R.J. Stasieczko

Innovation is a change in the process. It happens when innovators change the means to the desired outcome. Nearly all disruptive platforms are a result of outsiders taking advantage of the insider's complacency and stubbornness. 

Imaging Channel leaders, it is now time to bring in outsiders and work with new human capital bringing new ideas and the talents to execute. The channel's commonality in human capital is killing the channel from within. There are too many fighting the insecure future behind shields of compliancy. Nothing is changing, and very few are moving the needle to innovative change.

Why does the imaging channel continue to merely rotate its talent? Or, how does a Private Equity roll up change the game by providing money to those owners or executives who still play by yesterday's rules? The digital world is swallowing all the once grandiose attributes of the channel's past deliverables, and very few are responding to the impending doom. I believe the complacency is a result of unawareness to what things could be, based on what things should be, and what things should be is recognized when the realities of the market are observed through open, and different mindsets.

The industry is still fighting as an example, e-commerce, and has an obsession with walking away from all transactional business opportunities. I believe those two things are tightly connected. The leaders inside the Imaging Channel are, for the most part, a collection of push economy collaborators. From the manufacturers pushing products to the dealers, and the dealers pushing products to the end-users. The functionality of the model is 100% product-based and is ignoring actual customer needs. The channel must end its product-centric thinking and actions.

Today's buyers are not looking for product pushers; they instead are looking to pull solutions to themselves. Many in the industry believe they have control over the buyer if they control how the buyer buys. The problem with this strategy. Is that buyers are continually searching for better ways to accomplish both the means to and their desired outcomes, and innovators are welcoming the searchers by providing better experiences. Many times, these better experiences are based on the innovator delivering a different means to that customer's desired outcome. Innovation is nearly always process based. it's not about getting new products, as much as it's about the how, or the process used allowing them to achieve their desires.

My friends, it's the time for the Imaging Channel to answer some questions, and when finished a more critical exercise, is to decide when the channels customers will begin asking these same questions? Or, face the reality that many have already started asking.

What is the imaging Channel doing to end product-centric leadership? 

What is the Imaging Channel doing to diversify its mindset? 

When is the Imaging Channel going to stop investing to save yesterday and instead invest in creating tomorrow? 

When will the Imaging Channel's customers be presented alternatives outside the channel's current processes? 

When will A4 replace the majority of the oversold A3's and will the channel's current providers do that, or will that disruption come from outside?

Here's my solution to enable the channel to deliver the future to the present. I challenge the channel's leaders to open new doors and find some new mindset; mindsets to help those stuck in what was once relevant. 

What if the Imaging Channel recruited senior executives from Google, Facebook, Netflix, Pay-Pal, and of course, our friends at Amazon? 

The changes in consumer habits are passing the skills of many in control of the Imaging Channel's deliverable. If the industry continues to look as they always have in the places they always went, they will only re-discover what they already know and one day soon what they already know won't matter.

Experts from the organizations I mentioned above could teach the channel the new realities to consumer behaviors — everything from the power of digital information, subscription selling, the facts to e-commerce benefits to bottom lines, alternatives to outdated leasing models, distribution enhancements, 21st-century marketing and, of course along the way. The channel will discover what has been hidden from them because they never looked in new places. That discovery will give birth to a new relevance. 

Collaborating to change the game takes both imagination and persistence.

Changing the game in declining industries is much easier by collaborating with expanding industries.

Anyone can continue buying yesterday. It's time the industry steps up and invests in tomorrow. Remember, those who believe that collaboration is a group of like minded thinkers will be out thought by those who can disrupt themselves with different mindsets. The Imaging Channel must end its obsession to put be comfortable before being relevant.

 "A company becomes obsolete when they focus on delivering the past to the future instead of delivering the future to the present."   

 "Status Quo is the Killer of all that will be invented."

 Ray Stasieczko

Join me at BTA West I will be speaking on the A4 revolution and its impacts on the channel https://www.bta.org/page/West19

Send invite if you wish to connect on Linkedin

Well, The Imaging Channel is used to the Whitewashing in explaining how great things are even when common sense disagrees. The channel's ability to whitewash is unprecedented. However, unfortunately, now it's affecting the channel's aptitude to reacting to severe threats and holding back its innovation. Some unfortunately even believe that everything is all right, as the whitewash paints over the market's realities.  

So, I thought it would be valuable to highlight some severe current threats in the way they would be presented to make us feel good, instead of making us react toward improvement. This example is satirical in nature, but, I hope it hits home to some, and motivates the channel to realize how dangerous to innovation whitewashing really is. 

Here are five threats whitewashed to hide realities

The Threat- Declining Print Volumes and Revenues

The Whitewash; Let's all agree that declining revenues and declining print volumes are no concern. Millennials love to write on paper, and baby boomers love taking notes on paper. The paperless society is decades away. Oh, and if we get blindsided the channel has great smart people who can reduce profits and lay off workers like any other disrupted industry.

The Threat-Lack of Significant Diversification

The Whitewash; The channel has diversified by at least 5%, and hardly anyone has over 20% of its revenues coming from non-print-related deliverables. This lack of diversification proves the channel is still excited about the future of print and its services business. After-all nearly ever manufacture is doubling down on Production Print in its efforts to save the industry, Big machines mean Big Opportunities????????

The Threat- Staples DEX Imaging merger, the ignored change in infrastructure.

The Whitewash; Staples and DEX Imaging coming together is absolutely nothing to worry about. The channel can continue to postpone e-commerce capabilities even longer. The channel can allow its customers to have their bad on-line experience from DEX/Staples who more than likely will deliver equipment in an e-commerce system before anyone else. By allowing DEX/Staples to fail first in e-commerce the rest of the channel can avoid unhappy customers. More importantly, Everyone knows that No One will ever buy an A3 Copier/MFP from a Staples store or, on-line. Not to mention selling copiers and printers in retail locations didn't work in the 1990's.

The Threat-Overselling A3, Being Product-Centric 

The Whitewash; Overselling A3 to over 80% of the market is fantastic for the dealer's manufacturers, salespeople, top-line revenues, and outdated leasing strategies. After all, why should the channel sell based on Customer – Centricity's? All of its processes are built to deliver A3. Currently, 80% of the customers don't know they are being oversold, and currently dealers are making more money by being product-centric. Selling A4 because 80% of the customers would benefit must come second to the benefits A3 offers the industry.

The Threat-Private Equity Failures Dismissed

The Whitewash; Private Equity roll-ups and growth through acquisitions is proof the industry is stable. When Private Equity fails and forced to sell its assets if another Private Equity buys those assets it proves the market is stable, it has nothing to do with a declining deliverable; Managed Print Services is growing like crazy. After-all Everyone is signing MPS contracts, and soon the print world's entire customer base will have an MPS contract. Even though these contracts will continuously decline in value, we must remember Millennials like to write on paper, and there is always another Private Equity firm ready to buy into the unbelievable growth of MPS, and of course Production Print.

It is Time to End The Madness!!!!!!

OK, I realize some are swearing, and others are saying, Ray, has described five excellent examples of things the channel continues whitewashing. Threats the channel must address.

My friends, the Imaging Channel, must start having serious conversations regarding its reinvention. The Channels leaders must call out the whitewashing and be willing to discuss the market realities. It seems the Imaging Channel has been too fearful of addressing past threats, and now the channel must face those threats head-on.

As an example: look at the recent outcome regarding LMI. Back in August of 2018, why were the tough questions not asked? The realities to the LMI situation would have challenged a first-year business major to question the sanity of anyone investing in that situation. Even today, there are others on the verge of collapse, and those realities are being whitewashed or worse ignored. 

This inability to ask hard questions, and have conversations involving constructive criticism is crippling the channel's future. The threats of lawsuits or the threats of cancelling sponsorships are killing needed conversations. Being obsessed in remaining comfortable usually eliminates any uncomfortable accountability.  

The channel needs to explore more customer-centric deliverables, and without challenging things you know should be challenged, you will be a culprit in helping outside disruptors take away the once-great relationships of The Imaging Channel.

Those five examples are and should be treated as severe threats to the current circumstances to the channel. The channel's leaders and dealer owners must challenge and debate all that is threatening. It's only through conversations and collaborations, which sometimes are uncomfortable that threats are responded to and even neutralized. Ignoring warnings usually ends as we all just witnessed, and unfortunately will soon see again. 

"Without the ability to understand how we can be defeated, we are at the mercy of those who plan and execute our defeat."

I am eager to help my friends look in new places, and explore what could be, based on what should be. Nothing new will ever come when everything old continues fighting for what was, more than they fight for what should be. 

"Status Quo is the killer of all that will be invented."

Ray Stasieczko 

Join me at my upcoming speaking engagements.

RemaxWorld Summit 2019 in Zhuhai China https://www.rtmworld.com/event...axworld-summit-2019/

BTA West I will be speaking on the A4 revolution and its impacts on the channel https://www.bta.org/page/West19

Send invite if you wish to connect on Linkedin

As the print equipment and services industry continues declining it's time to evaluate all aspects of the deliverable. In the days of its growth it made sense for dealers to sell all the industry's equipment. However, today dealers should question that approach. Here are my thoughts on Production Print.

There seems to be a lot of talk regarding Production Print. However, if that talk turned into a discussion based on realities, most would listen with caution. The Imaging Channel is chasing this fantasy to the glories of production print, and too many get sucked into the vortex of what I describe as “production print’s pit of debt.” A debt rarely paid back to those who acquire it. Production Print is not a growth business model; it’s a displacement model. Many are buying into the noise without studying the data. Just because manufacturers are dumping R&D money into production print doesn’t mean your dealership should sacrifice its profits to join in.  

If the channel were realistic in the market realities, there would be fewer players, and for some, the game would be rewarding. However, the game is being played by too many who don't play based on a knowledge of the game. Some of the players on the field are not aligned to win; they simply showed up to play a game they have no business playing.

 “Never let the noise in the excitement of chasing revenues silence the cries to controlling cost.”

If the dealers really looked at the numbers and paid attention to all the cost associated with running a production print program, most would concede and abounded this money pit. Think about all the production machines spread around the demo rooms of those dealers who once had a grand vision of production print's success. Not to mention the obsolete parts, the extensive supply inventories, or production print technicians without enough placements, so they are fixing desktop printers. Now top that off with lowering print volumes. Many of these production placements are not the ideal account and extremely underutilized. Sales reps are placing production print equipment to capitalize on the lower service cost per page in order to increase hardware revenue.

Today there are too many manufacturers trying to chase after the king of production Xerox. Soon this king will buckle down and fight harder for their customers. When Carl Icahn decided to inject himself into the Xerox management, he made a few comments that should be noteworthy. The comments regarding the Global Imaging Group selling non-Xerox brand equipment is something the other manufacturers should take heed of. One day soon all the non-Xerox brand equipment placed in the past by, Global Imaging will revert back to, Xerox this will obviously include production print. 

My prediction of HP buying Xerox also plays heavily into the production print arena. HP and Xerox share many customers, along with indisputable brand recognition. The indigo technology from HP would be a great asset to the Xerox production line up. Xerox has had an advantage for decades on production. Yes, they can be challenged by our friends at Konica, Canon, or Ricoh. However, dealers without the understanding of the market will find themselves selling production print as they sell walk-up A3's. These less sophisticated dealers will turn production print into a vendor auction. Sadly, in much of the market, this has already happened.

Dealers should re-think the production strategy. Those dealers less than 10 million in revenue should run from production. Focus instead on beating your competitors who are bogged down with 1990-2000 sales mythologies. Figure out how to align with the market realities, stop chasing revenue with no regards to cost. I see dealers more excited about the trophies of production print then the profits from its placements. Let your competitor's lose money selling production while you deliver 85-90% of their customers a better experience with A4.

In March 2018, I wrote an article for ENX Magazine regarding Production Print. It was based on an analysis of nearly 5,400 Black and White units. Here’s a link to that article. https://www.enxmag.com/twii/mi...-not-marketing-hype/

Create Something Different Be an Entrepreneur and Change the Game 

Start developing a strategy to change the way your customers’ lease equipment; change the way you allow customers to engage you aligning with a digital world. It's time to shed outdated parts of the deliverable which kill margin and are no longer relevant to the market's realities. My friends, it's time to change the whole game. It's time to win.

A Possible Solution to Exit Production Print’s Pit of Debt

It’s simple call up a competitor and sell them your base of production print. To motivate you into doing this. Take your production print and evaluate its actual cost to the organization. When you discover the negative numbers and truly understand how it’s weighing down your profits, you will then be ready to exit “Production Print’s Pit of Debt.”

Now that you’re ready to spin it off. Sell your production print business for the revenue it generated over the last twelve months. I am sure you can find a dealer in your market who would be happy to acquire your production base. Selling at revenue would give you a five times EBITDA at a 20% EBITDA, and in reality, If Dealers with a handful of units in the field put their production print business on a separate PnL, their EBITDA on that business would more than likely be around -5 to 5%. Provided you are accounting for all the cost appropriately and don’t forget to add in the depreciation cost of all the equipment in your demo rooms. Call my friends at NEXERA and have them help you evaluate your actual cost.

Getting out of production print for many dealers would result in an instant increase in overall profit. A handful of units in the market is simply not enough to offset the high cost of the deliverable. As a bonus you will finally get rid of those production units you walk by every day and see $$$$ littering your demo room floors.

Things to think about as the industry continues declining and mega dealers keep buying distribution. Those independent dealers left should fight the game to win as they grow. Let the private equity fight each other to grow their top lines. The future of the industry will prove painful to those who insist on chasing revenue and using outdated sales mythologies which are out of alignment with the realities of the market. As we are witnessing today with some of the industry’s actors who are watching their revenues evaporate, buried in debt fighting for survival, being the biggest doesn’t translate to being stable or profitable.

"Status Quo is the Killer of all that will be invented."

Ray Stasieczko

For more thoughts on the subject In March 2018, I wrote an article for ENX Magazine regarding Production Print. It was based on an analysis of nearly 5,400 Black and White units. Here’s a link to that article. https://www.enxmag.com/twii/mi...-not-marketing-hype/

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