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Canon India Gets First Mover Advantage

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Even before the present-day clamour for digitisation began, Canon was sitting pretty as a market leader. Now it’s time to expand the canvas. In conversation with Vivek Malik of Elets News Network (ENN), Bhaskar Joshi, talks about how various government initiatives have taken the digitisation drive to the remotest corners of the country

Give us an overview of Canon’s Office imaging solutions Division’s operations in India?

We have two kinds of sales structure in this division. First is the direct sales team. This deals with the top 500-1000 large corporates in India. We do direct sales and service to these organisations. It means those on the payrolls of the company directly deal with these companies and provide service to them. Then we have a strong channel partner network. They handle the SMEs and the government sector. We have around 220 channel partners of us.

One unique aspect of our partner network is that it is direct sales and service partnership, meaning whoever sells the machine also services those machines. This is required in any high-level machinery equipment segment. You have to understand that our machine range starts from say, Rs. 50,000 and goes onto maybe Rs. 20 lakh. So, customer satisfaction becomes very important in such cases. We don’t want our customers to roam in circles contacting the service team or some other third party. That is why the responsibility of service has been given to the seller itself. Also, we invest a lot of money and time in training these channel partners. We lay down strict conditions before taking any partner on board. They need to have a minimum number of people working for them, requisite experience and infrastructure. Only then we certify them as partners.

Tell us about your foray into services.
In the traditional model, you sell a product and you have a maintenance agreement. But in services model, we sell it as a service, as in, you don’t have to buy that equipment to use it. It operates on the per-page model, per-click or rental model. We are also offering print management software solutions which deal with the entire data of printing, such as who is printing what and how much.

Same applies for scanning. You can also set a quota for individuals. It works like a prepaid automatic card. It comes under the services offering. The customer continues to pay on per page basis. Another is ‘any place printing’. Currently, you fire a print and the print comes out from a pre-defined machine. In this system, you fire a print and it will come out when you go near the machine and authenticate your details. And it can be from any machine. This helps a lot when it comes to confidential documents and other important prints.

We have also launched Canon Business Services. Currently, the usual way of digitalising a document is that you go to a scan machine and start scanning. But the reason you scan a particular document is that you want to secure it for future. In digitisation service, the customer will continue to pay by the per page usage model. We will unbind a particular book or document, scan them, bind them again and also index those pages. It will be integrated with the workflow software as well.

We will also go aggressively on Print Room Services. Today in India, companies outsource of lot of printing which may be brochures, pamphlets or other document needs by the company in large numbers. This is very unorganised in India and has no confidentiality too. We have entered into this arena and will go aggressively into this. The industry is moving into Capex to Opex model.

Digitisation has become a buzzword ever since the new government has come in. A lot of initiatives are being launched. How do you see yourself in this?
The biggest change has been that earlier we used to run after the people and now it is the other way around. I am talking about the government sector. They are aware of the various initiatives we have launched and want to partner with us. To focus in a better way, we have initiated state meets with respective state governments. We have started meeting IT secretaries of these states to impress upon the need for digitisation and the services that we offer. We are going pie-by-pie such as land records, criminal records. It helps that the Central government has started emphasising on ‘safe city, secure city concept’. There too a lot of technology is required to secure our cities. So this is our approach when it comes to state governments.

Now that the government sector has realised this, how do you plan to change your approach towards them?
Yes, we are forming a pre-sales team for this sector. Though it will be routed through the channel partners only, considering it involves length and breadth of the country and we cannot be present everywhere. This team will do the front ending for all these deals such as explaining about the benefits of a particular machine, closing that deal and then taking the help of event partners in helping them out with services and other aspects. As for the big states for us, they would be Maharashtra, Gujarat, Karnataka, West Bengal and the North-East region. We are also keeping a keen watch on Andhra Pradesh, Telangana and Punjab.

“All the data pertaining to criminal records, fingerprints and other information is being stored in databases and that requires a lot of digitisation. Then there is digitisation of land records in all the states. Same applies to courts across the country”

Prime Minister’s Jan Dhan Yojana is a huge project and will bring in a lot of people into the banking fold. This is a huge opportunity for a company like yours. How do you see yourself benefitting from it?
Talking about the banking sector, it involves a lot of paperwork. Earlier, the technology was not playing a big role in it but things have changed now. Also, we want to expand into D and E towns where the impact of this scheme will be seen the most and a lot of unbanked population lives there. The role of our channel partners becomes very important here. Going forward, by 2015, we want to add 50 more partners and they will be exclusively for these towns. We have shortlisted these partners and are currently in the process of training their personnel. We will then go all-out by deploying all our technology there.

What is your take on the regulatory framework for the sphere you work in?
I will first touch upon the issue of grey imports. There is a lot of it currently happening. A lot of equipment from the developed world is being dumped on our shores and then after repairs sold in our market. Some law should govern this. This disturbs the level playing field for companies such as ours who invest in technology here. Secondly, is the issue of uniform tax law. All states have different laws and their definition of a particular machine, too, is different. This needs to be done away with. In a sector like ours even a small difference of tax structure can impact prices in a big way.

How do plan to maintain your lead in the Indian market?
Canon has always been known as a company which brings in new technology. We want to continue that approach. For example, print management solution software is available in India for long but the cost is very high. Because of this SMEs and government sector have not been able to afford it. We want to bring down the costs and make it more affordable. Same features but lower price. Another way of beating the competition is expansion. We want to create a robust service network for our partners. Currently, we are operating directly in 7 cities and we want to expand it to 10-12 cities. Our market share is 26 percent, which is highest in the country. Going forward we want to increase it to 30 percent by mid next year.

What can people look forward to in terms of technology from Canon in the coming days?
We are coming up with network surveillance camera in coming days which will be a first for India. It will be an IP camera and have features like face recognition and number plate scanning which will be a huge boost as far as surveillance of our cities is concerned.

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