*NEWS*PAPER TIGER THAT WON’T LIE DOWN

[Anonymous]

Paper tiger that won’t lie down
OCT 2006
world according to  Paul Curlander
IF
the head of any printing company has printer’s ink for blood, it would
have to be Lexmark chairman and chief executive Paul Curlander.
Paul
CurlanderEven before Lexmark split from IBM in 1991, Dr Curlander was
firmly grounded in the company’s printing operations, having joined Big
Blue’s office products division in 1979 and worked his way up to
printer products director by 1989.When Lexmark spun off, Curlander
followed, taking on a number of senior positions before being appointed
chairman and chief executive in 1999.Since then, he has taken the
company through the digital photography printing boom while its
business printing operations encouraged businesses to print less.Are
there still traces of the IBM culture at Lexmark?It has been 15 years
since we spun out of IBM, which was and still is a terrific
company.There are some tremendous things about IBM that I think we have
brought into Lexmark.As we began to form our own culture, we took the
best we had seen at IBM and tried to infuse it into our business.IBM
was terrific at managing people and paid a lot of attention to
developing people.IBM was a huge company that tried to do everything
with every customer set, but we needed to be selective about our
customer set and segments within that set.Those of us who came from IBM
were all back-office and research and development guys, so we had to
get a lot closer to the customer, something we were not able to do at
IBM. We tried to take a culture from one of the world’s largest IT
companies and use it in one of the world’s smallest IT companies.is it
an advantage for Lexmark to be narrowly focused on printing?We think it
is a huge help. Lexmark is a focused provider of distributed imaging
and printing, but even so it has $4 billion in revenue, is a Fortune
500 company, has 13,000 employees worldwide and is doing business in
150 countries through 30 sales subsidiaries.So it’s kind of a mix
between being small in focus but still a globally significant
company.We think customers look for experts in specific things and we
see ourselves as experts in workflow processing.Do you think printing
and document management gets the attention it warrants from management
and chief information officers?No. Over the past six years, we have
been engaging our enterprise customers on their print, copy, fax and
scan environments.We have found that this is largely unmanaged space
for large enterprises and government agencies.In general, they don’t
know how many devices they have, how many pages they generate, and they
don’t know how much it costs them to run and support the devices they
have.When we go to look at these enterprises, we find 30 per cent to 50
per cent of their devices are underused and they haven’t really done
anything to attack the paper processes, even though they have a very
advanced networking capability.We have found that huge amounts of money
can be saved and we have even found customers that have more than one
device for every employee.What role do multifunction devices play in
reducing the print and paper load?Use of these devices is growing
rapidly. People are paying more attention to consolidating devices, but
even when consolidating to multifunction devices, companies are only
doing what they are familiar with, such as copying and faxing, rather
than scanning.Scanning to a network or to email is not as easy to do as
the other tasks. Scanners are in all of these office devices but are
not being used to do what they should be used for: to reduce the paper
load.It is an education and technology problem in that we have to make
it easy for people to use, because we won’t be able to educate them in
a complex process.Will companies ever outsource document management and
printing to managed and bureau services?We’re starting to see it. I
don’t think it’s a well-publicised thing, but we are managing
distributed output for many customers.It is a way to right-size the
fleet and get savings, which we’ve been talking about. We can help
customers configure their devices in a way that is productive.We also
engage them in a continuing service to manage that environment and to
track these devices and their use, because things don’t stay the same
and organisations tend to grow or shrink and move people around.It is
still relatively new in terms of seeing enterprises and governments
doing it, but we are seeing it pick up.

Lexmark wants this side of the business to grow.
By
monitoring and managing the environment we can buy these things in a
different way. We don’t necessarily have to buy the devices from one
company, and supplies and service from someone else.Now, we can roll it
all up in one pay-as-you-go per-page click charge. We have invested a
lot in the infrastructure to help enterprise customers achieve that.The
cost of printing ink is a bugbear for many people. How do you defend
ink prices and will we see the cost go down?I think it is a simple
concept, but misunderstood. The focus needs to be not the cost of ink,
but the total cost of ownership of the device over its life.If you look
at an inkjet device five years ago and a similar device today, the
total cost of ownership is about half what it was. What is interesting
is that consumers tend to value the lower hardware price initially and
make decisions based on on the price of that, so the model that has
evolved is that companies are more aggressive about cutting the
hardware cost as against the ink cost.The consumer is choosing to take
their half reduction in the total cost of ownership up front. That’s
not a bad choice, depending on how many pages they are going to
print.If the consumer is going to print only occasionally, it’s a good
choice. Conversely, if the consumer is going to print a lot, they need
to consider that the cost of consumables is likely to be less for a
device that costs more. That’s not well understood by the consumer
base.Printing, more than most areas of technology, faces environmental
criticisms to do with ink and paper. What steps is Lexmark taking to be
environmentally responsible?We have a very strong environmental focus.
We began focusing very many years ago on the collection of cartridges.
Sure, we sell printers, but over the lifetime of the printer you are
generating a lot more supplies like cartridges and things that end up
in landfills.So we started very early collecting cartridges. We are
very aggressive about that in Australia. We have a very successful
cartridge collection program.The thing I think is unique is that we’re
focused on helping customers to print less. I have yet to hear any of
our competitors say print less.As we sit and talk to our enterprise
customers about what they have in their distributed fleets, we are
always quick to tell them that they probably have way too much
equipment — if we went to study it, probably 30 to 50 per cent of what
they have deployed would be under-used. They bought too much stuff and
they print too much.We are focused on helping them to downsize and
rightsize their fleet and to print less.

Will we ever see a paperless office?
I
think no. It was a common myth that started 20-plus years ago, and
there was a lot of insight to the comment at the time, but the vision
was slightly wrong. The role of paper 20 years ago was to transport and
store information.When people talked about the paperless office, what
they were thinking about was the movement of information and the
storage of information on paper, which can be done electronically.What
they missed was the important role of paper in personal productivity.In
many cases, it is more productive to use paper, in meetings or
collaborations for example it can be easier to pull out a document and
flip through it than try to share it electronically. In the enterprise
today, paper should be there because it makes people, the most
important asset, more productive.What you don’t want to do, if you have
a paper document and you want to share it, is to make a paper copy of
it or fax it.That can be done electronically, and if the recipient
wants to print it to help their productivity, they can .What about such
developing technologies as e-ink and e-paper? Do you see them as a
threat or an opportunity?We don’t see it as a threat or an opportunity
per se, it’s a display technology. To be honest, I view it as a way for
people to display things in another way.That is a different business,
that’s not a business we’re in. What we are focused on, if you look at
the whole market out there, is the huge amount of paper-based
information that is not declining, even with all the e-business and
internet infrastructure that has been installed.Our focus is on how,
when someone does have paper-based information, they can move it back
in so it can be displayed on devices such as PCs and tablets or, in the
future, e-paper.

[Author]

October 6, 2006 at 11:21 AM