Yoshinori Yamashita
The OEM is lagging behind other companies in the race to adapt to the concept of the paperless office, finding it can no longer depend on its ink and copier sales.
An article by Hiromi Yamabata of the Nikkei Asian Review reveals that Ricoh is floundering as a result of the increasingly widespread paperless office concept, having already “dug itself into a hole with its aggressive global expansion.”
Since the company’s new CEO and President, Yoshinori Yamashita, took the reins back in April 2017 he has initiated reform under the slogan “Clear Departure from the Past”, but Ricoh is “in a race against time” to make the reform work, taking such measures as streamlining its operations in the United States and putting an end to the financial support of its scandal-wracked subsidiary in India.
However, the changes instigated by the reform could come too late, with Yamabata questioning if Ricoh is “simply in too deep to quickly boost its earnings?”
Since taking the company’s helm, Yamashita has taken a number of measures to try and help Ricoh recover and catch up with its other OEM competitors, for instance by directing Ricoh’s units “in the US and elsewhere” to “outsource sales of multifunction printers to external dealers” and cutting the number of US employees by 2,500 in six months.
Yamashita also said Ricoh would “rethink its emphasis on expansion in pursuit of market share, and focus more on profit” and noted that, though Ricoh’s global direct-selling system was “effective when the industry was growing”, with the onset of the paperless office, the system has now turned into “a serious drag on efficiency.”
At an April-September earnings briefing held on 30 October 2017, Yamashita revealed that the reforms he had instituted had already garnered positive results, with operating profit climbing by 33 percent “despite the losses related to Ricoh India.” However, he also conceded that “there is still much to be done” and “set up a CEO office to gauge the progress of structural reforms and implement additional measures, if necessary.”
With paperless workflows meaning that Ricoh can no longer depend on its sales of copiers and ink, Yamashita has turned his attention to industrial printing, personally unveiling the company’s new range of T-shirt printers on 16 November 2017.
But, with a company executive saying “it is still unclear how much the T-shirt printer business will expand”, questions remain over Yamashita’s reforms and whether they will be enough “to restore Ricoh’s earnings next fiscal year and beyond”, particularly as rivals like Canon continue to adapt to the paperless office and what it means for printing technology.
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