June 2007 Office Technology by Business Technology Association

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CONTENTS Volume 13 No. 12

COURTS & CAPITOLS

FEATURE ARTICLES 10

Professional Services Setting your dealership apart from competitors

Employee Ownership ESOP: The ‘E’ stands for exit strategy

by Brent Hoskins Office Technology Magazine

By Robert C. Goldberg BTA General Counsel

The transformation of the office technology industry continues. The changes keep coming. That’s a good thing, given the near-commodity nature of MFPs. What’s next for your dealership? Perhaps it is time for you to consider a professional services strategy.

Many business owners consider an Employee Stock Ownership Plan as an alternative when deciding to sell.

PRINCIPAL ISSUES Paper Connection Forum eCopy hosts event May 14-17 in Miami, Fla.

‘A Driving Force’ Ricoh explains new strategy during dealer meeting

by Brent Hoskins Office Technology Magazine

Annual forum promotes document scanning solutions, along with “connectors.”

by Brent Hoskins Office Technology Magazine

While they did highlight products, dealer support programs and sales successes at Ricoh’s recent Vision national dealer meeting in Dallas, company officials also took a significant amount of time to explain the OEM’s new distribution and brand strategy.

The Changing Market 2006: Color units rise, monochrome units decline

BTA Southeast in Nashville Attendees comment on successful conference

by Brent Hoskins Office Technology Magazine

The BTA Southeast district hosted its spring conference May 18-19 in Nashville, Tenn.

1,407,485 1,277,346

A Path to Great Leadership It begins with assessing, confessing & addressing

by Jonathan Bees InfoTrends

In 2006, total placements within the U.S. copier/MFP market (all monochrome and color units) declined by 5 percent. The results were consistent with the InfoTrends’ forecast for a modest decline, although slightly more negative. The story behind the placement decline is a familiar one.

by Joanne Smikle Smikle Training Services Inc.

Monochrome Copier/MFP Down -9.2%

Three bricks must be laid on whatever path you take on the journey to fulfill your potential.

Networking for Business Simple tips for generating new clients & revenue

Remote Diagnostics The service tool for greater customer satisfaction by Bob Sostilio Sostilio & Associates International

One would expect that any “tool” that can improve service revenue by increasing efficiencies and productivity would be exploited within a dealership. Yet, according to a recent survey, only 39 percent of dealers indicate they employ some type of remote diagnostics. 4 | www.of ficetechnologymag.com | June 2007

by Hank Blank Hank Blank Inc.

Networking can be a very powerful but low-cost method of acquiring new business.

DEPARTMENTS 6

Executive Director’s Page

BTA President’s Message

Advertiser Index

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EXECUTIVE DIRECTOR’S PAGE

Do You Know About These New Benefits? n May 18-19 it was my privilege to attend the BTA Southeast conference in Nashville, Tenn. I was among the three presenters at the conference. I took the opportunity to focus on some of the new programs and benefits BTA is now offering. In fact, in my presentation I highlighted ten new member benefits. In case you missed the announcements along the way, following are some details on these latest benefits. (1) This spring, BTA announced BTA ProSolutions, taught by one of the most dynamic, informative presenters in the industry, Darrell Amy. This two-day class will help your dealership start landing profitable solution sales. (The next class is scheduled for Aug. 2-3 in Las Vegas. For more information or to register, visit www.bta.org or www.dealermarketingsystems.com/BTA.) (2) BTA is now offering new and renewing members two discount coupons each membership year. Our $150 coupon can be used for ProSolutions and such classes as the workshops offered by MOTIVE8s. Our new $250 discount coupon can be used for ProFinance or FIX: Cost Management for Service. (3) Some changes have been made to the model taught in BTA’s ProFinance class. For example, business color detail for both the B&W and color copies made on B2C devices has been added. (4) Returning ProFinance students now only pay half price to attend this two-day class, a great opportunity for the 350-plus past attendees to get a refresher or learn about the changes to the model. (The next ProFinance classes will be held August 8-9 in Denver and

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Nov. 14-15 in Cleveland. Visit www.bta.org.) (5) The latest report in BTA’s Benchmarking Series, the 2007 BTA Compensation Report, is now available for download in the members-only section of the BTA Web site. (6) The 2007 Business Equipment Quota Index (BEQI) is now available and can be ordered via the BTA Web site. The new and improved BEQI can be used by dealers to set sales rep quotas, measure market potential, evaluate/assign territories, measure sales performance and allocate advertising dollars. (7) Used to determine the winners of the 2007 Channel’s Choice awards, the detailed results of the balloting of dealers earlier this year is available as a 104-page report in the members-only section of the BTA Web site. See how the performance of your vendor and the others are viewed by the dealer channel. (8) A discussion forums feature has been added to the BTA Web site, allowing for multiple forums and unlimited discussion threads. Register today from the home page. (9) BTA members receive a 30-day free trial and 10 percent discount off a subscription to InfoTrends’ new Office Product D ealer Advi sor y Ser vice, w hich gives dealers access to critical business information, including analysis of industry trends and issues. (Visit www.infotrends.com/ trialbta and enter code BTA.) (10) BTA members receive a 15 percent cash rebate (quarterly from BTA) when they subscribe to BEI Services’ new Sales Compensation Model Service, which allows you to monitor machines and pay your reps based on the total solution, not just selling boxes. (Contact Wes McArtor at wes@bei services.com or (307) 587-8446.) See any benefits that are “new” to you? — Brent Hoskins

Executive Director/BTA Editor/Office Technology Brent Hoskins brent@bta.org (816) 303-4040 Associate Editor Elizabeth Marvel elizabeth@bta.org (816) 303-4060 Contributing Writers Jonathan Bees, InfoTrends www.infotrends.com Hank Blank, Hank Blank Inc. www.hankblank.com Robert C. Goldberg, General Counsel Business Technology Association Joanne Smikle, Smikle Training Services Inc. www.smiklespeaks.com Bob Sostilio, Sostilio and Associates International

Business Technology Association 12411 Wornall Road Kansas City, MO 64145 (816) 941-3100 www.bta.org Member Services: (800) 505-2821 BTA Legal Hotline: (800) 869-6688 Valerie Briseno Membership Marketing Manager valerie@bta.org Gary Hedberg Accounting Manager gary@bta.org Mary Hopkins Accounting Clerk mary@bta.org Cathy Kenton Membership Sales Representative cathy@bta.org ©2007 by the Business Technology Association. All Rights Reserved. No part of this publication may be reproduced by any means without the written permission of the publisher. Every effort is made to ensure the accuracy of published material. However, the publisher assumes no liability for errors in articles nor are opinions expressed necessarily those of the publisher.

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BTA PRESIDENT’S MESSAGE ®

Thanks BTA, it Has Been a Great Year n this space in the July 2006 issue of O ffice Technolog y magazine, I noted that I was anticipating a banner year for BTA. Today, with this month marking the close of my year as president of the Business Technology Association, I am pleased to say that my expectations were realized. It has been a banner year — one that I will remember for years to come. Thank you for the honor of leading your great association. We’ve made some significant strides in these past 12 months. We have strengthened our educational offerings, adding ProSolutions to the line-up. We’ve added more discount programs, such as InfoTrends’ Office Product Dealer Advisory Service. And, I am pleased to report, our membership numbers are strong — not only on the dealer side, but on the vendor side as well. This year, for example, such manufacturers as Kodak and Lexmark have joined long-time vendor members like Ricoh, Sharp and Toshiba as members of BTA. We’ve also had manufacturers return as members, such as Kyocera Mita America and Panasonic. Increasingly, vendors are seeing the importance of supporting the association that supports dealers. This year’s strides were the result of a team effort with volunteer member dealers and members of the staff working closely together to further strengthen the association. On the volunteer side, it has been my privilege to work alongside some ver y capable individuals serving on our national Board of Directors — Shannon Oliver, Ronelle Ingram, Bill James, Thomas Chin,

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Mike Blake and Rock Janecek. On the staff side, our employees in Kansas City have “rekindled the fire,” so to speak, under the leadership of BTA Executive Director Brent Hoskins, who has a passion for this association — a passion that serves us all. And, certainly, Bob Goldberg, ser ving as BTA’s general counsel, continues to do a phenomenal job advising dealers on legal matters and serving as an advocate for the independent dealer channel and our association. Of course, when I say it is “our” association, I mean “your” association. BTA was created by dealers, is governed by dealers and will forever remain dedicated to serving the dealer community. With that in mind, your continued membership in BTA is particularly important. There is strength in numbers. That strength makes it all possible — the research and information, legal services, peer collaboration, education and discount programs. As one of my last tasks as president, allow me to encourage you to take advantage of all that BTA has to offer. If you do so, your membership renewal will be among the easiest decisions you make each year. On this occasion, looking back at this past year, I cannot help but look back even further. I recall the day that my dad, Onva Hayes, purchased Purcell’s Business Products. He said, “Guess what, you’re running the business. That’s your job.” I quickly found that I needed some help. That’s when I turned to what was then NOMDA, now BTA. My membership in the association has made all the difference in the world. It provided me the education I sought, the support I needed and the friends in the industr y that I treasure. I’ve welcomed the chance to give something back to our association. — Dan Hayes

2006-2007 Board of Directors President Dan Hayes Purcell’s Business Products 222 E. 1st St. Campbellsville, KY 42718 dan@purcells.com President-Elect Shannon Oliver 25 Wheaton Circle Greensboro, NC 27406 soliver@triad.rr.com Vice President Ronelle Ingram Steven Enterprises Inc. 17952 Sky Park Circle Ste. E Irvine, CA 92614 ronellei@msn.com BTA East Thomas Chin Accolade Technologies LLC 604 Hampshire Road Mamaroneck, NY 10543 tchin@accotech.com BTA Mid-America Mike Blake Corporate Business Systems LLC 2018 S. Stoughton Road Madison, WI 53716 mblake@corpbussystems.com BTA Southeast Bill James WJS Enterprises Inc. 3315 Ridgelake Drive P.O. Box 6620 Metairie, LA 70009 bjames@wjsenterprises.com BTA West Rock Janecek Burtronics Business Systems Inc. 216 S. Arrowhead Ave. P.O. Box 1170 San Bernardino, CA 92408 rjanecek@burtronics.com Ex-Officio/General Counsel Robert C. Goldberg Schoenberg Finkle Newman & Rosenberg Ltd. 222 S. Riverside Plaza Ste. 2100 Chicago, IL 60606 robert.goldberg@sfnr.com

Kyocera June 07

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Vibrant color. Superior functionality.

Must be one terrific MFP.

Kyocera’s KM-C3232 Delivers Across-the-Board Productivity for Your Customers For an affordable color document solution that maximizes business productivity, discover the power and reliability of the KM-C3232. This workhorse is one of a series of color MFPs designed to keep your customers’ business color needs in-house and within budget. At 32 pages per minute of crisp black and white or brilliant color, it delivers impact to any job. Add the full range of advanced ﬁnishing features for compelling business communications. Plus optional software solutions maximize your customers’ hardware investment. Combine all this with strong dealer marketing support, and it’s no wonder Kyocera keeps you smiling. To learn more about Kyocera and its products visit www.kyoceramita.com.

KYOCERA MITA CORPORATION. KYOCERA MITA AMERICA, INC., a group company of Kyocera Corporation. ©2007 Kyocera Mita Corporation. “People Friendly,” “The New Value Frontier,” the Kyocera “smile” and the Kyocera logo are trademarks of Kyocera.

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Professional Services Setting your dealership apart from competitors by: Brent Hoskins, Office Technology Magazine

he transformation of the office technology industry continues. From analog to digital, standalone to connected and monochrome to color, the industry has seen its share of changes in recent years. And they keep coming. That’s a good thing, given the near-commodity nature of MFPs. What’s next for your dealership? How can you set it apart from competitors? Perhaps it is time for you to consider a professional services strategy. It is a strategy that has been frequently addressed at OEM dealer meetings and otherwise. Many would agree that it is the next logical step. With hardware increasingly intertwined with software-based solutions, the discipline that pulls it all together is professional services. It may already be a part of your dealership, but “under the radar,” so to speak. You may be performing, for example, a needs assessment or workflow analysis to some extent in order to land an MFP deal. Despite these assessments and analyses, however, the question arises: Is your dealership still seen as a hardware sales company? A better question may be: Have you branded or transitioned your dealership so that it is seen, perhaps, as a document workflow consulting company known for its professional services? The distinction that the question addresses points to the idea of transforming your dealership to a company that is seen as the source for helping end users in managing their document workflow. Specifically, you could be known as the local provider that saves businesses money and boosts document-related efficiencies through software, hardware and, yes, professional services. Regardless of these visions of a transformed office technology dealership, some dealers may remain focused on square one. That is, they may ask themselves, “What, exactly,

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are professional services?” Certainly, the definition remains a bit elusive. Comments shared by industry leaders provide a better understanding. “I would define it as consultative services that enable customers to solve specific business problems, either by way of reengineering a business process or optimizing a specific process,” says Bill Melo, vice president of national accounts marketing and operations for Toshiba America Business Solutions Inc. “It is a knowledge offering as opposed to a product offering.” Susan Gain, director of solutions sales and engineering support for Konica Minolta Business Solutions, offers a similar definition. “Professional services is working with a customer to resolve their business process issues from discovery to a proof of concept, scope of work, implementation and ongoing development,” she says. “It is all about helping a customer streamline their processes and reduce their overhead.” Gain manages the Solutions and Services Group at Konica Minolta. The group provides dealers with professional services to, in turn, resell — with a mark-up — to their customers. Konica Minolta personnel perform the services in cooperation with dealership personnel. “For those dealers who don’t have professional services, we are an extension to their dealerships,” explains Gain. A look at some of the services and descriptions provided by the Konica Minolta group provides an even greater understanding of professional services. They include, for example: “Form and Process Design” — Designing eForms and/or writing eWorkflow processes for a dealership’s customer; “Code Development” — Writing custom printer code, integration to other systems, customer interfaces, etc.; and “Document/Process Assessment” —

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opposed to conveying any Consulting with a dealer“... There is a high level of sort of process knowledge to ship’s customer on optimal awareness because every dealers.” As a result, he says, document workf low and manufacturer has been on most dealers and sales reps engine placement. are overwhelmed by the Actually, says Gain, a prithis soapbox. But, I would thought of understanding the mary goal of the Solutions guess at the most, only 10 many software applications and Services Group is to help percent of dealers have now on the market. In addidealers develop their own professional services as a tion, says Melo, dealers often professional services stratsteady business area.” remain focused on selling the egy. “They can use us, but — Bill Melo box, not the process. “They ultimately our job is to teach Toshiba America Business Solutions Inc. are using their knowledge as them how to provide these a means toward an end — to services,” she says. “By consell machines — as opposed to an end itself.” tracting with Konica Minolta and sending out one of their Increasingly, of course, dealers are recognizing that selling employees in the field with us, we can teach them. In fact, they can pay the person they hire to provide professional beyond the box — that is, the knowledge-based “value add” services through the profits they make by using our services.” in the form of professional services — is a route to greater Gain shares an example of the profit opportunity. “We revenue and company growth. Gain is a particularly strong have a dealer who we helped with a very large hospital proponent of the strategy. “The only way they are going to account,” she says. “We went in, did discovery and deter- get ahead is if they provide value-add — period,” she says. mined a way to streamline all of their forms processes. We “Every dealer out there, I don’t care how big or small, has quoted the dealer $20,000 in solutions and professional serv- something of value to add.” Chip Miceli, president of Des Plaines Office Equipment ices. The dealer not only did not blink an eye at our quote to him, he turned around and doubled his price to the cus- (DPOE) in Des Plaines, Ill., is among those dealers who see the need to transition to a value-add focus. “We’re not tomer. And, that was the first time that he used us.” The example illustrates a key value associated with pro- ‘selling boxes’ anymore and we’re really not ‘selling CPC’ fessional services — the high margins. “The dealerships that anymore,” he says. “What we’re doing is we’re going out and combine solutions and services along with hardware are we’re evaluating customers. In fact, I just had two of my pulling in 50 percent margins,” says Gain. “There is no value veteran sales reps change their titles on their business cards to the customer in the engine anymore. The value is in the to ‘consultant.’” The focus on consulting is often the expectation of cussolution that makes the engine become something more for a customer. The professional services allow the customer to tomers, says Miceli. “I was in the field in an account with a have and use it without having to work hard — to just take couple of salespeople the other day and the customer said, ‘What we really want before we go forward is a consultant.’ off and go.” Melo touts the high margins as well. “It is not unusual on And we said, ‘Okay, here’s what we can do for you’ — and we professional services to get 60 to 70 percent margins,” he charge for that.” Specifically, the dealership offers its DPOE Workflow says, “as compared to 20 to 30 percent margins on hardware.” With margins as high as 70 percent, all dealers are Program. “Any customer that wants the service has to pay jumping on the professional services bandwagon, right? The for it,” he says. “We have three IT people who can perform answer, of course, is that most dealers have not ventured into the workflow program. Once one of them does so and puts the area yet. “I think there is a high level of awareness together his findings, then the sales rep meets with the cusbecause every manufacturer has been on this soapbox,” says tomer along with our IT person to do the presentation.” DPOE sales reps are seeing the value of working with the Melo. “But, I would guess at the most, only 10 percent of dealers have professional services as a steady business area.” dealership’s IT personnel, says Miceli. “They see that they can Why the low percentage? Melo attributes the reality, in part, turn a $15,000 sale into an $80,000 sale with all of the things to the pervasive, continuing focus among manufacturers on that get tied into the deal, after we do the consulting,” he says. hardware and solutions products and their features “as “When we do consulting, we end up not only selling the 12 | w w w . o f f i c e t e c h n o l o g y m a g . c o m | J u n e 2 0 0 7

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Begin by providing procustomer more product, but “It’s not about price. fessional ser vices around we also end up selling them It’s about what I’m solutions that are more or less software that will make their going to do for the extensions of the MFP, such as lives easier, like Reform, eCopy scanning products. Equitrac, Laserfiche or Inclient to help them print “Start close to the MFP and tact. Then, of course, beor scan or better drive move farther and farther cause the profitability is their paper in whatever away as you gain experibetter, the sales reps see that direction it needs ence,” says Melo. “So, you they can make more money.” to be driven.” could ultimately move to While professional serv— Chip Miceli services associated with, for ices are often profitable, Des Plaines Office Equipment example, document manbillable services, it should agement, records managebe noted that such services ment, etc. Now, you are pretty far away from the box.” are sometimes offered at no charge, with the goal of There needs to be a team approach with dealership sales winning a deal in a competitive bid situation or otherwise. For example, within the System Support Group at Gordon reps, solution specialists, IT personnel, etc., reaping the Flesch Co. Inc., headquartered in Madison, Wis., the dealer- rewards. “If you silo the compensation, with the sales rep ship’s systems analysts often perform services at no charge. getting all the money, it causes bad feelings,” says Gain. “The “They get heavily involved in workflow analysis, needs sales process is a team process; no one is successful without assessments and printer fleet studies and those sorts of the others. The key is to make sure the team benefits, either things,” says Beth Somermeyer, a senior supervisor for the through compensation or recognition with everyone Gordon Flesch sales support team. “Those are typically pre- winning. Otherwise, it will not work.” The commitment to professional services must start at sales functions and we don’t charge for that; that’s our due diligence and our discovery for hopefully winning the deal the top. “One thing that I would say is common among successful dealerships is a commitment from the executive level that we’re researching.” Gain concurs that free professional services are part of to make the services program successful,” says Melo. “They the strategy. “Our mantra is ‘pre-sales for free, post-sales for say, ‘This is important to my business and this is how I’m a fee,’ because, obviously, we want to win the deal,” she says. going to do it.’” The dealership will need to continually adjust its busi“Now, that being said, if in the pre-sales process we develop ness model. “Those dealers who are successful in professome forms working with, let’s say, Prism DocForm, to show how Prism will work for the customer, if the customer buys sional services are not afraid to, every six months, look at from us and wants to use those forms in their business, then their business model to see if it needs adjusting,” says Gain. we will charge them for the development of those forms. “Services are perpetually evolving as the dealership grows.” As dealers consider pursuing a professional services We’re not going to give them away for free. But, other than that, doing the discovery and proof of concept to prove that strategy, perhaps the initial realization should be that it will help them transition away from traditional sales methods, we can meet their needs, that’s free.” Sometimes professional services are particularly prof- based on price or speeds and feeds. “I hate selling that way; itable. Other times they are offered at no charge, but lead to You might as well be a Wal-Mart,” says Miceli, noting that he greater revenues through additional software and hardware enjoys, instead, DPOE’s consulting strategy. “It takes me out sales. Either way, however, it appears that they can position of that mentality of ‘What’s your price?’ It’s not about price, a dealership for future growth and ongoing success. “Look it’s about what I’m going to do for the client to help them at how our industry is changing right now,” says Miceli. “If print or scan or better drive their paper in we don’t look at other ways to grow our businesses and con- whatever direction it needs to be driven.” Brent Hoskins, executive director of the tinue to make our businesses more money, I believe we are Business Technology Association, is editor going to lose out over the long term.” of Office Technology magazine. He can be So, where does the dealership begin? What factors should reached at brent@bta.org. be considered? Gain and Melo offer some advice to consider. 14 | w w w . o f f i c e t e c h n o l o g y m a g . c o m | J u n e 2 0 0 7

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Piecing Ideas Together.

The BPCA was founded in 1963 with the vision of forming a best practices organization that unites leaders of independently-owned office equipment dealers. The concept is quite simple - bring the leaders of these companies together so that they can share ideas, learn from each other, and take their businesses to the next level. Our members will attest that it’s well worth the investment by making each of them better leaders and bringing more value to their dealerships. Feel like there’s something missing from your organization? Let BPCA bring together all the pieces of the puzzle.

“Better Dealers Through Learning and Idea Exchange.”

If you’d like more information about our organization and how to join, please send us an email or give us a call. Phone: 800.897.0250 Email: info@businessproductscouncil.org Website: www.businessproductscouncil.org Membership Director BPCA c/o BTA 12411 Wornall Road Kansas City, MO 64145

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‘A Driving Force’ Ricoh explains new strategy during dealer meeting by: Brent Hoskins, Office Technology Magazine

hile they did highlight products, dealer support programs and sales successes at Ricoh’s recent Vi sion national dealer m eeting in Dallas, company officials also took a significant amount of time to explain the OEM’s new distribution and brand strategy, described by Ricoh U.S. President Tom Salierno as “a whole new strategy for the success of the extended Ricoh family in the U.S.” Themed “A Driving Force,” the May 1-4 meeting drew approximately 650 attendees. In his introductory remarks in the opening General Session, Salierno set the tone for the event. “If I were to declare one primary objective for what needs to be accomplished in this meeting, it is to help you feel as comfortable as we do with the changes taking place in the new Ricoh U.S. and, more importantly, how those changes are being implemented and how they will affect you,” he said. “We worked on this new approach for over a year and, to make sure that we made the best possible decisions for all concerned, we reached out to many individuals across the Ricoh family for input and recommendations.” Salierno listed the three changes that have occurred: Ricoh Corp. and Lanier Worldwide have merged into one legal entity called Ricoh Americas Corp. (The U.S. business unit will continue to be known as Ricoh U.S.) All existing Lanier direct branches have begun selling the Ricoh brand, joining the 15 Ricoh Business Systems branches in one unified direct operation called Ricoh Business Solutions, evolving to the Ricoh brand as the only brand sold directly by the company. The company’s 200-plus Gestetner brand dealers are being converted to the Lanier brand, joining the 44 existing Lanier dealerships. (The Gestetner brand will be phased out in the U.S. market.) The Lanier brand represents a $100 million business for the company, said Salierno. “For us to grow that to a true national dealer brand ... we would need to make an invest-

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Clockwise from top: Tom Salierno, president and COO of Ricoh U.S., addresses attendees during the opening General Session; dealers gather in the meeting’s Technology Expo; Sam Ichioka, chairman and CEO of Ricoh Corp., addresses attendees. ment so large that it simply wouldn’t make sense for us,” he said. “So, instead of adding another 160 or so Lanier dealers to give us equitable dealer distribution of about 200 points for each of four brands, we’ve taken our existing Gestetner dealers, plus our Lanier dealers, and brought them together into one strong, national brand distribution network.

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“Why didn’t we take the Lanier dealnot only in the U.S., but also in all of “We are signaling a ers and make them Gestetner?” he North, South and Central America.” asked, noting that the question is an While Ichioka and Salierno comnew era ... as a unified obvious one. “All the information and m ent ed fur th er on th e chan ge s at organization positioned indicators available to us pointed to the Ricoh, Salierno also commented on the for success not only in Lanier brand as the better known of the other significant change faced by the the U.S., but also in all two brands in the U.S. In fact, it has company — the recent acquisition of of North, South and more than double the national brand Global Imaging Systems by Xerox Corp. Central America.” recognition of Gestetner.” “Ricoh Americas Corp. has just notified Regarding the merger of Ricoh Corp. Global Imaging Systems that, effective and Lanier Worldwide, Sam Ichioka, chairman and CEO of May 31, Global dealerships will no longer be authorized as Ricoh Corp., said the move creates a unified company with Ricoh, Savin or Gestetner dealers,” announced Salierno, one management team, a common vision and common noting, however, that Ricoh will, through legal obligation, strategies. It also simplifies the company’s “brand mix to continue to make parts and supplies available for a defined maximize our distributon effectiveness,” he said. period of time (three years). “Global is now a competitor In addition, by changing the corporate name to Ricoh and we will treat them as such.” Americas Corp., said Ichioka, “we are signaling a new era for Brent Hoskins, executive director of the Business Technology ourselves as the American arm of a global Fortune 500 Association, is editor of Office Technology magazine. company, and as a unified organization positioned for success He can be reached at brent@bta.org.

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The Changing Market 2006: Color units rise, monochrome units decline by: Jonathan Bees, InfoTrends

n 2006, total placements within the U.S. copier/MFP market (all monochrome and color copier/MFPs) declined by 5 percent to 1,496,167 units. These results were consistent with the InfoTrendsâ&#x20AC;&#x2122; forecast for a modest decline, although slightly more negative. Monochrome placements are falling at a rapid rate, coming in at -9.2 percent (1,277,346 units), due to market maturity, competition from printer/MFPs and the ongoing transition from monochrome to color devices. Conversely, color copier/MFP placements continued to grow at a brisk rate, with an increase of 31.3 percent (218,821 units). Even so, the remarkable growth in color placements was unable to offset the monochrome decline, leading to a total market decline.

Color and Monochrome Copier/MFP Placements 1,600,000 1,407,485 1,400,000 1,200,000 1,000,000 800,000 600,000 400,000 166,628

218,821

200,000 0

Color Copier/MFP Market The growth in color copier/MFP placements can be explained in many ways. Clearly, large numbers of end users have decided that they are ready to try a color device. In a recent InfoTrends research study, the majority of end users said that a color multifunctional is the number one device they plan on purchasing as the next device they buy for their office. Laser and inkjet color MFPs top the list of product preferences, followed by color laser printers. Further fueling the color copier/MFP marketâ&#x20AC;&#x2122;s rise has been the staggering number of new models vendors have introduced. This influx of faster and more attractively priced color copier/MFP models has provided end users with a broad selection of color devices from which to choose. Along with increased performance at lower prices, the latest models also offer significantly more attractive operating costs, narrowing the gap between the cost of a monochrome and color page. 18 | w w w . o f f i c e t e c h n o l o g y m a g . c o m | J u n e 2 0 0 7

1,277,346

Color Copier/MFP Up 31.3%

Monochrome Copier/MFP Down -9.2% 2005

2006

Added to the mix is the high level of strategic focus that both vendors and dealers have placed on growing their color business. In a recent InfoTrends dealer survey, respondents said that color copier/MFPs were the most important product type in terms of their dealershipsâ&#x20AC;&#x2122; profitability by far. The next closest product type in importance was Segment 4 through 6 monochrome copier/MFPs, which we will discuss later in this article. Much of the color copier/MFP placement growth is taking place in the faster segments. Interestingly, placements in the 3-23 pages per minute (ppm) speed range are actually in decline (-24.1 percent) as vendors have focused their research and development efforts on faster models and have slowed product introductions at the lower level of the market. The 24+ ppm level saw impressive growth in placements, increasing 80.8 percent over 2005 placement results.

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chrome copier/MFP market is another Monochrome Copier/MFP Market In the end, not even matter. It will experience steeper declines The overall copier/MFP market is as color models take a greater share of behaving like a seesaw. As color placethe color copier/MFP placements and printer/MFPs gain more ments have risen, monochrome placemarket will be immune traction. In the end, not even the color ments have declined. While a large from competition from copier/MFP market will be immune from number of monochrome devices are cerprinter/MFPs ... Only the competition from printer/MFPs. In the tainly being replaced by color devices, MFPs with the best value newly converged copier/printer market, there are not enough of them to balance propositions will survive. only the MFPs with the best value propothe slate, leading to the overall marketâ&#x20AC;&#x2122;s sitions will survive. 5 percent decline. Jonathan Bees is director of InfoTrendsâ&#x20AC;&#x2122; Digital Peripheral So where are the monochrome units going? The monochrome copier/MFP market has been mature for some time, Solutions Service. He has more than 25 years experience in the office imaging industry, including market research, product which has something to do with it. But there are more ominous management, competitive analysis and sales. trends for copier/MFP vendors on the horizon. Increasingly, Prior to joining InfoTrends, he was printer/MFPs from vendors like Hewlett-Packard and Lexmark are making headway in the market. These typically A4-size editor-in-chief of Better Buys for Business, a MFPs are currently having an effect on Segment 1-3 publisher of information and analysis on the office imaging market for end users. copier/MFP placements, and they are poised to move into the Visit www.infotrends.com. faster copier/MFP segments. Furthermore, HP and Lexmark offer A3 MFPs as well, and these are indistinguishable from copier/MFPs in terms of functionality and features. The main differences between these printer/MFPs and copier/MFPs are they are sold through different channels of distribution and they typically use cartridge-based consumables. In 2006, the monochrome copier/MFP market featured uneven results within the various segments. Segment 1 had a very steep decline (-45.4 percent). Retail channel models in this segment have experienced a steady decline in prices over the years, yet their engine speeds are faster with each passing year. As a result, machines which were previously classified as Segment 1 models have now moved into Segment 2. In turn, Segment 2 grew dramatically because of this trend, increasing 70.1 percent. The middle part of the monochrome market declined across the board. Segment 3 (-3.1 percent), Segment 4 (-3.6 percent) and Segment 5 (-10.7 percent) were all down. The lone bright spot was Segment 6, which came in with an increase of 39 percent. The growth in Segment 6 can be explained in part by the increase in new models from vendors such as Canon, Konica Minolta, Ricoh and Xerox. These vendors have introduced highly capable new machines during the last year or so, and have placed a priority on developing production businesses. Conclusion Looking forward, the color copier/MFP market has several years of rapid growth left, but the outlook for the monow w w . o f f i c e t e c h n o l o g y m a g . c o m | J u n e 2 0 0 7 | 19

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Remote Diagnostics The service tool for greater customer satisfaction by: Bob Sostillio, Sostilio & Associates International

ccording to a number of sources, service revenu e contributions range from 27 percent to 32 percent of a dealership’s overall revenue. The current BTA Service Report says 32 percent of total revenue comes from service while our most recent dealer sur vey recorded 27 p erc ent. In eith er case, it demonstrates that no dealership survives without a profitable revenue stream from service. As thinner margins on hardware and “C P C ” programs generate less profit, service is the last leg of the three-legged stool that props up the dealership. Therefore, one would expect that any “tool” that can improve ser vice revenue by increasing efficiency and productivity would be exploited within a dealership. Yet, according to our research, only 39 percent of dealers surveyed said they employ some type of remote diagnostics.

The Value of Remote Diagnostics Remote diagnostics are service tools that proactively monitor and analyze an installed base of MFPs or printers and send a status report to an assigned entity. Customers will undoubtedly see a value in remote diagnostics with the ability to honor those quick response guarantees made at the time of the sale, and customers of high-volume devices will see the value of tracking and flagging “life” parts and 20 | w w w . o f f i c e t e c h n o l o g y m a g . c o m | J u n e 2 0 0 7

providing accurate meter readings seamlessly to the machine operators. Having remote diagnostics installed in a dealership’s machine population can provide better management of service technicians by tracking time on site, call backs and parts usage. And the device can supply the dealer and his (or her) customer with an accurate machine history. For existing accounts, it may be a challenge to go back and install remote diagnostic devices. According to our data, connectivity of black-and-white units was under 33 percent in dealerships under $5 million in annual sales. But today, new sales data tells us that two out of every three black-and-white models — and virtually all color units —

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are sold connected and , therefore, should be candidates for remote monitoring devices.

productive, administrative work performed by technicians is costly and time consuming. In most cases, ser vice reporting, trip reports, meter reads and parts usage analysis can be automated. With only 39 percent of dealerships communicating with their installed base via remote diagnostics, the rest have burdened their technicians to tract yields, software levels and even firmware revisions of devices in their territories while being asked to conduct document assessments and develop system designs. Those dealerships that introduced remote meter reading capability have cut down on human error in tracking some of their product yields and removed an administrative burden from service. Granted, remote metering is crucial to fleet management and capturing supply yields, but to improve technician efficiency and productivity, more communication is required. Imagine a service department capable of monitoring a technician’s car stock as he leaves the company parking lot by using a system that employs RFID (Radio Frequency Identification) for tracking parts in and out of its parts department. Imagine never having to ask where a technician is and, instead, using a GPS (Global Positioning System) that tracks a technician’s whereabouts and pinpoints his location. These systems exist today and are employed in other industries to improve efficiencies and the profitability of fleet servicing. It is only a matter of time before the office equipment industry embraces it. Presently, remote diagnostics in the copier/MFP industry consists of a service department polling a device for periodic maintenance checks, page counts, image scans, toner levels, drum usage and fuser usage. Some systems can notify a technician or service coordinator of the jam frequency of a particular model or provide a notification if the device is “down” for an extended period of time. Some can provide a problem alert when there is a unit or component failure. Any methodology that reduces or eliminates administrative time, automates simplistic tasks or manages travel time can only improve a technician’s productivity and efficiency, while at the same time reducing his frustration and increasing the dealership’s profitability. In the past, when the dealership principal wanted to know what was happening in his business, it was generally learned anecdotally — after the fact and after the technician visited the account. With

Any methodology that reduces or eliminates administrative time, automates simplistic tasks or manages travel time can only improve a technician’s productivity ...

Uptime — Measuring Service If I’m going to talk about the value of remote diagnostics as a possible service tool, then I had better define how I think service is measured. The measurement of any service department is its ability to keep the greatest amount of “uptime” in its installed base. Specifically, the more customers use your product without interruption or failure, the happier they will be and the better chance you have of retaining them as your customers. Yet, a service technician spends only about two-thirds of his (or her) time dealing with customers. The rest of his time is spent traveling (19 percent), doing administrative work (12 percent) and training (5 percent). In the 1980s, product reliability and quality control took center stage and product documentation (administrative) tasks became very important. “Japan Inc.” promoted its product reliability and quality by endorsing the Deming award; the United States countered with its Balridge award. Both are award organizations that exhibit the highest degree of commitment to quality control and who made yearly improvements in the pursuit of quality. That means tracking machine performance. Both awards provided a methodology (statistically) to measure degrees of performance and reliability and eventually lead to TQC (Total Quality Control) and development of tools to capture product performance. It was a matter of “uptime,” copies between failures, response times, monthly volumes, etc., that drove customer satisfaction marks to higher levels. As service technicians were responsible for keeping the quality and performance of various models consistent over an extended period of time, they became the linchpin in a dealership’s TQC and its success or failure.

Service Revenue Lost or Poor Communications Everyone in the office equipment industry today knows that service income is the only product that is the most prone to human error and is dependent upon a service department that has a 64 percent utilization rate of its staff. Meter clicks and service calls are customer dependent, while internal tracking of a dealership’s machine population depends upon how complete service reports are made and how accurately the data is entered into the system. Non-

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remote diagnostics, the dealership principal gets the real-time status of the machine base and does not necessarily have to wait for the service report to be entered into the system.

The Costs are Justifiable The cost of a good dispatch system and monitoring software that a service manager can use to access real-time status of the MIF (machines–in-field) is justifiable. Take a hypothetical dealership where the average service call per unit is five per year, and a technician can cover 2.8 calls per day on those units. With remote diagnostic software installed in the base, he is able to reduce on-site time because the exact failure is known beforehand and the right part is taken to the account on the first visit. In addition, the technician does not have to conduct on-site troubleshooting. By being better prepared, the technician adds half of a service call to his average daily responses or increases his territory by 18 percent, roughly 25 machines in this example. Now let’s run the same exercise and reduce non-scheduled service calls. This can be accomplished by setting the remote diagnostics system to flag those accounts that are due for preventative maintenance well in advance of a failure. Hypothetically, the technician cuts the annual call rate per machine from five to 4.5 visits per year, thereby increasing his overall territory by 10 percent or roughly 15 machines. Combining the impact of remote diagnostics in this example has improved efficiencies and allowed the technician to cover almost 30 percent more units than without having it. Think of that the next time you have to hire and train a new service technician. What is Being Offered? Every manufacturer is now offering some type of meter capturing and/or remote diagnostics software either embedded, over the Web or through third-party vendors. Canon and Sharp use Web-based systems. Canon calls its system “imageWare Remote,” while Sharp’s is referred to as “Remote e-mail Diagnostics (RED).” Toshiba has a Global Service Portal in conjunction with software from MWA Intelligence, while Konica Minolta just announced its bizhub vCare. Ricoh will launch its second generation @Remote this summer. Each supplier realizes that loyalty and perceived reliability is important to its channel 22 | w w w . o f f i c e t e c h n o l o g y m a g . c o m | J u n e 2 0 0 7

partners. Others, like Kyocera Mita and Océ, utilize third-party suppliers to help dealers track and capture meter clicks and parts usage. Even GreatAmerica Leasing utilizes “Fleetview” to monitor its base of installed units. Some thirdparty companies, such as MWA Intelligence, w ork w ith O c é, S har p and Toshiba in providing dealers with levels of confidentiality to ensure that user information is protected. If a supplier needs machine performance history, only the raw data without the clients’ names is provided. Almost all vendors offer a menu of software and technology either organically or by partnering with companies like PrintFleet, FMAudit and OMD to help capture meter clicks or usage and maintain levels of security and confidentiality.

Remote diagnostics software ... frees up a technician’s ... time for more repair time at customer locations as well as lowers a dealership’s costs ...

The “Uptime” Tool Remote diagnostics software and implementation frees up a technician’s administration time for more repair time at customer locations as well as lowers a dealership’s costs in recording and transferring meter reads. It can improve a technician’s efficiency and increase coverage, which equates to improved profitability. Also, remote diagnostics provide real-time status, reduce errors when dispatching a technician, provide accurate meter reads on time and, overall, are excellent management tools to measure efficiency. Higher efficiencies from revenue-generating positions improve cash flow and profitability. Remote diagnostics reduce customer intervention and help to accurately forecast and manage car stock and parts inventories. They can be customized for individual accounts and they help reduce on-site repair time by assuring that the tech arrives with the correct knowledge and the right part at the right location. They increase “uptime,” which means greater customer loyalty. Above all, remote diagnostics help to measure what you have to manage. Bob Sostilio is president and CEO of Sostilio & Associates International, an Ocala, Fla.-based consulting firm serving the office technology industry. He has 34 years of experience in the industry, including service in senior management positions with leading manufacturers and research organizations. Sostilio can be reached at (352) 624-2625 or sostilio@flash.net.

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COURTS & CAPITOLS

Employee Ownership ESOP: The ‘E’ stands for exit strategy by: Robert C. Goldberg, General Counsel for the Business Technology Association

money he or she earns from selling the ny business owner, at one time or The tax breaks stock to the ESOP into a “qualified replaceanother, considers leaving the busfrom an ESOP are ment property” — namely stocks and bonds iness. There is always the option of substantial. As the debt — without having to ever pay a capital gains selling your business and many pursue is repaid, not only tax on the sale of the stock to the ESOP. The that option. However, the sale of your busionly requirement is that the ESOP must ness often does not benefit the employees is the interest deductible hold the stock for at least three years. who helped to build the success you enjoy. from taxable income, Yes, there are drawbacks. Perhaps the Thus, many business owners consider an but so is the principal. most famous ESOP failure was United AirEmployee Stock Ownership Plan (ESOP) lines. Initially the employees made concesas an alternative. An ESOP allows you to sions to improve the profitability of the company and the stock sell the business to the employees and offers significant tax price rose significantly. Many employees were making thouadvantages as well. More than 10 million workers have stakes in their compa- sands of dollars — on paper. Following Sept. 11, the stock nies through ESOPs. ESOPs, established by federal law in 1974, crashed, wiping out the paper profits and ultimately resulting have been used by approximately 10,000 businesses. Only 5 in bankruptcy. However, this is an exception because most percent of the existing ESOPs represent large businesses. Most ESOP companies out-perform non-ESOP companies in the are set up when the owners of a family-owned corporation or a same industry. Giving employees a stake in the profitability is privately held small business wants to sell all or part of the always a significant incentive. An ESOP is not appropriate for every business and you business to employees. A business owner who wishes to set up an ESOP creates a should engage a qualified consultant to determine if it is right trust. The owner then places his or her stock in the trust and for you. An appraisal will be required to determine the value the employees purchase it over time. Often it is necessary for of the stock and, at times, the appraisal does not coincide the employees to secure a loan to finance the stock purchase. with the owner’s opinion of the worth of the company. An For small businesses, having employees obtain a loan can be a attorney will be necessary to prepare the ESOP Plan Docustumbling block — the result being owner-financing and the ment. The plan must be adopted and submitted to the possibility that the business does not succeed without you and Internal Revenue Service to become “qualified” and thus elia loss is incurred. Having to take back your business after a gible for the tax breaks referenced. The process of setting up an ESOP is complicated, but manageable, and should not disfailed ESOP is not an attractive result. As the loan is repaid, the shares are allocated to individual courage consideration. For owners seeking to exit the business and provide employees employee accounts within the trust. A number of different forwith an ownership opportunity, an ESOP is a solution. It may also mulas can be used for allocation. The most common are allocation in prop or tion to c omp ensation , al lo cation in be a solution where there is not a market for the business and liqproportion to ultimate ownership percentages, allocation of uidation would result in an inadequate return — hardly the situastock according to years of service, some combination of these tion in the business equipment industry. ESOPs increase employee motivation, create a market for the sale of existing and, equally, all of these options have been used. The tax breaks from an ESOP are substantial. As the debt is shareholder shares and provide substantial tax repaid, not only is the interest deductible from taxable income, and financial advantages. When considering an but so is the principal. Sometimes the tax breaks are large exit strategy, consider an ESOP. Robert C. Goldberg is general counsel for the enough to offset all of a company’s taxable income. There is also Business Technology Association. He can be a significant tax advantage for the selling owner. If the ESOP reached at robert.goldberg@sfnr.com. holds at least 30 percent of the stock, the owner can roll the

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Paper Connection Forum eCopy hosts event May 14-17 in Miami, Fla. by: Brent Hoskins, Office Technology Magazine

Ricoh offering embedded eCopy solutions). ith the goal of further promoting its Meanwhile, on the software side, there are curdocument scanning solutions, along rently 57 eCopy connectors being shipped by with its “connectors” and those of ISVs and 15 available directly from eCopy, with many of its partners, eCopy hosted its third others in development. Today, eCopy has annual Paper Connection Forum May 14-17 in employees or representatives in the United Miami, Fla. The event drew 423 attendees from States, Canada, Europe, Japan, Australia and is manufacturing companies, dealerships and looking at opening a new office in Hong Kong. independent software vendors (ISVs) as well as “We announced that we sold almost $63 mila number of end users. lion in product last year,” said Schmid. “Our fiscal Founded in 1992, eCopy’s solutions line-up year ends this June and our business continues includes ShareScan, a software product that to grow. We will announce bigger numbers this enables network users to easily send documents eCopy President year than we did last year.” scanned on an MFP or scanner to specific appli& CEO Edward Schmid During the Forum , eCopy made several cations, and ScanStation, an external solution announcements. They included: that attaches to the MFP or scanner, featuring an integrated, The launch of eCopy Professional Services (ePS), an free-standing touch screen, keyboard and PC. Software “connectors,” developed by eCopy and third-party ISVs, provide a offering designed to help dealers provide customers with eCopy implementation, customization and training services. link between the MFP or scanner and software applications. The schedule for the Forum included 14 education sessions Th e of fering provides dealers with additional eCopy and a Partner Showcase Pavilion, featuring approximately 50 ShareScan and eCopy Desktop (another eCopy solution) exhibiting companies. Prior to the opening of the Forum, expert resources to supplement their own capabilities. The availability of eCopy Desktop Software Developer eCopy hosted a Media and Industry Analyst Day, during which Toolkit (SDK), used to integrate document imaging capabilieCopy President and CEO Edward Schmid provided an ties with business applications. The SDK provides application overview of the company. He began by noting the two catalysts of eCopy’s growth — interfaces, a wizard that generates the sample code framethe first being the transition from analog copiers to digital work and documentation to develop connectors. The launch of an MFP document imaging solution for MFPs. “Almost every company had a copier, so we knew every company was going to have a scanner,” said Schmid, empha- the U.S. Department of Defense (DoD) that complies with sizing that the rise of MFPs ultimately would allow eCopy to Homeland Security Presidential Directive/Hspd-12. The implement its vision of having everyone in the office capable solution enables DoD employees to use Common Access Cards (CACs) to securely identify themselves, log in at the of processing paper documents electronically. The second catalyst, he said, became apparent with the now MFP and scan documents directly to electronic workflows common practice of placing e-mail addresses on business cards. or business software applications, ensuring access to only “That meant that anyone could scan a document and send an e- authorized users. The notable milestone that Canon U.S.A. has sold more mail with that document attached, reaching anyone in the than 50,000 eCopy ShareScan software licenses through its world directly with paper-based information,” said Schmid. With document scanning now prevalent in the workplace, dealer and retail channels. The product has been available eCopy has seen substantial growth. Just over two years ago, through Canon U.S.A. since 1999. Brent Hoskins, executive director of the Business Technology Canon was the only MFP OEM offering eCopy solutions. Association, is editor of Office Technology magazine. Today, eCopy’s OEM partners also include Hewlett-Packard, He can be reached at brent@bta.org. Konica-Minolta, Ricoh, Sharp and Toshiba (with Canon and

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BTA Southeast in Nashville Attendees comment on successful conference by: Brent Hoskins, Office Technology Magazine

ith the goal of providing an educational, relaxing venue for dealers and vendors, BTA Southeast recently hosted its spring conference in Nashville, Tenn. The event was held May 18-19 at the Union Station Wyndham Historic Hotel. The conference featured three education sessions: “Moving Your Solutions Business to the Next Level,” presented by Darrell Amy, president of Dealer Marketing Systems Inc.; “Establishing Your Business, Not Your Vendor,” presented by Robert C. Goldberg, BTA general counsel; and “The Advantages of BTA Membership,” presented by Brent Hoskins, BTA executive director. The conference schedule also included a dinner cruise aboard the General Jackson Showboat. Comments from attendees reveal the value of the conference: “The venue of the BTA Southeast meeting in Nashville, Tenn., was relaxing, yet beneficial to our dealership. The educational presentations were relevant and focused on the practical issues that determine the success of the office equipment dealership. Robert Goldberg’s presentation alone was worth the trip!” — Tim Teasley, senior vice president of operations, SYSTEL, Fayetteville, N.C. “You always get something at these meetings — a manufacturer has a program you don’t know about, a supplier who has better prices on toner, a contact with another dealer who has a similar problem to yours, a BTA program you are reminded about, etc.” — Keith Walker, president, Data Copy Inc., Louisville, Ky. “To me, the value of the BTA Southeast meeting in Nashville was that it gave me some new ideas and refreshed other things that I had forgotten about and, as a result, ‘recharged my battery.’ All of the seminars were excellent and the sponsors were good contacts to make. I also enjoyed the association with other BTA members.” — Phil Lovell, president, Lovell Office Machines, Columbia, Tenn. The conference also included five sponsoring exhibitors: Color Imaging, Compass Sales Solutions, Digital Gateway, The Utility Company and SYNNEX Corp. Sponsors shared comments on the success of the event as well: “BTA Southeast Nashville was the first regional BTA session we exhibited at and I really liked the format. It is a much more intimate, focused group that allows considerable face time with the very dealers we hope to partner with. It pro-

Top: BTA General Counsel Robert C. Goldberg presents his education session. Bottom: The Utility Company’s Jason Creally (second from left) visits with conference attendees. vides ample opportunity to have good, in-depth conversations with members compared to the minute-long conversations that we normally get at large trade shows with thousands of attendees and hundreds of vendors. It also provides a nice mix of ‘business and pleasure’ activities. We look forward to future events.” — Jason Creally, sales director, The Utility Company, Ottawa, Ontario, Canada. “The BTA Southeast Nashville meeting was a great success. The show was well attended and the presentations were informative. BTA seems to have its finger on the pulse of the dealer network it supports. Keep up the good work!”— Rob Gilbert Sr., distribution sales manager, Fleet Management Services, Compass Sales Solutions, Eagle, Idaho. The next BTA Southeast conference will be held Oct. 26-27 in Waynesville, N.C. Visit www.btasoutheast.org for details. w w w . o f f i c e t e c h n o l o g y m a g . c o m | J u n e 2 0 0 7 | 25

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A Path to Great Leadership It begins with assessing, confessing & addressing by: Joanne Smikle, Smikle Training Services Inc.

o one wants to be a lackluster leader, but somehow it happens to many. We get caught up in the day-to-day grind: stressors from customers, staff and competitors and any number of other pressures. In light of all of these unpleasant realities, it becomes even more important to carve our own path to exemplary leadership. The path will be dif ferent for each individual because we each bring all of our uniqueness, peculiarities and propensities to the table. This article details the three bricks that must be laid on whatever path you take on the journey to fulfilling your maximum potential. The three essential bricks are assessing, confessing and addressing. These activities will help you analyze your leadership abilities. Thorough analysis enables you to work with what you have and develop what you lack. Confession gives you the ammunition to begin conversations about your development, how your style impacts your organization and your colleagues. It also gives you the communication skills to promote professional development with your staff. Finally, being able to address your specific developmental needs is what must be done to move from theoretical to practical. If you think about what you need to do and then talk about what you need to do without ever doing it, both the thought and the conversation were pointless.

Assessing Assessment can take on many different forms. You can use formal analytical tools like the Myers-Briggs or the DDI instruments. These instruments provide you with valuable insights on both your style and how it may impact others in the workplace. This information can help you better understand how you actually lead, manage resources and communicate. If you prefer a more comprehensive assessment, use any number of 360-degree measurement instruments. This approach requires you to gather the perceptions of peers, staff and superiors. An 26 | w w w . o f f i c e t e c h n o l o g y m a g . c o m | J u n e 2 0 0 7

approach like this yields useful information about the perceptions that you create in the workplace. It also gives you greater insight on the impact that you have on colleagues at all levels. For many, this approach can be a bit intimidating. It forces you to look beyond how you see yourself and see the real you with a complete array of strengths and weaknesses. You may choose a more informal approach to assessment. Consider having candid conversations with colleagues who are willing to give you straight feedback. This means that you have to select people who are both objective and unafraid of providing constructive criticism. A byproduct of this tactic is that it strengthens relationships. It may also help you develop a mentoring relationship with someone who you respect and trust. Confessing The old adage says that confession is good for the soul. I do not know about all of that, but I do know that confession is important in the professional development process. Once you have used assessment to gather data about who you are and how you are, you must then confess the realities to yourself. Here is an example from my own assessment: First off, I must confess that I practice avoidance. If there is a need for a difficult

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conversation I will avoid that discussion The second conclusion I have come to The second conclusion until it becomes imperative, which is genis that avoiding difficult situations actually erally a little late. As a result, I frequently makes them worse for everyone involved. I have come to is let things slide when, in fact, they should Think about it: By avoiding the difficult that avoiding difficult be addressed. conversation with the problem staff, does situations actually makes Recently, I had an experience with a the problem go away? No. In fact, the them worse for everyone client that was uncomfortable. I needed to behaviors become more ingrained and involved ... Does the let someone I genuinely liked know that I harder to correct. Avoidance makes probproblem go away? No. did not want to participate in an activity. lems bigger and more difficult to handle. My reason was simple, I did not want to do Confessing these personal propensities it. It was not a contractual requirement. But, having the con- allows you to deal with both the behavior and the results. This versation was tough because the client felt that I should par- is not to say that confessing is easy. Quite the contrary â&#x20AC;&#x201D; it is ticipate in every single social gathering. While I am a social very difficult. But, being clear about your behavior enables you creature, there are some gatherings that make me uncomfort- to be more aware and to modify it. able. Long story short, they were planning for me to attend this black tie gala and, at the eleventh hour, I confessed that I Addressing would not be attending. This created a few hurt feelings that The first two strategies give you everything that you need to could have been avoided had I not been such a wimp. address your developmental needs. There are any number of I was keenly aware of my propensity toward avoidance paths that you can take to plot a workable course. My preferbecause I spent a lot of time discussing this with my sister, who ence is a six-fold process: also serves as my mentor. She has asked me to analyze both the Declaration of intent why and when of avoidance. I have come to a few conclusions Statement of objective(s) about this behavior. The first is that I pretend that if I do not Brainstorm action steps address a problem, it will somehow go away. Have you ever had a Prioritize action steps difficult staff member who presented problems for you and Act everyone else? Have you then just tiptoed around the person and Evaluate made excuses for his (or her) behavior? Have you said things like, Let us begin with the first step â&#x20AC;&#x201D; declaration of intent. This â&#x20AC;&#x153;Well, thatâ&#x20AC;&#x2122;s just how he is,â&#x20AC;? or â&#x20AC;&#x153;Just ignore her, sheâ&#x20AC;&#x2122;ll shut up even- is a simple, well-thought-out statement that defines why you tuallyâ&#x20AC;?? These are clear signs that you, too, practice avoidance. are working on your professional development. It is a guide.

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28OT0607

6/3/07

8:46 PM

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on cost. Since you know what financial Think of it as your developmental stateUse the brainstorming resources you have (both as an individual ment of strategy. Examples include: and within the organization) you may “I am growing into a proactive leader process to gather decide to accomplish tasks based on the who emphasizes learning and formal eduan exhaustive list bucks. You may decide to prioritize based cation for myself and others.” of any and every on the timing of business cycles. Crunch “I am a dedicated leader who strives activity that you could times are not the right time to test new to balance professional dedication with implement to make approaches. Timing makes a tremendous the balancing of life.” your objective reality. difference in whether you can hit the mark. “I am a senior executive who proNo matter how you decide to prioritize, it duces consistent results that positively should be consistent with your intent. Make sure that your priimpact performance and people.” Whatever your intent, it must reflect both your core values orities reflect what you have stated in your declaration of intent. The fifth step is action. Doing the hard work of the first four and your long-term desires. stages is wasted energy if you never implement all of those The second step is to state your specific developmental objective. This is a statement of how you plan to opera- ideas. Action cannot be half-hearted. Use every bit of energy tionalize your strategic intent. In its specificity, it anchors that you have to act with purpose and clear intent. Rather than frustrating yourself, focus on one or two action steps at a intent to action. Examples of solid objectives include: To better utilize the skills of department managers so time. Small steps beat no steps. These small steps also allow they work to their fullest potential with the aim of maximizing you time for ongoing evaluation. They produce a string of successes that you can measure and celebrate. revenue growth for the association. It is that measurement and celebration that make the final To build a cadre of senior managers able to assume greatstep possible. Every action must be measured. Evaluate based er responsibilities in the company, your professional associaon both execution and results. Ask yourself what you would tion and your industry. To watch industry trends and gauge your activities so have done differently implementing each action step. Then ask that we are consistently able to meet pressures of a changing yourself if you got the results you wanted, and why or why not. It is this evaluation that enables you to track your own best pracbusiness environment. Whatever your objective, it needs to provide specificity and tices. What are the activities that are worth repeating? How can clarity. Skip a lot of flowery words or theoretical mumbo you modify your approaches? Which pieces of your action plan jumbo. Make it plain. Make it basic. Make it reflect your can you transfer into other areas? The answers to these questions will provide a framework for your best practices. bottom-line intent. The third step should be the most fun, although it can be the most difficult. Brainstorming a wide range of ideas Summary Navigating today’s business terrain can be difficult. It can be requires you to get beyond the limitations of your own thinking. You have to exercise a lot of creativity. I generally get stressful. It can be trying. However, even with all of these preshelp at this stage. I try to enlist the assistance of friends and sures, this navigation can be rewarding, insightful and enercolleagues who think differently. I know that my limited gizing. It is your mindset and approach that determine both thoughts will undoubtedly yield limited results. Adding more how you navigate and the results that you get. Use the model introduced to plot a course that ensures breadth and depth to the mixture can only yield better results. Use the brainstorming process to gather an exhaustive list of your continuous growth and development. Modify each step any and every activity that you could implement to make your of the process so that it meets your needs. Once you have objective reality. Even the ideas that seem preposterous should mastered the process share it with other leaders in your combe on the list. The more divergent from your thoughts, the pany so that they, too, can work on their probetter. These distinctly different ideas can potentially yield fessional development. Joanne L. Smikle is the author of innovation that you may not have otherwise considered. "Calamity-Free Collaboration: Making The fourth step is to take that long list and begin prioritizing. Teamwork WORK!" A speaker, consultant and There are any number of ways to prioritize. You could do it by trainer, she can be reached at (301) 596-3140 grabbing the low-hanging fruit first. This enables you to have or joanne@smiklespeaks.com. quick successes that build confidence. You may prioritize based 28 | w w w . o f f i c e t e c h n o l o g y m a g . c o m | J u n e 2 0 0 7

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6/3/07

8:50 PM

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PRINCIPAL ISSUES

Networking for Business Simple tips for generating new clients & revenue by: Hank Blank, Hank Blank Inc.

etworking can be a very power ful but low-cost method of acquiring new business. It is a proven method of developing relationships that help you win and keep a recurring stream of revenue coming into your business. Networking is one of the most cost-effective ways of increasing visibility and gaining new business. But what is its impact? Well, 75 percent of all deals are completed because of relationships and referrals. Isn’t that the way your business has grown? Networking is a hot topic right now. MySpace is a social network. Keith Ferrazzi’s book on networking, “Never Eat Alone,” has been on the New York Times Best Seller list. If you want to find a new job, 70 percent of all new jobs are found through relationships. Though people appreciate the power of networking, many do not know how to do it themselves. My approach to networking is a little different, in that I base my networking on the philosophy of getting more by asking for less. Many people avoid networking because they think of the stereotypical “martini guy” walking around a room, handing out business cards and asking for orders. But that is the last thing networking is. Doing that is credibility suicide. Many people think that an approach that is “less for you, but more for others” is counterintuitive or contradictory. They think, “Hey, I am networking to get ahead and it’s about me. Me, me, me.” But the reality is that you can help get more of what you want if you spend time helping others get what they want. When you press, you often shoot yourself in the foot. Here is what networking is not: It isn’t going to an event and standing beside the bar with somebody from your company and only talking to your friends. That’s partying. Is that what you consider networking? Many people do. Many of us really do not like to try new things. We say that we do, but there is a big difference between trying a new martini flavor and walking into a room of 500 strangers. For me, walking into a room like that is an adventure.

What are the benefits of networking? First, networking leads to a revenue stream. I call that financial currency. I have a lot of expressions that people have sent me that relate to networking: “Your net worth is equal to your network. The opposite of networking is not working. It is not what you know but who you know.” Networking also makes you smarter. We are an amalgam of everyone we meet. Networking exposes you to more people and broadens your base of experience. You know more things, you have more options and you learn a lot. You also become more valuable to your company and your clients because you can provide added value for them. You become the gatekeeper — the go-to person. You are the resource that can make it happen. Networking also provides social currency. Social currency starts with the understanding that money is not meaning, and success is not significance. Over 90 percent of rich, successful people are not happy. The breadth of your network is a measure of your real worth. For me, a key measure of a person’s success and his (or her) value is his relationships. Material possessions are not important. It is the people you know and the relationships you have that provide real value. Social currency and financial currency go hand in hand. If you have strong relationships, then people become your apostles, advocates and your business development people. Social currency validates you and closes some of that distance when trying to close a business deal. Social currency also brings you authenticity. Another benefit of networking is career insurance. In today’s business environment, the best way to save money is to lay off employees. But who will be the last person to get cut? Would it be the networker who is connected and can provide new business in the future or the grinder who is inside but does not know anyone? So, now that you know about the benefits of networking, where can you network? There are hundreds of networking w w w . o f f i c e t e c h n o l o g y m a g . c o m | J u n e 2 0 0 7 | 29

30OT0607

6/4/07

11:21 AM

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passion and a desire to help you succeed. organizations and groups that you can Go ethnic — Most ethnic group organizaconnect with. Go to your library and talk to Reconnecting with your tions were the first social networks to help the reference librarian who will provide you past can be a very new arrivals. Get connected with your herwith a list. Most newspapers have job rewarding experience itage. They will be more loyal, more helpful resources online and a list of networking ... With history comes and a great source of networking contacts. groups. Check your local business press trust, compassion and Network 24/7. Network everywhere — listings. Also, network with alumni groups. I a desire to help you You should always keep business cards in live in California but went to school in succeed. your pocket at all times. Networking is Canada and I network with my Canadian alumni group locally. about creating synergy. I got my first client Do you want to contact strangers and leave a message that by sitting around a fireplace at a bar. If you go to the gym in the you could help their organization or would you rather meet morning, you should have your business cards in your pocket. them at a bar while they are watching their favorite alumni Do not network only during business hours — networking is a team with the local alumni chapter and develop a social rela- way of life. Keep your cards in your pocket seven days a week. tionship first? Which builds the better bond? Which provides Why? Because you do not know where your next lead or conthe higher return? nection is going to come from. Start your own networking group — Think of potential Most people blow off networking events when they are busy. Write them in your day planner or Outlook calendar and put members who could be good for your business: a CPA, PR down $50,000 or another number beside it. This number should person, a reporter, recruiters or your peers. Meet once a be the revenue stream that can develop from the right relation- month and discuss valuable networking places, connections ship. What is your approach to getting new business? Spending and best practices. If each of you have 500 contacts and there an hour writing strangers or sending them a direct mail piece are eight people in the networking group, that equates to 4,000 saying that your company would be perfect for them? Or would contacts. So get out there and start networking and see just how much your business can grow. you rather meet them in person and help them first? Hank Blank is president of Hank Blank Inc. Network with your past — Contact old bosses, previous He is a well-known networker in Southern clients, old friends and former coworkers. Remember, in this day California and speaks to companies and and age, many people will change their positions every three to four years. Visit that old Rolodex and reconnect. Reconnecting organizations about networking. He can be reached at hank@hankblank.com. with your past can be a very rewarding experience both personally Visit www.hankblank.com. and from a business perspective. With history comes trust, com-

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30 | w w w . o f f i c e t e c h n o l o g y m a g . c o m | J u n e 2 0 0 7

Panasonic June 07

5/22/07

10:40 AM

Page 1

IT’S NOT BASIC. You probably know by now that Panasonic copiers are turning some heads. Look what we’re up to now! Introducing the new C3 Color Series from Panasonic. All of the innovative features of our C3 are now available in four simply brilliant colors to suit virtually any ofﬁce personality. It’s eye candy for the ofﬁce! And that’s not all. Panasonic was recently ranked “#1 Copier in Overall Customer Satisfaction Among Business Users.” For more information visit panasonic.com/notbasic or call us at 1-800-742-8086.

Panasonic received the highest numerical score in the proprietary J.D. Power and Associates 2006 Business Copier Customer Satisfaction StudySM. Study was based on a total of 1,524 responses, measuring 10 manufacturers and measures opinions of business customers at small, medium, large businesses who purchased or leased a new copier in the previous 21 months. Proprietary study results are based on experiences and perceptions of those surveyed from January 2005 - September 2006. Your experiences may vary. For J.D. Power and Associates award information, www.jdpower.com.

051807_basic_blkmachine.indd 1

5/18/07 12:54:37 PM

Great America June 07

5/14/07

10:04 AM

Page 1

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