Canon creates digital printing solution market
Canon creates digital printing solution market
Early Days
In 1997, the team consisted of two people, and from then on the Company started growing in strength and operations. Their primary focus was on increasing its sales team. In the very first year itself, Canon India had 50 people on board, which eventually increased to 100 in the following year.
Canon started its India operations by selling copiers to corporates and SMEs. They adopted the business model of direct sales in the B2B segment, without the involvement of dealers and resellers. "For about two years, we were doing direct sales operations from 14 cities. But from 2000 onwards, we started adding more products to our portfolio, as at the same time we obtained the permission from SIPB to appoint distributors," informs Alok Bharadwaj, Sr. Vice-President, Canon India.
In 2001, Inkjet printers were introduced, which were followed by scanners and projectors in 2002. In 2003, digital cameras and laser printers were added to their portfolio. Then, almost after a gap of 20 months, digital SLRs, video camcorders and Laser MFDs were introduced. Not only this, during 2006-07, Canon India marked its entry into other emerging categories like large format printers and DR scanners. In 2008, digital presses were added. Bharadwaj saw to it that the Company created some new categories every year. Finally, in 2009, Canon announced entry in the surveillance market and document management services segment.
Canon's Evolution: From product-centric to process-centric to people-centric
Canon India is now a 800-member strong team. Their focus is on direct sales as well as channel network. Canon has 7 business divisions, headed by directors.
Enterprise solutions division (Document management and enterprise solutions)
Channel division (Office automation)
Channel division (Printers and IT peripherals)
Channel division (Camera sold through retailers and distributors)
National retail chain (Taking care of sales through LFRs)
Corporate sales division (Corporate gifting)
SI division
The first canon partner was signed in Delhi and at the time of their tenth anniversary the distributor participated in the celebrations.
The decade also witnessed a change in the India operations head. Alan Grant was replaced by Kensaku Konishi. Both of them have been a great asset and building blocks of the company. Grant played a major role in setting up a lot of processes in the Company. "He was a highly process-oriented guy and that was the time when the organization required more processes," Alok Bharadwaj reminisces. The initial thrust of the Company in the first 7-8 years was to enhance the product portfolio- meaning product-centric growth was the focus. This had to be complemented by the operational efficiency for which the Company needed more processes. For almost two years, from 2005 onwards. Alan focussed largely on these processes.
As a normal phenomenon, high economic growth implies bringing in more resources, more skill sets and more business efficiency and that is what Konishi brought with him, when he joined the organization. "He began to scale up, he brought in more investments and more Canon showrooms were created. We expanded our service support, in the last two years with 11 new centres unveiled," Bharadwaj shared.
The capital base of the economy was extended. They doubled their office space in square feet, extended their manpower strength to 30%. "From 400 people in 2006, we doubled to 800 in 2009," he added.
Fortifying their strength
Currently, Canon's BIS division has 160 channel partners, followed by ICP with 100 and CSP with 93 channel partners. Not only this, this is further complemented by thousands of resellers across India.
Canon recently hosted 8th season of "Wings of Glory" in London. Wings of Glory is a unique Channel Engagement Programme of Canon to reward the top performers with their spouses- a six-day offsite in London. The programme is an effort to acknowledge those partners who grew higher than the respective division which they represent and did a business of more than Rs.2 crore with Canon annually. Under this programme, Canon rewarded the top 70 partners across channels for all its product categories. The aim of this unique programme is to build deep involvement, high motivation and bonding of Canon and its partners with a special relationship of collaborating in a unique "out of office" environment to help do "business with pleasure".
Canon is conscious of its Environmental Responsibilities.
Canon India is certified for ISO 9001, ISO 14001 and OHSAS 18001. In 2006, the Company was certified for its "Strong commitment to excel" at the CII-EXIM Business Excellence Award. In India, Canon takes the responsibility to dispose of end-of-life Canon products and other e-waste by sending such waste to government-approved recycling agency.
As part of Corporate Social Responsibility, recently, the company observed World Environment Day by initiating a pilot project for Printer and Cartridge E-Waste management programme called the "Canon Green Cycle". The project will allow users to bring in any brand of used printer or cartridge and drop the same for E-Waste disposal. Canon launched this pilot project across 45 Original Ink Centres and 3 printer Greencycle points in three cities of Delhi, Mumbai and Chennai. Canon has tied up with the authorized E-Waste recycler TIC Group India Pvt. Ltd. which would be collecting and disposing of the e-waste from the 45 OICs. Hence, Canon is not only setting up collection centres to oversee the process, but also ensuring that the hazardous products are handled by registered recyclers in order to control the possible damage to the environment and health of the people.
Kensaku Konishi, President & CEO, Canon India, said, "E-Waste is one of the rapidly- growing environmental concerns of the world and it is Canon's endeavour to create a proper disposal and recycle mechanism in India to ensure efficient, safe and easy product retirement." Canon has planned to roll out this programme in phases across the country, covering 16 more cities this year and cover pan-India by the end of 2011.
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VARIndia spoke to Alok Bhardawaj, Senior Vice-President, Canon India, who traces past links it with present and foresees future of Canon India. Following are the excerpts.....
In January 2007, Canon celebrated its 10th anniversary in India and Alan Grant was replaced by Konishi. How was the transition?
Both of them have been a great asset and acted as the building blocks of the company. Alan Grant established a lot of processes in the company. He was a highly process- oriented person and that was the time when the organization required more processes. The initial thrust of the company in the first 7-8 years was to introduce new products to the existent product category. So, it was a product-centric growth. After that, we started focussing more on processes, as we required operational efficiency for which we needed more processes. Processes became the focus for almost two years, from 2005 onwards. Alan focussed largely on these processes.
High economic growth implies bringing in more resources, more skill sets and more business efficiency and that is what Konishi brought, when he joined the organization. He began to scale up; he brought in more investments and more Canon showrooms were created (around 6 of them). We created more service centres, and in the last 2 years, 11 centres have come up. The capital base of the economy was extended; we doubled our office space in square feet; and we extended our manpower strength to 30%. From 400 people in 2006, we doubled our manpower strength to 800 in 2009. So, this is how Canon has built itself up over time- from product-centric to process-centric and now to people-centric.
How is the Canon's entry in the surveillance market doing?
Since we have just started to function in this segment, it is still a very infancy stage for us. The surveillance market comprises of system integration, which uses various hardware, software, recording devices. So, it is a complete work undertaken by system integrators. Canon's product category consists of anything, which is of a high zoom and which needs high optics. We are only the hardware supplier; we are not into networking or software solution. Our main priority is to sign up new SIs. They would bundle these cameras with the required software and recording devices and then position them in the market.
What kind of future expansion plans do you have?
We usually come up with strategies for the long run, but we prepare the budget for a single year. So as long as our strategies and plans are concerned, we are looking at very rapid future expansion. We are looking at the idea of becoming a billion dollar business by 2015. Now that needs sustainable growth of about 3540 per cent, which means that the top rank must grow at a speedy rate. From this year onwards, we have seen a very remarkable growth.
In 2010, 51% will come from smaller cities and 49% from top cities. Five years from now, 70% will come from tier II and II cities. It is a daunting task as it has repercussions and implications in terms of the way we invest in resources, align the resources, establish supply chain and handle customer service. So, it needs multiple fronts and areas where work is required. Canon has started a very strong drive "Canon Image Express" which will cover 38 smaller towns in 38 weeks and will move all over the country, coming in touch with 5 million people.
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Expansion and Strategies
Canon believes in chalking out strategies for the long term, but prepares the budget for a single year. Bharadwaj informs that they are eyeing at becoming a billion dollar business by 2015. Now this needs sustainable growth of about 35%-40%, which means that the top rank must grow at a fast rate. In the first quarter of 2010, they grew at 60% and expect to be 50% in the second quarter. "If we can replicate this same story throughout the year, we are very much on the track of becoming a billion dollar business," shared elated Bharadwaj.
They will not leave any stone unturned and explore all the opportunities. This would be complemented by the study of geographies- in other words going into the interiors of India.
Their next focus would be on expanding and enhancing their product categories where they consider their market shares are low but have a higher potential to expand. Yet another biggest focus would be to strengthen their positions in the market verticals. The Company feels, BFSI, telecom, Pharma and hospitality are the most promising sectors. They, in turn, have different business or growth drivers. "We are looking at those verticals where we are not that strong and look for full optimization of these verticals," he concludes. In a nutshell, they would be looking at strengthening geographically, product category wise and customer vertical wise.
Their new initiative called "Canon Image Express" will cover 20 states and 38 cities, with the aim to reach out to the tier-II and III markets which have been Canon's focus to capture a bigger market share. It will travel continuously for 266 days and over 18,000 kilometres. Konishi added, "Canon Image Express is a very important campaign for Canon as we aim to have a stronger foothold in the emerging small cities in India. This innovative city road show will be reaching out to 5 million customers during the extensive tour across India."
The journey goes on...
Over the last twelve years of its India growth story, Canon's comprehensive range of the latest digital imaging products supported by a trained sales force across the country has emerged as its key differentiator. Very rightly, Canon is practically moving with their corporate philosophy called "kyosei". Canon redefines it as, "All people, regardless of race, religion or culture, harmoniously living and working together into the future".
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