Lexmark Takes Solutions Seriously

softwareYou’d better not call Lexmark a printer company anymore. You can, but if you want to more accurately describe who they are today and what they offer channel partners and customers, the word “solutions” aka “software” better be somewhere in that description.

That was a key message at last week’s press and analyst briefing in New York City. Equally notable was Lexmark’s emphasis on unique solutions that its competitors aren’t yet offering. A lot of territory was covered during the nearly six-hour briefing, but I’m going to focus primarily on the company’s commitment to the BSD channel and it’s solutions focus, both of which are closely intertwined.

How serious is Lexmark about becoming a solutions company? The goal is for 50 percent of its business to come from solutions by 2017. To clarify, that figure includes hardware bundled with solutions as opposed to 50 percent software.

One doesn’t have to look to far back to see a trend developing within Lexmark. It all started in 2010 with the acquisition of Perceptive Software. Since then Lexmark has acquired 10 other software companies, including its most recent acquisition, ReadSoft, in August of this year. No wonder Michael Johnson, vice president of North American Business Channels and SMB for Lexmark, says, “We realize we need to do more to be successful. We’re in the middle of a transformation. We’re transforming from a hardware company to a solutions company.”

Meanwhile, Lexmark has done a nice job of growing its Business Solutions Dealer (BSD) channel, a channel that includes some heavy hitters such as RJ Young, Pacific Office Automation, and TGI, Inc. among many others. This channel is number one for Lexmark from a revenue and growth perspective, and obviously, as a channel for carrying out its solutions mission.

“We view the BSD channel as the most strategic and is clearly a leader and has been for years,” says Michael Johnson, vice president of North American Business Channels and SMB. “It has the best sales people out there and the most ability to take our value prop forward for us.”

Since establishing that channel, Lexmark has been feeding it a steady diet of A4 product, combined with what Johnson describes as “product differentiation—unique products driven by feedback from our dealer network and solutions from our Virtual Solutions Center.”

Lexmark continues to add resources to this channel year over year to support this growth and Johnson reports that these building blocks have served as a great platform to drive success.

“But, it’s not enough,” he adds. “We need to do more; there’s a need for differentiation and we’re focused on driving that. We want to be able to drive more solutions with our products so they can take that differentiation to their customers. We’re proud of the dealers we’ve brought on board. Our goal is to go deeper and wider with each one of these partners.”

The A4 focus isn’t going to stop anytime soon, and Johnson notes that Lexmark’s goal is to maintain leadership with the best in class A4 product while providing differentiation through channel specific software solutions. Not to be underestimated among all the technology and solution differentiation is the relationship with its dealers. “We need to have close relationships with partners and get to know them on a personal and business level to help them drive our business and get the feedback from them to help us drive our business,” adds Johnson.

Sticking to its solutions mission, Lexmark is intent on rolling out more channel specific software solutions. And that’s exactly what it’s been doing this year. In the first quarter of 2014, Lexmark unveiled mySignShop, a software tool for creating high quality retail signs, labels, and tags and the Embedded Logistics Solution, software for creating capturing, processing, and retrieving logistics documents more efficiently.

The latest introduction, AccuRead Automate, announced on Tuesday, Oct. 21, is an app that enables a Lexmark MFP to capture, automatically classify, and route documents, while extracting key information for file naming and indexing. According to the AccuRead Automate brochure, ‘this results in a simpler and easier capture process for users requiring little training. Plus it’s the only such technology that runs on a Lexmark MFP, reportedly saving the cost and management of an additional server and keeping all activity within the customer’s network and behind their firewall.”

According to Johnson, Lexmark has received unbelievable partner feedback on this solution. “We’re feeling like we’re hitting the mark with this solution,” he says.

Based on the demonstration I saw in New York City last week, Johnson has that right, this is a home run.

And the solutions just keep on coming. Doug Frazier, manager, North American Channels Solutions Engagement, previewed another intriguing and timely solution that Lexmark will be unveiling next year. I can’t write anything about that yet, but I will provide future coverage once I get the go ahead from Lexmark. If you’re a Lexmark dealer you may already know about it, if you don’t, it’s a solution worth waiting for based on the demo.

Johnson convened the briefing by reinforcing his earlier comments and those of other Lexmark executives throughout the briefing, including a commitment to the channel, delivering differentiation, continuing to invest in the channel, and a focus on solutions. And it’s those solutions that represent the future of Lexmark.

“A lot of the solutions we’ve had over the last 10, 12 months have been me-too solutions,” acknowledged Johnson. “We feel like we’re going to have the ability with this funnel of channel specific software solutions that are now coming through Perceptive to be different. The solutions we announced (AccuRead, Logistics, MySign Shop, etc.) are going to be solutions the competition will not be able to replicate very fast. You’re going to see us put the pedal to the metal and drive that differentiation.”

Johnson’s final words were words that he and others from Lexmark have emphasized again and again during these press and analyst briefings. “We’re going to continue to listen and stay close to our partners and our customers to find out what it takes to win.”

 

Scott Cullen
About the Author
Scott Cullen has been writing about the office technology industry since 1986. He can be reached at scott_cullen@verizon.net.