That the past year has been challenging to Ricoh Company is an understatement. The Tokyo-based OEM registered a $1.6 billion loss for the fiscal year ending March 31, 2018, which was largely a factor of the goodwill impairment of its North American business.
Well before the dismal financials came to light, however, Ricoh had already set the wheels in motion to begin remedying its performance in the U.S. The company launched its global Ignite growth strategy, which builds on structural reforms done in the last fiscal year to reinvigorate Ricoh. A new go-to-market strategy is augmented by plans to invest 200 billion yen in M&A, enabling the company to pursue new growth opportunities. Further, the company appointed Joji Tokunaga, an executive with a wealth of experience in the U.S. market, as president and CEO of Ricoh Americas.
Jim Coriddi, Vice President, Dealer Division of Ricoh USA Inc.
Only last year, Ricoh announced that as part of its new go-to-market strategy, it was selling approximately one-third of its contracts in the SMB space to a select core of dealers. To get a better view of the changes taking place within the organization on a corporate and local level, ENX Magazine had the opportunity to chat with Jim Coriddi, vice president, Dealer Division of Ricoh USA Inc. Coriddi outlined how the Ricoh Family Group of national dealers is working collaboratively with the OEM to bring value on both fronts. He also provided insight as to how the dealer-driven ConvergX conference further solidifies the relationship between the manufacturer and its dealer partners, one that Ricoh is confident will lead the charge to its resurgence in the United States.
Tell us about your career path leading up to your current position at Ricoh.
Coriddi: I’ve been fortunate to have leadership positions in different parts of the Ricoh organization over the last 30 years, including on the channel and marketing sides, plus I’ve run an overall operation. At the time, Ricoh had a division dedicated to IKON that I ran for nearly six years—we had a complete sales, marketing and service operation. We grew that business nearly 60 percent during the six-year period, and ended up with nearly half a billion dollars in revenue. We decided to buy IKON and I was involved in that acquisition. After that, I was on the direct side of the business for about two and a half years, transitioning the IKON business into Ricoh’s direct business, while building a rules of engagement channel management element to our business.
In my current position, I’ve been running the Ricoh Family Group dealer business for the last six and a half years. It’s a pretty diverse responsibility that has given me a good perspective in working with our dealers. So much is changing and we must look at the business from different angles and understand marketing better, understand how sales works, right on through the transaction on the direct side.
What were some of the highlights in 2017 for Ricoh across all its lines of business, and specifically in the dealer channel?
Coriddi: What stands out is our new go-to-market strategy. On the dealer side, we enjoyed another solid year of growth with our dealers. They played a significant role in the strategy by expanding our reliance on our dealers in the mid-market.
In 2017, Ricoh created three distinct business channels—Enterprise Channel, Commercial and Industrial Printing Channel and the SMB Channel. What are some of the benefits reaped from this new structure?
Coriddi: The three business channels, for all intents and purposes, are sales, services and production. The biggest benefit is the focus that each of the areas is able to get, all the way up to Ricoh Japan. As we develop our strategies in each of these areas, we’ve been able to include global best practices. We’re in a position where we can bring all of that information together. There are aspects of the European and Japanese markets that we can leverage and take advantage of in the United States. Now we have a newly-named CEO who can add to the coordination and collaboration efforts. This puts us in a great position with a solid structure as we move forward into the future.
During Ricoh’s restructuring process, Ricoh also transferred thousands of direct SMB accounts to some of its dealer partners. Can you provide insight into this initiative?
Coriddi: This all falls under the umbrella of our new go-to-market strategy. Selling these customer contracts to dealers in a select number of markets is certainly one of the most provocative aspects of the strategy, and grabbed headlines. But it’s really just one of a number of different tactics that we use to deploy this new strategy. There are elements we feel were much more beneficial to dealers all over the country. We sold a little less than a third of the SMB customer base to 20 dealers. The other two-thirds are managed and maintained by our inside sales group. When you think of all of those accounts, whether they’re managed by dealers or inside sales, 100 percent of those markets—all of the net-new (zero-based) accounts—in that midmarket segment are now the responsibility of dealers. So 100 percent of our dealers in 100 percent of the market is served. They are Ricoh’s play to grow, because our inside sales group is only calling on existing customers in that midmarket sector. We feel strongly that our dealers are extremely capable of managing those type of accounts. When you get into the midmarket range, the local presence dealers can provide the end user—backed by experience and trust—is really second to none. We have a tremendous amount of confidence in our dealer network, and that was the catalyst behind a lot of these changes.
With the focus shifted to dealer growth for the SMB customer base, how is Ricoh bringing solutions that help foster dealer growth?
Coriddi: One of the things we’re doing is providing our dealers with leads that we generate in the midmarket space. Since we’ve deployed this new strategy, the amount of leads Ricoh has provided is five times greater than it was pre-strategy. We’ve built systems to monitor and manage those leads to conclusion and it’s been extremely successful. From a field execution standpoint, we’ve established a national position on the solutions’ side that’s responsible for putting together and developing our national dealer strategy. They’re responsible for training our solutions specialists, and we now have 21 solutions specialists in the U.S. supporting our dealers. There was a dotted reporting line to that position for those 21 individuals, but now we have a solid line of reporting into our region directors for each of the four regions. The reason we’re doing that is we needed to get these people more into every day, mainstream activities. So we have the strategy piece coming out of the national position. We’re building the tools and the resources, and we have the people who are supporting the dealers on the solutions’ side reporting into the regions as part of the market teams.
In light of the news regarding Ricoh’s $1.6 billion loss, how is the Ignite growth strategy progressing? Tell us about the role M&A will play in its turnaround?
Coriddi: The whole Ignite element of our worldwide strategy that Yoshinori Yamashita, president and CEO of Ricoh Company Ltd., announced in February is all about growth, and it’s building for accelerated growth as we go forward. Part of that is securing and maintaining the current customer base, but what it’s really focused on now is bringing in other adjacent businesses to build on that customer experience and provide more in the form of helping customers manage their information. As to the M&A fund that was announced, while I don’t have specifics, it includes investing in positions that are going to help us develop adjacent businesses. That’s still in development.
Ricoh believes its competitive advantage lies in its ability to bring technology, resources and support to dealers. Our dealers have the strength of having established, solid relationships and trust with their customers.
– Jim Coriddi
Can you provide insight as to the work that goes into Ricoh ConvergX? What were you hoping to accomplish with this year’s event?
Coriddi: ConvergX is all about collaborating and working in tandem with our dealers to leverage our respective strengths. Ricoh believes its competitive advantage lies in its ability to bring technology, resources and support to dealers. Our dealers have the strength of having established, solid relationships and trust with their customers. Ricoh brings its power and the dealers bring their local experience and expertise. Working together, we’re focused on helping customers improve their ability to manage information.
In planning this year’s ConvergX, we started with a blank piece of paper. We worked with our National Dealer Council to create a dealer survey, and we asked our dealers for input on every element of the event, including the breakout seminars and their topics. Based on the feedback, we came up with 15 different seminars. The dealer response was tremendous; they provided write-in thoughts and opinions, along with some questions. This is definitely the dealer’s meeting; they were involved in the general sessions, seminars and panels. We had a forum with dealer principals only, with every dealer principal sitting down with the entire Ricoh executive management team, enjoying an open discussion. I hope we were able to articulate Ricoh’s vision for bringing the business forward.
We made some very out-of-the-box moves, particularly with our dealers, to change our go-to-market strategy.
– Jim Coriddi
Can you talk about the roles A4 devices and other new technologies will play in advancing Ricoh’s growth strategy?
Coriddi: A4 continues to grow in our industry. From a Ricoh standpoint, our A4 devices are being launched with more robust capabilities, not only from a mechanical standpoint, but also in being able to integrate with our other products in a common platform on the network. The A4 products are becoming more capable and represent a key element to the expansion of managed print services. Not only is A4 a key element of managed print services, it’s ideal for certain vertical markets such as health care, with features designed specifically for that space.
In terms of the collaborative aspect of the technologies, Ricoh is launching a lot of different visual communications devices, making the technology more inclusive with our interactive white boards, projectors and visual displays.
In April, the company announced that Joji Tokunaga would take the helm as president and CEO of Ricoh Americas. What qualities does he possess to help mold the Americas as part of Ricoh’s global transformation?
Coriddi: I’ve known Joji for 30 years and I’m very excited about him taking this role. He has tremendous insight about this region of the world, having spent 22 years in the United States. But he also understands Ricoh globally, so he brings a tremendous perspective, a great background and understanding of the U.S. market. Joji’s going to look to establish a real sense of collaboration and a wider perspective on the business that is critical. As technology continues to evolve, the tendency is to zero in and become a little myopic, when in reality it needs to be the opposite. There needs to be more of a mindset of integration and a wider perspective. I think Joji brings that to our company.
Ricoh has been consistently honored for its commitment to environmental sustainability, setting internal benchmarks for renewable energy usage, along with providing educational programs for employees and its dealers. Tell us about the passion behind this policy.
Coriddi: Ricoh has been building its products with a basic mindset and focus on environmental sustainability for decades. Its Ricoh’s culture. The awards are great; these are some noteworthy organizations that are doing great things to make sure that they recognize and honor the companies like ours that are leading the way. But this is nothing new to Ricoh at all. Ricoh focused on the environment before it was cool to do so and it has been in our DNA for 20 years.
What changes in the BTA space are influencing your go-to-market strategy, and what variables will play a role in your strategy going forward?
Coriddi: Our overall goal is profitable revenue growth, which is simple, yet challenging. We’re very fortunate in that the Ricoh Family Group dealer network is a capable group of dealers who are oriented to growth and have the wherewithal to invest in that growth. They have the ability to recognize what is required to grow the business and have the mentality to partner like we do, much like our partners have with us. That is why we feel very bullish on the growth of our dealer channel going forward. From Ricoh’s standpoint, we’re very committed to fueling that ongoing growth; we’re on a positive run with our dealer business and that’s only prompted us to put more reliance in them and more investment as we go forward. Specifically, one of the things we’re doing is establishing a more customized way of setting up business plans with our dealers. For example, in the past we had general programs and promotions, general resources that were available. What we’re looking to do with many of our dealers now is come up with specific business plans predicated and focused on the growth opportunities that they seek for their businesses and their particular markets. That’s where we’re looking to be pliable enough to take a more targeted approach to growth.
What are your goals for the next 12-18 months?
Coriddi: We’re taking a real expanded focus on establishing and investing in specific growth initiatives with our dealers. For one dealer, it may be more of a focus on establishing and growing a production area. Another one might be wanting to shift more of their customers toward a services expansion. With Ricoh, you will see a willingness and focus on specific initiatives, dealer by dealer, to promote growth within each dealership.
Ricoh has had the courage to make some very difficult decisions over the past couple of years. It started in Japan; before we went into our Ignite phase, there was another phase established to make sure we were moving all our operations efficiencies the right way. We made some very out-of-the-box moves, particularly with our dealers, to change our go-to-market strategy. Frankly, I think the industry will have no choice but to follow some of those things. We’re very excited going into this fiscal year. We think we made some innovative choices to change the business, and we’re already seeing significant benefits from that. Initially, a lot of people looked at Ricoh sideways for doing some of the things we were doing, but that’s what happens when you innovate. It’s different, and people don’t like things that are different. It’s starting to look better for Ricoh and it is definitely paying dividends from a business standpoint.
