platform, and what could be accomplished electronically.

Lucky for studios, these days the line between making a film or television show, getting the production paid, and systems that house invaluable data is blurring rapidly. Certain products have come to market that are automating many aspects of the process. Studios are being steered away from the labyrinth of never-ending boxes of paper that comprise “document management” and distribution.

Efficiency: There’s really no other business like entertainment. Upwards of 300 people come together for 10 to 12 weeks to make a product, spend $120 million dollars, and then poof…they disband. Yet, the product lives forever.

With so much of the back office processes being done by hand, it’s no wonder problems have arisen. Consider the longstanding tradition of paper scripts, for example. In 2014, Seth McFarlane, Universal Pictures and Media Rights Capital were sued for alleged copyright for the megahit Ted which grossed $550 million at the box office. Bengal Mangle Productions filed the suit, alleging that the concept for the film had been lifted from its web series, Charlie the Abusive Teddy.

McFarlane and the studio ultimately prevailed in court, proving that the inspiration for Ted was derived independently, but likely at a tremendous cost. One can picture teams spending months and months of hours rifling through boxes to find the original copy of the paper script. Had they been using a robust automated system that stored the original screenplay, the lawsuit would have been immediately dismissed.

When an actor from a popular 1970s film passed away, his estate sued a studio relating to a residuals issue. A team was then tasked with tracking down a call sheet from the 40- year old movie. The employees didn’t even know what building the document was in, let alone which box. Needless to say, lawyers historically have often found it easier to just settle these kinds of cases.

On the other hand, attorneys have been aggressive regarding retention policies. Documents must be retained for seven years, but antiquated paper systems have made this difficult. With new technology, it’s beginning to dawn on studio executives that they can actually have retention policies that are enforceable. An audit from the Directors Guild of America (DGA) requires a dizzying array of different kinds of documents that include payroll, contracts and production reports, to name only a few. With no centralized database, it can be highly problematic tracking all of these things down. A digital repository that brings these documents together with the push of a button saves time, money and resources.

Compliance

Productions have become increasingly subject to scrutiny in terms of compliance. From sexual harassment training to employment verification to incentives tracking, entertainment is a complex business subject to vast state and federal laws and regulations. Systems that can track these kinds of issues are becoming invaluable. For example, if a crew member is discovered after-the-fact to have been working on an expired visa or driver’s license, a production can be disqualified from receiving a tax credit for the person’s wages, in addition to incurring other legal penalties. With digital start packets, these potential problems can be dealt with at the outset.

Since productions are often mobile with traveling crews shooting in remote locations— often in a variety of cities and states, adhering to the respective sick leave and minimum wage rates further complicates matters. In greater Los Angeles, for example, sick leave and minimum wage not only vary from city to city, but by jurisdictions within those cities. This means that a crew member could be entitled to $10 per hour on a shoot one day, and $10.50 per hour the next. Penalties are steep. One can see how a digital platform that integrates this information is necessary to stay accurate and in full compliance.

Safety

Of course, crew and talent safety is always a major concern. The Occupational Safety and Health Administration (OSHA) has the capacity to shut down any production at any time for safety violations. In fact, OSHA has listed entertainment as one of the top industries for which avoidable accidents happen. Pyrotechnics, explosions, aerial lifts, falling objects—with everything that goes into making a production, this shouldn’t come as any surprise.

In 2014, a 27-year old camera assistant was tragically killed by a train in Savannah, Georgia while working on the film, Midnight Rider. Subsequently, the production was cited for willful and serious safety violations after OSHA investigated the incident. This was an egregious example of a production flagrantly disregarding crew safety. Still, the tragedy underscores the need for digital systems that provide safety oversight.

In another one-off situation, production workers on a television set in Santa Fe, N.M. experienced an outbreak of Valley fever. Despite warning the production workers of the outbreak, one crew member claimed he hadn’t been told and subsequently filed a claim against the productions. The digital system allowed the production company to prove that everyone had been warned.

Security

Traditionally, production offices have generated vast amounts of documents, shared through unsecure files, and emailed by multiple stakeholders over various platforms or providers. These days, automated systems in production are increasingly utilizing closed loop security for document management. This protects scripts as well as the Personally Identifiable Information (PII) of production workers.

Studios and production companies are right to be concerned with hacking and largescale data breaches, but what if papers with PII were simply stolen…say, off the back of a truck? Not long ago, a Fed Ex truck containing boxes of tax documentation from a production company was robbed in New Mexico. Once the company learned of the theft, it was required to notify everyone whose information was on that truck. Luckily, the company used an automated system that made retrieval of all email addresses and phone numbers instantaneously accessible. The robbery happened on a Friday evening, and by Monday morning the company had purchased Life- Lock for all the potential victims. That could only happen in a digital environment.

Digitized platforms can also help stop fraud. Matching a production’s schedule with purchasing is difficult with paper, but a digital ecosystem makes it much easier to decipher when something is out of whack, like a production accountant who is making purchases at high-end retail stores long after the production is over.

Conclusion

Studio executives are busy, frequently overseeing multiple shows and productions. A studio-wide retrieval system provides a centralized platform for managing, storing, searching and accessing virtually every kind of document in an organization. From financial data, to compliance, to safety, digitized platforms are reducing the need (and cost) of physical storage. Further, mobile applications and customizable executive dashboards are able to provide real-time feeds and alerts.

The bottom line is that when production companies and studios move to a digitized back office platform, they can do things that were never possible in a paper-environment. Are you onboard the digital production train?

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