SOS
T W E N T Y: T W E N T Y S E R I E S
PART FOUR
THE ROUTE TO FUTURE SUCCESS THE ROADMAP FOR THE FUTURE
CONSOLIDATION & DIVERSIFICATION
Looking to the digitalised era ahead
How can dealers prepare for a successful future?
BROADENING HORIZONS
Why expanding solutions will win business
TWENTY:TWENTY
PRINT MARKET FOCUS
FUTURE
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PRINT MARKET FOCUS Q&A
ROB ATTRYDE, Head of Marketing Communications, KYOCERA Document Solutions UK, talks about the changes in the print market and why the mid-market is the place dealers should focus their attention
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veryone is looking for the silver bullet and the next big thing to ensure their future success but in reality future changes will be based on very simple things and there are gradual changes that dealers and resellers should be aware of. Obviously industry developments such as 3D printing, cloud printing and apps are front of mind but, as Quocirca’s report on ‘Managed Print Landscape, June 2014’ points out, while the market for MPS is certainly maturing, the demand for MPS is still growing as end-users require more from the next generation of MPS. More organisations are in their second and third phases of MPS engagement and the financial services, business and professional services sectors expect to see expanded services and solutions that support broader process automation initiatives. In the ‘MPS in the Cloud April 2014’ report, Quocirca states that the rise of mobility and the growing acceptance of cloud services, widely used by consumers and increasingly by employees, is demanding a new approach to IT delivery. Employees expect IT to manage new technological trends, but the adoption of consumer/BYOD technology in the workplace can be a long and complex task. Enterprises are recognising that traditional IT delivery models cannot address these needs effectively, and many are moving to managed services and cloud models to be able to quickly respond to the constantly evolving business landscape. Steve Mitchell, Group Product Marketing Manager at KYOCERA Document Solutions UK said: “The improving culture of mobile technology means that business people and consumers alike will want to print and read documents on the move. Being able to access and control documents via the cloud or through networks is going to be a must for business and personal use.” “The big thing I can see that will change how we work, will be the digitisation of documents and the capability to manipulate these documents on the move. Everything is going to be about easy access (via simple applications) and easy transfer of information across technologies such as tablet to phone to PC or laptop to print to cloud to archive.” “Other things for consideration will be things like near field communication, which allows users to authenticate via smart phones and tablets. Software really is the key. Applications and bespoke things that make users’ lives easier – anything that can make the working day more efficient.” Mitchell continued: “We’re seeing a move away from hardware-only selling, to a much more flexible approach and adjusting their portfolio of products to meet the demands of a changing workplace. The proliferation of cloud and mobile means that a new generation of sales person is needed – these technologies need a more consultative sell. Increasingly astute consumers and the proliferation of Frameworks
means that the landscape is changing for dealers and they need to focus their businesses accordingly.” Cloud Evangelist at KYOCERA Document Solutions UK, Eddie Ginja adds: “Documents will continue to be commonly shared via mobile device, cloud solutions and social media. People will soon stop thinking of ‘digital documents’ and just consider the document and what they need from it rather than whether its digital or hardcopy. Dealers need to help their customers access and if necessary print their documents where and when they want. It’s not only having the right technology, it’s also about taking the right approach for that organisation.” Dealers also have to realise that the real opportunity lies with the mid-tier market which is the hungry, ambitious organisations who are driving growth and want to be more agile. According to GE Capital, despite being a relatively small group of businesses it represents just over 1% of all UK companies – the mid-market employs 10.9 million people and generates £1.7 trillion worth of sales every year. Recent GE Capital research ‘European Capex Barometer’ has some interesting key findings for the industry: • The preferred method of financing capital investment is using existing company capital (37%) followed by leasing (17%) • Estimated loss of income due to out-of-date equipment totals EU63bn in 2014, with the vast majority (EU59bn) being reported by Western European firms • Enhancing productivity remains the top reason for upgrading equipment cited by almost half (48%) of firms, across a total of seven markets • SMEs no longer see economic uncertainty as being such a significant obstacle to investment. Only 29% of firms reported this
“We’re moving away from hardwareonly selling to a flexible approach” to be a barrier, compared to around 43% last year. Encouragingly, 16% of firms reported having ‘no restrictions’ on their capital expenditure, saying they were able to invest as they wish • The average UK mid-market company – defined as posting annual turnover of £15million - is set to grow sales by 6.1% in the next 12 months. This equates to projected UK mid-market revenue growth of £133billion in the next 12 months This mid-market is ‘thinking bigger’ and is the perfect target for dealers and resellers to focus on, ensuring they offer the products and solution which will help this demanding audience manage and exceed their growth targets. DS
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ACHIEVING FUTURE SUCCESS
C O N S O L I DAT I O N A N D D I V E R S I F I CAT I O N As discussed previously, the dealer channel is changing. HELEN GEORGE, MDS Marketing Manager at KYOCERA Document Solutions UK, reveals how she thinks KYOCERA’s channel partners can prepare for a successful future
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ACHIEVING FUTURE SUCCESS Q&A
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here’s no hiding from the fact that the dealer channel is products, services, skills and sales engagement. Change and challenge changing. Led by customer demand for new services tend to go hand in hand. So it will require the people who lead within and solutions and enabled by technological advances, dealerships to have the appetite to take advantage of this opportunity, channel partners are expanding their areas of expertise have the clarity of vision to take it a step at a time and the and offering more than ever before in an attempt to determination to see it through. It can be hard to move an organisation, capture a larger share of every customer’s wallet. the sales team and the engagement process forward. So when the “We’re definitely seeing a new breed of dealer,” necessary appetite is in place and you can bring the right people in to explains Helen George, MDS Marketing Manager at KYOCERA build support, it’s a winning combination.” Document Solutions UK. “And a channel that is experiencing an George continues: “It’s also about picking battles, where and with increasing amount of consolidation. Our traditional dealer channel is what you decide to compete. When expanding a portfolio, it’s important maturing, some dealerships are coming to the end of their lifecycle to be clear about the clients you will be targeting, what you are offering, naturally, with owners reaching retirement. Other dealerships are looking why you are offering it and what you want to be known for. Taking on to new markets and offerings to achieve growth, and we’re seeing them too broad a portfolio too quickly, or ad-hoc technology solutions, could acquire other businesses to achieve this. The positive here is that confuse clients about who you are, why they should talk to you and generally the acquisitions are well thought through and satisfy a specific how to buy from you. This is also about branding, which can become requirement for territory, technology or skills. an issue and priority in a crowded market.” Whether through organic growth or acquisition, dealer portfolios are expanding to offer additional technology solutions such as desktop, OUTSOURCING AND MANAGED SERVICES storage, server and network solutions or into document management, George suggests that dealers might want to consider taking advantage workflow and business process improvement. “ of the outsourcing of services. “As companies evolve we are seeing them “As well as this consolidation and diversification, we’re also seeing a move to outsource more and more IT functions. IT directors are looking new breed of more cloud-savvy to focus in-house resource on key dealers who aren’t about selling projects and develop vendor product but provide infrastructure management skills to buy in and solutions as a service. This will “When expanding a portfolio, it’s resources and services that are require manufacturers to change too either ad-hoc, too expensive to own as these dealers can be cutting edge important to be clear about the clients or delivering commoditised lights and very nimble. This is where on support. The move to pay as you you will be targeting, what you are KYOCERA’s size comes in as we’re go, OpEx rather than CapEx, offering, why you are offering it and big enough to provide the solutions funding models and cloud required but small enough and agile what you want to be known for” capabilities are also driving an enough to adapt quickly. This is appetite for software as a service.” crucial to future success as channel partners and manufacturers will However, George isn’t talking about traditional outsourcing services. need to work closely together to deliver what clients are looking for.” “It’s worth noting that although Gartner is predicting growth in IT outsourcing services, they also expect this spend to shift from traditional OVERCOMING HURDLES datacentre type outsourcing to new, standardised offerings, including Of course no change can happen without overcoming one or two cloud services. In the context of the dealer channel this focus is hurdles along the way. George says: “Skill sets in the market will be an probably more about managed services on and off site.” issue. There’s a lack of the more consultative skills such as business Dealer businesses are undoubtedly set to change over coming process and document management in the industry. This isn’t a barrier months and years. Being prepared to change and willing to adopt new that can’t be overcome but it’s a barrier that has to be planned for. It’s services and solutions, dealers can thrive in the new-look world of another example of where partnering with the right OEM is key. business solutions. DS Dealers can leverage the OEMs skills and expertise where they don’t yet have the volume of business to support full time specialists. KEY POINTS Eventually they may choose to take the skill set in house if an • Mergers and acquisitions in the dealer sector will continue as opportunity takes off, but by partnering in the early stages they can companies look for the advantages of scale or additional reduce their risk and financial exposure. expertise and services “Success is also reliant upon the people leading the dealership taking • Find time to invest in the relevant skill sets – this is perhaps a broad view of what’s required. We’re seeing dealers moving into the biggest hurdle dealers have to overcome when looking to managed services being careful to grow their sales, consulting and provide the service solutions of the future delivery capability at the same time, which works very well. Dealers that • Partner carefully with your long term business requirements grow their delivery capability first can struggle with cash flow and in mind. profit. Those that grow the sales force first can struggle with delivery • Do what you have the appetite to do as it’ll make any change and customer satisfaction. Again this is where manufacturers can help much easier by building up competency centres that dealers – especially smaller ones • Pick your battles – don’t take on too much too soon – can call on when needed.” • The way business takes place is changing – it’s prudent to “Another hurdle is appetite. These are exciting times for our industry keep abreast of these changes in order to provide the most but to take advantage of these opportunities requires change. New relevant services and solutions
TWENTY:TWENTY
FUTURE IT
P R E PA R I N G FOR THE YEARS AHEAD How can dealers prepare for the future? AUSTIN CLARK asks Rod Barthet, Group Sales Director at Annodata, for his thoughts Q. WHAT PRODUCTS AND SERVICES WILL BE THE FOUNDATIONS OF YOUR FUTURE BUSINESS? A. Within the print space, clients are increasingly looking for a partner who can not only demonstrate a fundamental understanding of the print environment but increasingly how this integrates across the network and integrates with other software platforms. We have seen a significant increase in the demand for cloudbased hosting services to complement their own IT strategy and it is with this in mind that Annodata has invested significantly over the last few years both in terms of our own capabilities (staff as well as technology and infrastructure) as well as the services we can provide which range from the traditional print estate through to hosted document workflow solutions, ICT, communications and mobility deployments. Q. HOW CAN DEALERS SWITCH FROM BEING PRODUCT FOCUSED TO SERVICE AND SOLUTION FOCUSED? A. This is not an overnight fix as it requires a deep rooted understanding of their client needs and in turn investment into the areas of their business to deliver these solutions. Investment in high calibre architecture, network and ICT teams combined with partnering with the right manufacturers is crucial to win the ongoing opportunities being presented. Those vendors who continue to focus only on the print estate will see their market share eroded as clients continue to rationalise the vendors operating across their network infrastructure. Q. WHAT ARE THE BIGGEST ROADBLOCKS BETWEEN YOU AND FUTURE SUCCESS? A. Given our understanding of our client base
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“Those vendors who continue to focus only on the print estate will see their market share eroded as clients continue to rationalise the vendors operating across their network infrastructure”
combined with the ongoing economic recovery, we don’t see roadblocks, only opportunities to continue to develop our services with our clients. In doing so, remaining fleet of foot and ensuring that we continue to be positioned as a key strategic partner to our key clients is our biggest area of focus. Q. HOW CAN YOU ACHIEVE THIS? A. We will continue to invest in people and technology to meet these opportunities and in doing so ensure that we maintain our focus on providing best in class solutions, which means ensuring we remain future focused on market trends as well as ensuring we have best in class teams to deliver these solutions. Q. DO YOU THINK SOME DEALERS HAVE A FEAR OF CHANGE, WHICH IS HOLDING THEM BACK? A. It would be inappropriate for us to comment about others but, as mentioned above, we are seeing a significant increase in new client engagements who are looking for our expertise across both network, infrastructure and print as their existing suppliers are only focused on supporting the print estate. We don’t see a future for these vendors. Q. HOW CAN DEALERS OVERCOME ANY INTERNAL RESISTANCE TO CHANGE? A. This is all about how change is viewed. For us, it is all about creating opportunity and competitive advantage for our customers in an increasingly competitive market. It is with this mind-set that we continually challenge our teams to continue to provide best in class and leading edge solutions to our customers. DS