Xerox, HP, Lexmark : The Greatest Transformation of a Niche Since the 70's Auto Industry

Remember transformations of the Past -

• The great computer dealership purges of the 1990's - Inacomp to Wal*Mart
• The music industry - vinyl to CD to MP3 to streaming
• The auto industry, 1970's, from V8 to 4cyl, from 400 HP to 100 horses running through front wheels

2/2016 -

Look what is happening to Sharp - the copier side of Sharp is viable and profitable - is it far fetched to see another 'spin-off' or will the imaging division continue to be a profit center for the whole?  Is an investment of $450M good money after bad ?

Lexmark has gone from the "long cool woman in a black dress" to having her parts examined separately.  Recent augmentations appear more valuable than the core.

HP just reported,

"...Printing remained challenged in the quarter with net revenue of $4.6 billion, down 17% year-over-year as reported or 11% in constant currency, with declines in all regions."

Turning to Supplies, revenue was down 14% year-over-year in Q1 about 400 people exited the company globally as part of the restructuring activities announced in September...we are accelerating the program and now expect approximately 3,000 people will exit by the end of fiscal 2016 instead of over three years."

Last year, Q1 2015, HP reported a 14% decrease print revenue.  Two years of down numbers?  How about 4 years?

Xerox -

In an article written by Stephen Hays, the chairman of Brighton Securities, George Conboy is quoted saying Xerox...

"is steadily on a downward path, especially in its equipment business. The demand for its technology is falling by the day. Though the company may not be staring at bankruptcy in the near future it is, however, facing a situation where it is slowly moving away from maneuvering paper documents and making copies. Meaning, Xerox Corporation (NYSE: XRX) is steadily shifting away from its equipment business as there is lesser demand for its technology..."

Outside pundits see, why don't our own?

Some might say the auto industry transformation was greater in scale and scope than our copier confluence but consider this: no other segment of business, lest IT, has had more impact in the business world that printing and copying.

Nothing in history compares.

Chevy Citation, anyone?

How can Lexmark, Xerox and HP change to remain relevant?

The car of the year in 1980 was the Chevy Citation.  A front wheel drive, side mounted radio, "Accord killer".  Parts fell off, transmissions locked and a generation of customers scrambled toward Toyota.

The OEMs continue to produce more of the same:

Is ink in the office akin to front wheel drive?
Is MPS the independent channel's CD?
Is managed services the next 5.25" floppy?

Either way, slow down and consider what is unfolding before our eyes - the greatest shift in business communications since the typewriter.

Click to email me.

Why I Think Franklin Planners Will 'Save Print'

Yup, that's right.

Back in the day, every single salesperson worth his or her quota carried a Franklin planner. Heck, I think HP, IBM, and Canon gave every rep a planner and the "Seven Habits..." in lieu of a PC and printer.

Instead of checking smartphones and pecking the qwerty, we'd unzip and unfold our cool, custom binders, jot down notes, check off tasks, and review calendars.  And by 'jot' I mean, write down...with a pen or pencil...on paper even.

"...sometimes, reps would copy entire months, off the glass, and submit these "reports" to management..."

Scheduling the next appointment was in real-time, face to face, and "...if it didn't make it in my Franklin, it didn't exist..."

Business cards were stuffed in plastic sleeves for easy access and we wrote down phone numbers.

No.  Really...we did.

At the end of the day or week, one might review the past and plan future action items or follow-up tasks.  Again, we wrote on paper.  More advanced users would apply sticky notes, and custom forms. (show-offs)

Leadership loved these things.

Old-school sales managers would surprise audit your Franklin, checking for scheduled meetings over the next couple of weeks - funnel review included handing your planner over to your manager.

Sometimes...and get this...sometimes, reps would copy entire months, off the glass, and submit these "reports" to management.  Penny a click, penny a click...

So here's my plan.

If every single HP, Lexmark, Xerox, Canon, Ricoh, Epson, Samsung, Muratec, or Memjet, sales rep indeed, if every sales, branch, or district manager, each VP, AVP, and C-Suite employee in every manufacturer and dealer ordered a Franklin planner today, the industry would lead by example.  The industry would save itself.

For this to work,  The 'Planner' must be the required tool for funnel reviews and account planning. Follow me here...if the industry is serious about saving itself by repeating the same mistakes over and over, it should drink its own champagne and regress back to paper.

Move off Outlook, turn off the carphones.  Get back to alphanumeric pagers, pink phone message pads, and overhead transparencies.

Fewer screens, more carbon paper.

Worried about productivity? Hear meetings without beeps, whistles, and tweeting sounds.  No more heads buried in a keyboard checking Facebook during your copier technology roadmap presentation.

Nirvana...truly.

Go full tilt.  Stop "selling the cloud" and referring to yourself as a technology company - everybody knows you're just trying to make your MFDs relevant.

Do you want relevance?  Move your entire ordering process back to paper.

CRM? Yeah, it's a 1-30 tickler file.  Slide deck?  Sure, it is a deck of real slides.

If the industry wants to return to the hey-days of 1986, I say, put your value prop where your toner bottle is and get rid of your digital technology.

I dare you.  I double-dog, dare you.  I can't wait to see the direct reps sporting pleather binders and a return of the receptionist!

Require your professional salespeople to scan their Franklin at 7:00 AM and again at 5:30PM.  Penny a click, penny a click...

While you are at it, bring back the original QWERTY and put the receptionist to work, typing up proposals.  And yes, make 20 copies for every meeting.  Penny a click, penny a click...

"Receptionist Wanted:  Must type 120 words per minute and be versed in grammar."

Gosh, the possibilities are endless...

Satire -

We all know nobody in the imaging industry is going to lead into the past by giving up all their paper-reducing technology.

I guess the big question is, how can they expect their clients to do so?

Shades of Greg: 2016. The Year of The Flood

11/2015

Mergers, acquisitions, sell-outs and less paper.

2016 will see the beginning of the End.

More signs.  The tipping point is in your rearview mirror, if this is news to you, it's too late.

• Today, Xerox may be running out of ink with quarter after quarter of declining technology business. They've also decided to scrap the wax.
• Lexmark, after years of building a portfolio of MPS contracts is finally ready to sell out.
• HP, the thickest of the thick, is splitting into two. HPG, (HP Inc.) can now move quicker and turn their profits into R/D for print.  Will this five billion dollar start-up be the last print vendor standing? Can the old Printelligent model work?  Mother Blue has been adding vans almost as fast as she's laid off employees.  She has an impressive array of services, and a behemoth of a team ready to take the argument to the streets - direct.
• Samsung may gobble up Nuance, enhancing a practically non-existent MpS program.
• The independent channel continues to shrink and evolve.  Just this week, Loffler joined the Xerox dealer channel and Marco cashes in, selling to an equity firm.
• On top of all this, the American Forest & Paper Association released their yearly report stating, "...total printing-writing paper shipments were down 4% in September as compared to September 2014."  The same report a year earlier sited a 7% drop from 2013 to 2014.

Taken individually, the list has one dimension.

But observed from a distance, and just to the side, these points reveal a multi-dimensional reality: The deluge is here.

Knee deep in a receding surf for the last 18 months the final Wave is coming.  If you haven't sold or gotten out the only choice you have is to hunker down and hope for the best.

So what does it mean?

The End is just the beginning...ask yourself this one question,

"If office print disappeared tomorrow, what would I be doing the day after?"

Whatever answer you come to, you are absolutely correct.