I had the opportunity to present at this week’s Inspire Conference in Las Vegas, hosted by Lexmark and Perceptive Software (a division of Lexmark). It was a double pleasure because I was sharing the stage with my friend and industry colleague, Dean A. Sleeper, the founder and CEO of AccessVia, which was acquired by Lexmark last year. AccessVia is a solution for in-store publishing, and it is used by many of the world’s largest general merchandisers and fast moving consumer goods retailers. You can hardly shop in a grocery store in America and not see the result on the shelf edge. Dean is now the VP of Global Industry Solutions for Lexmark, and by all indications is happy to be a part of the bigger company.

Lexmark (originally an IBM spin-off) of course makes printers – and if you’re in the retail drugstore business (as I was) you are probably well aware that they “own ” retail pharmacy. And the big reason it became so pervasive (an estimated 95% market share) in that particular sector is because Lexmark took the time to understand the retail pharmacy environment. For example, the company built the printer shells to be able to withstand the rigors of the physical environment, and worked with Rx retailers to design a multi-part form to handle prescription labeling (if you’ve ever wondered about how all those colored warning labels on your prescription are produced – here’s your answer: they were probably printed on a Lexmark).

That ability to listen well turns out to be a key part of the company’s message to the retail industry now. As Dean said in his part of the presentation, “Enterprise-level solutions envision something structured – a symphony <i.e. they live in the land of theory>, but store execution is really a cacophony – <we know> it’s messy! ” Later in the day, Global VP & GM for Retail and Manufacturing Tim Rowland reiterated: “There’s a breakdown between Corporate’s vision for the store, and the reality of a 17-year-old servicing the customer. ” So the question is, what does Lexmark hear? What they hear is that the store is challenged to spend more time with demanding customers (said Tim, “retailers ask themselves, ‘how is it that Amazon has the highest customer satisfaction rating?’ “), that omni-channel fulfillment is creating plenty of chaos and friction at the store level, and that high employee turnover is making it worse.

But one industry’s chaos is another industry’s opportunity. And Lexmark has in the last few years embarked on a significant merger and acquisition strategy to build a broad set of capabilities that specifically deal with the 80% of the world’s data that is unstructured (according to Gartner), and apply those capabilities to the retail industry (among others). Lexmark’s retail focus is on the following:

• In-store signage, to cut the costs associated with retailers’ publishing needs and lift sales with pricing consistency;
• Incident management (i.e. breakage in shipments, spills & falls in the stores), to capture information when it happens and integrate it with existing processes and systems (example: HR, Loss Prevention, Risk Management);
• Managed print services, to optimize retailers’ “output environment ” through asset monitoring, maintenance, and management;
• Employee onboarding, so that HR can quickly respond to employee information (onboarding, availability, discipline, off-boarding, etc.); and,
• Accounts payable, particularly for “indirect “, or non-EDI, store orders

Why Now?

The question is, why has Lexmark undertaken the more difficult task of addressing a strategic information challenge, when they could more easily continue to milk the cash cow with their pervasive printers and signage software? That’s the question I asked Tim, Dean, and Retail Global Industry Manager Mike Wessel. Tim explained, “Printing will go down, it’s just a question of ‘when’. Some recent data shows that there are 60 trillion pages throughout the world per year of ‘cut sheet’ consumption. But the important thing is that it has been at about the same rate for several years! There are a lot of moving parts – for example, consumer Internet adoption caused the number of pages to go up <people would reprint what they saw on the screen>, but other things like workflow automation have caused it to go down. But over the long haul, there will be fewer printers and less toner – what we have called ‘black gold’ – used in the world. And we want to be ahead of that change. “

Dean added, “In retail there are many disparate sources of information and disparate processes – but the connectors between them either don’t exist or are broken. People have to execute the handoffs – and that takes time away from servicing customers. ” And Mike stressed, “We’re not trying to be yet another enterprise solution, but we want to help those solutions to work better by getting unstructured data to them. ” For example, last year Lexmark/Perceptive Software acquired Saperion, an imaging and document management solution that is focused specifically to work with SAP.

So, Lexmark and its portfolio companies have taken on the difficult task of delivering a set of integrated capabilities that manages the explosion of unstructured information, not only in retail, but also in healthcare and insurance, banking, higher education, HR and accounting, manufacturing, and government. The company’s goal is the “bridge the unstructured and structured domains “, and it sees a particular opportunity in retail.

Ultimately, said Dean, the objective is to “eliminate chaos and restore order ” in the store – and that is important if retailers are to meet the service demands of digitally empowered but time-starved consumers.