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The Big Crunch Continues!

April 9, 2017

I first wrote about “the big crunch” in 2012 on the Copier Network as a guest blogger. Back then it was Sharp that looked like it was on the verge of insolvency, now Toshiba seems to be the lead candidate for that fate. While 5 years may have changed the landscape of the Copier Industry, the more things change the more they seem to stay the same. Clearly the big Crunch continues.

Ricoh just purged more than a thousand loyal employees and turned over their down the street business to a handful of large Independent Dealers. While this has not made the small to midsize Ricoh Dealers happy, they should see RBS (Ricoh BS Branch) leaving the SMB market as a gift! Other manufacturer’s dealers could only wish that their _BS Branches would disappear.

The Big Crunch seems to also be affecting Xerox. Splitting the company in two, has not seem to have helped Xerox.  They too are engaged in layoffs. One report I read that was posted last month said ~ 50 system analysts were let go across the country. This is especially short sighted on the part of Xerox’s Management team. I personally have seen this move before. Firing an SA (Systems Analyst) or an SE (Systems Engineer) is low hanging fruit, and seems like a quick fix, but it is a trap. SAs and SEs are well paid, and for good reason. But too often the Suits who run these large companies (and have great skills in many areas) don’t understand what the SA / SE really does. After all why do you need a Systems Engineer? SA / SEs are like yeast! You only notice them when they are not there! And you know what happens to bread with out yeast, it goes flat! So does your sales numbers without SAs or SEs! How do I know this? When I was first approached by Ricoh Business Systems the person interviewing me told me that they wanted me to reconstitute a “Solutions Team” to do technical Pre Sales work with the New England Market Place’s Sales Force.  I asked him what had happened to the previous Solutions Team? He said it was disbanded by Ricoh Corporate in a cost cutting move. They didn’t see the value of it. After two years of watching the branches miss their sales numbers they went back and studied what had changed and to their credit they recognized it was the firing of the SA’s and SE’s.

I thought that they had learned their lesson but after the Ricoh \ Lanier merge they did it again! They moved my Solutions Team to the Service Department. This was after my branch had a banner year. We hit our triple crown numbers. We were the only branch of 13 branches to hit these 3 goals and my branch had never done it before in it’s history. But Ricoh Corporate rewarded this excellent performance by dismantling what we had built. I resigned shortly thereafter. I did however see history quickly repeat itself. I go a call six months later from a Sales Manager at RBS. He told me that my name came up in a conversation among the Sales Managers. He stated that as best that they could figure I had cost the Branch a Million Dollars since I left. That is ~ $2 million a year. I asked him if he would mind putting that in writing on Ricoh letterhead, but he politely declined.

That is the problem with firing SA / SEs is you get a small and quick positive impact on your bottom line, as you try to figure out why your sales numbers tank! Xerox is now heading down this perilous downward spiral. And so the BIG CRUNCH continues, but it is not all bad! The Independent Dealers are thriving! It’s good and getting better on this side of the street. We see the Big Crunch as a culling of the heard. We seem to be seeing the dying off of the weak. Maybe a return of the 70s and 80s when the Independent Dealers were large and in charge! We shall see!

That’s My $0.02

Vince McHugh

VP \ NECS

vince.mchugh@yahoo.com

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