Following Frank Stefansson's opening welcome, Keynote #1 was a strong effort, by Senior VP Corporate Communications, Product/Solutions and Channel Marketing, Ron Potesky.
His theme? Change can be good (renamed from “change is good”).
And a great point -- just what does a guy from Ricoh know about change? Plenty! Potesky’s outlined a brief history of Ricoh’s activities including acquisitions of Savin, Gestetner, Lanier, Hitachi, IBM (Infoprint, actually currently still a Joint Venture but leading to a full-fledged acquistion), and ending (for now?) with IKON in 2008. He likened the IKON acquisition to Xerox’s 2007 acquisition of Global Imaging, a large non-prorietary base of customers.
Potesky covered trends in channels (Ricoh/IKON, Xerox/Global, Konica-Minolta/Danka, Canon Grows CBS, Independent Dealer Valuation Bubble, Dealers selling at 10X earnings, Direct vs. Dealer), technology battles (Copier-based A3 vs. printer-based A4, Ink vs. laser, Print vs. display), and the business model shift (Lease and Purchase vs. Managed Print Services/Facilities Management, Break/Fix “Copier” Service vs. Cartridge Based end-user service.)
One Conclusion: Supply outweighing demand, significant consolidation. A question though -- are we in the industry DRIVING OUR OWN DEMISE?
We're offering to solve many customer problems, like lower Total Cost of Ownership (TCO), a focus on the environment, printing less, controlling color, all with the underlying theme of "Spend your money with us, not them…"
Potesky offered examples of brands that have adapted and those that haven’t. Andthen a good personal story of a bad example: Linotype-Hell – a market leader that didn’t pay attention to signs of change (ignoring emerging threats like desktop Postscript printers and Direct-to-Plate) in their business environment. (Hell in this case is not a place but rather an acquired company that helped take Linotype there.)
His final thoughts were:
And If You Take One Thing Away…
“It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change.” - Author unknown
And unlike the later presentations, there was time for a couple of questions.
Q – What makes a good acquisition? A – didn’t integrate fast enough (Savin/Gestener took seven years, Lanier also; faster integration is easier. Going much better with IKON!)
Q – A3 and A4, does Ricoh see A4 MFPs taking away A3 placements? A – Absolutely! Esp in mid- and low-end markets (sements I and ii especially). Will continue, but service model for A3 is still a good economic model, with individual parts replacements. With ink technology improved to mean less “throw away” that could change.
Ann Priede, VP of Publications, and Charley LeCompte, president and founder of Lyra, publisher of The Hard Copy Observer and The Hard Copy Supplies Journal, then presented the first of two “Making the Grades” – Marketing and financials – based on the printer/copier portions of the business, with today's (Tuesday) based on the copier side of things. Priede offered developments and grades in sales and marketing, products, and technology, and LeCompte countered with financial metrics and grades based on revenue growth and operating profit. Companies covered included Canon, Konica Minolta, Kyocera, Ricoh, Océ, Sharp, Toshiba, and Xerox. A relatively short presentation, it was packed with data and very interesting grading outcomes! Tomorrow's promises to be interesting when the eight top printer vendors are examined.
Opportunity in Adversity: Finding The Way Forward, Willem Appelo, President Global Business and Services Group, Xerox Corporation
Look ma – No slides! The first presentation to go without the usual visual aids, but a carefully prepared pitch nonetheless.
Appelo started with the popular theme of how the economy has affected our industry, and in an optimistic view sees the benefit of the current woes as representing a catalyst to change for the better for the world economy. There’s “no business as usual” anymore and the Xerox exec drew on the company’s own near-death financial crisis of the early decade, eight years ago. He offered examples of how Xerox was forced to change and how those changes ultimately bolstered the company, in ways that are very observable today in the company’s strength (remember it’s relative, given their “C” grade for operating profits, as covered in LeCompte’s prior presentation.)
Appelo pointed to the historical customer focus among the founding leadership of industry stalwarts Ricoh and HP, along with Xerox.
Ownership of document output is typically spread across the organization – Xerox has an assessment that helps customers design a more efficient and less wasteful copying and printing, based on customer needs. Bottom line -- adapt to the customer! Trends include single function to multi-function machines, a “window to the world”. Another example is EIP, Xerox’s open platform for development, which makes it easy for partners to develop tailored solutions for Xerox machines. Lean Six Sigma is the tool Appelo credits for helping transform Xerox.
In the area of “green” Appelo described one example -- Xerox’s efforts to create a
more environmentally sensitive paper. With usage of seven hundred pounds of paper a year, per person, worldwide, and growing at least in some geographies, the making and usage of paper is an opportunity. Xerox developing a “digital paper” that would be more environmentally friendly, by using mechnanical rather than chemical means, using more of the tree and less water in the process.
Partnerships were a recurring theme in the speeceh. Outsourcing of cartridge manufacturing of cartridges to Flextronics, evolving from a simple outsourcing deal to a deep partnership today. The company’s work with UPS and creative applications was mentioned, and also their partnership in document management with IBM was touted. Sourcing around the globe is key – keeping things the same is not an option.