Ricoh Says It Wants A REVolution
“Real, Enhanced Value” The Focus At 2008 Ricoh
Dealer Conference
November 6, 2008 - Recently-inducted NBA hall of famer
Pat Riley, who coached teams including the Los Angeles Lakers and Miami Heat to
seven NBA World Championships, delivered the keynote speech on the second day
of Ricoh’s 2008 dealer conference held recently in Orlando, Florida, explaining
how he handled his wins—and more importantly, how he handled his losses. Riley
told several other stories that illustrated the feelings of frustration when
you think you’re doing a good job but still not breaking through, and then the
knowledge, once you have broken through, that the work and the journey was
worth it. That was the message he seemed to hope the dealers left the
conference with—the willingness to accept challenges and turn them into
victories, particularly when circumstances appear most trying. It was an apt
message considering the economic climate during which the meeting was held.
Indeed, the stock market’s record October plunge was
front-page news as 550 attendees gathered at the Omni Orlando Resort at
Championsgate from October 13 to 16.
While dealers attending the conference reported that
their overall sales were holding steady (“People need these machines to do
business,” noted one dealer, “it’s not like they can go without a copier when
their lease is up.”), some dealers did report that with the October credit
crunch, new customers – even those with excellent credit – were having trouble
securing financing for large orders. It was also a sign of the times that only
300 dealers attended the conference (a lower than normal number), and those who
did seemed to be spending less time enjoying the entertainment after the
seminars and technology expo, and more time on their cell phones working on
deals back home.
The soft U.S. economy was one of the factors
contributing to Ricoh’s recent reorganization, in which Katsumi “Kirk” Yoshida
returned to the position of Chairman and CEO, Ricoh Americas Corporation, while
continuing in his role as chief marketing officer and board member of Ricoh
Company Ltd. in Tokyo.
“As a famous movie psycho once said…I am back,” he
joked as he took the stage to address the dealers at the general session.
His speech, however, was serious business. Yoshida
said he had been brought back to address a number of challenges facing Ricoh
Americas Corporation. “Some were external and beyond Ricoh’s control,” he
noted, but he acknowledged that there were also areas within Ricoh itself that need
fixing, and he intends to address them.
Most notably, he said, the top priority is to “regain
the confidence of our dealers by establishing ways to restrain conflicts in
each particular market.” He said that Ricoh has developed a Rules of Engagement
system, which will protect dealers from having Ricoh Business Systems or IKON
branches compete against them for existing accounts by setting up clear
boundaries aimed at protecting dealer/customer relationships.
Another top priority for Yoshida has been to fix the
back-end issues with implementing the Oracle ordering system, which has been a
bane to many dealers. “We applied every available resource to fix the
problems,” he said, “and soon the process will be faster and smoother.”
Yoshida said his third and final priority is to “build
the foundation for growth, with the goal of making Ricoh the number one
provider of office equipment and document management services, both in the U.S. and throughout the world.”
He noted, “As we make the bold move into the market,
Ricoh America Corporation must adapt, with the ability to take decisive action
for customer satisfaction.” He said that “real enhanced value” is the key to
Ricoh’s continuing growth in this challenging market.
The “Real Enhanced Value” Equation
Hede Nonaka, executive vice president, Ricoh Americas
Corporation, explained Ricoh’s strategy of selling on value, not necessarily on
price. “Real Enhanced Value” (the “REV” in Ricoh’s “Leading the REVolution
2008”theme) is the company’s true competitive edge, he said.
“We have always sold great products,” he said at the
general session. “However, in today’s competitive market, that is not enough.
Our customers and prospects want their document solutions partner to help them
solve critical business issues. Instead of selling on price,” he said, Ricoh’s
recent R&D efforts have been to “provide solutions that provide real
enhanced value to the customer. We want our customers and prospects to trust us
to solve their most pressing business problems, and we want them to become
intensely loyal to Ricoh because they cannot get those products delivered from
anyone else at any price.”
“We want to achieve what Apple has achieved with its
iPod,” he explained. “My daughter and I are loyal to Apple because they have provided
an excellent music solution for us wherever we go. There are other music
players and other providers, but my daughter and I have never considered
another supplier. We want our customers and our prospects to feel the same way
about Ricoh.”
Nonaka said, “Instead of competing on product features
or on price, our strategy in solutions demonstrates to the market that we have
a complete understanding of their business needs and can provide them with
solutions to help them improve their processes or reduce their operating cost
or comply with government regulations. The market is desperate for these
solutions.”
He said that Ricoh’s research had identified five key
issues that are top priorities for most businesses—process improvement;
information security; total cost of ownership; regulatory compliance; and
environmental sustainability—and told the crowd that Ricoh is developing
packages that can be used by dealers to address Ricoh’s competitive advantages
in each of these areas, which can be personalized to reflect each customer’s
requirements.
“Simple things, such as automated click management,
are cutting customer costs and making their lives easier,” he said.
He also noted that the new “Cosmos” open platform
Ricoh will be introducing shortly will simplify personalization options even
further, and added that products are being designed with customer ease of use
as the top priority.
“Our software solutions such as GlobalScan offer great
competitive advantages,” he said, and suggested that dealers could “sell the
value packages we are developing or you can use our solutions to create and
enhance your own line of packages.”
Nonaka summed up by explaining, “The market is
changing. Customers are looking for value. They’re looking for a solutions
partner who can solve specific problems for them – and we can use these
opportunities to take share from our competitors.”
“We Want to Be Better Partners For You.”
Martin Brodigan, the newly appointed president and CEO
of Ricoh U.S., who was described by Yoshida as “a team builder, as evidenced by
the success that Ricoh Canada achieved during his tenure,” described his goal
for Ricoh to become a more efficient, more streamlined company.
“We’ve grown successfully,” he told the audience, “but
with growth we’ve become a lot less nimble. We want to regain a culture that is
fast and customer-focused. With Kirk’s return to the U.S. and our new
management team, we’re all committed to being part of a company that is truly
customer-focused and easy to do business with.”
He said that Ricoh’s focus in the coming months will
be on new solutions, strategies and sales tools that will help dealers achieve
their business goals. “We will only succeed if you, our dealer channel,
succeeds,” Brodigan said.
Among the steps Ricoh is taking to provide what
Brodigan called “a sensitive and positive customer experience” includes
improvements in the supply chain, a flatter management structure that he said
would provide “better accountability and faster decision-making,” as well as
safeguards (called “Rules of Engagement”) to prevent direct competition among
dealers, Ricoh Business Systems and IKON marketing efforts.
“We want to be better partners for you,” he said,
encouraging dealers to keep the lines of communication open with Ricoh and to
feel free to pass along criticisms or suggestions or questions to management.
“Expect honest answers,” he warned. “You may not always like what you hear,
just as we may not always like what you tell us, but mutual trust is critical.
The word ‘partner’ suggests that we can learn from each other and work towards
our mutual success.”
Expanding on that partnership theme, Kiyo Shimizu,
senior vice president of Ricoh U.S.A.’s dealer division, told dealers about
Ricoh’s new management structure, saying it would provide stronger service and
support to dealers. He explained that under the new structure, instead of the U.S. being divided into three regions, each covering three individual brands, going forward
there will now be four regions, each of which is responsible for maintaining
all three brands (Ricoh, Savin and Lanier). He also said that Ricoh will
support future products from all three brands with supplies that can be used by
all three.
He said that the restructuring of the dealer support
team was meant to make Ricoh faster and easier to deal with and pledged, “We
will focus on helping dealers, instead of just watching our own internal
business.”
He forecast that Ricoh would become more productive by
optimizing its resources under the new management structure, and would lower
overall costs.
And, Shimizu noted, in the event of dealer conflicts,
“I am the guy in the hot seat when it comes to delivering on our commitment to
the Rules of Engagement, and I accept the challenge.”
He continued that he wanted to do “even more to help
earn your trust, your loyalty and your business,” and noted that in his
opinion, in the past Ricoh had placed too much emphasis on moving boxes and not
enough emphasis on complete solutions to specific business issues. “Hardware is
certainly at the core of our business,” he said, but he stressed that Ricoh’s
future growth would be fueled by quality management to support the dealer
channel as well as providing solutions, such as managed print services, to help
dealers maintain profit margins in an increasingly price-sensitive industry.
According to Shimizu, “If you give your customers real
added value such as managed print services, they will pay more,” because it
saves them time and headaches involved in tracking various output devices
themselves.
He also solicited advice and opinions from the dealers
at the conference, asking point-blank, “What can we do to give you a strong
feeling that we are supporting you? What kind of support can we give you that
would make you say ‘no thank you’ to a proposal by one of our competitors? The
answer is for us to meet specific requirements to strengthen our partnership.
Please tell us what we can do, and most of all, give us the chance to meet your
expectations. Mutual commitment is the key.”
How IKON Fits Into Ricoh’s Strategy
During the main session, Yoshida also explained
Ricoh’s upcoming IKON acquisition to the dealers as an offer Ricoh couldn’t
refuse.
“To use the Wall Street term,” he said, “IKON was a
company ‘in play.’ If we didn’t buy it, someone else would have. We were not
willing to put ourselves in that position, and we were not willing to put you
[the dealers] in that position. If we had lost such a sizable piece of our
distribution, we would have lost a significant amount of our market share, we
would lose the scale that allows us to offer a competitive price, and we would
lose money that would otherwise be invested in developing new technologies.
None of those outcomes were acceptable.”
He noted, “It is no secret that one of our main
competitors will come out short as a result of Ricoh’s acquisition of IKON,”
estimating that the shortfall for the competitor will be about $1 billion in
lost business. “This makes Ricoh the strongest possible partner for the future
success of your company,” he said.
Yoshida told dealers that throughout its acquisition
of IKON, he intends to “protect and respect your existing customer positions.
For those of you thinking you’ve heard that before, let me tell you the
difference. This time, I am here.”
He said that Ricoh’s primary goal is to replace IKON
machines in field with Ricoh ones. The emphasis will be on converting all of
IKON’s existing market to the Ricoh base.
“We absolutely need Ricoh dealers to go after the
remaining 70 percent of the market that is not Ricoh,” he said. “We still see
the dealer as the net new business closer.” He noted the development of
“aggressive programs and promotions” to support dealers with new business. “We
need you,” he told the dealers, “and we depend on you as the engine of our
growth in each market.”
Ricoh’s Plans For A Greener Times Square
Ricoh also told dealers that it intends to increase
both its brand awareness and its reputation as a leader in environmentally
friendly technology by erecting a sign this fall in New York City’s Times Square that will be lit completely by wind and solar power.
“Ricoh is a strong proponent of wind energy and we
have been focused on sustainability for more than 30 years,” said Yoshida. “Our
new eco-sign is the first of its kind in the country and it's proof that
corporations can develop creative ways to help save energy and assist cities in
their mission to become more environmentally sound.”
He also noted that even if there was ever another
blackout in New York similar to the 1977 and 2003 events, the Ricoh sign will
remain lit because it generates its own power.
More Color, For Less Cost
A lot of excitement was generated at the dealer
conference when Ron Potesky, vice president of corporate communications, Ricoh U.S., announced, “In the next three months we’re introducing eight new color MFPs. In fact,
we’re replacing our entire color MFP product line 20 to 50 ppm by the end of
this year. We have the broadest color engine lines in the market.” He said that
was particularly advantageous because “color engines generate three times the
after-market profit of a black and white engine.”
According to Potesky, “Our new Segment 1 B-to-C
product is a huge opportunity, as is the new 90-ppm Pro C900 color production
engine,” which Ricoh unveiled (without published specifications) on the
Technology Expo show floor. Full specifications were scheduled to be released
on October 27th, after the conference ended.
In addition to the Pro C900, Ricoh touted a number of
new products that it says offer newer, lower TCO. These included:
·
The Aficio SP C220/C221S/SF/SP Series: New entry-level
color laser printer MFPs in three configurations: SP
C220S – 16-ppm print/copy/scan; SP
C221SF/SP, C222SF
– 21-ppm print/copy/scan/fax. All models include standard USB and Ethernet
connectivity (and optional wireless) and a maximum paper capacity of 751
sheets.
·
The Aficio SP C312DN Color Laser Printer: Ricoh touted the
26-ppm Aficio SP C312DN as offering an affordable hardware price and CPP;
compact design; easy maintenance via all-in-one cartridges; standard duplex and
PictBridge support.
·
The Aficio SP C420DN: Offering a rated engine speed of 31
ppm in full color and black, an 800-MHz processor and standard duplexing, as
well as the ability to handle media up to 55-lb. bond/110-lb. index, the Aficio
SP C420DN will deliver “unmatched total cost of ownership,” according
to Ricoh.
·
The Aficio MP C2800/C3300 series: Like its new sister
products, the MP C4000/C5000 series (see below), the MP
C2800/C3300
series uses Ricoh’s patented PxP™ Toner, generating high-quality color
documents with resolutions up to 1200 x 1200 dpi. Rated engine speeds are 28
ppm (C2800) and 33 ppm (C3300) in both black and color.
·
The Aficio MP C4000/C5000 series: With rated engine speeds
of 40 ppm (C4000)
and 50 ppm (C5000)
in both color and black, a 1-GHz print processor and a standard 1 GB of RAM
plus 160-GB hard drive, these devices can handle heavy paper weights (up to
140-lb. index) through the main trays and offer full-bleed 11" x 17"
print and copy capability.
·
New monochrome products showcased included the 37-ppm Aficio
SP 4210N laser printer, offering a 466-MHz print controller, standard 256-MB
RAM (max 512 MB), optional 80-GB hard drive, and resolution up to 1200 x 600
dpi; and the 30-ppm Aficio SP 3300D/DN
series, which includes standard duplex, standard 32-MB RAM (upgradeable to 160
MB) and is available in both network and non-network configurations.
Ricoh also showcased its new HotSpot printer that
allows users a convenient, secure way to print on demand from a laptop, PDA,
cell phone or other remote device. According to Ricoh, the HotSpot printer is
ideal for public spaces such as hotels, airports and retail establishments, and
supports third-party billing and accounting systems while also offering an
“ultra-low” CPP. The HotSpot printer offers 1200-dpi resolution and an engine
speed of 25 ppm in both black and color.
In addition to providing hardware demonstrations,
Ricoh had a small army of solutions product managers available, offering
hands-on demonstrations of software and services that could be used by dealers
to streamline their own processes, as well as to help customers maximize their
efficiency.
Ricoh products, programs and solutions showcased
included Ricoh University; Ricoh’s DocumentMall on-demand document management
service; Ricoh’s Document Solutions and Services division; and Ricoh Saves, a
new TCO tool that Ricoh says allows dealers an easy way to demonstrate a Ricoh
advantage by right-sizing a customer’s fleet to their needs. Ricoh Saves can
even recommend a specific configuration. By using the TCO tool with what Ricoh
calls the MFP plus P selling strategy (selling a combination of MFPs and
printers to lower overall printing and copying costs), dealers can now offer a
simple managed print services solution.
Ricoh also invited a broad array of alliance partners
and third-party solutions product providers to the show, with booths including:
·
FabSoft (showing solutions including Reform; Modular Object
Scanning Technology; Tag Doc; snap Doc; Form Medic; Postal Sorting; and
Document Authority Control)
·
CIT Vendor Finance
·
Innovative Systems & Solutions, showing eC2DS, the Xerox
DocuShare Connector for eCopy ShareScan OP and Image Capture for eCabinet or
DocumentMall
·
Contex HD series and SD series large-format scanning products
·
ECi OMD and La Crosse
·
Compass Sales Solutions
·
Hytec Dealer Services (an authorized parts repair facility)
·
Digital gateway, showing e-automate management software for
imaging and business equipment dealers
·
Captaris Streamline, RightFax, Alchemy and Academy solutions
·
Omtool Accuroute
·
Wahlstrom Group, Ricoh’s appointed Yellow Pages agency
·
Lotus Foundations (developed in partnership with IBM-Lotus
Foundations)
·
MBM Corporation (finishing products including cutters, folders,
collators, etc.)
The Learning Curve
Ricoh presented numerous seminars for dealers as well,
with staggered sessions so that dealers had time to attend all of them. Seminar
topics included:
REV — Ricoh Real Enhanced Value:
In this seminar, dealers were introduced to the new
Ricoh REV tools, which Ricoh said were designed to help them enhance value and
differentiate their dealerships from the competition. Here, dealers were given
demonstrations on the latest set of Ricoh tools, including the Ricohsaves.com
site, which is home to the latest TCO tool with an expanded feature set; the
new Ricohpresents.com site, which gives reps access to all of the latest
marketing, sales and REV information; the new Ricohproposes.com, designed to
enable sales reps to enhance all of their customer presentations and proposals
with professionally created presentations; and Ricohgetsit.com, where dealers
can find the latest sales rep tools and training materials.
How to Increase Business and Add Value Through
Managed Print Services (MPS):
Tom Callinan of Strategy Development explained how
dealers could introduce MPS to their customers through their own businesses,
outlining how MPS can be offered to small and medium-size business customers as
well as to CRD and in-plant buyers. The emphasis was on how MPS can be offered
by dealerships to increase customer base, revenue, profit and overall number of
machines in the field.
Production Printing 101:
This seminar introduced dealers to the production
printing business, with an overview of key market segments, vertical market
opportunities and how dealerships could benefit by adding production-level
products and technology, including the DDP/EMP, Pro EX Series and the brand new
C900 Production Color System to their product lines.
A Sprinkling Of Orlando Magic
For those dealers who weren’t distracted by
last-minute business back at home, the entertainment at the event was a
“best-of” mélange of Orlando’s main attractions, with dealers treated to a
private Fright Night party at Universal Studios, where they were entertained by
live “ghouls” as well as a walk-through haunted house, a line-free chance to
check out the new Men In Black II interactive ride, and the most talked-about
feature of the night, a motion simulator ride based on The Simpsons.
The next day, between the technology expo and the
dealer awards dinner, guests were allowed to choose between a round of golf at
the Omni’s on-site golf, a day trip to their choice of Disney theme park; or
leisure time to enjoy hotel amenities including a spa and meandering “lazy
river” pool.
Capping off the dealer awards dinner was entertainment
from Chris Bliss, the self-described “most famous juggler in the world,” whose
humorous banter and impressively choreographed juggling won over the crowd.
What The Dealers Were Saying
Dealer reaction to the seminars and new product
introductions ranged from lukewarm to highly enthusiastic. Some smaller dealers
expressed reservations about the time and expense involved in adding the C900
to their product line, while others looked forward to expanding into the
production area as soon as possible so as to better compete against other
vendors offering production-speed devices.
As to possible fallout or increased competition from
the impending acquisition of IKON, most of the dealers BLI spoke to were
adopting a “wait and see” attitude about how it might affect them down the
road. Even in markets where IKON would be in direct competition with them, the
dealers BLI spoke to expressed confidence in the Rules of Engagement and in
Ricoh’s new direction under the new leadership.
“We trust Kirk Yoshida,” said one dealer during the
dinner, prompting nods of agreement from several other dealers at the table.
“We’ve had some problems in the last year or so, but if he says he’s going to
fix things, he will do it.”
That trust looks like it can form the basis of a
productive partnership between Ricoh and its dealers going forward.
