Is Arrogance of Core Competency Killing, The Document Imaging Channel's Innovation?

by ray stasieczko January 24, 2021

The Document Imaging Channel's Manufactures are in Crisis as those manufacturers with direct operations face major challenges. Over the last year, on more than a few "The End Of The Day With Ray!" episodes, I have discussed the much-needed diversification regarding print equipment manufacturers with direct operations. 

In this article, I want to address what I will describe as,

"The pain in equipment manufacturers selling diversification." 

Over the last decade, the print manufacturers have completely understood that their product was declining in needs from its end-users. This realization is still mostly ignored as we witness many manufacturers continue producing equipment that is completely out of specs with users' realities. Even today, we continue seeing the press releases introducing new A3 models. In reality, we should be reading of manufactures eliminating A3 models instead of introducing more.

"Hallucination leadership, Is when a leader continues towards an oasis of stability even though they know it's only a mirage." 

Unfortunately, most of the industry's manufactures decided to double down in fooling themselves that nothing impactful would affect an over-selling and over-spec'ing marketplace. Today, even our friends at HP must realize those who continue believing the glories of overselling A3 equipment will last for years are completely delusional.

The "Arrogance of Core Competency." This has caused many of the industry's actors to play along with the delusion. In the future, as business leaders study the print equipment industry, they will determine the same as those who today study other collapsed or disrupted industries. This failure, as in past industry collapses, will not be regarding something missed. The collapse or disruption will regard something ignored.

However, let's not define collapse so quickly. When I speak of collapse, I am speaking of the collapse of the processes designed to maintain the overselling and over-spec'ing of A3. The facts are that people will continue to use the industry's equipment for the foreseeable future.

The foreseeable future in my vision is about new processes and new competitors challenging a decades-old business model ripe for change. 

The document imaging channel's innovation must not be about apps, paint jobs, or face-lifts on outdated A3 models. The past-due disruptive innovation to the document imaging channel is about changes to the deliverables processes. Those process changes will be based on marketplace realities as A4 replaces A3.  

Unfortunately, those manufacturers who built their entire business on selling products must now focus on selling based on innovative processes, processes that will, in fact, eliminate the vast majority of the A3 equipment they currently manufacture. 

In this global pandemic, we see today manufacturers scrambling to align themselves with other manufacturers who have A4 line ups superior to their own. This need to adjust rapidly will also play a factor in the coming consolidation.

However, can Manufactures Diversify Outside Print? What is Konica teaching the industry?

The acquisition, Konica made ten years ago this month, All Covered, does not appear to have been the home run integration many thought it would be. Over the last ten years under the All Covered name, Konica purchased numerous IT service deliverables. However, diversification growth through acquisition fades if what's acquired is not fully integrated with the core. This applies to dealers and the direct operations of manufacturers. 

Today, Ten years of owning All Covered. Konica seems more recognized as a print equipment company than an IT services company. It also seems as a majority of its leadership within the direct operations focus more on A3 print than IT services. Begging the question, Can manufacturers truly diversify the deliverable outside what they make?

So, as the manufacturers consolidate, the industry's end-users migrate from A3 to A4, and new innovative processes delivered by new competitors change the landscape. How will Konica, the manufacture with the most diversification, respond? Or, can Konica turn their financials around and circumvent the current and continuous print declines with the All Covered portfolio?

I have said and will say, again, Konica should spin off their direct and dealer distribution to Xerox. It has been proven that manufacturers focus on what they manufacture, and regardless of how they diversify what they manufacture takes priority over all the great intentions to expand the deliverable past print.  

Xerox has the largest direct footprint, and they need to replace the Fuji relationship. Remember, Xerox does not manufacture any products other than their production print portfolio. 

My question for Xerox is this, can they leave the processes built to sell A3 and innovate to processes built for continued relevance. Will Xerox be an organization known as the organization which helps businesses navigate technology towards continuous relevance? Will Xerox have the discipline to eliminate all that stands in the way on that journey towards relevance?  

The Industry's manufactures have procrastinated their process innovation for too long. Can manufacturers of products truly sell alternative services that could be void the products they manufacture? History has proven the answer is no.

In Closing: 

Will, a global pandemic that brought an evaluation of the industry's product needs to both its end-users and its investors. Change how its end-users and investors respond post-pandemic? 

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

If not already Let's connect here on Linkedin

Ray Stasieczko 

CEO/Founder TEASRA,The Innovation Channel and Host of The End of The Day With Ray! https://www.endofthedaywithray.com/

I welcome everyone to subscribe to my YouTube Channel https://www.youtube.com/channel/UCULKZDBCR1ozWXmu4Tob66A?view_as=subscriber 

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