Interview

From Document Manager Magazine Vol 20 No 03 - May/June

DM Editor David Tyler speaks with Neil Murphy, Northern Cluster Sales Manager for Kodak's Document Imaging (DI) division about recent developments within the company and across the industry as a whole

David Tyler: The current DM market is challenging for vendors for a number of reasons: how is Kodak adapting to remain successful?

Neil Murphy: Right now Kodak is still going through a transformation which started years ago with the introduction of Kodak Capture Pro: there is more of an emphasis on our supplying components of a solution, rather than just supplying hardware. There are different challenges in the market if you are 'just' a scanner supplier: we're moving up the value chain.

Which is not to downplay hardware sales: that remains the most important part of the DI business. What we're looking at as we go up the value chain is having more to talk about with potential customers, and leveraging the partner network we have in place. We have lots of partners with whom we have very tight and successful relationships right now, and we are also trying to win over new partners. That can sometimes be quite difficult to do if all you have to talk about is your scanner range, so we have to make sure that our message is relevant to them. The conversation is changing from how it might have been five years ago; we are much more about what else we have to offer to add value. It's about how we can help them to make more money, or make them more competitive.

I believe that in the past we probably didn't make as much use as we could have done of the Kodak brand: leveraging such a well known brand in collaboration with our ISV and VAR partners is quite a powerful thing to do.

DT: How does the importance of software - and especially Capture Pro - translate for your partner channel and indeed end users?

NM: Capture Pro sales in the UK doubled last year, and later on this year two new software lines will be launched, so there is significant R&D investment going into that whole area. We've seen such success from Capture Pro: it's a powerful front end batch capture solution, with no 'perclick' charges and a strong positioning statement i.e. we supply the de-facto capture front end, and the partner and/or user can then decide how and where the image is routed: whether it goes into a back-end repository, or into an IDR (Intelligent Document Recognition) engine or other process solution. That way the user only pays for that added functionality when they actually need it.

This has become quite a strong pitch for the bureau market, where typically they will use Capture Pro to front-end everything, and then certain specific jobs might then be routed into Kofax, TIS, ReadSoft and the like. From their point of view, no matter what job they're scanning, the operator always sees the same interface, and it makes the whole process far more productive while keeping costs down.

DT: As you've already stated, hardware remains at the core of the Kodak DI business, so how does the scanner market look to you at the moment?

NM: In point of fact 2011 was quite a good year for us, especially with software sales included, but the overall market did decline for all scanner manufacturers in the UK. This is largely as a result of the recession, but that said we are now seeing quite a strong upturn in sales right across our markets for Q1 this year.

I suspect some of this is driven by public sector departments that had been holding onto budget from last year, especially in healthcare and central government.

We've seen significant increase in our market share in the low volume, mid volume and high volume sectors. In the second half of 2011 the trend in high and medium volume particularly was steeply upwards for Kodak. The i4600 device has been a particular success for us since its introduction, and has effectively taken over its market sector.

We're also delighted with the strong growth we've seen in ibml sales. Due to the revenue involved, every sale of a medium and high volume level scanner can make a significant impact on our figures so we're pleased that we're performing strongly in these sectors.

And increasing our market share at that level is helping us to develop much closer relationships with partners, for instance ISVs selling mailroom type solutions, and with the bureaux and BPOs who increasingly look to us to supply a lead in that market.

More info: www.kodak.com/go/docimaging

Interview