In this exclusive interview with PrintIT Reseller, Andy Muskett, Director of Channel at Xerox, talks about the acquisition of Lexmark and how the integration of the two businesses is progressing. He explains how Xerox’s Reinvention is driving a more channel-centric model, highlights some of the key benefits emerging from the combined operations, and how a comprehensive portfolio across print, IT, and digital services, will benefit channel partners. Here’s an excerpt of the conversation
Michelle Ryder (MR): How is the integration of Xerox and Lexmark progressing, and what strategic benefits are emerging from the combined operations?
Andy Muskett (AM): Things are progressing well. But the important thing really is to understand why we wanted to acquire an organisation like Lexmark. We were looking for an organisation that could bring us significant benefits as we went through our Reinvention strategy that you and I have spoken about before, and it was the perfect fit for us.
Our intention, strategically, is to create an organisation fit for purpose, for the future of not just the print industry, but also the IT services industry. So, we have been focusing on ensuring that the integration gives us an expansive portfolio around print, it also gives us an expansive portfolio around managed print services and other additional services that the Lexmark organisation bring to Xerox partners and Xerox to Lexmark partners.
And also at the same time, not just from a technology and services capability, but culturally, the two organisations really do look like they’re the perfect fit and the perfect match.
MR: As part of Xerox’s Reinvention journey, you announced a shift towards a more channel-centric model, in what areas in particular do you see opportunity for channel growth?
AM: I think the first thing is to understand why do we want to move to a much more channel-centric role? There are clearly some efficiencies and commercial benefits in terms of doing so, but actually, we know the market has shifted significantly over time. Xerox is more than 100 years old.
We’ve seen huge amounts of changes in the industry, and this is no different, really, as we continue to try to reinvent ourselves. So really, the intention is to give ourselves the ability to reach a much wider audience.
So, we want to be an organisation that has print and IT services capabilities that can be delivered not just to corporate large, enterprise type customers, but also small and medium and mid-market size organisations, and therefore we need help and support to be able to reach that wider audience.
Hence, moving to a more channel- centric model. At the same time, we’re adding value to those channel partners, who in turn, can add value to their customers.
MR: We’ve spoken before about how Xerox has built on its print legacy and though acquisition, expanded its capabilities in IT and digital services. You have an advanced offering spanning AI-driven workflow automation, cloud-based solutions, and cybersecurity, presumably this makes you an attractive vendor to MSPs and IT service providers as well as traditional MPS providers?
AM: Yes, we’d absolutely like to think so. There is a convergence going on in the marketplace that’s quite clear. The print market continues to operate in the manner in which it has previously been accustomed to, but we also see that there are large numbers of dealers that have converged into forms of IT services and potentially digital services as well.
So, we want to broaden our portfolio, to reach a wider audience of channel partners and MSPs, IT VARs and solution providers are absolutely key to our success in the future.
MR: There are, I’m sure, many strategic benefits to the Lexmark acquisition. One in particular that stands out for me is the fact that Lexmark is a manufacturer. It owns its own technology end-to-end, which will help strengthen Xerox’s overall offering, particularly in A4.
AM: Yes, one of the strategic imperatives around the actual acquisition was taking back control of manufacturing our own products. And like you said, particularly A4. We know that the marketplace for A4 is greater than it is for A3.
We’re certainly seeing with the evolution of an expansion of the hybrid workplace, that actually the growth in A4 outweighs the growth in A3, and therefore taking back control, or taking responsibility for manufacturing, product development capability, was a really important point for us to consider during the acquisition phase.
The A4 portfolio from Lexmark further enhances the A4 portfolio from Xerox. They have certain technologies and capabilities and applications that the Xerox range of products don’t necessarily have today. So, it’s important that we take the best bits of both organisations and put them together, that gives our channel partners greater access to a wider portfolio, which allows them to serve greater sets of customers in the marketplace.
MR: Where are you investing for channel growth and how are you enabling both Xerox and Lexmark channel partners to sell and support your expanded portfolio?
AM: One of the things that we will be looking to do as we transition through the integration is to take the best parts of the Xerox channel value proposition, the best parts of the Lexmark value proposition, and build something which is sustainable for the future, for both Xerox partners and Lexmark partners.
We believe that actually what we need to do is to create a best- in-breed vendor capability so that we can be classified by our channel partners as the vendor of choice, or the channel partners’, partner of choice.
That’s a key strategy for us, and a key KPI that we want to try to achieve, that will encompass creating value-based solutions for those organisations – education, training, programs, support and more importantly, I guess, what we want to try to do is to invest in demand generation and awareness and consideration of our brand in those marketplaces where we perhaps don’t have strength of awareness and consideration, like the SMB customer, for example. So that’s a real focus area for us in terms of investment.
MR: Another area that we should touch on is sustainability. Sustainability is such an integral part of every business’s journey now and it’s figuring quite heavily on tenders. Both Xerox and Lexmark are very strong in this area.
AM: Lexmark has a recognised standing in terms of sustainability in the marketplace, as do we. We both have our ESG goals that we’re looking to try to achieve, and again, we’ll take the best of what we’ve got at Xerox and the best of what Lexmark offers and put those two together.
MR: Will there be some changes to the partner program coming next year as well?
AM: There is already some work going on to ensure that what we are able to do is to facilitate the Xerox technology on some of the Lexmark platforms, and some of the Lexmark technology on the Xerox platforms, which gives us cross pollination of the other good things of both organisations.
We’re looking to try to offer something different to Lexmark partners, if Xerox has that on the table, and likewise, Lexmark products, technologies, and services that Xerox partners today may actually take advantage of and benefit from. The acquisition was strategically made to ensure that our core print business stood at the heart of the Xerox organisation.
Moving forward, we want to expand in the areas of growth in the print industry. So, whilst we want to dovetail that capability and add other services to it, print is still going to be a core business for Xerox moving forward.
